On 8 June 2026, the Council of the European Union adopted a revised Regulation on the screening of foreign direct investments in the EU (revised FDI Regulation or Regulation).[1] The new rules replace the current FDI screening framework that has been in force since October 2020 (current FDI Regulation).[2] The revised FDI Regulation will shortly be published in the EU’s Official Journal and will enter into force 20 days after publication. The updated FDI screening framework will start to apply 18 months after the Regulation comes into force, with the new rules expected to take effect in early 2028.
Below, we outline the key changes introduced by the revised FDI Regulation. We also assess the implications of the Regulation for the FDI screening regimes in Germany, France, and the Netherlands, and discuss the draft investment screening regime that was recently introduced in Finland.
1. Key changes in the revised Regulation
The new Regulation brings five main changes to the EU’s FDI screening framework.
a. Mandatory national screening regimes, broader scope
The revised Regulation now makes it mandatory for Member States to establish a national FDI screening mechanism.[3] This contrasts with the current FDI Regulation, which provides only that Member States “may” adopt an FDI screening mechanism. While FDI screening remains a national competence, Member States must ensure that their screening mechanisms are consistent with, and do not undermine, the objectives of the revised FDI Regulation.
The revised FDI screening framework is broader in scope than the current regime. In a change from the current FDI Regulation, indirect foreign investments – i.e., FDI made through an EU-incorporated or domestic subsidiary of a third-country parent – are now expressly within scope.[4] This amendment is intended to address perceived circumvention risks and responds to the EU Court of Justice’s finding in Xella that the current FDI Regulation does not apply to indirect foreign investments.[5]
Greenfield investments are not subject to mandatory prior authorisation, but Member States may still screen them. Portfolio investments are expressly out of scope, as under the current FDI Regulation.
Since the launch of the Cypriot FDI regime in April 2026, all Member States now have screening frameworks in place – up from two thirds of all Member States with FDI regimes in 2021.
b. Mandatory prior authorisation of FDI in specified sensitive sectors
The revised Regulation requires Member States to impose a mandatory, pre-closing authorisation requirement in respect of FDI in certain sensitive sectors, technologies, and infrastructure. Unlike the current FDI Regulation, which does not define the sectors for which prior clearance is required, the new rules specify that national regimes must cover a minimum common list of sensitive sectors. These are:[6]
- dual-use items;
- defence-related products;
- advanced technologies (semiconductors, quantum technologies, AI);
- critical infrastructure (transport, energy, digital);[7]
- strategic raw materials;
- financial market infrastructure (e.g., central counterparties, payment systems); and
- electoral infrastructure.
Member States remain free to extend their screening regimes beyond this minimum scope.
c. Expanded, mandatory assessment criteria
The revised FDI Regulation also harmonises the substantive criteria for assessing whether an FDI is likely to affect security and public order. As before, the new screening rules envisage a two-part assessment framework that looks at (i) the potential effects of the FDI on critical technologies, critical infrastructure, critical inputs, access to sensitive information, and media freedom and pluralism, as well as other factors; and (ii) the risk profile of the foreign investor, including whether the investor is likely to pursue a third country’s policy objectives or is engaged in illegal or criminal activities. Under the new rules, Member States are required to take the listed factors into account in their assessment, whereas the criteria are purely advisory (i.e., Member States “may” take them into account) under the current FDI Regulation.
Aside from the mandatory nature of the assessment approach, the revised FDI Regulation expands the list of relevant criteria. For the first time, Member States must now assess the potential effects of FDI on electoral processes, public health, and the security of military facilities. Likewise, the assessment of investor risk includes new considerations, such as whether the FDI will be used to support internal repression and serious human rights violations in a third country or whether the law of a third country requires the foreign investor to share information for intelligence purposes without due process.
d. Harmonised national review process and timelines
The current FDI Regulation does not mandate a national review timeline, other than that Member States must apply timeframes that allow them to give “due consideration” to comments and opinions from other Member States and the EC. Subject to this provision, nothing prevents the host Member State from adopting its screening decision before the deadlines for the cooperation mechanism expire. The length of the Member State’s review is a matter of national law, so there is significant divergence in regulatory timelines across the EU. Although the cooperation mechanism itself has fixed deadlines (e.g., for submitting comments), these do not directly impact the length of the review period itself.
