Greece adopts Law 5202/2025 to introduce national FDI screening mechanism aligned with EU Regulation 2019/452

On 23 May 2025, the Hellenic Parliament enacted Law 5202/2025, establishing a national framework for screening foreign direct investments (FDIs). This marks a significant development in Greece’s foreign investment regime, introducing a market-wide structured legal framework for screening FDIs that might affect national security or public order.

Law 5202/2025 establishes the procedural and substantive rules governing FDI screenings, designates the competent authorities, and aligns Greece with broader EU efforts to ensure coordinated oversight of foreign investments across critical sectors, including energy, defence, telecommunications, and emerging technologies.

In this alert, we provide an overview of the key provisions of Law 5202/2025.

 

EU Regulation 2019/452 overview and transposition into Greek law

EU Regulation 2019/452 was formally adopted by the European Parliament and Council on 19 March 2019 and became applicable on 11 October 2020. The Regulation establishes a screening process for FDI, without prejudice to national law.

Specifically, the regulation doesn’t mandate screening mechanisms at national level but sets minimum standards for those EU member states that choose to implement them. EU member states have to “set out the circumstances triggering the screening, the grounds for screening and the applicable detailed procedural rules”. It also introduces a cooperation mechanism between EU member states and authorizes the European Commission to review and rule on investments that pose a threat to the public order of more than one EU member state.

Law 5202/2025 transposed the regulation into domestic law by establishing for the first time a national FDI screening mechanism. The law’s primary objective is to protect national security and public interests from potential risks posed by certain foreign investments, particularly in critical sectors of the economy. It defines the sectors subject to screening, based on their sensitivity and designates the competent authorities responsible for evaluating whether a proposed investment might pose risks to national security or public order. In doing so, the law aligns Greece with EU standards while tailoring the framework to national strategic interests.

 

Application criteria and sectoral thresholds

Foreign direct investments in Greece are subject to screening for reasons of national security or public order if:

• they’re made by a third-country investor, and the target enterprise is active in sensitive sectors;
• they’re made by an EU member state investor which is controlled either by a third-country individual or enterprise; or are directly or indirectly under the control of a third-country government, including its state bodies or armed forces (such control may be exercised through ownership structures or significant funding, and the target undertaking must be active in one of the sectors); or
• they’re made by an EU-based investor in which a third-country government, entity, or individual holds at least 10% participation – either through ownership or significant funding – and the target enterprise operates in one of the particularly sensitive sectors.

An investment qualifies as an FDI in a sensitive sector when it concerns infrastructure, assets, goods, or services essential to sectors such as energy, transport, health, information and communication technologies, or digital infrastructure, and the foreign investor’s stake in the target enterprise reaches or exceeds 25%. The screening procedure is also triggered in case of an increase in the levels of participation in the target enterprise – specifically at 30%, 40%, 50%, and 75%.

For particularly sensitive sectors – including military technologies, AI, cybersecurity, port and underwater infrastructure, and tourism infrastructure in border areas – screening begins at a lower threshold of 10% participation. Any increase in participation to 20%, 25%, 30%, 40%, 50%, 60%, 70%, or 75% also triggers the procedure.

 

Exemptions

Article 4 (2) of Law 5202/2025 outlines specific cases in which FDIs are excluded from the scope of the screening mechanism. These exemptions aim to preserve flexibility for non-controlling transactions and internal corporate reorganisations that don’t pose risks to national security or public order.

Firstly, portfolio investments are expressly excluded. These are acquisitions of corporate securities by individuals or entities that are intended purely for financial purposes, without any intention or potential to influence the management or control of the target undertaking. Intra-group restructurings are exempt, provided that they don’t result in an increase in the degree of control held by foreign investors or confer new rights that alter effective participation in management or control. Lastly, the law excludes pending public procurement or concession procedures where binding offers have already been submitted, and contracts for developing assets that hadn’t been completed before the law entered into force.

These exemptions reflect a risk-based approach, ensuring that the screening mechanism only targets those transactions that may present substantive threats to public order or national security.

 

Screening authorities and procedure

The Interministerial Committee for the Screening of Foreign Direct Investments for security or public order reasons (ICSFDI), with the Minister of Foreign Affairs, are the primary decision-making authorities under the new framework. The Directorate B1 of the Ministry of Foreign Affairs acts as the coordinating body and contact point for both investors and EU cooperation.

Investors must file an application to Directorate B1 before completing an investment that falls under the screening criteria. Within five days, Directorate B1 verifies the completeness of the application. If the file is in order, it’s forwarded to ICSFDI, which then decides within 30 days to either exempt the investment or launch an in-depth review.

During the in-depth phase, information is shared with the European Commission and other EU member states. The ICSFDI may call for additional data and even override standard confidentiality protections (eg tax, banking) to obtain relevant information, except for privileged legal communications. The committee must issue a recommendation to the Minister of Foreign Affairs within 30 days, which may be extended. A lack of ministerial decision within 60 days is considered tacit approval of the investment.

In urgent or exceptional cases, the ICSFDI can recommend prohibiting or conditioning an investment without a full investigation. The Minister of Foreign Affairs can adopt such measures based on the ICSFDI’s advice within 30 days.

 

Cooperation mechanism under EU Regulation 2019/452

Directorate B1 is responsible for implementing the EU’s cooperation mechanism. It acts as the national contact point and shares information with other member states and the European Commission, solicits views from domestic ministries, and ensures compliance with response timelines. It can also request information from third parties and oversees data protection in line with the General Data Protection Regulation and Law 4624/2019.

 

Consequences of non-compliance and sanctions

Non-compliance with Law 5202/2025 triggers serious consequences, including the invalidation of the investment transaction, the potential reversal of share purchase agreements, and any other measure necessary to revoke the consequences of the transaction. Administrative fines range from EUR5,000 to EUR100,000 for procedural violations, including failure to notify, submission of false information, or non-compliance with documentation requirements.

Fines may amount up to twice the value of the investment in cases of more serious breaches, such as carrying out a prohibited investment, getting approval based on false information or violating imposed mitigation measures. The Minister of Foreign Affairs imposes sanctions after recommendation from ICSFDI, following a hearing procedure for the investor involved.

 

Conclusion

Law 5202/2025 positions Greece within the EU’s harmonized FDI screening system, while safeguarding national interests. The new framework enhances legal certainty for investors and public authorities alike. Foreign investors with strategic interests in Greece should assess their transaction structures carefully and engage proactively with legal and regulatory counsel to ensure they comply with the new regime.