EU Commission Proposes A Framework For Screening Foreign Direct Investments Into The EU

On September 13, 2017 the President of the EU Commission (Commission), Jean-Claude Juncker, tabled a proposal for an EU regulation establishing a framework for screening of foreign direct investments into the European Union (Regulation).¹ The proposal is made at a time where the lack of a coherent EU-wide approach towards controlling foreign direct investment into Europe has been increasingly criticized. It seeks to strike a balance between enabling greater protection against the sell-out of infrastructure and technology that is considered to be of national importance by one or more EU Member States and keeping an open foreign investment environment.

There is no EU legislation on foreign direct investment screening today. While mergers, acquisitions, and certain joint ventures between large companies are subject to review by the Commission under the EU Merger Regulation, that review is limited on competition law grounds. However, almost half of the EU's 28 Member