The revised FDI Regulation introduces a harmonised two-phase national review structure, alongside a restructured cooperation mechanism. Member States must complete the initial Phase 1 review within 45 calendar days of a complete filing being submitted,[8]though they have discretion on the timeline for Phase 2 investigations, provided it is compatible with their obligations under the cooperation mechanism. A host Member State can no longer adopt a screening decision until comment and opinion deadlines have expired. While the final screening decision remains with the host Member State, national authorities will be required to explain any departure from comments submitted by the EC and Member States.[9]
e. Restructured cooperation mechanism
The current FDI screening framework requires Member States to notify any FDI in their territory that is undergoing screening “as soon as possible” and sets out a fixed timeline for Member States to provide comments or for the EC to issue an opinion, as well as request additional information.
Under the new rules, Member States have a tiered obligation to notify certain FDI to the EC and other Member States within a specified timeframe after filing based on the level of risk.[10] The types of FDI requiring notification by the host Member State, and the deadlines for notification, are as follows:
- FDI from high-risk investors (e.g., state-linked or sanctioned investors, or investors whose FDI was previously screened and not authorised): 15 days after filing
- FDI subject to an in-depth Phase 2 investigation where the target is active in a project of Union interest or has subsidiaries in at least one other Member State: 45 days after filing; and
- in “exceptional cases” where the Member State intends to prohibit the transaction or impose mitigating measures without a Phase 2 investigation or in any other case where the Member State considers the FDI may negatively affect security or public order: “without undue delay”.
Specific rules apply to transactions requiring filings in multiple Member States.[11] The person making the filing should endeavour to make all filings on the same day to cross-refer to the other filings. Member States and the EC are required to coordinate on whether the notification requirements under the cooperation mechanism are met and should align on the timing of review and screening decisions.
National authorities must be able to ‘call in’ non-notifiable transactions that may affect security or public order for at least 15 months, but no more than five years, after completion.[12]
2. Changes necessary for national regimes
The Revised FDI Regulation is intended to reduce fragmentation between national screening regimes. Its practical impact will nevertheless vary considerably depending on the design of existing national screening mechanisms. The following sections discuss the most important amendments to the national frameworks of Germany, France, and the Netherlands, as well as the amendments that will likely be required to the draft investment screening legislation which was recently published by the Finnish government.
a. Germany
The relevant FDI rules in Germany are laid down in the Foreign Trade and Payments Act (Außenwirtschaftsgesetz, AWG) and in the Foreign Trade and Payments Ordinance (Außenwirtschaftsverordung, AWV). The German Federal Ministry for Economic Affairs and Energy (Bundesministerium für Wirtschaft und Energie, BMWE) is the responsible authority for enforcing the German FDI rules.
The BMWE is expected to reform Germany’s foreign investment screening regime by introducing a standalone Investment Screening Act (Investitionsprüfgesetz). Though no concrete legislative draft has yet been published, a number of changes to the German FDI regime can be expected as a result of the Revised FDI Regulation.
I. Revision of the Phase 1 timeline
Currently, the timeline for Phase 1 reviews is two months from the BMWE becoming aware of the conclusion of the acquisition agreement.[13] At the end of the Phase 1 review, the BMWE will either clear the transaction or open an in-depth Phase 2 investigation. Phase 2 can be extended by an additional four months. In practice, the BMWE already clears nearly 60% of its cases within 40 calendar days. The Revised FDI Regulation provides for a review period of 45 calendar days following the submission of a complete notification.[14] Thus, the German legislature must shorten the Phase 1 review period by 15 days.
