The European Commission has requested a report from the OECD secretariat on the effectiveness of the EU framework for screening foreign direct investments. This was published on 10 November. The authors conducted research and interviews with various actors involved in screening between October 2021 and June 2022. They received generally favourable views on the EU regulation on investment screening.
Stakeholders report a greater recognition of the benefits of screening and a better understanding of investment trends in the EU. This is mainly due to the cooperation mechanism introduced by the Regulation in 2019. This is seen by several Member States as the main benefit from the Regulation.
Nine EU countries do not currently have an investment screening mechanism in place, but seven of them have a legislative or consultative process underway to put one in place. Only Bulgaria and Cyprus have no plans at present.
The OECD report indicates that the lack of a mechanism in some countries affects the effectiveness of screening at European level. Moreover, only six Member States actively participate in the exchange of information under the cooperation mechanism, according to the authors of the report. Others even doubt the relevance of screening investments and fear that it will harm their economic attractiveness.
The Commission published a report in September on investment screening activities in 2021 (see EUROPE 13013/10). Out of more than 400 transactions analysed, less than 3% led to a European Commission opinion.
See the OECD report: https://aeur.eu/f/41s (Original version in French by Léa Marchal)