COMMISSION STAFF WORKING DOCUMENT Screening of FDI into the Union and its Member States Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL First Annual Report on the screening of foreign direct investments into the Union
Date: 2021-11-23
Institutions: Directorate-General for Trade and Economic Security, European Commission
Subjects: EU Member State, activity report, coronavirus disease, direct investment, epidemic, financial control, foreign capital, foreign investment, investment policy, third country

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 23.11.2021  SWD(2021) 334 final  COMMISSION STAFF WORKING DOCUMENT Screening of FDI into the Union and its Member States   Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL First Annual Report on the screening of foreign direct investments into the Union         {COM(2021) 714 final}  
 
 
Contents 
Flowchart illustrating the handling of cases among the Member States and the Commission under 

1. 
the cooperation mechanism set up by the EU FDI Screening Regulation .................................................... 3 

2. 

Foreign Direct Investments into the EU – 2019 / 2020 overview ......................................................... 4 

3.  Methodology and sources .................................................................................................................. 19 

4. 

EU Member States – legislative developments  ................................................................................. 21 

Introduction ............................................................................................................................................ 21 

Austria ..................................................................................................................................................... 22 

Belgium ................................................................................................................................................... 23 

Bulgaria ................................................................................................................................................... 24 

Croatia ..................................................................................................................................................... 24 

Republic of Cyprus .................................................................................................................................. 25 

Czechia .................................................................................................................................................... 26 

Denmark .................................................................................................................................................. 27 

Estonia ..................................................................................................................................................... 27 

Finland ..................................................................................................................................................... 28 

France...................................................................................................................................................... 29 

Germany .................................................................................................................................................. 30 

Greece ..................................................................................................................................................... 31 

Hungary ................................................................................................................................................... 32 

Ireland ..................................................................................................................................................... 33 

Italy ......................................................................................................................................................... 34 

Latvia ....................................................................................................................................................... 35 

Lithuania ................................................................................................................................................. 36 

Luxemburg .............................................................................................................................................. 37 

Malta ....................................................................................................................................................... 38 

Netherlands............................................................................................................................................. 39 

Poland ..................................................................................................................................................... 40 

Portugal ................................................................................................................................................... 41 

Romania .................................................................................................................................................. 42 

Slovakia ................................................................................................................................................... 42 

Slovenia ................................................................................................................................................... 43 

Spain ........................................................................................................................................................ 45 

1 

 
 
Sweden .................................................................................................................................................... 46 

2 

 
 
 
 
 
1.  Flowchart illustrating the handling of cases among the Member States and the 
Commission under the cooperation mechanism set up by the EU FDI Screening 
Regulation 

3 

 
 
 
 
 
 
2.  Foreign Direct Investments into the EU – 2019/2020 overview 

As could be expected, 2020 proved a particularly challenging year for multinational enterprises 
and investors, operating in a deeply uncertain environment.  

The uncertainty was largely fueled by the exponential growth of COVID-19 cases1 and its fall-out 
on  economic  activity  across  the  globe,  as  well  as  actions  shielding  domestic  industries  in  key 
critical  sectors  from  foreign  speculative  takeovers.  The  growing  tensions  between  the  United 
States (US) and China, and the increased pace in the reshaping of international supply chains added 
further pressure to an already challenging environment for multinational enterprises and investors.  

The  particular  characteristics  of  2020,  and  their  related  impact  on  foreign  direct  investment, 
including for the European Union, are best understood when placed within a broader time-frame. 
Consequently, this Section covers the time-period of January 2019 through first quarter of 20212. 
This allows for proper context and for the 2020 numbers to be contrasted against both the pre-
COVID-19  pandemic  environment  and  developments,  as  well  as  the  indication,  albeit  not 
uniformly for all sectors and investors, of some rebound in economic activity globally for the first 
quarter of 2021, including FDI transactions.  

This Section looks closely at FDI inflows into the EU and individual member states, the origins of 
foreign  investors  in  the  EU,  and  the  impact  of  COVID-19  on  foreign  direct  investment  into 
particular sectors.  

Official FDI flows, covering equity transactions, reinvestment of earnings, and intercompany debt 
transactions, measure financial links between the reporting country and its first counterpart. The 
need to look deeper into the origin of investors underpins the use of firm level data on mergers and 
acquisitions (M&A) deals3 and greenfield projects. 

The word “uneven” captures developments well. The negative impact on FDI activity has been 
uneven dependent on the foreign investor, the host EU Member States, and the sectors at issue. 
Likewise, the rebound, however fragile and subject  to  the further handling of the pandemic, is 
proving to be uneven across EU Member States and economic sectors.  

1   With 166 million confirmed cases worldwide and over 3.4 million deaths as of May 2021, WHO, May 2021 
2   For FDI flows from National Account figures (Fig. 1) the time window 2015-2020 allows to see the effect of 

COVID-19 within an already decreasing trend in flows. 

3   The terms deal and transactions will be used interchangeably.  

4 

 
 
 
                                                           
Main findings 

In 2020, global FDI flows fell to €885bn, 35% less than in 2019. In the EU, 2020 is characterised 
by a decrease of inward FDI by 71% to €98bn in 2020, down from €335bn in 2019.  
In 2020, 33.6% fewer foreign4 M&A deals were announced as compared to 2019. Deal-making 
recovered  slowly  by  end-2020  and  in  the  first  quarter  of  2021  (+4.5%  on  a  year-on-year 
comparison), but remained 30% below the 2019 level. In 2020 Europe has lost €31bn in foreign 
greenfield investments and 115,000 expected jobs when compared with 2019. 

In 2020, the largest share of foreign investments in Europe originated in the United States (US) 
and Canada, with nearly 35% of M&A transactions and 44% of greenfield projects, followed by 
the United Kingdom (UK) with 30.5% and 21% respectively. EFTA comes next with about 12% 
of the foreign M&A transactions and 8% of greenfield projects. China, with 2.5% of the M&A 
transactions (down from 4% in 2019) and 7.5% of greenfield projects, was the fourth foreign 
investor in the EU after US, UK and Switzerland. 

The drop in the number of M&A transactions in 2020 involved all EU Member States, even if 
France  and  Sweden  were  particularly  affected.  Germany,  with  a  more  contained  drop  in  the 
number  of  M&A  transactions,  suffered  from  sinking  Chinese  and  US  investments,  while  in 
Spain and the Netherlands deals from EFTA countries and from Korea and Japan lost ground in 
2020 as compared to 2019.  

Economic sectors in Europe were not equally impacted by COVID-19. The hardest-hit sector 
was accommodation with a drop of more than 70% in the number of foreign deals. With a quarter 
of all foreign M&A transactions, manufacturing suffered a 40% drop in 2020 deal numbers as 
compared to 2019, and still shows a cloudy outlook in the first quarter of  2021 with a year-on-
year performance rounding  -1.3%. Over 56% of  acquisitions  done in  manufacturing in  2020 
involved medium or large companies, about 15 percentage points more than the EU average for 
all sectors. A non-negligible 8% of the deals involved acquisitions of enterprises with less than 
10 employees in this sector. 

Information and communication technologies (ICT) is the sector least affected by the pandemic, 
with a modest drop of 12% in 2020 as compared to 2019. In 2020 ICT totaled 35% of all M&A 
deals, surpassing manufacturing for the first time ever. ICT also drives the recovery in 2021, 
with a year-on-year increase in M&A transactions rounding 53% in the first quarter of 2021, 
which brings the number of deals in this sector to its pre-COVID level. 

4   The term foreign, when associated to M&A deals or to greenfield projects, refers to transactions made by non-
EU investors in Europe. See the section on methodology and sources. 

5 

 
 
 
 
 
 
 
 
                                                           
The numbers in detail 
In 2020, global FDI flows fell drastically to €885bn5, meaning 35% less than in 2019 and 55% less 
as compared to the peak year of 2016 (Fig.1). The COVID-19 pandemic accelerated the steady 
decline of global FDI and contributed to global FDI flows plummeting to their lowest levels in 25 
years, recorded in 2020, with FDI values 30% below the lowest point recorded after the global 
financial crisis6.  

In the EU, the COVID-19 pandemic produced even harsher effects when compared to the world 
average, with inward FDI falling by 71% to €98bn in 2020, down from €335bn in 2019. This is an 
80% reduction with respect to the European peak year of 2018. In 2020 inward FDI accounted for 
a mere 0.7% of EU27 GDP, sharply down from 3.6% in 20187.  

Figure  1:  World  and  EU  FDI  inflow  (left  panel)  and  FDI  inflow  in  EU  with  breakdown  by 
instrument (right panel) 

Source: OECD data, extracted on 20 May 20 2021. The details by instrument does not include inflows into Bulgaria, 
Croatia,  Cyprus,  Malta,  and  Romania  whose  value  is  grouped  under  Rest.  FDI  values  exclude  investments  from 
resident special purpose entities. 

5   Global FDI flows are the world FDI inflow values reported by the OECD (FDI in figures, OECD, June 2021); the 
exchange rate used is extracted from the database International Financial Statistics-IMF and refers to the yearly 
average of the Exchange Rates per U.S. Dollar (ENDA_XDC_USD_RATE).  

6   UNCTAD, Investment Trends Monitor n. 38, January 2021. 
7   Source: OECD, data extracted in May 2021.  

6 

 
 
 
 
 
 
                                                           
A different picture, all depending on the EU Member State 

This  decline  in  European  FDI  inflows  in  2020  is  driven  by  significant  disinvestments  in  the 
Netherlands,  where  FDI  fell to  -€98bn from +€38bn in  20198.  Large reduction of investments, 
especially from US, are also observed in Ireland, where FDI inflows were €29bn in 2020, down 
from  €72bn  the  year  before9.  German  and  French  FDI  inflows  fell  to  €31bn  and  €16bn 
respectively, recording a -36% and -48% decrease compared to 2019. Italian FDI inflows dried 
out almost entirely reaching -€338ml in 2020, down from €16bn in 201910. In conclusion, 2020 
has  been  an  annus  horribilis  almost  everywhere  in  the  EU,  with  the  notable  exceptions  of 
Luxemburg,  Belgium  and  Sweden  and  to  a  lesser  extent  in  Spain  and  Hungary,  which  saw 
increased flows despite a decline in the number of deals and projects. 