II. Expansion of the list of sensitive sectors
In Germany, foreign investment control distinguishes between, on the one hand, cross-sectoral screening under Section 55a AWV and, on the other hand, sector-specific screening under Section 60 AWV, which covers sensitive defence- and security-related sectors. In the cross-sectoral review procedure, German investment control already comprehensively covers a broad range of sectors and activities.[15] The acquisition of German target companies active in these sectors by non-EU/non-EFTA investors is subject to mandatory notification. In addition, in the sector-specific area set out in Section 60 AWV, a notification obligation applies to all foreign investors, including acquirers from the EU or EFTA.
Although the current German FDI regime is already relatively broad, the Revised FDI Regulation will require Germany to review and, where necessary, expand or refine the scope of its sensitive sectors, including in relation to AI technologies, dual-use items, military equipment, semiconductors, quantum technologies, critical infrastructure (including critical materials and services), electoral processes (which has to be newly introduced), media platforms, protection of military installations and other sensitive installations, sensitive data and broader investor-specific considerations. While most of these areas are already covered under German law, the scope and definitions of the critical sectors covered by the German FDI regime may need to be aligned more closely with the minimum sectoral coverage and definitions set out in the Revised FDI Regulation.
III. Changes to the substantive assessment
Because sectoral scope and substantive assessment are closely linked under the German AWG/AWV regime, changes to the sectors subject to mandatory screening will require targeted updates to the assessment framework. Section 55a AWV already covers most of the criteria set out in Article 19(1) of the Revised FDI Regulation, so amendments may be limited. The key change will be the express inclusion of Article 19(2) foreign and security policy factors, such as internal repression and serious human rights violations in a third country, in the screening assessment.
IV. Procedural changes
Finally, the procedural changes accompanying the Revised FDI Regulation, in particular the enhanced cooperation and coordination mechanisms in Article 7 et seq. of the Revised FDI Regulation including the timelines and the new comply-or-explain mechanism, will require adjustments to German law and administrative practice.
V. Other topics
As regards other substantive changes brought about by the Revised FDI Regulation, German law already captures certain indirect investments. Thus, no amendments will be necessary in this respect.
Greenfield investments are currently generally not covered by German FDI law.[16] Germany may therefore consider using the discretion granted by the Revised FDI Regulation to extend its FDI screening regime to such investments.
Furthermore, no amendments are necessary with respect to internal restructurings. German FDI law does not provide for a general intra-group exemption,[17] and Member States retain discretion to screen such transactions.
The possibility of a call-in power for a period of up to five years, as contemplated by Article 4(4) of the Revised FDI Regulation, is already reflected in German law. The BMWE may open ex officio proceedings within five years of becoming aware of the conclusion of the acquisition agreement (Section 14a (1) and (3) AWG), which corresponds to the maximum call-in period contemplated by the Revised FDI Regulation.
b. France
The relevant FDI rules in France are laid down in the Monetary and Financial Code (Code monétaire et financier (CMF)), primarily Articles L.151-1 to L.151-7 and R.151-1 to R.151-17, supplemented by the Ministerial Order of 31 December 2019 as last amended on 27 February 2026. Article 459 of the French Customs Code (Code des douanes) provides for criminal sanctions applicable in case of a breach of certain FDI rules. The Minister of Economy (in practice, the Direction Générale du Trésor (DGT) operating under the Minister of Economy’s authority) is the competent authority for enforcing the French FDI rules. Administrative guidance is set out in the DGT Guidelines on the control of foreign investments in France (IEF), most recently updated in 2025.
A parliamentary mission entrusted by Prime Minister Lecornu to three Députés (Plassard, Thiériot and Rodwell), established on 11 March 2026, is examining the economic security frameworks implemented by France’s main European and international counterparts with a view to drawing lessons for the French FDI regime. The report was due within three months of establishment and may have been submitted to the government around the time of this note. Independently of the outcome of that mission, the analysis below assesses the changes required by the Revised FDI Regulation.
