Foreign investment monitor
Issue 8
May 2024
Welcome to our eighth Foreign investment monitor
In this edition, we delve into the evolving landscape of foreign direct investment (FDI) and national security regulations worldwide.
As nations strive to balance economic growth with dynamic security concerns, new regulatory measures present both challenges and opportunities for investors and businesses.
Our analysis begins with a write-up of the recent UC Berkeley Law webinar, CFIUS’ Impact on Cross-Border Deals, in which the speakers, including Freshfields’ Aimen Mir, Brian Reissaus and Andrea Merediz Basham, discussed the US government’s evolving view of national security and practical strategies for evaluating deal opportunities, mitigating deal execution risk and managing the CFIUS process.
We then turn our attention to Singapore's newly introduced Significant Investments Review Act (SIRA). This legislation aims to harmonize the influx of foreign investment with national security imperatives by introducing a stringent notification and approval process for ownership changes in critical sectors. SIRA endeavors to protect vital industries while maintaining Singapore’s business-friendly reputation.
We also explore the role of legal challenges to FDI decisions. Despite increasing government interventions, such challenges remain rare due to the confidential nature of national security issues, the broad discretion afforded to governments, and the complexities of legal recourse.
Next, we shift our focus to Europe, where the European Commission has proposed significant changes to the EU’s FDI screening process. This proposed regulation aims to streamline and coordinate FDI procedures across Member States, especially for multi-country transactions. It expands the scope to include post-closing screenings of sensitive sectors and strives to harmonize procedures while acknowledging persistent differences in Member States' practices.
Further, we examine the active enforcement of the new EU Foreign Subsidies Regulation (FSR). The European Commission has initiated numerous investigations, particularly targeting Chinese companies and state-owned enterprises, to ensure compliance with the FSR.
Lastly, we cover the UK government’s forthcoming reforms to its National Security and Investment regime. These reforms aim to enhance clarity and predictability for businesses by updating sector definitions and reviewing the notification process. Despite calls for more significant changes, the UK government remains cautious, maintaining flexibility in its national security assessments.
As you navigate this edition, we hope these insights deepen your understanding of the complex and dynamic interplay between foreign investment and national security. Should you wish to discuss any FDI issues in more detail, we would be delighted to arrange a meeting.
- Introduction
- Ex-CFIUS chair analyzes the Committee’s current impact on cross-border deals
- Can Singapore's Significant Investments Review Act balance investment and national security?
- Court challenges to FDI decisions
- EU Commission’s Draft Regulation to revamp Europe’s FDI screening landscape
- Updating the UK national security and investment regime
- Not a paper tiger – enforcement trends in the first ten months of the EU Foreign Subsidies Regulation
- Foreign investment monitor archive
See our articles below
Our team
Please get in touch with us or your usual Freshfields contact if you would like to discuss these or any other regulatory issues in more detail.
Alastair Mordaunt Partner
London, Hong Kong
Aimen Mir Partner | Foreign Investment and National Security | Head of CFIUS Practice
Washington, DC
Dr. Frank Röhling Partner
Berlin
Brian Reissaus Senior Advisor, National Security*
Washington, DC
Ninette Dodoo Partner
Hong Kong
Dr. Uwe Salaschek Counsel
Berlin
Sarah Jensen Counsel
London
Winfred Knibbeler Partner
Amsterdam
Colin Costello CFIUS and National Security Advisor
Washington, DC
Dr. Maria Dreher-Lorjé Partner
Vienna, Brussels
Alex Potter Partner
London, Brussels
Ermelinda Spinelli Partner
Milan, Rome
Dr. Jérôme Philippe Partner
Paris, Brussels
Christine Laciak Special Counsel
Washington, DC
Álvaro Iza Partner
Madrid
Prof. Dr. Juliane Hilf Partner
Düsseldorf
Paul van den Berg Partner
Amsterdam, Brussels
Dr. Andreas von Bonin Partner
Brussels
Ignacio Borrego Of Counsel
Madrid
Kaori Yamada Partner
Tokyo
Pascal Cuche Public Law
Paris
Dr. Stephan Denk Partner
Vienna