FDI Review Regimes are Well-Established and Active; Outbound Investment Regimes are on the Horizon
The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2024”.
In 2024, boards of directors face a well-established, complex and active global foreign direct investment (FDI) landscape in which transactions will regularly trigger multijurisdictional FDI filing and approval processes. This is the case not only with respect to well-known FDI review regimes such as the Committee on Foreign Investment in the United States (CFIUS), but also with newly established, modified, and/or expanded non-U.S. FDI review regimes, particularly in Europe. Indeed, as governments around the world have become increasingly empowered and willing to scrutinize, and in some cases prevent, transactions they deem objectionable, FDI approvals have become a significant regulatory issue for many cross-border transactions.
Moreover, while existing FDI review regimes focus on inbound investment (i.e., investment by foreign persons into the relevant jurisdiction), the United States is developing, and the European Union is considering, restrictions and prohibitions on certain outbound investments (i.e., investments by U.S. and EU persons outside of the United States and European Union). If adopted, such restrictions and prohibitions could complicate, disrupt and in some cases prohibit certain cross-border investments by U.S. or EU investors involving so-called “countries of concern.”
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For a PDF of the full memorandum, please click here.