Three  months  into  2021,  the  EU  landscape  has  started  to  improve  in  all  developed  countries. 
Investors seem to be gearing up for a recovery of FDI inflows to Europe, as the last quarter of 2020 
recorded  €11bn,  up  from  the  -€17bn  of  the  third  quarter.  Both  corporate  and  private  equity 
investors are increasingly considering new investments, in order to capitalise on a potential market 
upswing as economies reopen11.  

However,  while  there  appears  to  be  some  light  at  the  end  of  the  tunnel,  the  post  COVID-19 
recovery represents a marathon, not a sprint. Baseline projections suggest that the EU recovery 
will depend on how successfully vaccination  programmes will manage the pandemic, and how 
quickly governments will ease or lift restrictions. The EU economy is forecast to grow by 4.2% in 
2021, returning EU GDP to its pre-crisis level by the end of 202112. Yet FDI remains on shaky 
grounds. The enduring challenges of the pandemic (including the surge of new variants, with some 
more resistant to available vaccines), the fear of an increase in trade frictions, the rise in technology 
competition,  and  the  continuous  reshaping  and  regionalisation  of  supply  chains,  are  all  factors 
likely to influence the volume and direction of future FDI flows worldwide13.   

Mergers & acquisitions deals and greenfield investment projects in Europe - general trends  

While official FDI figures at macro-level describe investment links between the reporting country 
and the first partner country14, the link between the foreign investment and the ultimate origin of 
the  investor  can  only  be  established  by  looking  at  individual  transactions,  namely  mergers  & 
acquisitions (M&As) and greenfield projects.   

In 2020, 33.6% fewer foreign M&A deals were announced when compared to 2019 (Fig.2, upper 
panel).  The  drop  in  M&A  transactions  in  the  second  quarter  of  2020  (-45.7%  on  year-on-year 
comparison15)  corresponds  to  the  first  lock-down  period  in  many  EU  Member  States  and  is 

8   UNCTAD estimates -€105bn for sales of equity stakes in Dutch companies by foreign parents, and -€86bn in intra-
company loans (increased borrowing of the foreign parent from its affiliate or decrease of loan amount paid off by 
the affiliate to the parent). Source: UNCTAD, Investment Trends Monitor n. 38, January 2021. 

9   2019 value for Ireland accounts for the $62bn acquisition of the pharmaceutical company Shire plc by the Japanese 

Takeda Pharmaceutical. 

10   Foreign direct investment (FDI) - FDI flows - OECD Data, extraction May 2021. 
11   Refinitiv news 5/13/2021 
12   European Commission, European Economic Forecast, Spring 2021. 
13   2021 FDI Confidence Index.  
14   FDI flows consist of equity transactions, reinvestment of earnings, and intercompany debt transactions. Fig.1, right 

panel, reports the proportions for each type of instrument in EU. 

15   Year-on-year is the % variation of a period (here quarter) with respect the same period of the previous year. 

7 

 
 
                                                           
particularly severe. Foreign M&A transactions stagnated to a smaller reduction of around 25% in 
the  following  two  quarters,  reflecting  the  uncertainty  facing  investors  and  the  significant 
confinement  measures  worldwide.  Deal-making  recovered  slowly  in  the  first  quarter  of  2021 
(+4.5% on a year-on-year comparison), although remaining 30.7% below the level of 2019.  

The drop in the number of M&A transactions involved all EU Member States. France and Sweden 
(Fig.4, left panel), were particularly affected, especially for the foreign M&A deals involving US 
and EFTA investors. Germany, with a more contained drop in the number of M&A transactions, 
suffered from decreasing Chinese and US investments, while in Spain and the Netherlands deals 
from EFTA countries and from Korea and Japan lost ground in 2020 as compared to 2019 (Tab.3). 
In the first quarter of 2021 the number of deals are on the rise in all Member States, except Italy, 
Spain, Luxemburg and Portugal. 

Figure 2: General trends of foreign M&A deals and greenfield projects into the EU from January 
2019 to March 2021 (three months rolling average). 

Source: JRC calculations on Bureau van Dijk data extracted on the 6 May 2021. 

8 

 
 
 
 
The negative effect of COVID-19 on greenfield projects has been even more pronounced than on 
M&A transactions (Fig. 2, bottom panel) 16. This partly reflects the long-term nature of a greenfield 
investment which requires, in its initial phase, visits to the future production sites17 and meetings 
with  local  authorities18,  all  extremely  difficult  in  pandemic  times  with  lock-downs  and  travel 
restrictions.  

In 2020, foreign investors cut the number of greenfield investments in Europe by over 50% as 
compared to 2019. Projects dried out in the second and third quarters of 2020 with a year-on-year 
variation of -72% and -55%, respectively. The last quarter of 2020 showed a temporary rebound, 
with +30% in the number of projects as compared to the first quarter, despite the lock-down in 
many EU countries. In value-terms, the rebound in the last quarter of 2020 is even more significant, 
with  €12.6bn  of  capital  expenditures  announced  or  completed  between  October  and  December 
2020, up from €6.3bn in the third quarter of 2020.  Irrespective of this uptick, in the last quarter of 
2020 the number of greenfield projects was 40% less than the number observed in the last quarter 
of 2019, whereas the value of the projects was only 10% lower.  

Altogether,  the  losses  in  terms  of  foregone  investments  and  job  creation,  due  to  cancelled  or 
postponed  greenfield  projects,  were  considerable.  In  2020  Europe  has  lost  €31bn  in  foreign 
greenfield  investments  and 115,000 expected jobs  when compared with  2019 (Fig.3). The first 
quarter of 2021 shows a mixed picture. The number of greenfield projects is estimated to be 34% 
lower  than  in  2019,  but  the  capital  invested  amounts  to  €16.6bn,  up  from  €14.8bn  in  the  first 
quarter of 2020. 

16   Greenfield investments are projects aiming at setting up a new site or expanding an existing site. The section on 

methodology and sources describes the data used here. 

17   Some investment agencies, e.g. Portugal and Poland, organised in 2020 virtual site visits to assist investors. 
18   More  information  on  Investment  Promotion  agencies  is  available  in    www.oecd.org/coronavirus/policy-
responses/investment-promotion-agencies-in-the-time-of-covid-19-50f79678/#section-d1e48. Greenfield projects 
also depend on government incentives (e.g. tax rebates, land availability, trained HR). 

9 

 
 
                                                           
Figure 3: Foreign greenfield projects, capital invested and expected job creation, 2019-Q1, 2021-
Q1 

Source: JRC calculations on Bureau van Dijk data extracted on the 6 May 2021. 

A  closer  look  at  the  host  countries  for  foreign  investments  shows  that  foreign  projects  in  the 
COVID-19 year fell in all EU countries.  

Denmark, Romania and Germany suffered the most from the COVID-19 outbreak (Fig. 4, right 
panel). In particular, US greenfield projects declined considerably, from  -38% in Germany to -
84%  and  -87%  in  Romania  and  Denmark  respectively.  Swiss  greenfield  projects  in  Germany 
dropped by 90% in 2020 as compared with 201919.   

In the first quarter of 2021, in Denmark, Hungary and Greece a recovery of greenfield investments 
by  more  than  40%  on  a  year-on-year  basis  is  observed,  while  in  Spain  and  Portugal  the 
improvement  observed  is  between  3%  and  16%.  All  remaining  Member  States  with  a  sizable 
number of greenfields remain in negative territory. 

19   In 2020, Germany hosted 56% of all Swiss greenfield investment projects in the EU. 

10 

 
 
 
 
 
 
                                                           
Figure 4: Number of foreign M&A deals and greenfield projects by target EU country: share over 
the total in 2020 and percentage change with respect to 2019 

Source: JRC calculations on Bureau van Dijk data extracted on the 6 May 2021. 

Origins of foreign investors in the European Union 

In 2020, the largest share of foreign investments in Europe originated in the US and Canada, with 
nearly 35% of M&A transactions and 44% of greenfield projects, followed by the UK with 30.5% 
and 21% respectively. EFTA comes next with about 12% of the foreign M&A transactions and 
8% of greenfield projects. China, with 2.5% of the M&A transactions (down from 4% in 2019) 
and  7.5%  of  greenfield  projects  was  the  fourth  foreign  investor  in  the  EU  after  US,  UK  and 
Switzerland20 (Tab.1). 

While heavily affected by the pandemic, US outward investments to Europe are slowly recovering, 
with 37% more M&A transactions in the first quarter of 2021 as compared to the first quarter of 
2020, topping the pre-COVID level of 2019-Q1. The positive outlook is also shared with offshore 
financial  centres21,  which  represent  about  7%  of  all  M&A  transactions  in  2020  and  4%  of 
greenfield projects. Offshores were only moderately affected by the pandemic and display a year-
on-year upturn of M&A transactions reaching 47% in the first quarter of 2021.  

20   Chinese figures include Hong Kong and Macao. 
21   Offshore financial centres are defined according to IMF (2014) "Offshore Financial Centers (OFCs):  IMF Staff 
Assessments"  and  IMF  (2000)  "Offshore  Financial  Centres"  IMF  Background  Paper.    The  main  Offshores  by 
number  of  deals  or  greenfields  are  (in  alphabetical  order)  Bermuda,  British  Virgins  Islands,  Cayman  Islands, 
Mauritius and the United Kingdom Channel Islands. For a list of Offshore Financial Centres, see e.g. Commission 
Staff  Working  Document  -  Following  up  on  the  Commission  Communication  "Welcoming  Foreign  Direct 
Investment while Protecting Essential Interests" – SWD(2019) 108 final – 13 March 2019. 

