Responding to news that the Council of Ministers of the EU has, today, endorsed legislation setting up an EU-wide framework coordinating the way in which Member States screen foreign direct investment (FDI), Veronica Roberts, a partner at Herbert Smith Freehills, says that "this will enable the European Commission to potentially have more influence over Member State decisions on proposed foreign investment, whilst ensuring the EU remains open for business."
The new Regulation provides a general framework for assessing FDI for those Member States that have their own regime: it does not impose an obligation on any Member States to adopt a regime.
Roberts, a partner and head of Herbert Smith Freehills global foreign investment group, says: "In the current climate, development of a FDI framework at EU level was inevitable. There wasn't enough political agreement to introduce an EU-wide regime, but the framework goes some way to achieving consistency in approach by those Member States that choose to have their own regime.
"It also gives the European Commission some scope to get its own views heard on a particular FDI proposal."