CELIS Update on Investment Screening and Economic Security – April 2026
Authors: Helene Schramm with the assistance of interns Reet Sodhi and Aditi Singh
INVESTMENT SCREENING MECHANISMS
Cyprus – Introduction of New FDI Screening Regime Under Law 194(I)/2025
Cyprus has introduced a new national framework for the screening of foreign direct investments (“FDI”) under Law 194(I)/2025 “On the Establishment of a Framework for the Screening of Foreign Direct Investments”, which entered into force on 2 April 2026. The law transposes Regulation (EU) 2019/452 on the screening of foreign direct investments and establishes a mandatory, prior‐approval regime for certain foreign investments that may affect the security or public order of the Republic of Cyprus.
The regime applies to foreign investors, defined for these purposes as non‐EU/EEA/Swiss natural or legal persons, including investments made via EU‐incorporated entities if the ultimate beneficial control or ownership lies outside the EU, EEA or Switzerland. Notification is required for investments in undertakings operating in strategic or particularly sensitive sectors, as identified in the Annex to the Law and in line with the sensitive‐sector list in Article 4 of Regulation (EU) 2019/452, including critical infrastructure, energy, transport, water, health, communications, media, data processing or storage, aerospace, defence, financial infrastructure and electoral infrastructure.
The notification obligation is triggered where the foreign investor acquires at least 25% of the voting rights or capital in a strategic undertaking, or where an existing qualifying shareholding is increased to 50% or higher, or where the value of the investment exceeds €2 million in the same transaction within a rolling 12‐month period. The Ministry of Finance is the competent authority, and prior written approval must be obtained before implementation of the investment. Under the procedure, the Ministry completes an initial review within 20 working days of receiving a fully‐completed filing and may either grant unconditional approval or initiate a full screening; if a full screening is opened, a final decision on approval, conditional approval or prohibition must be taken within 65 working days, with the timelines suspended where additional information is requested.
The Ministry is empowered to approve the investment, approve it subject to conditions, prohibit it, or, in certain cases, require the reversal or termination of an investment post‐completion. The law also provides for ex‐post review of notifiable transactions that have not been filed, within five year of completion, and for non‐notifiable investments where concerns arise, within 15 months of completion.
Romania – Government Emergency Ordinance 17/2026 Simplifies and Strengthens Foreign Investment Screening
Romania made important changes to its FDI screening rules by adopting Government Emergency Ordinance No. 17/2026 (“GEO 17/2026”), effective from 13 March 2026.
The minimum threshold for mandatory notification was increased from EUR 2 million to EUR 5 million, although investments below this level can still be reviewed if they may affect national security, public order or EU interests. The scope was expanded so that it now also covers certain acquisitions of both physical and non-physical assets in sensitive sectors, and these sectors are more clearly defined, including areas such as energy, transport, healthcare, financial services, defence and agri-food, as well as technologies like AI, robotics, semiconductors and cybersecurity.
A limited exemption was introduced for certain intra-group restructurings involving EU or OECD investors where there is no change in control or ownership. The process was simplified with shorter timelines, with a general review period of 45 days from a complete filing and up to 135 days for more complex cases. The screening fee was reduced from EUR 10,000 to EUR 5,000 and digital filing was introduced through an IT platform. Overall, these changes are intended to make the system more predictable while still allowing the government to review sensitive investments.
United Kingdom – UK Refines Investment Screening Rules with Targeted NSIA Reforms
On 12 March 2026, the UK government published its response to consultation on reforms to the National Security and Investment Act 2021 (“NSIA”), confirming significant changes to the mandatory notification regime that will reshape how foreign investors approach UK acquisitions. This development follows the government’s July 2025 announcement of reform plans, which itself came after a comprehensive call for evidence launched in November 2023 that revealed widespread concern among stakeholders that the existing regime was inadvertently capturing low-risk transactions and creating unnecessary compliance burdens.
The March 2026 reforms introduce a dual approach: while expanding sectoral coverage in strategically important areas such as artificial intelligence, quantum technology, semiconductors, critical minerals, and water infrastructure, the government has simultaneously introduced exemptions to mandatory filing obligations and clarified sector definitions to prevent routine business transactions from triggering notification requirements.
For artificial intelligence, the reforms exclude ‘off-the-shelf’ AI systems from mandatory notification rules, focusing instead on firms that develop or modify advanced AI systems, with the government continuing work on precise definitions to ensure that widely available systems used for standard business tasks remain outside the net. Semiconductors and critical minerals will now move into their own dedicated categories, separated from the broader Advanced Materials section, making it simpler for companies to check if they need to notify the government; for semiconductors, the definition now captures advanced packaging and specific chip design processes to ensure hardware remains secure from the ground up, while for critical minerals, the government will further consider whether additional minerals should be in scope, in line with those highlighted in the 2025 UK Critical Minerals Strategy. Water-operating companies are being brought into the mandatory notification process for the first time, though the new rules will focus on major water companies and larger independent providers, with the government confirming following industry feedback that companies in the general water supply chain will not be subject to mandatory notification.
Beyond these sector-specific clarifications, the reforms distinguish between supply contracts for non-critical goods and actual control of critical suppliers to government – a distinction that prevents ordinary commercial relationships from requiring notification – and establish clearer thresholds for what constitutes a controlling acquisition versus passive minority investments.