11 

 
 
 
 
                                                           
Table 1. Foreign M&A transactions and greenfield projects in 2020 by nationality of the investor’s 
ultimate  owner.  Percentage  change  in  2020  as  compared  to  2019,  and  share  over  total,  are 
displayed  

USA and CAN 
UK 
EFTA 
Offshores  
Developed Asia 
China  
Central & S. America 
India 
AUS and NZ 
Gulf Coop Countries 
Turkey and other ME 
Other Asia 
Russian Federation 
Rest of the World  

Percentage change 
2020 over 2019 

Share over total  
(in %), 2020 

M&A  Greenfield  M&A  Greenfield 

-35 
-21 
-25 
-34 
-47 
-63 
-37 
-44 
-50 
0 
-50 
-73 
-83 
-54 

-47 
-46 
-68 
-25 
-59 
-50 
-67 
-47 
-50 
-35 
-57 
-55 
-41 
-44 

34.9 
30.5 
12.1 
6.9 
5.6 
2.5 
1.7 
1.4 
1.2 
1.2 
0.9 
0.4 
0.1 
0.6 

44.2 
20.9 
8.2 
4.2 
6.3 
7.5 
1.0 
1.4 
0.7 
0.8 
2.3 
0.5 
0.5 
1.0 

Source: JRC calculations on Bureau van Dijk data extracted on 6 May 202122. 

While accounting for a relatively small share of deals, Chinese companies increased their presence 
in the EU considerably in the past years. During the three years prior to the pandemic, Chinese 
M&A in EU grew by 26.1% as compared to the previous four years, despite the deceleration of 
Chinese GDP growth. Other strategic economic partners like the US, Switzerland or Japan reported 
significantly more modest increases of 20.8%, 13.2% and 15.6% respectively. 

Chinese outward investment deals into Europe have sharply slowed down starting from November 
2019, i.e. two months prior to the lock-down in Wuhan (China) at end-January 2020. Irrespective 
of the early re-opening of the Chinese economy, in mid-2020, Chinese M&A activity in the EU 
declined by 62.5% as compared to 2019 (Tab.1), and M&A transactions in the first quarter of 2021 
are failing to take off (as contrasted against greenfield investments which display positive year-
on-year  growth).  Together  with  COVID-19,  continuing  political  tensions  between  the  US  and 
China, and the reshoring of global value chains23, largely exposed to China to avoid geopolitical 
and tariff fallout24, also slowed down such Chinese foreign investments. However, the appetite of 
Chinese investors for high tech sectors is likely to increase and could shape future FDI flows from 
and to China. Since 2013, about 80% of the greenfield projects and 74% of the M&A transactions 

22   Acronyms: CAN (Canada), EFTA (Switzerland, Norway, Iceland, Liechtenstein), AUS (Australia), NZ (New 

Zealand), ME (Middle East). For the listing of Offshores see footnote 25. Developed Asia includes Japan, Korea, 
Singapore and Taiwan; Gulf Cooperation Countries include United Arab Emirates, Qatar, Saudi Arabia, Kuwait, 
Oman, and Bahrain. Other ME includes Israel and Lebanon. Chinese data include Hong Kong and Macao. 

23   On general trends in global value chains, see OECD 2020. See also WEF 2020. 
24   Japan is favoring companies to relocate from China. In the US, President Biden has pushed forward an executive 
order strengthening Buy American provisions. Whether reshoring will be a mass phenomenon is still unclear. 

12 

 
 
 
 
                                                           
have been in sectors linked to “Made In China 2025”25, and the new Chinese multi-annual plan 
presented in March aims at boosting an innovation-led growth model26.  

EU economic sectors unevenly impacted by COVID-19 

Economic  sectors  in  Europe  were  not  equally  impacted  by  COVID-19.  Some  sectors  saw 
unprecedented  surges  in  deal-making  (such  as  medical  supplies,  pharma  manufacturing,  e-
commerce), while others such as tourism, leisure, aviation and marine transportation have been 
adversely affected. 

The hardest-hit sector was accommodation with a drop of more than 70% in the number of foreign 
deals. Real estate and transportation sectors followed, with -52% and -63% drops on a year-on-
year comparison, respectively. Retail, representing 6.4% of all foreign deals in 2020 (down from 
8.4% of 2019) was also impacted heavily in 2020 (Tab. 2 and Fig.5, upper panel).  

With a quarter of all foreign M&A transactions, manufacturing suffered a 40% drop in 2020 deal 
numbers as compared to 2019, and still shows a cloudy outlook in the first quarter of 2021 with a 
year-on-year performance rounding -1.3%. Over 56% of the transactions done in manufacturing 
in 2020 involved medium or large companies, about 15 percentage points more than the average 
for  all  sectors  (Tab.2).  However,  a  non-negligible  8%  of  the  deals  involved  acquisitions  of 
enterprises with less than 10 employees in this sector. 

The sky is no clearer for greenfield projects in manufacturing. Third by number of foreign projects 
(after wholesale and ICT), manufacturing is nevertheless the top sector in terms of investments 
with €11bn of foreign projects in 2020, down from €22.5bn in 2019. Foreign investors have been 
more cautious, also in the amount invested per project. The average value of investments decreased 
from €27.5ml in 2019 to €20ml in 202027.  

For the period observed (2019-Q1 to 2021-Q1), US, China and Japan have been the main non-
European investors in manufacturing. About 26% of all US deals in EU, involved companies in 
the manufacturing sector. This percentage increased to 61% for China and 42% for Japan. The UK 
and Switzerland have been  the main  European players, with  22% and 34% of their investment 
deals targeting manufacturing.  

If the COVID-19 crisis  revealed the widespread  fragility  of  global supply  chains,  the recovery 
certainly goes through technology and innovation. Information and communication technologies 
(ICT) is the sector least affected by the pandemic, with a modest drop of 12% for M&A deals in 
2020 as compared to 2019. In 2020 ICT totaled 32% of all M&A deals, surpassing manufacturing 
for  the  first  time  ever.  Two  third  of  the  M&A  deals  in  ICT  involved  small  or  very  small  EU 
companies. Only 8% of the foreign deals involved large EU companies.  

ICT also drives the recovery of foreign investments in 2021, with a year-on-year jump in M&A 
transactions of 53% in the first quarter of 2021, which brings the number of deals in this sector to 
its pre-COVID level. The picture for greenfield investments is slightly different. While buoyant 

25   Made in China 2025 is a national strategic plan to further develop the manufacturing sector. 
26   Next-generation artificial intelligence, quantum information, brain science, semiconductors, genetic research and 
biotechnology, clinical medicine and health, and deep space, deep sea and polar exploration. See Reuters, March 
5, 2021.  

27   It  is  worth  noting  that  figures  for  2021  will  pick  up  with  the  €7bn  project  announced  by  Intel  to  open  a 

semiconductors fab facility in Ireland. 

13 

 
 
                                                           
before the pandemic, greenfield investments in ICT more than halved in 2020 and are failing to 
take off, also in the first quarter of 2021 (Fig. 5, bottom panel). In 2020, ICT and R&D related 
activities represented over 25% of all foreign greenfield investments in EU, and 22% of the capital 
invested  (about  €9bn),  with  an  average  size  of  investment  unaltered  across  the  timeframe 
observed28. In terms of expected job creation, ICT and R&D related projects represented 31% of 
the entire job creation produced by foreign greenfield investments, eight percentage points more 
than manufacturing. Among the projects announced, those related to green transportation, and data 
use, storage and transmission stand out.  

The US is, by far, the main foreign investor in ICT. In the past two years, as much as 45% of US 
foreign M&A transactions in the EU targeted ICT and R&D activities. The UK follows with 34%. 
Japan and Switzerland come next with 26% and 27% respectively, while China lags behind with 
a mere 7%. 

Figure 5: Foreign M&A deals and greenfield projects by target EU sector, 2019-Q1 – 2021-Q1  

28 The percentage is obtained by summing up greenfield investments in NaceRev.2 sections J and M. In 2020 ICT 
(section J) represented 15.3% of all foreign greenfields, 21.3% of the expected job creation and 15.1% of the 
investment (about €6bn). Professional, scientific and technical activities (section M), broadly containing R&D 
activities, represented about 8.5% of all foreign greenfields, 9.7% of the expected job creation and 7.2% of the 
investment (about €8.2bn). 

14 

 
 
 
 
                                                           
Source: JRC calculations on Bureau van Dijk data extracted on 6 May 2021. Prof. and Scientif. stands for Section M 
of the NACE Rev. 2 Classification “Professional,  scientific and technical activities”, this section broadly contains 
R&D activities.   

Table 2. Size of acquired companies in EU (blue panel) and share of foreign M&A deals (green 
panel). Detail by Nace-rev2 sectors. 

Sectors 

ICT 
Manuf. 
Prof. Scientif 
Retail 
Finance 
Health 
Transport 
Construction 
OtherService 
Real.Estate 
All remaining sectors 
Average all sectors 

Share over total by sector, 2020 

Micro 
20.30% 

Small  Medium  Large 
7.60% 
25.60% 
46.50% 

Share over total  
2020 
2019 
32.3% 
24.5% 

7.50% 

36.30% 

41.80% 

14.40% 

27.4% 

24.6% 

22.00% 

45.10% 

24.40% 

8.50% 

19.70% 

49.30% 

18.30% 

12.70% 

30.30% 

28.80% 

9.10% 

31.80% 

13.33% 

20.00% 

33.33% 

33.33% 

30.80% 

30.80% 

23.10% 

15.40% 

9.10% 

36.40% 

36.40% 

18.20% 

27.30% 

36.40% 

36.40% 

0.00% 

50.00% 

30.00% 

10.00% 

10.00% 

7.6% 

8.4% 

7.4% 

2.1% 

3.8% 

1.9% 

0.3% 

3.0% 

7.8% 

6.4% 

7.7% 

3.0% 

2.1% 

1.7% 

0.1% 

2.1% 

20.80% 
15.10% 
19.10%  40.00%  27.20%  13.70% 

34.00% 

30.20% 

13.6% 

12.1% 

Source: JRC calculations on Bureau van Dijk Orbis-Global data extracted on 6 May 2021. The first four data columns 
(blue) are based on detailed balance sheet data, available only for 66% of the M&A observed. Each row in blue sums 
to 100. The last 2 columns (green) are based in the entire M&A sample an each column sums to 100. Micro: enterprises 
with less than 10 persons employed; Small: enterprises with 10-49 persons employed; Medium: enterprises with 50-
249 persons employed; Large: enterprises with 250 or more persons employed. 

