Multi-jurisdiction guide for screening foreign investments
The Antitrust and Competition team have authored an update of DLA Piper’s multi-jurisdiction guide for screening foreign investments, building on their previous guide from 2019. FDI’s have been gaining relevance as a source of economic activity over the last decade thanks in part to the continuing shift towards international technology-based production and a wave of cross-border mergers and acquisitions. Governments have reconsidered and have shifted policies to ride the trend, particularly in developing and emerging countries. Many have removed restrictions on financial flows, fostering even greater mobility of capital and international exchanges, although the profile of each specific country varies.
Certain investments are seen as a risk for national security and consequently, some local as well as supranational authorities (such as the EU) have developed measures aimed at screening foreign investments, ultimately enabling them to intervene either ex ante and/or ex post should those investments require control -or in the more severe cases- prohibitions.
EU Regulation 2019/452 which entered into force on 11 October 2020 aimed to establish a framework to screen FDI into the EU. It promotes cooperation, information sharing and a minimum level of transparency regarding FDI control between the European Commission and Member States but it does not -and cannot- replace national FDI screening mechanisms.
The aim of this guide is not to substitute proper due diligence and specialized advice when conducting business, it will hopefully help the reader navigate the different FDI regimes. Particularly in this complex context and in view of the proliferation of new regimes, by explaining the key aspects of regimes including main issues to consider, thresholds and proceedings to take into consideration when investing in our globalized world.
This guide will be updated regularly to reflect changes to the FDI regimes in the relevant jurisdictions. This version of the guide is dated May 2021.