Clifford Chance

Belgium's FDI authority, the Interfederal Screening Committee (ISC), published its Annual Report on the screening of foreign direct investments during the period from 1 July 2024 to 30 June 2025. The report highlights the continued evolution and growth of Belgium’s FDI screening regime in its second full year of operation.

Key figures – notification numbers surge

From 1 July 2024 to 30 June 2025, the ISC received 100 notifications – a notable increase of nearly 50% compared to the previous year’s 68 notifications (see our briefing here on the first Annual Report). Of these, 89 investments were authorised unconditionally and one was approved subject to mitigating measures. The remaining notifications were either withdrawn or are still pending. Importantly, no investments were blocked, mirroring last year’s outcome.

First-ever mitigating measures

For the first time, the ISC imposed mitigating measures in a case, which related to sensitive technology. These included placing certain technology, source code, or know-how in the custody of a third party in Belgium, guarantees to ensure continuity of key processes, and the appointment of compliance officers. The Belgian FDI legislation provides for other, more far-reaching mitigating measures including the reduction of governance rights, the forced licensing of technology, and restrictions on the business activities of a Belgian target company. However, to date, the ISC is not reported to have imposed any of these measures.

Process continues to be smooth

The Phase I verification procedure commenced on average within two days of notification, an improvement from six days last year, reflecting investors' increased familiarity with the process and the build-up of the ISC's workforce. Only 15% of notifications had missing information, down from 19%. While the statutory review period is 30 days, the average processing time for Phase I procedures remained steady at 31 days (reflecting stop-the-clock information requests and bank holidays). In seven cases, the ISC requested additional information during this procedure, compared to four cases last year.

Further, five Phase II screening procedures were launched (same as last year), with three investments approved (two fast-tracked, one with mitigating measures) and two cases still ongoing.

Generally, these figures show that investors can rely on a relatively predictable process for Belgian FDI notifications. In almost all cases, the ISC will commence the Phase I procedure very rapidly after receipt of the notification, and finalise its review and issue its clearance decision within the 30-day review period for Phase I.

US and UK investors remain at the forefront

US and UK investors continue to lead, accounting for 45% and 22% of notifications, respectively, followed by Japan (8%), Canada (7%), and China (5%). Flanders remains the most popular investment region with almost half of the notifications. Not only complete acquisitions or acquisitions of control were notified, but also internal restructurings (22 times). Such restructurings may be subject to notification when they involve non-EU entities – even if the ultimate non-EU ownership or control remains unchanged.

Sector spotlight – data leads, dual use emerges

The top five sectors most impacted were data (21%), digital infrastructure (14%), energy (13%), health (12%), and dual use (9%). Data remains the leading sector for notifications, as was the case last year. This reflects the broad scope of the Belgian FDI regime, which under "data" covers any Belgian companies that have access to, or the possibility to control, sensitive information or personal data. Meanwhile dual use enters the top five for the first time – signalling a growing investor interest in the defence sector.

Outlook for the third year

Looking ahead, the EU is in the process of revising its FDI screening regulation to address gaps and inconsistencies between national regimes (see our briefing here for further details). The European Commission’s proposed revision focuses on harmonisation, enhanced cooperation, and making FDI screening mechanisms mandatory across all EU Member States. Interinstitutional negotiations are currently underway, aiming to reach a political agreement on the final text of the revised regulation by the end of the year.

Once adopted, Belgium will be required to align its national rules with the minimum standards set out in the new regulation before it becomes applicable – currently foreseen after a 24-month transition period following its entry into force. While this timeframe allows for the complex legal reforms needed (including a new cooperation agreement between the federal and regional governments in Belgium), critics may argue that such legislative delays reflect a broader issue: regulation often trails behind geopolitical, technological, and market developments, particularly in fast-evolving areas like foreign investment and national security.