15 

 
 
  
Table 3. Foreign M&A deals by origin of the investor and location of the investment in EU. Share 
over yearly total by top receivers. 

16 

 
 
Source: JRC calculations on Bureau van Dijk data extracted on 6 May 2021Box: Public shareholding in 
foreign investors 

This  Box  presents  evidence  of  public  shareholding  in  EU  foreign  M&A  transactions  and 
greenfield investments for the period 2019-2020. Public shareholding refers here to any case 
where a state-controlled body or company belonging to a selection of countries (Switzerland, 
China, Japan, South Korea, Russia, UK, US29) holds stakes in a foreign investor in the EU. The 
ownership structure of the foreign investor is investigated at any level of holding, both direct 
and indirect, and both control and minority shares are considered for these purposes.  

In  2020  public  shareholding  is  more  pronounced  in  M&A  transactions  than  in  greenfield 
investments. 15% of the foreign M&A transactions (unchanged as compared to 2019) and 11% 
of the greenfield- investments (10% in 2019) have cases of public shareholding. 

The presence of public shareholding is mainly by way of minority shares, with an average public 
share of 4% for M&A deals and for greenfield investments, so looking only at actual control 
would leave out a significant number of cases (Fig.B1). The results for each deal type are very 
similar,  showing  that  public  influence  in  greenfield  investments  and  M&A  transactions  is 
comparable. 

Figure  B.1.  Foreign  M&A  deals  and  greenfield  projects  with  public  participation:  share  by 
amount of participation and country. 

29 These countries represent about 75% of all deals and 81% of all greenfield projects in EU in 2019-2020. 

17 

ATBEDEESFIFRIEITNLSEUS+CAN20191.5%5.0%21.1%14.5%2.1%14.3%7.2%9.0%12.4%5.7%20202.3%4.7%19.9%16.7%3.5%8.8%9.7%11.4%0.3%4.1%UK20190.3%4.2%20.6%14.0%2.6%10.8%11.3%9.5%11.6%7.1%20200.7%4.4%19.1%19.8%0.3%5.7%13.4%6.7%1.7%6.7%EFTA20193.2%3.2%20.3%12.7%5.7%10.1%1.3%5.7%11.4%17.1%20204.2%2.5%27.1%5.9%7.6%3.4%4.2%6.8%1.7%5.1%China20193.1%1.6%32.8%14.1%3.1%6.3%3.1%14.1%14.1%6.3%20204.2%4.2%25.0%4.2%4.2%4.2%0.0%29.2%4.2%8.3%20192.9%4.9%24.3%12.6%1.0%9.7%2.9%7.8%21.4%1.9%20201.8%3.6%32.7%9.1%5.5%16.4%1.8%3.6%3.6%1.8%20191.2%3.7%16.9%20.6%2.5%8.6%5.3%9.9%14.8%6.2%20202.8%3.5%19.0%32.4%1.4%5.6%2.1%8.5%2.1%2.1%Origin of the investoryearTarget EU member stateDeveloped AsiaRest of the Word 
 
                                                           
Source: JRC calculations on Bureau van Dijk data extracted on 6 May 2021. 

The foreign countries under analysis hold public shareholding in rather different amounts. The 
largest  proportion  of  public  shareholding  cases  (45%)  comes  from  the  US,  but  with  average 
stakes below 1%. This is the case of both federal and local funds, controlled by public bodies, 
that hold  small stakes in both  US, and foreign, companies investing in  the EU.  South  Korea 
follows  (present  in  22%  of  the  cases),  again  with  very  small  average  stakes. The  remaining 
countries hold shares on average below 2%, the exceptions being Switzerland, with an average 
public stake of 7%, China with about 25%, and, Russia with a very significant average presence 
of 68%30. 

Public  shareholding  is  more  frequent  (43%  of  cases)  in  foreign  investors  investing  in  the 
Manufacturing sector, although the amount of public stakes is rather limited in this group (on 
average 3%). The second-largest group of foreign investors with public shareholding are in the 
ICT industry (15% of cases), with an average stake of 3%. Public shareholding in the Financial 
sectors is found in 9% of cases, with a mean public stake of 9%. Public shareholding in investors 
acting  in  other  sectors  is  less  frequent,  with  the  highest  public  average  shares  recorded  in 
Transportation, Professional Activities, and Electricity (12%, 12% and 9% respectively). 

Roughly half of the analysed  M&A deals and greenfield investments entail the public owners 
holding stakes in an investor registered in the same country (e.g. Russia being shareholder of a 
Russian investor in EU). This percentage is significantly lower (around 3%) for China and Japan 
as their presence is mostly detected in investors registered outside Japan or China. At the other 
end of the spectrum, in almost all cases UK public bodies or companies appear as stakeholders 
in UK investors investing in EU, however, with minority shares. For the US and Switzerland, 
this is the case for two-thirds of the investments by Swiss and US investors.  

30 The data on State influence depends on the reconstruction of ownership links among subsidiaries, sometimes very 
difficult for Chinese companies. Those companies often use offshore subsidiaries to enter the EU, with little or no 
information on the links with Mainland China, or have complex nested structures not fully captured by Bureau van 
Dijk raw data. 

18 

 
 
 
 
 
 
 
                                                           
3.  Methodology and sources 

For purposes of Section 2 of this Staff Working Document, raw data on Mergers and Acquisitions 
(M&As) and greenfield projects is from Bureau van Dijk datasets Orbis-Global, Zephyr and Orbis-
CrossBorder. Data has been retrieved in May 2021 and then further elaborated by the Joint Reseach 
Center (JRC).  

The term “foreign investor” is used whenever the investor is ultimately controlled by a non-EU 
subject (either a company or an individual). When the ultimate owner cannot be established, the 
location of the investor applies. This definition is not identical to the definition of foreign investor 
used in the FDI screening regulation31. 

“EU” indicates EU27, i.e. excluding the UK.  

Only the observed number of M&A deals are reported, rather than deal values, as those values are 
only available for less than half of the deals. The reluctance of companies in reporting the financial 
details  of  the  transactions  motivates  this  lack  of  data.  National  account  data  at  the  start  of  the 
section,  although  based  on  the  first  counterpart  location  principle,  should  help  in  devising  the 
importance and variations of M&A deals (see Fig. 1 on equity flows in Section 2).  

For  greenfield  projects,  the  expected  investment  and  the  job  creation  is  always  available  and 
reported in the text. All types of greenfield projects are accounted for in this document, including 
the construction of new sites, the relocation of a foreign presence, and the expansion of existing 
sites. 

The reader should consider these figures (particularly those referring to the latest months in the 
sample) as preliminary and incomplete projections. Raw data are regularly updated, but a delay 
usually exists between the publication of a deal in the news and its recording in the dataset. Note 
also that the data provider updates old deals when new information becomes available, so data 
extractions for the same time window, but done at different points in time, could lead to different 
figures. 

Section 2 considers deals and projects completed and assumed completed, but reports them with 
their announced date. For the latest transactions, Section 2 includes also the announcements, while 
rumours and postponed deals/projects are excluded. A special treatment is accorded to multi-deals, 
i.e. deals where there are multiple targets and/or multiple investors. Section 2 considers the multi-
deal  as  a  sum  of  multiple  transactions.  This  means  that  if  a  foreign  investor  acquires  two 
companies,  this  is  recorded  as  two  transactions.  Conversely,  if  a  foreign  investor  acquires  a 
company with multiple subsidiaries (in different countries), the transaction remains unique and is 
attributed  to  the  main  company’s  country.  Transactions  with  multiple  targets  and  multiple 
investors (a negligible amount) are disregarded, as it is very difficult to devise a general rule to 
attribute the deal. This classification rule is also applied to greenfield investments  in case of multi-
purpose  projects  in  which  several  sites  are  built  and/or  the  projects  with  multiple  investors  is 
announced. 

31   See Regulation 452/2019, Article 2 (2). 

19 

 
 
                                                           
For the analysis of public shareholding, for each investor, the ownership information available at 
the time of the deal/project is used. Where not available for 2020, the ownership information used 
is that of 2019, the latest information available. 

Finally, data on the size of EU target companies acquired by a foreign investor is based on raw 
data from Bureau van Dijk Orbis-Global. This database contains detailed balance sheet data for 
about 40 million companies world-wide. Where not available for 2020, the information on balance 
sheet used is that of 2019. Note that very small firms (and to some extent small companies) are 
poorly covered in this database (see OECD, 2020 for additional insights). 

20 

 
 
 
 
4.  EU Member States – legislative developments32  

Introduction 

This part of the Staff Working Document reflects the information provided by the EU Member 
States pursuant to their annual reporting obligation set out in Article 5 of the EU FDI Screening 
Regulation. 

The section for each Member State reflects: 

-  whether the relevant Member State has, as of 1 July 2021, a national investment screening 

mechanism in place; 

- 

- 

legislative developments in the field of investment screening during the reporting period 
(Q1 2019 – Q1 2021); 

any  ongoing  initiatives  that  may  be  expected  to  result  in  the  introduction  of  a  national 
screening mechanism or amendments to an existing mechanism. 

32 For purposes of this Section, legislative developments means the formal introduction or adoption of a legislative 
text under the constitutional procedures of a Member State, be it an amendment to existing legislation related to 
investment screening, or a legislative text creating a screening mechanism. 

21 

 
 
 
 
 
 
 
                                                           
Austria 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – 
Q2 2021):  

The Austrian Investment Control Act (ICA) entered into force on 25 July 2020. Prior to this Act, 
Section 25a of the Foreign Trade Act 2011 applied. 

