Our thinking

Foreign direct investment reviews 2023: A global perspective

What's inside

A guide to navigating the rules for investing in countries that require foreign direct investment approval.


Now in its seventh year of annual publication, White & Case's Foreign Direct Investment Reviews provides a comprehensive look into rapidly evolving foreign direct investment (FDI) laws and regulations in approximately 40 national jurisdictions and two regions. This 2023 edition includes more than 15 new jurisdictions in addition to those covered in previous editions and summarizes high-level principles in the European Union and Middle East. Our expansion in coverage reflects the rapid global proliferation of FDI regimes and our market leading position in the field.

FDI regimes are wide-reaching in scope, from national security to public health and safety, law and order, technological superiority, and continuity and integrity of critical supply chains. They are divergent with respect to jurisdictional triggers across countries, and are almost always a black-box process.

The following are some general observations, in large part based on the 2022 CFIUS and EU annual reports:

  • The number of FDI regimes and regulatory enhancements is growing around the world, particularly in Europe. In 2021 and 2022, four EU Member States—Czech Republic, Denmark, Netherlands and Slovakia—implemented new FDI regimes, and in 2023, Sweden and Belgium are slated to adopt FDI screening measures (in addition to non-member Switzerland).
  • FDI regulators, at least from allied nations, are collaborating and learning from each other. CFIUS reported at its first annual conference in 2022 that it continues to host training sessions for US allies so that they can adopt similar regimes.
  • FDI regulators interpret their jurisdiction and authority broadly, especially if they believe it is in the national interest. Many regulators have "call-in," "ex officio," or "non-notified" authority.
  • Despite increased regulation, most cross-border transactions are successfully consummated, although there has been an increase in the number of cases clearing with remedies.
  • The origin of the investor remains a key concern for Western regulators. For example, China and Russia are included more and more in CFIUS's regular Q&A, asking broader and more invasive questions.

Investors conducting cross-border business need to understand FDI restrictions as they are today—and how these laws are evolving over time—to avoid disruption to realizing synergies, achieving technological development and integration, and ultimately securing liquidity.

We would like to extend a special thank-you to all of our external authors, who have provided some insightful commentary on the FDI regimes in a number of important jurisdictions. The names of these individual contributors and their law firms are provided throughout this publication.

We would also like to extend a special thank-you to James Hsiao of our Hong Kong office and Tim Sensenig of our Washington, DC office for their tireless efforts and dedication to the publication of this edition.



The Canadian government announced a strict framework to evaluate foreign investments in the critical minerals sector by state-owned enterprises and state-linked private investors, especially if from “non-likeminded” countries.

canada fdi 2022


Foreign direct investments, whether undertaken directly or indirectly, are generally allowed without restrictions or without the need to obtain prior authorization from an administrative agency.

mexico fdi 2022

United States

Most deals are approved, but expanded jurisdiction, mandatory filings applying in certain cases, enhanced focus on national security considerations, and a substantially increased pursuit of non-notified transactions have changed the landscape.

United States of America



Driven by the European Commission's guidance, Member States keep expanding their investment screening regimes. A similar trend is observed in Europe at large.

european union fdi 2022


In Austria, the Austrian Federal Investment Control Act (Investitionskontrollgesetz or the ICA) introduced a new, fully fledged regime for the screening of Foreign Direct Investments (FDI) and came into effect on July 25, 2020. With its wide scope of application and extensive interpretation by the competent authority, the number of screened investments has soared.

austria fdi 2022


Belgium implements an FDI screening regime by July 1, 2023.


Czech Republic

The new Foreign Investments Screening Act took effect in May 2021, and completed its first full year in operation in 2022.

czech republic fdi 2022


The scope of the Danish FDI regime is comprehensive and requires a careful assessment of investments and agreements involving Danish companies.

denmark fdi 2022


Estonia will have in place an FDI review regime by September 2023.

estonia fdi 2022


Deals are generally not blocked in Finland.



In France, FDI screening authorities have issued new guidelines to improve the transparency of the FDI process.

france fdi 2022


The Federal Ministry for Economic Affairs and Energy continues to tighten FDI control, but the investment climate remains liberal in principle.

germany fdi 2022


The need for FDI screening remains in focus for deals with Hungarian dimensions.

hungary fdi 2022


Ireland anticipates adopting and implementing an FDI screening regime by Q1 2023.

ireland fdi 2022


Italian "Golden Power Law:" Ten years old and continuously expanding its reach.


