The Xella Judgment – EU Court Limits Member States’ Discretion in Applying FDI Control Laws

July 2023
Region: Europe

More and more countries introduce Foreign Direct Investment regimes, ramp-up enforcement and assume jurisdiction over global transactions. Where existing regimes are in place, they tend be extended. In the EU, FDI control is essentially national, and EU harmonization was considered to be limited to common minimum standards and information exchange. A recent judgment by the European Court of Justice found that there is also a substantive control by the EU courts over Member States actions in situations where a national security concern is not obvious.