I. Revision of the Phase 1 timeline
Currently, the timeline for Phase 1 reviews is 30 working days from the date of receipt of a complete request for approval by the DGT.[18] The Revised FDI Regulation provides for a Phase 1 ceiling of 45 calendar days from submission of a complete notification. An asymmetry arises: the French review period runs in working days while the EU ceiling is in calendar days. Converting 30 working days yields approximately 42 to 46 calendar days depending on public holidays. An amendment to Article R.151-6 CMF is therefore required to ensure a perfect alignment in all circumstances.
II. List of sensitive sectors
Article R.151-3 CMF articulates sensitive activities in three sections. Section I, which applies to all foreign investors, covers 11 activities, including arms and military equipment, dual-use goods, critical energy/transport/communications infrastructure, public health, food security and sensitive data processing. Section II, which applies to non-EU/EEA investors only, adds critical infrastructure, media, space, financial entities and, since Decree n°2023-1293, critical raw materials. Section III covers R&D in critical technologies (AI, robotics, semiconductors, quantum, cybersecurity, biotechnologies, low-carbon energy, photonics) and dual-use goods intended to feed into a Section I or II activity.
The French regime already covers all seven categories of the EU common minimum scope and goes beyond it in several areas, notably public health, food security, media and space, which may be maintained under the Revised FDI Regulation. No amendment is thus required on sectoral scope. Two types of targeted adaptations, however, appear necessary:
- A dedicated investor-facing designation mechanism for critical infrastructure entities in energy, transport and digital sectors (France’s OIV framework provides a solid basis but does not currently satisfy the Revised FDI Regulation’s predictability requirement); and
- A review of the definitions set out in Section II and III against the revised Regulation’s specific formulations for AI, quantum and strategic raw materials.
III. Substantive assessment
French FDI assessment criteria rest primarily on Article L.151-3 CMF (national defence, public order and public security interests) and Article R.151-10 CMF, which sets out the grounds on which the Minister may refuse approval. Article R.151-10 already expressly covers several of the criteria codified by Article 19 of the Revised FDI Regulation: links between the investor and a foreign government or public body, serious presumption of money laundering, terrorist financing, corruption or tax fraud, prior convictions for equivalent offences under foreign law, and material non-compliance with prior IEF conditions. The remaining gap is limited to the explicit codification of third-country economic coercion risk and sanctions exposure, factors that inform DGT practice but are not yet expressly listed in the regulatory framework.
IV. Call-in power
French FDI law provides for ex officio review powers under Article L.151-3-1 CMF enabling the Minister of Economy to act against foreign investors who have failed to notify and/or have failed to obtain prior approval before completion of their reportable investments. However, there is no time limitation for the Minister of Economy to take action. The Revised FDI Regulation addresses this by requiring all Member States to have a call-in right enabling them to initiate proceedings for completed but non-notified transactions within a window of between 15 months and 5 years post-closing, across all sectors, on a non-retroactive basis. An amendment to the CMF is therefore required to codify an explicit call-in period within the EU range, together with the procedural rules governing such proceedings.
V. Other procedural changes
The other procedural changes accompanying the Revised FDI Regulation require adjustments to French administrative practice rather than legislative amendment. The new comply-or-explain mechanism obliges France to provide explicit reasons where it diverges from other Member States’ comments or an EC opinion. Existing French practice is otherwise broadly consistent with the Regulation’s enhanced accountability obligations regarding annual reporting and predictability, though targeted updates and improvements may be needed. Should the optional single notification portal be activated, interoperability between the national IEF platform and the EU portal could require technical adjustments.