Compared to Section 25a of the Foreign Trade Act 2011, the Investment Control Act entails 
substantial improvements: 

  More precise definition of included sectors; 
  Enhanced possibilities of screening indirect acquisitions; 
  Lower threshold (10%) triggering the authorisation obligation in particularly sensitive 
areas (e.g. water, 5G networks, pharmaceutical sector, energy, medical products, 
protective equipment); 

  Exemptions from the authorisation obligation for certain microenterprises, including 

start-up enterprises, with fewer than ten employees and an annual turnover or an annual 
balance sheet total of less than €2 ml; 

  The cooperation mechanism between the European Commission and EU Member States. 

The authorisation obligation under the ICA applies when The Austrian undertaking targeted by 
the acquisition is active in an area of particular relevance for security or public order. A non-
exhaustive list of these areas is set out in the annex to the Investment Control Act. 

  An authorisation is required in the following cases: 
  Acquisition of the whole undertaking; 
  Acquisition of a specific share of voting rights (ten per cent or twenty-five per cent); 
  Acquisition of a controlling interest; or 
  Acquisition of material assets, whereby a determining influence on part of an undertaking 

is acquired. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL SCREENING MECHANISM OR AMENDMENTS TO AN EXISTING 
MECHANISM? 

Austria has no ongoing initiatives which can  be expected to lead to updates to its existing 
screening mechanism and related legislation. 

22 

 
 
 
 
 
Belgium 

NATIONAL SCREENING MECHANISM IN PLACE: No  

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

Shortly after the adoption of the Regulation, the Belgian federal government took the initiative to 
gather all relevant stakeholders, including civil society, to set out the guiding principles that should 
apply to a Belgian national screening mechanism.  

This broad consultation subsequently has led to a preliminary draft law that was adopted by the 
federal  Council  of  Ministers  in  July  2020  under  the  condition  of  further  examination.  By 
September 2020, an advisory opinion of the Legislation Section of the Council of State was issued, 
pointing out remarks regarding, among others, the allocation of competences within the Belgian 
federal structure. 

As soon as the new government took office in October 2020, further initiatives were taken to reach 
a  broad  consensus  on  the  allocation  of  competences  and  the  necessary  legal  instruments  to 
implement and apply a screening mechanism.  

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

At the time of reporting, further discussions are being held to establish an efficient and effective 
screening  mechanism  as  soon  as  possible.  It  remains  the  objective  to  finalise  the  preparatory 
drafting  of  the  legal  instruments  swiftly,  which  will  have  to  be  followed  by  parliamentary 
procedures to adopt and implement the Belgian national screening mechanism. 

23 

 
 
 
 
 
Bulgaria 

NATIONAL SCREENING MECHANISM IN PLACE: No  

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q1 
2021):  

In  2020,  the  Minister  of  Economy  sent  to  the  national  authorities,  which  are  responsible  for 
sensitive  areas,  an  information  request  regarding  the  current  legislation  and  the  sector-specific 
measures.  

Based on the analysis of the national legal framework, the competent Bulgarian authorities have 
concluded that the Bulgarian legislation provides sufficient tools for the monitoring of investment 
at sectoral and national level. Against this backdrop, no legislative changes have been initiated at 
this stage. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

Bulgaria has no ongoing initiatives which can be expected to lead to the adoption of a national 
screening mechanism and related legislation. 

Croatia 

NATIONAL SCREENING MECHANISM IN PLACE: No  

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q1 
2021):  

See below.  

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

Croatia  has  no  ongoing  initiatives  which  can  be  expected  to  lead  to  the  adoption  of  a  national 
screening mechanism and related legislation.  

24 

 
 
 
 
 
 
 
Republic of Cyprus 

NATIONAL SCREENING MECHANISM IN PLACE: No.  

Cyprus is in the process of evaluating the opportunity to establish a screening mechanism with 
other stakeholders, also taking into account any difficulties encountered up to now.   

Depending on a pending political decision on appointing a permanent contact point for Regulation 
(EU) 2019/452 some changes in the relevant legislation may be required. 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – 
Q2 2021):  

See below.  

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL SCREENING MECHANISM OR AMENDMENTS TO AN EXISTING 
MECHANISM? 

Cyprus has no ongoing initiatives which can reasonably be expected to lead to the adoption of a 
national screening mechanism and related legislation.  

25 

 
 
 
 
 
Czechia 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

The draft bill establishing the national screening mechanism and implementing the FDI Screening 
Regulation was submitted to the Chamber of Deputies in April 2020 and was passed in January 
2021. The Act No. 24/2021 on screening of foreign investments entered into effect on 1 May 2021. 

The Act  focuses on foreign investors whose ultimate beneficial  owner originates  from non-EU 
countries, and who acquire at least 10% of voting rights in or/and substantial control over a targeted 
Czech company active in a sector important for the security, public, or internal order of the Czech 
Republic.  If  the  target  company  does  business  in  the  field  of  production  of  military  material, 
selected dual-use  goods, or belongs to  critical  or critical  information  infrastructure  (defined by 
special  laws),  the  investor  will  have  to  request  mandatory  authorisation  from  the  Ministry  of 
Industry and Trade (MOIT) before completion of the investment. The screening period is 90 days. 
If a national security risk is identified, the Czech government will have a further 45 days to decide 
whether it will approve, conditionally approve, or, prohibit the transaction.  

Other national security relevant investments could be subject to ex officio screening up to 5 years 
after completion of the investment as well, however, the mandatory permission will not be required 
before the investment is concluded.  
To  strengthen  the  transparency  of  the  investment  environment,  the  law  introduces  a  regime  of 
voluntary consultations whether their investment could be relevant for national security, public or 
internal order. By consulting MOIT, foreign investors will gain legal  certainty through learning 
whether their transaction could be subject to a screening procedure. Such a consultation will be 
concluded  within  a  shortened  period  of  45  days.  The  consultation  is  mandatory  only  for 
investments  into  the  most  significant  media  houses  and  leading  media  outlets  (e.g.  holders  of 
nationwide broadcasting licenses). 

The  Act  also  sets  up  the  necessary  internal  and  external  procedures  to  process  comments  and 
requests for information by other Member States and/or the Commission.  

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

The Czech Republic has no ongoing initiatives  which can be expected to lead to updates to its 
existing screening mechanism and related legislation. 

26 

 
 
 
 
 
 
 
Denmark 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – 
Q2 2021): 

On  10  March  2021,  the  Danish  Government  introduced  a  proposal  for  new  FDI  screening 
legislation in Denmark (the Investment Screening Act).  

The  purpose  of  the  Investment  Screening  Act  is  to  prevent  that  foreign  direct  investments 
constitute a threat to national security or public order in Denmark, through screening and possible 
interventions against such investments, etc.   

The  Investment  Screening  Act  is  designed  as  a  combination  of  a  compulsory  scheme  for 
authorisation of foreign direct investments, etc. within particularly sensitive sectors and activities 
(defence,  dual-use,  IT  security,  critical  infrastructure,  and  critical  technology),  and  an  optional 
scheme for notification of foreign direct investments within other sectors.  

Following the approval of the Investment Screening Act by the Danish Parliament, the Act will 
enter  into  force  on  1st  July  2021.  However,  the  legislation  does  not  apply  to  foreign  direct 
investments that have been implemented before 1 September 2021.  

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL SCREENING MECHANISM OR AMENDMENTS TO AN EXISTING 
MECHANISM? 

See above. 

Estonia 

NATIONAL SCREENING MECHANISM IN PLACE: No 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

See below.  

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

Estonia does not currently have a national screening mechanism and related legislation in place. 

A legislative intent regarding the need to prepare a draft act for  a foreign investment screening 
mechanism was sent to public consultation and approved in July 2020.  

27 

 
 
 
 
 
An independent legal impact assessment of the planned draft Act was subsequently ordered by the 
Government Office and was prepared by the Centre for Applied Social Sciences of the University 
of Tartu. The impact assessment was finalised in April 2021.  

The draft law is planned to be submitted to the Government of the Republic in January 2022, and 
its adoption in the Parliament could take place in the second quarter of 2022.  

The expected time of entry into force of the act would be the beginning of 2023. 

Finland 

NATIONAL SCREENING MECHANISM IN PLACE: Yes  

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

A law amending the Act on the Screening of Foreign Corporate Acquisitions entered into force on 
11  October  2020.  The  amendments  aligned  the  existing  mechanism  with  Regulation  (EU) 
2019/452.  Specifically,  the  amendment  provided  anti-circumvention  clauses  and  rules  on  the 
disclosure  of  confidential  information.  In  addition,  the  amendment  provides  the  possibility  of 
imposing  conditions  in  the  confirmation  decision  (mitigating  measures)  and  provides  a 
clarification of certain definitions, such as key national interest.  

Furthermore, the scope of mandatory prior application was extended to acquisitions in the security 
sector when the undertaking concerned produces or supplies critical products or services related 
to the statutory duties of Finnish Authorities essential to the security of society. In the previous 
legislation, these acquisitions were mainly subject to a voluntary announcement, and it was also 
possible after the final conclusion of the transaction.  

In addition, in January 2020, further legislation on screening of foreign acquisitions of certain land 
and  properties  of  importance  to  defense  entered  into  force.  This  mechanism  falls  under  the 
responsibility of the Ministry of Defence. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

At  the  time  of  reporting,  Finland  had  no  ongoing  initiatives  which  can  be  expected  to  lead  to 
updates to its existing screening mechanism and related legislation. 

