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Germany’s new rules on foreign direct investment in light of the most recent European Commission proposals

 

28 September 2017

Berlin Wall rebuilt or storm in a water glass?  

Allen & Overy produced a briefing note on recent amendments to the German Foreign Trade Regulation affecting German inbound M&A transactions:

Foreign investment control in Germany: Berlin Wall rebuilt or storm in a water glass?

Germany remains open to foreign investment. In line with past practice, corporate acquisitions by non-European purchasers can be prohibited only if they present a threat genuine and sufficiently serious threat to public order or safety of the Federal Republic of Germany, which must always be determined in the individual case. However, screening periods have been extended and the reach of governmental screening has been clarified by a number of examples. These examples include operators of critical infrastructure and businesses producing software for the steering of critical infrastructure, but they do not incorporate all of the sectors mentioned in the proposed European Regulation (please find below a link to our client briefing on the proposed European Regulation).

European Commission proposes common approach to foreign direct investment screening

Non-European purchasers are well advised to analyse transaction risks early on and prepare their moves very thoroughly from a legal, political and communications point of view. They should consult with their legal advisors at an early stage of the proposed transaction to avoid any impediments resulting from the German FDI screening rules.

If your are interested in discussing the topic of our briefing note with us, we are happy to answer all your further questions.​

 

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