European Parliament Endorses New Screening Rules For Foreign Investment In EU

2025-05-08 03:13:19

(MENAFN- Caribbean News Global) BRUSSELS, Belgium – On Thursday, MEPs adopted revised rules to prevent security risks from foreign investments.

Under the new rules, sectors such as media services, critical raw materials and transport infrastructure will be subject to mandatory screening by member states, in order to identify and address foreign investment-related security or public order risks.

The procedures applicable to national screening mechanisms will be harmonised and the Commission will have the power to intervene on its own initiative or where there are disagreements between member states about potential security or public order risks emanating from a specific foreign investment. The new law will also cover transactions within the EU where the direct investor is ultimately owned by individuals or entities from a non-EU country.

If the screening authority finds that the planned foreign investment project is likely to have a negative effect on security or public order, it will either have to authorise the project subject to mitigating measures, or prohibit it.

The proposal was adopted by 378 votes in favour, 173 against and with 24 abstentions.

Parliament's rapporteur Raphaël Glucksmann (S&D, FR), said:

“Right now, the EU's foreign investment screening system is fragmented, costly for investors, and insufficiently effective at mitigating risks. Leaving large industrial plants, energy grids, and media giants open to foreign takeovers - whether from China, the US, or elsewhere - ultimately puts our security and economic sovereignty on shaky ground.

“Screening procedures will now be streamlined across member states, keeping the single market open and attractive, while also protecting our industries, safeguarding key sectors, and allowing our strategic industries to become more competitive. The Commission will have the authority to take final decisions in instances of disagreement, ensuring a more unified approach across the EU.”

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