28 

 
 
 
 
 
 
 
France 

NATIONAL SCREENING MECHANISM IN PLACE: Yes  

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

Several amendments were made to the applicable framework for FDI screening in France since 
January 1 2019:  

  Entry  into  force  of  the  “PACTE” (Loi  portant  Plan  d’Action  pour  la  Croissance  et  la 
Transformation  des  Entreprises»  law  -  May  2019):  the  updated  provisions  led  to  (i) 
increased  powers  with  the  Minister  for  the  Economy  for  injunction  and  sanctions;    (ii) 
strengthened powers for the State to investigate FDI cases ; (iii) increased transparency of 
the  procedure  with  the  introduction  of  parliamentary  control  and  the  obligation  for  the 
Government  to  publish  data  on  FDI  screening;  (iv)  increased  foreseeability  towards 
stakeholders evidenced by the revision of the assessment time-limits and the clarification 
of the scope of prior authorisation and opinion. 

  Entry into force of the infra-legislative decree implementing the « PACTE » law – April 
2020: through this reform (i) the scope of sensitive sectors was extended to new fields of 
activity; (ii) definitions of foreign investor and takeover were broadened.    

Emergency measures taken in response to the COVID 19 crisis - April and July 2020: (i) inclusion 
of  R&D  activities  in  the  field  of  biotechnologies  to  the  list  of  sensitive  sectors  /  critical 
technologies; (ii) lowering of the threshold triggering the screening to 10% of voting rights for 
takeovers by extra EU-investors in listed companies (valid until 31 December 2021). 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

No 

29 

 
 
 
 
 
Germany 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – 
Q2 2021):  

On 20 May 2020, the German government adopted a revision of the Foreign Trade and Payments 
Ordinance, which changes procedural and substantive aspects of Germany’s investment screening 
procedure  to  safeguard  essential  security  interests  (so-called  15.  AWV-Novelle).  The  changes 
extend the application of a 10 % trigger threshold for acquisitions by non-EU-foreigners and an 
associated  notification  requirement  to  health-related  sectors.  Furthermore,    it  adjusts  some 
procedural rules to close identified shortcomings in the operation of the mechanism. The changes 
entered into force 3 June 2020. 

On 18 June 2020, the German Bundestag adopted a revision of the Foreign Trade and Payments 
Act which aligns Germany’s investment screening procedure with the FDI Screening Regulation 
(452/2019) (so-called 1 AWG-Novelle). The Federal Ministry for  Economic Affairs and Energy 
serves as Germany’s contact point pursuant to Art. 11 of the FDI Screening Regulation. Due to the 
new law, it is now possible to take into account a threat to the security or public order of other EU 
Member States within the German FDI screening process. In accordance with Art. 4 of the FDI 
Screening Regulation the amendment changed the benchmark for the investment screening from 
“immediate danger to security or public order” to “likely to affect security or public order”,   so 
that now more prognostic aspects of the acquisition can be integrated into the screening. Further 
amendments  include  a  prohibition  to  close  the  deal  ahead  of  the  government’s  decision  if  the 
notification  is  mandatory.  It  is  now  also  prohibited  to  disclose  information  which  potentially 
impairs Germany’s public order or security during an ongoing screening procedure. The changes 
entered into force on 17 July 2020. 

On 29 October 2020, a further amendment to the Foreign Trade and Payments Ordinance entered 
into force (so-called 16. AWV-Novelle). The amendment adjusted the FDI screening related rules 
of the ordinance to the changes brought by the reform of the Foreign Trade and Payments Act. 

On 1 May 2021,  another amendment  to  the  Foreign Trade and  Payments  Ordinance came into 
effect (so-called 17. AWV-Novelle). The most important change is the extension of the notification 
requirement to several specifically defined emerging technologies (including artificial intelligence, 
robotics, semiconductors, optoelectronics, quantum and nuclear technologies) and introduction of 
a  20%  trigger  threshold  for  acquisitions  by  non-EU-foreigners  in  the  defined  sectors.  The 
amendment  allows  –  in  specific  circumstances  –  the  screening  of  investments  which  enable 
effective  participation  in  the  management  or  control  of  a  company  by  other  means  than  the 
acquisition  of  voting  rights.  The  amendment  further  adjusts  some  procedural  rules  to  close 
identified shortcomings in the operation of the mechanism. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

30 

 
 
 
Germany  is  currently  working  on  a  further  amendment  to  the  Foreign  Trade  and  Payments 
Ordinance  (so-called  18.  AWV-Novelle)  which  addresses  a  limited  number  of  identified 
legislative shortcomings.  

Greece 

NATIONAL SCREENING MECHANISM IN PLACE: No  

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

The legislation regarding the organisation of the Hellenic Ministry of Foreign Affairs (the national 
competent Authority for FDI Screening), which entered into force on 28 February 2021, includes 
a specific clause designating the new department which will be responsible for FDI screening, on 
the basis of the relevant EU legislation.  

As provided by the said legislation, the new department will be responsible for the operation of 
the contact point as regards the implementation of the FDI Screening Regulation, as well as for 
the operation of the national screening mechanism currently under preparation.  

Greece is planning to establish a national FDI screening mechanism on the grounds of security or 
public order.  This  information  has previously  been shared  with  the European Commission  and 
Greece  has  actively participated in  the exchange  of  good practices concerning Member States’ 
screening mechanisms as organised by the European Commission.  

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

The legislation regarding the FDI screening mechanism is currently being drafted. 

31 

 
 
 
 
 
 
 
Hungary 

NATIONAL SCREENING MECHANISM IN PLACE: Yes  

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

Act  LVII  of  2018  on  Controlling  Foreign  Investments  Violating  Hungary’s  Security  Interests 
entered  into  force  on  1  January  2019.  It  was  the  basic  legislation  for  implementing  the  FDI 
Screening Regulation with respect to compliance with its Article 6 and 8.   

In response to the COVID 19 pandemic, a new Government Decree 532/2020. (XI. 28.)  entered 
into force on 28 November 2020. This Decree modified the Act LVII of 2018 so that, during a 
state of emergency, citizens of the EU, the EEA and the Swiss Confederation, or legal persons 
established  in  the  aforementioned  countries  shall  also  be  considered  as  foreign  investors. 
Furthermore, the scope of screened activities was also widened. The Government Decree will be 
in force until the end of the state of emergency declared by the Government due to the COVID-19 
pandemic.  

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

At the time of reporting, Hungary had no ongoing initiatives which can be expected to  lead to 
updates to its existing screening mechanism and related legislation. 

32 

 
 
 
 
 
 
 
Ireland 

NATIONAL SCREENING MECHANISM IN PLACE: No  

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

Ireland does not currently screen foreign investment. The introduction of an Investment Screening 
mechanism in Ireland will require primary legislation.   

To inform and support the Government’s decision-making process in this policy area, a Regulatory 
Impact  Assessment  (RIA) was conducted in  2020, exploring  the various options available, and 
setting out the pros and cons of alternate policy interventions. In parallel, a public consultation 
exercise on Ireland’s implementation of the FDI Screening Regulation and on the options for the 
development of a domestic screening regime was undertaken. In all of the submissions received, 
there was a general appreciation of the need to address the current vulnerability in this regard. 

Based  on  this  work,  a  draft  General  Scheme  of  the  Bill  was  submitted  to  Government  for 
consideration. The General Scheme outlined the objectives of the proposed Investment Screening 
Bill and provided an initial indication of the types of measures that would need to be included in 
the  final  legislation.  In  July  2020,  the  Government  confirmed  their  decision  to  introduce  a 
screening  mechanism  and  approved  the  drafting  of  the  necessary  legislation.  The  Investment 
Screening Bill 2021 will give full effect to the EU Regulation Investment Screening, as well as 
facilitating the introduction of an investment screening mechanism in Ireland.  

The Department of Enterprise, Trade and Employment is working with the Office of the Attorney 
General to progress the drafting of legislation.  

It  is  expected  that  a  Bill  providing  for  an  Investment  Screening  mechanism  in  Ireland  will  be 
published in the latter part of 2021.  

Ultimately,  the  approach  taken  will  balance  Ireland’s  longstanding  FDI  Strategy  whilst  also 
acknowledging the challenge posed by potentially hostile investments.  

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

See above. 

33 

 
 
 
 
 
 
Italy 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – 
Q2 2021):  

The Italian FDI screening framework (commonly known as ‘Golden Power’ legislation or ‘special 
powers’) is established by Law Decree no. 21 of 15 March 2012 (‘DL 21/2012’), converted with 
amendments by Law no. 56 of 11 May 2012, and Law Decree no. 105 of 21 September 2019 (‘DL 
105/2019’), converted with amendments by Law no. 133 of 18 November 2019, which aimed to 
adapt national legislation to the provisions of the FDI Screening Regulation. The main legislative 
developments during the reporting period are the following: 

  Law Decree No. 22 of 25 March 2019, converted with amendments by Law No. 41 of 20 
May 2019, introduced in DL 21/2012, Article 1-bis, which regulates the exercise of special 
powers in relation to operators signing contracts for the supply of ICT tools with non-EU 
providers  –  related  to  broadband  electronic  telecommunications  networks  with  5G 
technology. 

  Law  Decree  No.  23  of  8  April  2020  (‘DL  23/2020’),  responding  to  the  COVID-19 
emergency  and  following  EU  Commission  guidelines  of  25  March  2020,  introduced 
Articles 15, 16 and 17, amending DL 21/2012 and DL 105/2019, to temporarily expand 
the scope of special powers until 31 December 2020. This urgent measure required a further 
implementing decree specifying the sectors and assets falling within the areas mentioned 
to extend the scope. The main amendments: 

o  Included  critical  infrastructures,  critical  technologies,  supply  of  critical  inputs, 
access  to  sensitive  information  and  the  freedom  and  pluralism  of  the  media,  as 
referred to in Article 4 of the Regulation, in the scope; 

o  Lowered the thresholds of acquisitions by any non-EU entity to at least 10% of the 
corporate  capital  or  voting  rights  in  the  target  as  long  as  the  investment  value 
exceeds  €1ml  and  included  acquisitions  by  EU  entities  only  if  they  result  in 
majority  control  in  all areas outlined  above (hence beyond defence  and national 
security sectors); 

o  Introduced the possibility to exercise the special powers ex officio in case of failed 

notification of a transaction by the parties. 

