On October 14, 2025, the European Commission (“Commission”) published its fifth annual report on the screening of foreign direct investments (“FDI”) into the Union (the “Report”). Notable findings:
- FDI inflow. The majority of M&A-driven FDI continued to originate from investors in the U.S. and the UK, landed primarily in Western Europe and targeted 6 sectors – Manufacturing, Information Communication and Technology (“ICT”), Professional, Scientific and Technical activities (“PST”), Finance, Retail, and Accommodation.
- Active FDI regimes. 25 out of 27 EU Member States have an active FDI regime, with Croatia and Cyprus expected to join shortly.
- EU cooperation mechanism. The number of FDI filings reviewed within the mechanism was flat – 477 in 2024 compared to 488 in 2023. These filings were shared by 21 EU Member States, though ~85% originated from only 7 countries – Austria, France, Germany, Italy, Lithuania, the Netherlands, and Spain.
- Enforcement trends. As in 2023, only 8% of the cases went to Phase II; EC issued an opinion in <2%, and Member States submitted comments in 3% of the matters. Manufacturing (50%) and ICT (19%) were the main sectors subject to a Phase II review.
- Outcomes. The overall outcome trends were almost identical in the past 3 years – 85-86% were cleared unconditionally, 9-10% required remedies, and 5% were prohibited or abandoned.