The Foreign Direct Investment Regulation

The global nature of many corporate transactions involving subsidiaries and affiliates located all around the world has spurred the need for the enactment of Regulation (EU) 2019/452 (the "Regulation"). Foreign direct investment controls vary in different countries across the globe but prior to the enactment of this Regulation, no comprehensive foreign direct investment screening framework existed at Union level, unlike those in place in the Union's major trading partners. The aim of the Regulation is not to reduce foreign direct investments ("FDIs") which remain crucial to the EU's continued economic growth, competition and innovation but rather, to increase trust and ensure that intervention is possible in the case of threats to the EU's security and public order that may be part and parcel of such FDIs.