The new EU screening mechanism for foreign direct investments - When the EU takes back control. Bruges Political Research Papers 84/2021.

Carcy, Loïc (2021) The new EU screening mechanism for foreign direct investments - When the EU takes back control. Bruges Political Research Papers 84/2021. [Policy Paper]

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Abstract

The recent years showed a sudden rise in foreign direct investments (FDI) in the European Union, especially from China. This fact could be anecdotical, but globalisation has created unequal positions of power on the international stage. Targeted investments in dual use technologies or strategic sectors can then give a decisive position to a state towards others and hence weaponize interdependence. By adopting the Regulation 2019/452 establishing a framework for FDI screening, the European Union gives an answer to this phenomenon and stands to protect its strategic and critical assets, even if the framework remains solely about cooperation and without giving the European Commission a veto power. Through deterrence and political action, the EU takes back control.

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