VI. Other topics
On the other changes brought about by the Revised FDI Regulation, it should be noted that: (i) regarding greenfield investments, France may seize the opportunity offered by the Revised FDI Regulation to extend its FDI screening regime to cover them, (ii) the intra-group exemption under Article R.151-7 CMF will need to be amended to exclude internal restructurings that introduce a new third-country entity into the upstream ownership chain.
c. The Netherlands
The Netherlands currently has three separate investment screening regimes: the generally applicable Dutch Investment Screening Act (Wet Veiligheidstoets Investeringen, fusies en overnames, Wet Vifo) and the sector-specific regimes set out in the Telecommunications Act (Telecommunicatiewet) and Energy Act (Energiewet).[19] The Investment Screening Bureau (Bureau Toetsing Investeringen, BTI) is currently responsible for enforcing all three regimes.
The Dutch government has stated that the Revised FDI Regulation will at a minimum require changes to the Wet Vifo, as well as the Decree on Sensitive Technologies (Besluit toepassingsbereik sensitieve technologieën), which sets out the Wet Vifo’s scope in relation to certain technologies.[20] Most of the changes introduced in response to the Revised FDI Regulation will thus likely be incorporated into the Wet Vifo. Certain amendments may however also need to be made to the sector-specific regimes, in particular the introduction of a standstill obligation.[21]
I. A shortened timeline for Phase 1 review
The timeline for Phase 1 assessments under the Wet Vifo is currently eight weeks, though this can be extended by six months.[22]This period will need to be reduced by 11 days. This already reflects BTI practice in most cases: in 2025, 50% of cases were cleared within 27 days.[23] However, for complex cases, it might shorten Phase 1 timelines and potentially lead the legislature to create more room for extensions in Phase 2.
II. Addition and recategorisation of certain sectors to the scope of the Wet Vifo
The sectoral scope of the Wet Vifo will also need to be expanded. Currently, the Wet Vifo applies to transactions involving certain corporate campus managers,[24] critical providers (vitale aanbieders), and sensitive technology providers. Sensitive technology providers can further be divided into ‘ordinary’ and ‘highly’ sensitive technology providers. Critical and sensitive technology providers cover a broad range of sectors and the Decree on Sensitive Technologies is currently being expanded to cover additional technologies.[25] The only other sectors that would need to be added to the Wet Vifo’s scope are strategic raw materials, certain regulated market operators, payment system operators, global providers of specialised financial messaging services, electoral infrastructure providers, and critical infrastructure providers insofar as these are currently not covered by the definition of critical provider.
These new sectors will likely be categorised as highly sensitive technology providers. The Revised Regulation seems to apply to foreign investments which do not lead to a change of control. The Revised Regulation states that foreign investments involving “lasting direct links” between a Target and Acquirer fall within its scope. Such links exist where a foreign investor can “materially impact” the commercial policy of a Union target, even if they do not have control.[26]
Transactions targeting corporate campus managers, critical providers, and ‘ordinary’ sensitive technology providers are only subject to screening if there is a change of control within the meaning of the EU Merger Regulation (EUMR). However, a lower threshold applies to highly sensitive technology providers: transactions leading to the acquisition of 10% of the voting rights in such a provider, or the ability to hire or appoint a member of its board need to be notified.
The notification threshold applicable to critical providers and sensitive technology providers is too high and the new sectors will likely be qualified as highly sensitive technology providers. Certain critical providers and sensitive technology providers, particularly undertakings involved in dual-use and military goods, as well as financial institutions, will also need to be reclassified to comply with the new FDI Regulation and thus be subject to the lower notification threshold of 10% of voting rights.
III. Changes to the substantive assessment
The substantive test under the Wet Vifo will also need to be amended to comply with the Revised FDI Regulation. Currently, transactions can be prohibited where they pose a risk to national security. The Wet Vifo sets out the factors that the BTI must consider in making this assessment. The minimum factors set out in the Revised FDI Regulation are, however, not all included, meaning that this list will need to be expanded.