Republic of Latvia

The Russian Federation's invasion of Ukraine has precipitated the inclusion of provisions blocking Russian and Belarussian nationals from direct investment in a number of sectors.



All investments concerning national security are under the scope of review.



Luxembourg has introduced a bill of law to regulate foreign direct investments. The law is currently being discussed before the Luxembourg Parliament.



Malta's recently introduced FDI regime captures a substantial number of transactions that must be notified to the authorities and, in some cases, will be subject to screening.


Middle East

The Middle East continues opening to foreign investment, subject to licensing approvals and ownership thresholds for certain business sectors or in certain geographical zones.

Middle East


The Netherlands prepares for its first effective year of new FDI regulation.



Changes in the geopolitical situation have resulted in increased awareness of security threats caused by strategic acquisitions and access to sensitive technology. The ongoing review of the FDI regulations in Norway is expected to result in more effective mechanisms to identify and deal with security threats in transactions and investors should be prepared to take this into account when planning future investments in Norwegian companies that engage in sensitive activities.



The Polish FDI regime governing the acquisitions of covered entities by non-EEA and non-OECD buyers has been extended until July 2025.



Transactions involving foreign natural or legal persons that allow direct or indirect control over strategic assets may be subject to FDI screening.



The Romanian regime regarding foreign direct investment has undergone a major change in 2022, when new legislation was enacted, and is aimed at implementing relevant European Union legislation.


Russian Federation

The Federal Antimonopoly Service (FAS) tends to impose increased scrutiny in the sphere of foreign investments and has developed a number of amendments to the foreign investments laws that are aimed at eliminating legislative gaps in this sphere.

Russian Federation


On November 29, 2022, Slovakia, for the first time, adopted full-fledged foreign direct investment legislation. This legislation is effective as of March 1, 2023.



Since May 31, 2020, certain foreign investments into Slovenian companies can be subject to review. Acquisition of real estate related to critical infrastructure may also be subject to review.



The restrictions imposed by the Spanish government on foreign direct investments during the COVID-19 outbreak have remained after the pandemic.



Other than security-related screening, Sweden is currently still without a general FDI screening mechanism.



Historically, Switzerland has been very liberal regarding foreign investments. However, there has recently been increased political pressure to create a more structured legal regime for foreign investment.



Making Türkiye an attractive investment destination continues to be a priority for the government.


United Arab Emirates

Foreign direct investment is permissible in the UAE, subject to applicable licensing and ownership conditions.


United Kingdom

The UK’s National Security & Investment Act has now been in place for a year and has already made its mark, prohibiting deals on national security grounds and also requiring remedies in cases that are not subject to the mandatory notification requirement.  We expect a continued tough approach over the next year as global geo-political tensions bring national security concerns to the fore.




Australia requires a wide variety of investments by foreign investors to be reviewed and approved before completion of the investment.



China has further developed its national security regulatory regime by promulgating measures on cybersecurity review and security assessment of cross-border data transfer.



India continues to be an attractive destination for foreign investment, ranking as the world's seventh-largest recipient of FDI in 2021.



The Japanese government continues to review filings and refine its approach under the FDI regime following the 2019 amendments.



Korea is increasing the level of scrutiny of foreign investments due to growing concerns over the transfer of sensitive technologies.


New Zealand

Recent legislative reforms have increased the New Zealand government's ability to take national interest considerations into account, but have also looked to exclude lower-risk transactions from consent requirements.

New Zealand


All FDIs are subject to prior approval, but the investment climate is welcoming and liberal.


Foreign direct investment reviews 2023: Germany

The Federal Ministry for Economic Affairs and Energy continues to tighten FDI control, but the investment climate remains liberal in principle.

8 min read

Germany remains open for foreign investors. However, the German Federal Ministry for Economic Affairs and Climate Action (the BMWK) has significantly tightened its FDI review, particularly for PRC and Russian investors. Investors should therefore carefully consider potential FDI restrictions at an early stage of the transaction when pursuing investment opportunities in Germany.

