The EU’s FDI Screening Proposal – Can It Really Work?

Chi-Chung Kao

European Review, 2020, vol. 28, issue 2, 173-184

Abstract: Nowadays China and EU share close investment relations. However, concerns have been raised over FDIs (Foreign Direct Investments) aimed at sensitive sectors, especially those from Chinese state-owned companies. In light of this, the European Commission in late 2017 proposed a FDI Screening Regulation. This proposal contains certain features, including cooperation mechanisms between Member States and the Commission to notify and give comments on FDIs, direct monitoring of FDIs by the Commission on the grounds of Union interests, and the illustration of instances to be considered when screening FDIs. However, the success of this proposal is in doubt. Its fate regarding being adopted as law through the EU’s legislative process is uncertain, due to the Member States’ divided attitude towards FDI screening. Its provision contains a lethal loophole, undermining the cooperation and exchange of information between the Member States and the Commission. The non-binding nature of the opinions and comments addressed to the FDI receiving Member State renders the mechanisms practically unenforceable. To establish an effective FDI screening framework for the EU, this proposal needs to be revised and amended.

Date: 2020
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.cambridge.org/core/product/identifier/ ... type/journal_article link to article abstract page (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cup:eurrev:v:28:y:2020:i:2:p:173-184_1

Access Statistics for this article

More articles in European Review from Cambridge University Press Cambridge University Press, UPH, Shaftesbury Road, Cambridge CB2 8BS UK.
Bibliographic data for series maintained by Kirk Stebbing ().