IV. Introduction of a call-in regime
The BTI currently does not have the power to call in transactions that do not meet the transactional notification thresholds set out in the Wet Vifo. It will therefore need to be granted the ability to screen such transactions on its own initiative for at least 15 months after closing if it poses a threat to security or public order. It is unlikely that this competence will be used frequently, given the low transactional thresholds applicable under the Wet Vifo in many sectors. However, it may lead to additional uncertainty for parties seeking to make investments in certain priority sectors which grant the acquirer lower amounts of voting rights than those set out in the applicable transactional thresholds.
V. Procedural changes to comply with the cooperation mechanism
Currently, the Wet Vifo only provides for an extension of the review timelines of the 3 – 6 months per phase in cases involving transactions falling within the scope of the FDI Regulation to allow time for other Member States and the EC to provide comments.[27] As with the German regime, the Wet Vifo therefore will need to be amended to allow the BTI to comply with its obligations under the new cooperation mechanism, particularly the mandatory notification of certain types of investments.
d. Finland
In Finland, the Ministry of Economic Affairs and Employment (toy- ja elinkeinoministeriö, the Ministry) is in the process of drafting a new Act on the Monitoring of Foreign Investments and Authorisation Procedures (sijoituslupalaki, the Investment Authorisation Act) to replace the current Act on the Monitoring of Foreign Corporate Acquisitions (yritysostolaki) of 2012. The reform is driven partly by the need to implement the Revised FDI Regulation but also more broadly to strengthen Finland’s ability to address risks to national security, security of supply, and broad-based foreign influence activities.
While a formal government proposal is not expected until autumn 2026, the Ministry has released the draft government proposal for public consultation on 3 June 2026, with the consultation period extending to 16 July 2026. The key changes proposed in the draft proposal are discussed below. However, it should be noted that at this stage the final content of the new Finnish legislation remains uncertain, pending the submission of a final government proposal to the Finnish Parliament and the completion of the legislative process during the second half of 2026.
I. Introduction of a statutory Phase 1 timeline
Unlike the other jurisdictions discussed above, the current Finnish regime has no statutory review deadline for mandatory filings, though transactions were on average cleared in approximately 58 days (based on 2025 statistics). The Investment Authorisation Act would introduce a two-phase procedure in line with the Revised FDI Regulation: a mandatory 45-calendar-day Phase 1 review conducted by the Finnish National Emergency Supply Agency (Huoltovarmuuskeskus, NESA), and, where necessary, an open-ended phase 2 in-depth review by the Ministry. The Ministry has the right to take a licence application for processing already in the first phase of the licensing procedure, if the significance of the matter so requires.
II. Requirement to notify
Under the current Act on the Monitoring of Foreign Corporate Acquisitions, the Ministry can require companies to submit a licence application where a transaction falling within the mandatory scope has been completed without the required authorisation. The authorities may also for special reasons require the buyer to submit an application in respect of a subsequent measure that increases its influence without crossing the applicable thresholds. Voluntary applications are also possible under the current regime, and in connection with such applications the Ministry can require companies to provide essentially the same information as in mandatory applications.
Under the draft Investment Authorisation Act, voluntary applications will no longer be available, and virtually all investments falling within the scope of the mechanism are subject to a prior authorisation requirement. Where a company fails to submit the mandatory application, the authorities may require it to do so within a specified time frame. In addition, where a company has already received clearance, the authorities may for special reasons require it to submit a new licence application in respect of a subsequent measure that increases its influence in the target without crossing the applicable notification thresholds.
III. More detailed definition of covered sectors
The current Finnish regime covers the defence (incl. dual-use goods) and security industries as well as broadly defined other activities deemed critical for securing vital societal functions. The new Act would clarify the regime’s scope to specifically also include, inter alia, ICT and information security services relevant to national security, critical infrastructure and vital societal functions, as well as the sectors mandated by the Revised FDI Regulation, including critical technologies such as semiconductors, quantum technologies and certain AI applications.
