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September 5, 2018

Is Germany's Liberal Freedom of Investment in Danger? New Protectionism Through Tighter Investment Control in Germany

Deutscher AnwaltSpiegel

The prominent German law magazine Deutscher AnwaltSpiegel published Frankfurt-based partner Sebastian Jungermann's article concerning foreign investment control and recent developments in Germany. The prohibition of takeovers by foreigners for reasons of national security is becoming increasingly important around the globe. In the summer of 2018, the German Federal Ministry of Economics and Energy (BMWi) prevented two transactions for the first time due to national security concerns. This affected Chinese investors and the planned acquisition of Leifeld Metal Spinning a minority stake in 50Hertz. In the United States, the Committee on Foreign Investment (CFIUS) has been quite active since 1975. In addition, the US procedure was further intensified by the Foreign Investment Risk Review Modernization Act (FIRRMA) signed on August 13, 2018. In the United Kingdom, a National Security and Investment White Paper was published in July 2018 in order to tighten investment control. In addition to Germany and the UK, other EU member states have also tightened their regulations, such as France, Denmark, Spain, Italy, Latvia, Lithuania, Austria, Poland, Portugal, and Finland. In September 2017, the EU Commission submitted a proposal for a corresponding regulation. In this article, Dr. Jungermann provides an overview and also recent developments in Germany.

[Article available only in German]