Screening of foreign investments in the Union

Key Points

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. This Regulation aims to harmonize national procedures and strengthen the EU Cooperation Mechanism, ensuring public control over critical sectors and programmes;
• stresses the importance of promoting greater harmonisation of national norms regulating FDI and screening mechanisms. This includes: i) setting consistent thresholds for FDI control and uniform deadlines for responses; ii) establishing coherent definitions of risks to security and public order; iii) bolstering Member States’ capacities for effective implementation of FDI control tasks;
• calls for establishing 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. To this purpose, the EU should establish clear procedures and circumstances to exercise control over investments that pose significant risks to EU interests;
• proposes to promote the application of the principle of reciprocity in trade, investment, or association agreements with third countries, and monitoring investments from countries that restrict EU investments, to ensure balanced and fair treatment; strict application would be decided on a case-by-case basis. Within the conceptual framework of strategic autonomy and the Economic Security Strategy, FDI should still be promoted to foster sustainable competitiveness.
• 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. Member States should consider the possibility of abolishing so-called ‘golden visas’ for obtaining residence or nationality in an EU country.
• highlights the necessity of mechanisms for the participation of social partners and civil society organizations in FDI policy and control at both EU and national levels, ensuring transparency and inclusiveness in the evaluation process