IV. Indirect investments
The Investment Authorisation Act will apply to both direct and indirect foreign investments, capturing situations where the ultimate controlling party is a foreign investor irrespective of the formal transaction structure. This aligns with the Revised FDI Regulation and is also broadly the case under the current regime, where authorities have looked through complex ownership structures to identify the party exercising actual control, though the new law codifies this explicitly.
V. Internal restructuring and Greenfield investments
Moreover, Finland would exercise the option under the Revised FDI Regulation to bring also greenfield investments within the framework’s scope, covering sectors such as defence, dual-use goods, port and airport infrastructure, data centres (≥100 MW), energy infrastructure and strategic raw materials. This distinguishes Finland from the jurisdictions discussed above, which currently do not require notification of greenfield investments.
Internal group restructurings are, on the other hand, generally excluded from scope, provided that the identity of the investor or party exercising actual control does not change. A restructuring will, however, fall within scope if a new party meeting the definition of a foreign investor is introduced into the ownership chain above the target for the first time. This is broadly consistent with the approach required under the Revised FDI Regulation.
VI. The substantive test
Authorisations could be granted subject to conditions, but only where the parties voluntarily commit to complying with them. A transaction may be refused approval by the government in plenary session upon a proposal by the Ministry where the investment threatens national security, military defence, security of supply, vital societal functions, or Finland’s foreign and security policy objectives, or where it would jeopardise public order or security under EU law (Articles 52 and 65 TFEU), including threats to the security of another EU Member State.
The substantive test as currently drafted does not explicitly incorporate the mandatory investor-based risk factors that will be introduced by Article 19 of the Revised FDI Regulation, such as whether the investor pursues third-country policy objectives, is subject to EU sanctions, or has an opaque ownership structure. How and at what legislative level these factors will ultimately be reflected in the Finnish framework remains to be seen as the legislative process progresses.
VII. Other relevant changes
A particularly significant change would be the contemplated removal of the current exemption for EU/EFTA investors. All non-Finnish investors would become subject to mandatory filing, as opposed to the current voluntary notification system applicable to certain sectors, at ownership thresholds of 10%, 33.3%, 50%, 66.6%, and 90%. This is notable given that the Revised FDI Regulation only applies to transactions involving investors which (ultimately) reside or are established in a non-Member State.
In addition, the Investment Authorisation Act makes significant changes to the sanctions which companies risk when violating the FDI regime. Criminal sanctions for failures to comply have in principle been possible under the current regime. However, under the new framework they would be replaced by administrative penalty payments of up to EUR 10 million or 10% of the global annual turnover for legal entities, and up to EUR 500,000 for natural persons. Investments completed without authorisation could also be declared null and void.
3. Commentary on likely effects on the overall EU landscape
Based on the required amendments to the national frameworks discussed above, the Revised FDI Regulation is likely to result in a modest increase in the workload of screening authorities across the Member States. The introduction of a mandatory sectoral scope will likely lead to an increase in the number of filings in most jurisdictions, apart from France, which already subjects the relevant sectors to screening. The effect of this will be compounded by the reduction in (or introduction of) Phase 1 timelines that is required in most jurisdictions. France is again an exception in some cases, given that the current 30-working day period can translate into a 42-calendar day screening period and thus review timelines will be extended. Thus, national authorities will need to assess more transactions within shorter timelines. The effect of this may however be limited if authorities continue to successfully screen most cases ahead of the statutory deadlines.
The harmonised sectoral scope might also simplify multi-jurisdictional analysis to an extent, given that most of the jurisdictions discussed will need to amend or redefine certain sectors to align with the Revised FDI Regulation. This may reduce national divergences in the circumstances under which screening is required for investments in sectors currently covered by most national regimes, such as semiconductors.
