EU Moves Closer to Adopting Updated FDI Screening Rules
EU member state representatives have finalized their negotiating position on updated foreign direct investment screening rules and are aiming to soon reach an agreement with the European Commission and Parliament on the final text, the Council of the European Union said.
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The changes, approved by the European Parliament last month (see 2505090020), would add more sectors to the scope of FDI restriction, allow the European Commission to intervene in member state disagreements and more. The council said it supports a proposal to “have all member states equipped with a screening mechanism and to cover intra-EU investments by EU subsidiaries of foreign investors.” But it said it made changes to the scope to limit it to “just military goods and dual-use goods,” which will help the EU “focus on the key issues where national security concerns are most likely and to minimise the disruption to the vast majority of foreign investment into the EU.”
The council also said it “simplified the EU coordination mechanism to ensure that the system is as efficient as possible, and has clarified that the final screening decision is taken by the relevant member state.”