The European Commission (“Commission”) has repeatedly urged EU Member States to set up foreign direct investment (“FDI”) screening mechanisms. To date, 18 out of 27 Member States have adopted FDI screening powers, providing for the review of M&A transactions and other investments on national security and public policy grounds. Recently, Belgium and Ireland have each announced draft proposals which, once implemented, will enlarge the group of Member States reviewing transactions on FDI grounds.
Against this background of increasing FDI screening for local and global M&A transactions, some voices call for broader reforms. The European Parliament has launched an initiative aimed to address a future EU international investment policy and recently adopted a resolution with far-reaching proposals for FDI screening in Europe.
We provide an update on these developments in this blog post and consider the current outlook for FDI screening.