The Revised FDI Regulation may also lead to a convergence in substantive outcomes. Each regime will require at least some amendments to the substantive test to account for the factors set out in Article 19 of the Revised FDI Regulation. This harmonisation is notable given public order and security have traditionally fallen under the purview of Member States. However, the criteria set out in Article 19 are broad, making it uncertain whether their introduction will result in materially more consistent outcomes. While the impact on routine transactions is likely to be limited, the new criteria may play a more significant role in the assessment of politically sensitive or otherwise contentious investments.
Taken together, the gradual alignment of national screening regimes reflects a broader trend towards greater EU-level coordination and harmonisation on economic and national security matters. Although national authorities will retain considerable discretion in applying their respective regimes, the Revised FDI Regulation is likely to narrow some of the existing divergences in both procedural and substantive aspects of FDI screening across the Union.
[1] Proposal for a Regulation of the European Parliament and of the Council on the screening of foreign investments in the Union and repealing Regulation (EU) 2019/452 of the European Parliament and of the Council (2024/0017).
[2] Regulation (EU) 2019/452 of the European Parliament and of the Council of 19 March 2019 establishing a framework for the screening of foreign direct investments into the Union OJ LI 79/1.
[3] Articles 3(1) and 4 Revised FDI Regulation.
[4] Article 2 (1) Revised FDI Regulation.
[5] Case C-106/22, Xella (2023) ECLI:EU:C:2023:568.
[6] Article 4(15) Revised FDI Regulation.
[7] Critical infrastructure providers will need to be designated by the Member States using a risk-based approach. Article 4(15)(d) Revised FDI Regulation.
[8] Article 4(2)(a)-(b) Revised FDI Regulation.
[9] Articles 8-13 Revised FDI Regulation.
[10] Articles 5-6 Revised FDI Regulation.
[11] Article 7 Revised FDI Regulation.
[12] Article 4(4) Revised FDI Regulation.
[13] Section 14a(1) no. 1 AWG.
[14] Article 4(2)(a) Revised FDI Regulation.
[15] Section 55a(1) nos. 1 to 27 AWV.
[16] However, prior clearance may be required where the structure involves the transfer of substantial assets of an existing German business to the new entity, or where the joint venture structure is used to circumvent an otherwise applicable FDI filing requirement.
[17] A narrow intra-group exemption applies only under the so-called cross-sectoral regime where the ultimate parent remains unchanged, the transaction is carried out exclusively between wholly owned group companies and the parties are located in the same third country (Section 55 (1b) AWV). Outside this safe harbour, internal reorganisations may still fall within the German FDI regime, although they will often be unproblematic in substance where the foreign influence over the German target remains unchanged.
[18] Article R.151-6 CMF.
[19] Prior to 1 January 2026, the screening regime set out in Article 6.3 of the Energy Act was two separate regimes as set out in the Electricity Act of 1998 (Elektriciteitswet 1998) and the Natural Gas Act (Gaswet).
[20] Letter from the Ministers of Economic Affairs and Climate, Justice and Security, and Foreign Trade and Aid to the House of Representatives of 24 April 2026, available at: https://zoek.officielebekendmakingen.nl/kst-1249958.pdf.
[21] Whether this will be necessary depends on which digital and energy infrastructure providers are considered critical by the Member States pursuant to Article 4(15)(d) of the Revised FDI Regulation.
[22] Article 12(1) and (3).
[23] See BTI Annual Report 2025, available at: https://www.bureautoetsinginvesteringen.nl/actueel/nieuws/2026/04/30/jaarverslag-bti-2025.
[24] Managers of corporate campuses were included within the scope of the Wet Vifo after the Eindhoven High Tech Campus was purchased by Oak Tree Capital, an American asset manager whose largest investor at the time was the Government of Singapore Investment Corporation.
[25] The amended version will likely cover the AI industry, as well as advanced materials, biotech, nanotech, sensor and navigation technologies, and nuclear technology for medical use.
[26] Recital 15, Revised FDI Regulation.
[27] Article 12(8) Wet Vifo.
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