Recent updates

  • Germany's new coalition government took office at the end of 2021 with the Green party taking over the Foreign Ministry and—for the first time—the BMWK. Since then, the BMWK intervened in a record number of transactions, particularly by Chinese Investors
  • The BMWK has significantly bolstered its FDI resources. In 2022, it has grown from one unit to two units, with more than 20 government officials working on FDI cases
  • Clearance decisions in cases without national security concerns remain swift. Defense-related cases and cases in the tech industry typically require more time
  • Sensitive industries for Germany's production (e.g., semiconductors and other high-tech products) and investments in critical infrastructure are under particularly tight scrutiny
  • Germany significantly broadened the scope of its FDI regime in 2021. In 2022, it further expanded its definition of critical infrastructures and will likely continue on this path
  • BMWK continues to interpret German FDI rules broadly both in terms of its scope of application and potential national security concerns

German FDI review covers both direct and indirect acquisitions

Who files

The direct acquirer is obliged to submit the filing, even if it is a mere SPV and/or located in Germany. BMWK accepts filings by legal counsel on behalf of the direct acquirer with proper power of attorney. If the direct acquirer has not yet been determined or established (e.g., in cases of a shelf company or a new SPV), the BMWK normally accepts the filing by the indirect acquirer.

Types of deals reviewed

The activities of the target and the "nationality" of the investor determine the review process. German FDI review covers both direct and indirect acquisitions by foreign investors. Further, the BMWK is entitled to review all types of acquisitions, including share deals and asset deals.

Regarding certain highly sensitive industries such as arms and military equipment, encryption technologies and other key defense technologies, acquisitions of at least 10 percent of the voting rights by any foreign (i.e., non-German) investor are subject to a mandatory review (so-called "sector-specific review") and trigger a filing (and a standstill) obligation.

Any other type of investment may only be scrutinized if the investor is based outside the EU/EFTA (so-called "cross-sectoral review") and acquires a share of at least 10, 20 or 25 percent of the voting rights depending on the industry at-issue. Whether a filing is required (and a standstill applies) depends on the target's activities. Sectors that trigger a mandatory cross-sectoral filing inter alia include (as defined in great detail):

  • Critical infrastructure
  • Software for critical infrastructure
  • Telecommunications monitoring
  • Cloud computing
  • Telematics infrastructure
  • Media industry
  • Services for state communication infrastructures
  • Medical/Pharmaceutical industry
  • Other critical industries (AI, robotics, semiconductors, nuclear, aviation and aerospace, quantum, satellite, additive manufacturing, IT, etc.)
  • Critical raw materials
  • Security of food supply (>1,000 hectares)

In all other cases, the government has a call-in right for any transactions involving the direct or indirect acquisition of at least 25 percent of a German company's voting rights by a non-EU/EFTA investor if the government is concerned the transaction may impede public security or order in Germany, another EU Member State, or certain EU programs.

Scope of the review

A transaction must be filed to the BMWK if the foreign investor acquires (i) voting rights in a German entity active in a critical business sector and reaches certain investment thresholds (10 percent or 20 percent, depending on the industry at-issue) or (ii) a certain scope of assets of such entity. In assessing the investment thresholds, the BMWK takes a broad approach and looks at all entities in the entire acquisition chain (without any dilution of the shareholding) from the direct acquirer to the ultimate parent, and arguably also at shareholders such as limited partners (to be assessed on a case-by-case basis). Additional mandatory filings are triggered when subsequently reaching thresholds of 20 percent (in case the initial threshold was 10 percent), 25, 40, 50 and 75 percent. All transactions triggering mandatory filings are subject to a standstill obligation, i.e., the transaction must not be consummated before it is cleared by the BMWK. In particular, it is prohibited to allow the acquirer to directly or indirectly exercise voting rights or grant the acquirer access to certain sensitive data before clearance has been or is deemed to be granted.

Outside the scope of mandatory review, the BMWK can call in acquisitions of at least 25 percent subject to cross-sector review, in cases of "atypical" control (a somewhat vague threshold that takes into account any influence beyond the shareholding acquired by the investor, in particular by means of additional board seats, veto rights or access to certain information), or in certain settings that allow for an aggregation of shareholdings, e.g., in case of shareholdings by several different investors controlled by the same foreign state.

