The First Annual Report on the EU FDI Screening

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FDI EUROPE

The First Annual Report on the European Union (EU) Foreign Direct Investment (FDI) Screening presented by the European Commission.

The Commission screened 400 foreign investments since the new Foreign Direct Investment (FDI) screening legislation entered into force.

While only in place since a year, there has been an impressive take-up of this mechanism, meaning that EU interests will be better protected going forward.

FDI Screening

This report on FDI screening is the first to be published since the new EU FDI screening regulation came into force a year ago. Under this regulation, Member States and the Commission work closely together to ensure that any foreign direct investment which can pose a security risk to EU Member States or EU critical assets is effectively screened.

In terms of key findings, the report highlights:

  • The Commission screened 265 transactions notified by Member States under the report until end of June 2021 (now the teller is above 400);
  • 80% of the transactions did not justify further investigation and were thus assessed by the Commission in just 15 days;
  • Most notifications for screening from Member States concerned the manufacturing sector, ICT, wholesale and retail;
  • The top five countries of origin of investors among notified FDI cases were companies located in: the United States, the United Kingdom, China, Canada and the United Arab Emirates;
  • The Commission issued an opinion in less than 3% out of 265 screened cases.

Discover more reports HERE.

The report confirms that the EU remains open for foreign investment, while ensuring the protection of EU security and public order. The FDI screening cooperation mechanism works effectively and does not create unnecessary delays for transactions. A growing number of Member States have adopted their own screening mechanism – 18 now have a mechanism in place.  The European Commission expects all Member States to adopt national screening mechanisms. This will further enhance the effectiveness of the screening system and ensure a comprehensive EU approach to tackle risks related to security or public order.

Source: European Commission