On Wednesday 24 January, the European Commission presented a number of initiatives on the EU’s economic security. The European Commissioner for Trade, Valdis Dombrovskis, took advantage of his meeting with the trade ministers of the EU27 on Tuesday 23 January to inform them of the various proposals. “The EU must improve its ability to operate in geopolitical conflict situations”, he insisted. To achieve this, the EU27 must speak with one voice on economic security issues if the Union is to play a stronger role on the international stage, he believes.
Some EU countries, such as Spain and the Netherlands, see the need for closer cooperation at Community level, for example on the investment screening of foreign direct investment. “We hope that countries that have not yet implemented this type of investment screening will do so, and that the flow of information between Member States will also be improved”, said Xiana Méndez Bertolo, Spain’s Secretary of State for Trade.
According to our information, the Commission is due to propose on 24 January that the foreign investment screening mechanism be made compulsory for all Member States. The current regulation governing investment screening at EU level does not impose a mechanism, and only 22 countries currently have one in place. The revised regulation should also propose new rules for sharing information between member countries, in order to close the loopholes identified over the last three years (see EUROPE 13308/23).
Such a standardised framework is not desirable for Hungary, for example, which considers that investment screening is a purely political issue. “We see a lot of hostility towards Chinese investments, although they are unfounded, and I have the feeling that they are sometimes used as an instrument by member states who are not competitive enough” said Péter Szijjártó, Hungarian Minister of Foreign Affairs and Trade.
However, this is a relatively isolated finding where foreign investment is concerned, and in recent months the EU27 have been more concerned about the idea of controlling outward investment.
According to our information, the European Commission does not plan to propose any rules in this area for at least another year. Instead, it should advocate that Member States monitor and analyse the risks that outward investment in critical sectors could pose before establishing a common risk analysis methodology only as a second step.
This approach is preferable, according to the Chairman of the European Parliament’s Committee on International Trade (INTA), Bernd Lange (S&D, German): “I commend the cautious approach, with no rushed legislative proposal”, he said.
The control of exports of dual-use goods is also likely to be the subject of recommendations only, on Wednesday 24 January. However, in the coming months, the Commission intends to propose uniform controls across the EU on new products considered risky. (Original version in French by Léa Marchal)