The standard of German FDI review is to ensure public order and (essential) security interests. In its assessment, the BMWK will in particular consider the origin of the investor, the foreign government influence on the investor, and the track record of the involved parties with BMWK filings. Further, general political considerations like securing supply chains or industrial policy play an increasing role.

In order to safeguard public order or security, the BMWK may—in accordance with other Federal Ministries—prohibit transactions or clear a transaction subject to mitigation measures or "remedies." These typically take the form of a trilateral agreement between the ultimate acquirer parent, target and the German Federal Government ("mitigation agreement"), but the government could also impose certain measures unilaterally. The contents of the measures will depend on the concerns to be resolved, and can include safeguarding pre-transaction volumes of supply, not relocating facilities/know-how, reporting obligations, etc. To enforce a prohibition, the BMWK can prohibit or restrict the exercise of voting rights in the acquired company, or appoint a trustee to bring about the unwinding of a completed acquisition at the expense of the acquirer.

Review process timeline

The review process timeline is split into two phases.

Phase I begins with the BMWK obtaining knowledge of the transaction (either by notification or by other means) and lasts up to two months, during which the BMWK will determine whether to open a formal review (phase II) or clear the transaction.

Phase II begins with the BMWK opening a formal review and requesting further documentation regarding the transaction, the scope of which lies within the broad discretion of the BMWK. The formal review starts upon receipt of that documentation and lasts another four months; however, the BMWK can extend it by another three months in exceptionally complex cases (plus another additional month in case of defense deals). In addition, the timeline is suspended in case of additional information requests by the BMWK, and for as long as negotiations on mitigation measures are conducted between the BMWK and the parties involved. Such considerations outside the official review timeline can therefore have a significant impact on the transaction timetables.

If at the end of phase I or II the BMWK has not issued a decision, the transaction is legally deemed to be cleared (for phase II, only in cases subject to cross-sectoral review).

How foreign investors can protect themselves

Parties to transactions should carefully consider the risk of foreign investment control procedures early in the process (ideally starting at the front end of the due diligence process). Given the potential for considerable FDI review risks, it may be appropriate for the parties to initiate discussions with the BMWK even before the signing and/or announcement of a binding agreement. In any event, parties should factor in sufficient time for the (German and potentially other) FDI reviews when negotiating long-stop dates. For example, in critical cases the BMWK has a tendency to wait until PRC merger clearance has been obtained (to factor in any implications of PRC remedies)—which had previously been the long pole in many transaction timetables.

Clearance provides a safe harbor for any transaction. In case no filing was submitted, the BMWK can take action ex officio for acquisitions in scope of German FDI review within a maximum period of five years from signing (but no later than two months after receiving knowledge of the acquisition) and even prohibit them retrospectively.

In order to protect oneself from such retrospective review in cases without filing obligation and to obtain legal certainty (in particular where German FDI clearance is a closing condition), foreign investors can voluntarily apply for a certificate of non-objection (Unbedenklichkeitsbescheinigung) as a safe harbor. Outside the scope of German FDI review, the investor can request an informal notice of non-applicability by the BMWK. The BMWK typically issues such notices as an administrative practice without binding effect or legal basis.

Lastly, any BMWK decision can be challenged before a German court. However, court action often is not a practical option for the parties (sometimes in light of timing or publicity concerns), and the BMWK enjoys broad discretion as to the interpretation of the legal provisions.

Looking ahead

  • Germany's new coalition government will likely keep up the intensified scrutiny of foreign investments under German FDI rules
  • The German government is re-evaluating its dependencies and trade relationships with certain countries, including China. This could potentially lead to even stricter scrutiny of investments from these countries
  • FDI reviews in critical companies tend to get increasingly politicized. Decisions in these transactions are increasingly taken with the involvement of the entire cabinet or the Federal Chancellery

White & Case means the international legal practice comprising White & Case LLP, a New York State registered limited liability partnership, White & Case LLP, a limited liability partnership incorporated under English law and all other affiliated partnerships, companies and entities.

This article is prepared for the general information of interested persons. It is not, and does not attempt to be, comprehensive in nature. Due to the general nature of its content, it should not be regarded as legal advice.

© 2023 White & Case LLP