The changes reflect a broader government commitment to being pro-growth and pro-investment, aligning the NSIA regime more closely with the UK’s competitive positioning as a destination for FDI. The government intends to lay secondary legislation in Parliament later this year to implement these updates.
ECONOMIC SECURITY STRATEGIES
Germany – Germany’s KRITIS Act Sets New Benchmark for Cross-Sector Infrastructure Resilience
Germany has adopted a new Act for Critical Facilities (KRITIS‐Dachgesetz), which entered into force on 17 March 2026 and implements the EU Critical Entities Resilience (CER) Directive 2022/2557. The law creates a cross‐sector, nationwide framework for strengthening the resilience and physical protection of critical infrastructure in Germany, with first‐time collective coverage of sectors such as energy, transport and traffic, finance and insurance, health, drinking water, waste water, municipal waste disposal, information technology and telecommunications, food, space and public administration.
The Act defines critical infrastructure as facilities that are essential for overall supply in Germany and serve more than 500,000 people, while supplementing the existing IT‐security rules for critical infrastructure and assigning primary responsibility for protection to the operators of critical facilities. Operators are required to implement nationwide, cross‐sector minimum standards for physical protection, including measures such as emergency teams, stronger property protection and resilience measures, based on risk analyses and risk assessments prepared by designated government agencies and made available to the operators. The framework also imposes a duty to report incidents and gives the federal states the possibility to identify additional critical facilities for services that fall exclusively under their responsibility, with the Federal Ministry of the Interior authorised to set the relevant criteria and procedures by statutory order, subject to the approval of the Bundesrat.
The German Government further notes that the protection of critical infrastructure is a key task of the state and industry, and a central element of Germany’s security policy, with the new Act marking a substantial step towards maintaining essential services in the event of natural disasters, terrorism, sabotage or human error and strengthening the resilience of central supply functions.
European Union – EU Moves to Secure Maritime Supply Chains and Port Infrastructure Amid Global Competition
On 4 March 2026, the European Commission adopted the EU Industrial Maritime Strategy and the EU Ports Strategy to strengthen competitiveness, sustainability, security and resilience in the EU’s wider waterborne sector, with a focus on ports, shipping and shipbuilding. The Commission underlines that maritime transport is central to the EU’s trade, economic growth, security and defence, accounting for a large share of EU external trade and intra‐EU freight, while ports handle most goods entering or leaving the Union.
The EU Industrial Maritime Strategy places manufacturing at the core of the maritime agenda, seeking to maintain Europe’s global leadership in high‐technology shipbuilding and advanced maritime technologies while supporting ship repair and equipment production. It aims to reinforce the EU maritime industrial ecosystem, improve the level playing field for European shipyards and related industries, and accelerate the digital and circular transformation of maritime manufacturing, including the deployment of low‐ and zero‐emission vessels. The Commission indicates that the Strategy will also support innovation, investment coordination and the integration of maritime industries with the wider transport and energy systems, for example through the modernisation of the EU fleet and the strengthening of maritime supply chains.
The EU Ports Strategy addresses the role of ports as critical nodes in the transport and energy networks, emphasising the need for long‐term planning, investment, decarbonisation and digitalisation. It focuses on measures to support port electrification, the deployment of clean fuels and renewable energy, and the modernisation of hinterland connections, including stronger rail and inland waterway links, to keep cargo flows efficient and low carbon. The Strategy also promotes the digitalisation of port operations and better data‐sharing between stakeholders, including through digital solutions for logistics and customs‐related processes. In parallel, it provides guidance on how EU funding and other investments can be used in ports, including the application of state‐aid and competition rules, and addresses issues related to foreign ownership and control in the port sector. The Commission highlights that the Strategy is intended to improve the security, efficiency and competitiveness of EU ports, strengthen logistics security and help large, medium and small ports adapt to the transition towards climate‐neutral transport, under the wider framework of EU state‐aid and investment rules.
Southeast Asia – ASEAN Ministers Strengthen Economic Resilience Amid Rising Global Risks
On 13 March 2026, ASEAN’s economic ministers have adopted a Joint Statement at the Thirty-Second ASEAN Economic Ministers’ Retreat in Taguig, Philippines, to strengthen the region’s economic resilience in response to growing global economic and geopolitical challenges.
The statement highlights issues such as rising trade tensions, unilateral tariffs, investment restrictions, supply chain disruptions, financial market instability and the risk of global economic fragmentation. It reaffirms ASEAN’s unity, integration and policy coordination, while continuing to rely on the ASEAN Community Vision 2025 and the ASEAN Economic Community Blueprint 2025 as key guiding frameworks. Ministers agreed to improve internal coordination through existing mechanisms and a newly created ASEAN Geo economic Task Force and to treat economic security as a priority by focusing on sectors like semiconductors, critical minerals, energy, digital infrastructure, healthcare and food systems.
ASEAN also aims to strengthen regional integration, manage trade more strategically, enhance industrial cooperation and reduce supply chain risks, while expanding relations with external partners without losing ASEAN centrality. The statement further emphasises energy security, affordable electricity, customs modernisation, better traceability and stronger enforcement standards to position ASEAN as a reliable part of global supply chains. It connects economic resilience with inclusive growth, support for micro, small and medium enterprises and social stability, especially due to rising living costs.
Finally, the ministers’ position will be taken forward to a Special ASEAN Leaders Meeting in 2026 to ensure a coordinated regional response, showing ASEAN’s shift from a mainly trade-focused approach to a broader, security-focused economic resilience strategy.
