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Update on the screening of FDI into the European Union

We hereby share with you a very good article written by our Belgian partner firm DALDEWOLF.

As we are approaching the end of 2023, it is a good moment to update you with the most recent legislative move and practices, in respect of the screening of Foreign Direct Investment (FDI) into EU.


EU level

It is expected that by the end of 2023, the Commission will present a report to the European Parliament and European Council, evaluating the functioning and effectiveness of Regulation (EU) 2019/452 of 19 March 2019 establishing a framework for screening foreign direct investments in the European Union (the FDI Regulation). To this purpose, the Commission has completed a consultation during June and July 2023. Up to this date, the report has not been issued. We will continue updating you with the content on this report, and on the Commission’s eventual legislative proposal to revise the FDI Regulation.

National level

As of October 13, 2023, out of 27 member states, 21 countries have notified its national screening mechanism to the European Commission: Belgium, Czechia, Denmark, Germany, Estonia, Spain, France, Italy, Latvia, Lithuania, Luxembourg, Hungary, Malta, The Netherlands, Austria, Poland, Portugal, Romania, Slovenia, Slovakia, Finland.


FDI screening law entered into effect as of December 1, 2023.


Published draft legislation in 2022 to introduce a new FDI screening mechanism and the proposal is currently being considered. It is expected to be approved soon.


The Belgian FDI screening mechanism, as established in the Cooperative Agreement dated November 30, 2022, entered into force on July 1, 2023. Interesting to note that all the Benelux countries have established the national screening mechanisms this year. For more details on the Belgian FDI screen mechanism, please refer to our article:

Screening practices

As published in the Commission’s third annual report dated October 19, 2023, on the screening of foreign direct investments into the Union (year 2022):

FDI into EU27 in 2022

  • the cumulative number of foreign transactions, including greenfield, and M&As, into the EU27 displays an increasing trend between 2015 and 2022. EU member states remain open to foreign investors;
  • the US remained the top foreign investor in 2022, accounting for 32.2% of all foreign acquisitions and 46.5% of all greenfield investments, followed by the UK, Switzerland and offshores .
  • China accounts for 2.3% of total foreign acquisitions into EU 27, it ranked in number 8, after US, UK, Switzerland, Offshores, Norway, Canada and Japan. It accounts for 3.9% of total foreign greenfield investments into EU27, it ranked in number 5, just after US, UK, offshores and Switzerland.
  • If we compare the FDIs from China over the years, there was a decrease of 14.6% (2022 vis-à-vis 2020) and 2.4% (2022 vis-à-vis 2021) in respect of acquisitions, and a significant decrease of 36.1% (2022 vis-à-vis 2020) and 34.1% (2022 vis-à-vis 2021) in respect of greenfield investment.
  • Top destinations of FDIs into EU are Germany, Spain, Italy, France, the Netherlands and Ireland.

FDI Screening in Member States

  • In 2022, a total of 1,444 requests for authorisations of acquisitions made by the foreign investors and ex officio cases were handled by the screening authorities in Member States. Only 55% of the cases were formally screened.
  • Out of the cases formally screened in 2022, 86% cases were authorised without conditions. 9% of the decisions involving an approval with conditions or mitigating measures, only 1% of all the cases were ultimately blocked by the national authorities. The percentage of refusal is therefore very low.

FDI Screening notified to Commission

  • In 2022, 17 Member States submitted a total of 423 notifications to the Commission according to the cooperation and notification mechanism under the FDI Regulation. The six main countries of origin were the US, the UK, China, Japan, the Cayman Islands and Canada.
  • The transactions are mainly in the manufacturing (critical infrastructures and technologies, such as energy and aerospace, defence, semiconductors and health), ICT, Professional Activities, Wholesale and retail sectors. Almost half of them had a value of less than EUR 500 million. 42% of the transactions involved a value of EUR 100 million and more.
  • Almost 81% of the 423 notifications were closed under Phase 1, only a limited number proceeding to more detailed assessment in Phase 2, and less than 3% of cases resulted in European Commission’s opinions.

Looking forward

It is important for foreign investors to keep an eye on the Commission’s upcoming proposed revisions to the FDI Regulation at EU level. In addition, we expect more Member States will establish or amend its national FDI screening mechanism, and there will be more experience exchanges amongst EU27, between the Member States and the Commission, as well as between the EU and its partner countries, notably the US, under the Trade and Technology Council Working Group on FDI.

More information

For more information on this subject , please feel free to contact our China Practice:

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