Trade Commissioner Phil Hogan returned to the European Commission's communication of the end of March calling for the acceleration of the implementation of a European Investment Screening Mechanism on Thursday 16 April at the EU ‘Trade’ Council (see EUROPE 12455/22, 12466/7). A communication which has been welcomed by all Member States, according to several European sources.
By inviting the European Chancelleries to anticipate the application of the regulation, initially planned for October 2020, the Commission intends, on the one hand, to ensure the protection of the EU's strategic assets and, on the other hand, to further address the economic vulnerability of European companies due to the current volatility and undervaluation of EU stock markets, Mr Hogan said in his speech. Circumstances that would see critical infrastructure or technology fall prey to undesirable foreign investment.
The Commissioner therefore urged European countries to mobilise together to this end: "While I am conscious of and fully respect Member States' competence in this area, I believe that we can and should do more", he said.
Phil Hogan proposed to the Twenty-Seven to focus on monitoring current or planned foreign acquisitions through the voluntary exchange of relevant information on the FDI screening in progress. The Commission has expressed its readiness to facilitate this process.
"I can only stress that for a security screening mechanism to be effective, we need the participation and cooperation of all Member States, including putting in place the necessary tools and access to information on your respective territories", he said.
A call rather well received
This initiative of the Commission "is partly common sense", said one diplomatic source, even if each country does not deviate from its own field. Berlin and Paris are still at the forefront of protecting their industrial jewels.
Rather, the Netherlands and other more liberal countries are concerned that this filtering mechanism could be extended to less strategic sectors for purposes considered protectionist.
But Sigrid Kaag, the Dutch Minister for Trade, admitted: "We need to ensure that we have shielded, nurtured and given companies space for innovation, where market forces and technology really (play a role), where there is enough space for that". And to underline that, in order to counter unfair competitive practices that would distort the rules of the game, the next step would be the development of a European instrument on international public procurement. (Original version in French by Hermine Donceel)