  The Decrees of the President of Council of Ministers (DPCM) no. 179 of 18 December 
2020  and  no.  180  of  23  December  2020  clarified  the  scope  by  defining  and  listing  all 
strategic assets in (i) the energy, transport, and communications sectors, and (ii) in all other 
critical  areas  of  Article  4  of  the  Regulation,  such  as  artificial  intelligence,  robotics, 
semiconductors, etc. 

34 

 
 
 
  Article  10-ter  of  Law  no.  176  of  18  December  2020,  extended  the  application  of  the 
temporary  regime introduced by  DL 23/2020  until 30 June 2021;  and  Article 4 of  Law 
Decree no. 56 of 30 April 2021, further extended the application until 31 December 2021. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

Italy is currently reviewing the sectors/list of technologies screened under its legislation so as to 
be fully compliant with Article 4 of the FDI Screening Regulation. 

Latvia 

NATIONAL SCREENING MECHANISM IN PLACE: Yes  

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q1 
2021):  

On 11 October 2020 amendments to the Regulations of Cabinet of Ministers of Republic of Latvia 
No. 606 of 3 October 2017 “Regulations Regarding the Institution Determined in the National 
Security Law, the Scope of Information to be Submitted, the Procedures for Submission Thereof, 
and  the  Evaluation  of  the  Submitted  Information,  and  also  the  Taking  and  Notification  of  the 
Decision Determined in the National Security Law” entered into force.  

In particular, the amount of information to be provided has been supplemented by the regulatory 
framework in case the investor is a foreign investor. Furthermore, the new regulatory framework 
has  established  procedures  for  transmitting  information  (including  comments  and  an  opinion) 
received  from  other  Member  States  and  the  European  Commission  to  the  national  security 
authorities for assessment. 

The main legislative developments during the reporting period are the following: 

  National  Security  Law,  Chapter  VI  -  Restrictions  on  Commercial  Companies  of 
Significance to National Security (Amended on 23 November 2020 and 20 May 2021)  

  Regulation No. 606 adopted on 3 October 2017 regarding the Information to be Submitted 
to the Authority Determined in the National Security Law and the Handling of Information 
on Foreign Direct Investments (6 October 2020) (Amended on 04 February 2021) 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

Latvia has no ongoing initiatives which can be expected to lead to updates to its existing screening 
mechanism and related legislation. 

35 

 
 
 
 
 
Lithuania 

NATIONAL SCREENING MECHANISM IN PLACE: Yes  

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

The  Lithuanian  national  investment  screening  mechanism  is  governed  by  the  Law  on  the 
Protection of Objects of Importance to Ensuring National Security of the Republic of Lithuania.  

The Law foresees safeguards to prevent national security threats associated with investments in 
enterprises, facilities and protection zones important to national security and in economic sectors 
important to national security.  

Several amendments to the Law have been adopted during the reporting period. Most amendments 
were minor and/or related to the updates of the list of enterprises important to national security or 
economic  activities  within  sectors  important  to  national  security.  However,  more  significant 
amendments  to  the  Law  were  introduced  on  30  June  2020  (amendment  No.  XIII-3257)  and 
included: 

  Review  of  the  criteria  for  assessing  the  compliance  of  investors  with  national  security 

interests; 

  Clarification of the criteria for transactions which have to undergo  mandatory screening; 

  Simplification of screening procedure by removing redundant requirements;  

  Review of specific time frames for the investment screening procedure; 

  Strengthening  the  role  and  functions  of  the  Governmental  Commission,  which  is 

responsible for national investment screening.  

  Specific provisions related to the implementation of the FDI Screening Regulation  

a)  Additional criteria for the assessment of an investor’s compliance with national 
security interests have been added in order to have the possibility of taking   into 
account  the  comments  of  Member  States  and  the  opinions  of  the  European 
Commission. 

b) Possibility  to  temporarily  suspend  the  national  screening  procedure  has  been 
foreseen in order to take into account comments from Member States and the 
European Commission 

c)  Additional competences have been given to the Commission for Coordination of 
Protection of Objects of Importance to Ensuring National Security to be involved 
in the process of reviewing FDI in other Member states, reviewing comments 
received, as well as cooperation with other Member States and the Commission. 

36 

 
 
 
 
The  national  screening  procedure  in  Lithuania  is  implemented  by  the  Commission  for 
Coordination  of  Protection  of  Objects  of  Importance  to  Ensuring  National  Security.  The 
Commission  is  composed  of  representatives  from  Lithuanian  government’s  ministries,  state 
security and special investigations services, and the Bank of Lithuania. The Commission follows 
the Rules of Procedure which were amended on 28 October 2020 (amendment No. 1213). The 
amendments are to ensure compliance with the newest edition of the Law On The Protection Of 
Objects Of Importance To Ensuring National Security (valid from 1 August 2020). The new Rules 
of Procedure also specify additional requirements for information to be submitted by an investor 
for the screening procedure.  

In  addition,  Government  of  Lithuania  has  appointed  the  Ministry  of  Foreign  Affairs  of  the 
Republic of Lithuania as a contact point for the implementation of the FDI Screening Regulation 
on 30 September 2020.  

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

At the time of reporting, Lithuania had no ongoing initiatives which could be expected to lead to 
updates to its existing screening mechanism and related legislation. 

Luxemburg 

NATIONAL SCREENING MECHANISM IN PLACE:  Luxemburg has no national screening 
mechanism and related legislation in place. 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021): 

A government bill is underway. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

The Government Council has approved on July 16 2021, a government initiative to introduce a 
national  screening  mechanism  and  to  set  up  the  rules  for  the  intra-European  cooperation 
mechanism. The government bill will now follow the normal legislative procedure. 

37 

 
 
 
 
 
 
Malta 

NATIONAL SCREENING MECHANISM IN PLACE: Yes.  

The screening of foreign direct investments originating from third countries (i.e. non-EU) started 
in April 2020 with the establishment of the National FDI Screening Office. Initially the basis for 
screening was the FDI Screening Regulation.   

The Office has since promoted and piloted a legislation in order to transpose the FDI Screening 
Regulation into the laws of Malta. This was effectively achieved on 18 December 2020, with the 
enactment of Chapter 620 of the Laws of Malta. The FDI Screening Office of Malta is tasked with 
implementing the provisions of Chapter 620.  

The Law regulates e.g. the establishment of a Board to direct the National FDI Screening Office. 
The Law describes in detail the functions and duties of the Office, and the notification and the 
screening process.  

The  Law  also  describes  the  Office’s  executive  powers,  mainly  the  imposition  of  conditions, 
unwinding  and  prohibiting  of  investments;  and  administrative  penalties  in  case  of  breaches  or 
offences  by  any  person(s)  involved  in  the  foreign  direct  investment.  In  such  cases,  an  appeal 
application process (also included in the Law) shall be filed within 20 days from receipt of the 
decision taken by the Office in relation to the foreign direct investment or an administrative penalty 
imposed. 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q1 
2021): 

See above. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

Malta has no ongoing initiatives which can be expected to lead to updates to its existing screening 
mechanism and related legislation. 

38 

 
 
 
 
 
Netherlands 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – 
Q2 2021):  

The  Netherlands  has  implemented  the  Uitvoeringswet  Screeningsverordening  Buitenlandse 
Investeringen (Implementation Act Regulation 2019/452) in December 2020.  

This  Act  assigns  to  the  Dutch  FDI  Screening  Authority  (the  Bureau  for  Investment  Screening, 
which is part of the Ministry of Economic Affairs & Climate Policy) powers to retrieve information 
from several internal sources in order to be able to answer any questions asked by the European 
Commission or Member States.  

Currently,  the  national  screening  legislation  of  the  Netherlands  is  contained  in  the  following 
sector-specific laws:  

• Telecommunications Act; 

• Electricity Production, Transport and Supply Act 

• Gas Transportation and Supply Act 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL SCREENING MECHANISM OR AMENDMENTS TO AN EXISTING 
MECHANISM? 

A bill for the assessment of the impact of investments in vital sectors on national security interests 
has been submitted to parliament on the 30 June 2021. 

The  bill  includes  a  screening  mechanism  for  investments  in  companies  with  a  role  in  national 
security or public order, or companies with sensitive technologies.  

Any  major  developments  with  regard  to  this  bill  will  be  communicated  to  the  European 
Commission. 

39 

 
 
 
 
 
 
Poland 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q1 
2021):  

The  most  important  amendments  regarding  the  Polish  FDI  screening  mechanism  have  been 
introduced  by  the  Act  of  19  June  2020  on  Subsidies  on  Interest  on  Bank  Loans  Granted  to 
Entrepreneurs  affected  by  COVID-19  and  on  the  Simplified  Procedure  for  the  Approval  of 
Arrangements in Connection with COVID-19, which introduced among others, changes to Act of 
24 July 2015 on the Control of Certain Investments (Journal of Laws 2020, item 2145).  

In order to strengthen the protection of domestic companies against takeovers by non-EU entities, 
a comprehensive framework was introduced on a temporary basis (a period of 24 months) for the 
control  of  activities  that  may  threaten  safety,  order  and  public  health  in  connection  with  the 
deteriorating  economic  situation  caused  by  the  COVID-19  epidemic,  affecting,  inter  alia,  the 
increased risk of reduced financial liquidity of enterprises. 

A procedure consisting of two phases was introduced. The first phase is to separate cases into those 
not requiring further control actions (non-controversial cases), and those requiring such actions. 

An  anti-circumvention  clause  has  also  been  introduced,  which  allows  checking  entities  from 
outside the EU, which, in order to avoid controls, are being introduced as EU entities. Proceedings 
conducted on this basis may be initiated only ex officio. In all  other cases, proceedings will be 
conducted upon notification or ex officio. 

