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On June 1, 2023, the Dutch foreign direct investment (“FDI”) screening regime entered into force, introducing a mandatory and suspensory screening regime for direct and indirect investments in companies in the Netherlands by European (including Dutch) and non-European investors. Continue Reading Dutch Foreign Direct Investment Screening Regime Enters Into Force

Since the current Italian cabinet was sworn-in in October 2022, it has applied the Italian foreign direct investment (“FDI”) regime in a few relevant cases, which appear to be the bellwether of the new government’s approach to FDI review.Continue Reading Italian FDI, When the Government May Rewrite Corporate Governance

Distributors of cattle, cocoa, coffee, oil palm, rubber, soy, wood and derived products will be subject to increased supply chain due diligence

Deforestation and forest degradation are drivers of climate change and biodiversity loss. Between 1990 and 2020, 420 million hectares of forest – an area larger than the European Union – were lost due to deforestation, the Food and Agriculture Organization of the United Nations (FAO) reported. The EU is responsible for 7-10% of global consumption of deforestation-linked crops and livestock products.Continue Reading EU Approves Ban on Products Linked to Deforestation

On May 22, 2023, the President of Russia signed Decree No. 364 (“Decree 364”) On Certain Amendments to Decree of the President of Russia No. 430 dated July 5, 2022 (“Decree 430”) requiring Russian businesses who have issued Eurobonds to issue replacement securities to enable holders whose bonds are held through Russian depositaries to receive payments.Continue Reading Russian Obligors Are Required to Issue Russian Bonds Replacing their Eurobonds

On April 25, 2023, the President of Russia signed Decree No. 302 On Temporary Management of certain assets, including movable and immovable assets and equity interests in the capital of Russian legal entities, that appoints the Federal Agency for State Property Management as the temporary manager of such assets and allows the agency to exercise all the rights of the owner of such assets, other than to dispose of the assets.Continue Reading Tit for Tat Continues, or Further Russian Countersanctions That Allow Nationalization of Assets of Persons From Unfriendly States

The first few months of 2023 have seen significant developments in the FDI landscape that will have a major impact on cross-border transactions. Deal makers need to be aware that the scope of FDI control is increasing:

  • With the United States taking major steps towards implementing an outbound FDI screening mechanism (which are echoed in Europe) and the European Commission further developing the EU Foreign Subsidies Regulation, new game changing regulatory frameworks take clearer shape.
  • Following the EU Commission’s calling of recent years, by the end of the year almost all EU member States will have adopted a national FDI screening regime.
  • On 27 April 2023, the UK Government published updated guidance that reflects its developing practice. Since January 2022, five transactions have been prohibited and 10 deals have been cleared subject to remedies.

Continue Reading Cleary Gottlieb FDI Newsletter: January–April 2023

Foreign direct investment (“FDI”) control has historically been centred on inbound FDI, meaning investment inflow into a country.  The tide is turning, as the United States seems ready to introduce an outbound FDI control mechanism, whereby capital outflow towards certain countries will be subjected to a screening process.  Similarly, the European Commission (“Commission”) 2023 Work Programme indicates that the EC will “examine whether additional tools are necessary in respect of outbound strategic investments controls”, and is “prepared to revise the EU’s FDI screening regulation.”Continue Reading Outbound Investment Screening Regime—EU May Follow In U.S. Footsteps

The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2023”.

This past year’s Russia-Ukraine conflict sparked a significant transformation of the global economic sanctions landscape, with developments and lessons extending well beyond Russia. 

In 2023, boards of directors should continue to monitor…

2022 did not see as many legislative changes of the German foreign direct investment regime (“FDI Regime“) as in years before. However, several foreign direct investments with a Chinese nexus reviewed by the German FDI authority, the Federal Ministry of Economics and Climate Action (“BMWK“), attracted public attention in 2022:Continue Reading German FDI Reviews of Chinese Investments in 2022 Confirm the Current Trend – Strict Scrutiny and Political Dimension in Decision Making