Foreign Direct Investment Review Regimes in Europe

France – Powers of the French Minister of Economy

• Information or consultation rights granted to the French State
• Information, veto and/or preemption rights to the French State on disposals of specific assets
• Representatives of the French State or French citizens on the investor’s board of directors
• Protecting sensitive data
• Maintaining some strategic contracts for a minimum duration
• Maintaining the sustainability of industrial capacities in France
• Preserving R&D capabilities or the associated technologies and know-how
• Ensuring the maintenance of vital infrastructures

Clearance conditions may include…
Powers in case of breach
Non-compliance with clearance conditions

• Injunction to comply with the commitments taken or new conditions (including unwinding or selling the investment) within a given timeframe
• Withdrawal of the clearance: new filing or unwinding required
• Imposition of interim measures (e.g. suspension of voting rights, limiting distribution of dividends, appointment of a temporary representative, etc.)

Implementation without prior approval

• Injunction to submit a request for authorization
• Injunction to modify the transaction terms
• Injunction to revert to the pre-existing situation

+ Financial penalties

• Maximum amount: highest of (i) twice the amount of the defaulting investment, (ii) 10% of the annual turnover of the target or (iii) EUR 5m (EUR 1m for individuals)

Potentially with daily penalties

United Kingdom – Current position (1)

• Historically, no separate FDI regime
• Secretary of State can intervene by public interest intervention notice (PIIN) in mergers being reviewed under Enterprise Act 2002, e.g.
• Sepura/Hytera, GKN/Melrose, Gardner Aerospace/Impcross
• If EU Merger Regulation applies, Secretary of State can issue a European intervention notice (EIN)
• e.g. Advent/Cobham
• For PIIN/EIN to be issued, merger must relate to national security, financial stability, media plurality, or from 23 June 2020 the capability to combat or mitigate the effects of public health emergencies
• 20 interventions, no prohibitions, remedies required in a number of cases
• Political intervention also possible
• E.g. Kraft/Cadbury, Pfizer/AstraZeneca, Softbank/ARM, Hinckley Point, Huawei