The Act indicates the sectors in which Polish entities are protected. These are strategic sectors (e.g. 
energy,  communications),  sectors  that  have  a  significant  impact  on    Poland's  GDP,  as  well  as 
sectors particularly important in the fight against the epidemic and ensuring the protection of the 
life and health of citizens (medical equipment, pharmaceutical sector). In times of epidemics, the 
food sector has also gained importance. Thus, the protection applies to: 

1)  public companies within the meaning of the Act of 29 July 2005 on Public Offerings and 
Conditions for Introducing Financial Instruments into an Organised Trading System, and 
on Public Companies, 

2)  entities which hold assets that form part of critical infrastructure, 

3)  companies from the IT sector that develop or modify software used in the power industry, 
water supply and sewage treatment, telecommunications (communications), mass transport 
and  logistics,  non-cash  payments,  data  processing  and  services  for  hospitals  and 
laboratories, medical devices, or sales of prescription drugs, 

4)  companies  that  operate  in  the  electricity,  natural  gas,  oil,  and  other  fuel  sectors  (e.g., 

production,  storage, transportation, and trading), 

5)  companies that produce rhenium, 

40 

 
 
 
6)  companies that produce chemicals, fertilizers and chemical products, 

7)  companies that manufacture or trade explosives, weapons, ammunition or other products 
and technologies for the army and police or extract and process metal ores for this purpose,  

8)  companies from the telecommunications sector, 

9)  companies handling at inland ports, 

10) entities  producing  medical  equipment  or  manufacturing  medicines  and  other 

pharmaceutical products, 

11) entrepreneurs from the food sector dealing with processing of meat, milk, cereals, fruits 

and vegetables. 

The President of the Office of Competition and Consumer Protection became the control authority. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

Poland has no ongoing initiatives which can be expected to lead to updates to its existing screening 
mechanism and related legislation. 

Portugal 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

The Portuguese investment screening framework is governed by the Decree-Law nº. 138/2014, of 
15 September, published in the DR nº 177, series I, from 15.09.2014 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

Efforts are currently ongoing to update the existing screening legislation:  

  An inter-ministerial Working Group at technical level was established in 2020.  
  A set of possible changes to the existing law is being discussed.  

There is initial agreement on adjustments proposed, including on: 

 
 
 

the alignment of deadlines between national and EU mechanisms,  
the establishment of the contact point 
the introduction of the possibility of imposing mitigation measures  

41 

 
 
 
 
 
A number of important issues remain to be decided. It is therefore not yet possible to conclude the 
review and begin the legislative process. 

Romania 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q1 
2021):  

The Romanian authorities have prepared a legislative proposal aimed at modifying their national 
screening mechanism.  

Discussions are still ongoing between the relevant national authorities and the law is expected to 
entry into force by the end of 2021. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

The amendments to the national screening legislation are expected to enter into force by the end 
of 2021.  

Slovakia 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q1 
2021):  

The  Slovak  Republic  does  not  have  a  comprehensive  legal  framework  for  screening    foreign 
investments to protect the security and public order of the Slovak Republic. 

However, a partial scheme covering the elements of critical infrastructure under the competence 
of the Ministry of Economy of the Slovak Republic has been incorporated into Act 45/2011 Coll. 
on critical infrastructure. 

The legislation entered into force on 1 March 2021 and covers all direct and indirect transfers and 
transitions of the elements of  critical infrastructure (energy and industry) under the competence 
of the Ministry of Economy (not only FDI). The legislation also sets out the rules and procedures 
for the assessment of such transfers and transitions. Transfers and transitions cover changes to and 
transfer of ownership of an entity, including as a result of liquidation, bankruptcy proceedings and 
restructuring and other legal proceedings. 

42 

 
 
 
 
 
 
ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

The  Slovak  Republic  recognises  the  need  to  adopt  additional  legislation  for  the  screening  of 
foreign investment.  

The Ministry of Economy of the Slovak Republic continues with intensive preparatory work on 
the draft Act on Screening of Foreign Investment which would be of general application, covering 
additional sectors beyond critical infrastructure. The official legislative process has started  It is 
expected that the proposed screening mechanism will enter into effect by  1 January 2022.  

Slovenia 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q1 
2021):  

Slovenia  did  not  have  a  national  screening  mechanism  prior  to  the  crisis  brought  about  by  the 
COVID-19 pandemic.  

The risk of acquisitions of strategic companies by third countries was increasing significantly due 
to  the  decline  in  value  of  European  companies.  Given  these  circumstances,  Slovenia  was  even 
more  exposed  to  hostile  takeovers  of  strategic  companies  and  infrastructure,  crucial  for  the 
systemic functioning of the state and the welfare of its citizens. 

With the entry into force  on 31 May 2020 of the Intervention Measures to Mitigate and Eliminate 
the Consequences of the COVID-19 Epidemic Act (Official Gazette of the Republic of Slovenia, 
No.  80/20,  hereinafter  referred  to  as  ZIUOOPE),  the  Foreign  Direct  Investment  Review 
Mechanism became fully operational as the first screening mechanism in Slovenia.  

The screening of FDI  entails   the following obligations for foreign investors: if the transaction 
represents a foreign direct investment under Article 70 of the ZIUOOPE, i.e. if a foreign direct 
investor acquires at least 10% of the share capital or voting rights in a Slovenian company through 
a transaction; and; if the activity of the target company relates to one of the risk factors, i.e. critical 
infrastructure,  critical  technology,  supply  of  critical  resources,  access  to  sensitive  information, 
freedom and pluralism of the media and projects or programmes of Union interest, the FDI must 
be notified to the Slovenian Ministry of Economic Development and Technology (“MGRT”): 

  within 15 days from the conclusion of the merger agreement or from the publication of the 
takeover bid (any contract by which a foreign investor acquires at least 10% of the share 
capital or voting rights in a Slovenian company), 

  within 15 days from the establishment of the company in the Republic of Slovenia (in case 

of  a “greenfield” investment), 

43 

 
 
 
 
  within 15 days from the conclusion of the sales contract, in the case of the purchase of real 

estate crucial for the use of critical infrastructure (or land in its vicinity). 

During the preliminary procedure, the Notification Commission (comprised of three members of 
MGRT  and  two  members  of  SPIRIT  Slovenia  (Public  Agency  for  Entrepreneurship, 
Internationalisation,  Foreign  Investments  and  Technology)  examines  the  FDI  notifications  and 
issues opinions on the introduction of the review procedure. 

If  any  potential  risks  are  identified  in  the  preliminary  procedure,  the  Minister  may  appoint  an 
interdepartmental  commission  consisting  of  3  to  10    members  (ministries,  agencies,  chambers, 
universities,  institutes,  etc.)  for  each  review  procedure.  Based  on  the  opinion  of  the 
interdepartmental commission, the Minister then decides whether the FDI under review is either 
authorised; authorised with conditions; prohibited; or cancelled.  

The FDI screening mechanism entered into force on 31 May 2020 and will remain in force until 
30 June 2023. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

The screening mechanism will be permanently included in the Investment Promotion Act (Official 
Gazette  of  the  Republic  of  Slovenia,  No.  13/18,  hereinafter  referred  to  as:  ZSInv)  within  the 
framework of the regular/shortened legislative procedure.  

Slovenia will take into account the experience in using the existing mechanism (in force until June 
2023),  and  concerns  and  suggestions  of  investors  and  their  representatives,  and  will  then 
permanently include the mechanism in ZSInv. 

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Spain 

NATIONAL SCREENING MECHANISM IN PLACE: Yes 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

The Spanish investment screening framework is governed by the following: 

  Royal Decree 137/1993, which approves the regulation on weapons. 
  Royal Decree 664/99, on foreign investment. 
  Law  19/2003,  on  the  legal  system  on  transfers  of  capitals  and  foreign  economic 

transactions and specific measures for the prevention of money laundering.  

  Law 7/2010, General Law on audiovisual communication. 
  Law 3/2013, creating the National Commission on Markets and Competition (Additional 

Provision nine). 

  Law 9/2014 on Telecommunications. 

Since  January  1,  2019  the  main  amendments  to  the  FDI  screening  framework  have  been  the 
following:  

  Royal Decree 8/2020 of 17 March introduced an amendment to Law 19/2003 of 4 July on 
the legal regime of capital movements and economic transactions abroad, which introduced 
article 7 bis. Article 7 bis suspends the liberalisation regime, based on national security, 
public order and/or public health reasons, for those direct foreign investments that require 
authorisation when they meet any of the assumptions set out in Article 7 bis.  

  Article 7 bis was subsequently amended by Royal Decree 11/2020 of 31 March 2020 and 
Royal Decree 34/2020 of 17 November 2020 (later amended by Royal Decree 12/2021 of 
24 June 2021). 

  Royal  Decree  11/2020  introduced  a  simplified  procedure  for  the  notification  and 

authorisation of foreign investments below a  €5ml threshold. 

  Royal  Decree  34/2020  established  a  transitory  regime  (until  30  June  2021)  for  foreign 
investments,  by EU or EFTA country investors, in  listed or non-listed companies if the 
investment exceeds  €500ml. Royal Decree 12/2021 has extended this transitory regime 
until 31 December 2021. 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

Spain does not have ongoing initiatives which can be expected to lead to updates to its existing 
screening mechanism and related legislation. 

45 

 
 
 
 
 
Sweden 

NATIONAL SCREENING MECHANISM IN PLACE: No 

LEGISLATIVE DEVELOPMENTS DURING THE REPORTING PERIOD (Q1 2019 – Q2 
2021):  

No 

ANY ONGOING INITIATIVES THAT MAY RESULT IN THE INTRODUCTION OF A 
NATIONAL  SCREENING  MECHANISM  OR  AMENDMENTS  TO  AN  EXISTING 
MECHANISM? 

Preparatory work is currently ongoing to introduce Swedish FDI Screening legislation.  

In August 2019 the Swedish Government initiated a government inquiry to propose a framework 
for screening of foreign direct investments in Sweden.  

The  government  inquiry’s  conclusions  will  be  presented  in  a  report  in  November  2021.  The 
Swedish Government thereafter intends to introduce a government bill to the Swedish Parliament 
regarding new legislation regarding screening of foreign direct investments into Sweden. 

46