EU External Relations Body Supports FDI Screening Revisions
An EU body in charge of dialogue with industry from third countries gave its support this week for a January proposal to bolster the bloc’s foreign direct investment screening efforts (see 2401240078).
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In an official opinion, the European Economic and Social Committee’s External Relations Section called the proposal a “step in the right direction” and stressed the importance of aligning FDI screening standards across all member states instead of the current patchwork of FDI restrictions that aren’t mandatory and are imposed by just over 20 countries (see 2310200038 and 2403190046).
The EU should look to set “consistent thresholds” for what types of deals the restrictions would capture, establish “coherent definitions of risks to security and public order” and help member states better implement “FDI control tasks.”
In certain “exceptional cases,” EU countries should be able to block, mitigate or “apply conditions to FDI that jeopardize programmes or projects of interest to the” EU, the External Relations Section said. It also said investments from “tax havens” should be subject “to special surveillance, requiring full knowledge of the real owners of the investing companies and examining the legality of the funds deployed.”