Screening of foreign investments in the Union

Background

In January 2024 the EU Commission presented a legislative proposal to update the 2019 Foreign Direct Investment (FDI) Screening Regulation, to adapt it to the evolving geopolitical and technological landscapes. This proposal is set to enhance the EU’s scrutiny of FDI, a critical step in safeguarding the Union's security against potentially risky investments, particularly those in strategic sectors like critical technologies and infrastructure.

By improving the FDI screening process, the EU aims to protect its essential interests without compromising its open investment regime, ensuring a secure and prosperous environment for its citizens and businesses.

Key points

In the opinion, the EESC:

  • welcomes the proposed Regulation as a step in the right direction, enhancing the screening mechanisms for foreign direct investments (FDI) in the EU;
  • stresses the importance of promoting greater harmonisation of national norms regulating FDI and screening mechanisms, including setting consistent thresholds for FDI control; establishing coherent definitions of risks to security and public order; and bolstering Member States’ capacities for effective implementation of FDI control tasks;
  • calls for the establishment of exceptional cases where the EU institutions may prohibit, mitigate, or apply conditions to FDI that jeopardize programmes or projects of interest to the Union, ensuring a unified approach to protecting public security and order across Member States;
  • calls for subjecting investments from tax havens to special surveillance, requiring full knowledge of the real owners of the investing companies and examining the legality of the funds deployed.

Additional information

EESC section: External Relations (REX)

Opinion number: REX/590-EESC

opinion type: Mandatory

Referral: COM(2024) 23 final 2024/0017 COD, COM(2024) 23 final 2024/0017 COD

Rapporteur: Javier DOZ ORRIT (Workers - GR II / Spain)

Date of adoption by section: 24/06/2024

Date of adoption in plenary: 11/7/2024

Result of the vote in plenary: 177 in favour/ 0 Against/2 Abstention 

Contact

Millie Tsoumani

Press Officer, Tel.: +32 (0) 2 546 9088, Email: Amalia.tsoumani@eesc.europa.eu 

Marco Ristori

Administrator, Policy Officer, Tel.: +32 (0) 25469969, Email: Marco.Ristori@eesc.europa.eu