Foreign direct investment reviews 2021: A global perspective

Now in its sixth year of annual publication, White & Case's Foreign Direct Investment Reviews provides a comprehensive look into rapidly evolving foreign direct investment (FDI) laws and regulations in 21 key jurisdictions around the world. This 2021 edition adds five new jurisdictions—Denmark, The Netherlands, New Zealand, Romania and Switzerland—to those covered in previous editions.

Although FDI reviews were on the upswing in many parts of the globe before the start of the COVID-19 pandemic, the trade vulnerabilities exposed by the events of the past two years have only accelerated that trend. Where FDI regimes have not previously been in force, they are emerging, as in Switzerland and Denmark. Where FDI reviews have long targeted certain foreign investments, they are becoming both more stringent and more frequent, as in the United States and Germany.

Not only are governments continuing to widen their nets beyond the traditional review purview of national security into an ever-broadening array of other sectors, but also governments are becoming more proactive, stepping in to scrutinize more and more transactions falling outside mandatory notification requirements.

The Committee on Foreign Investment in the United States (CFIUS) in particular has upped its attention to such "non-notified" transactions, making due diligence for FDI review a critical step for most investments into the US, regardless of sector or the potential balance of corporate control.

For its part, the European Union continues to step up efforts to harmonize FDI regimes among Member States while also sharpening its post-pandemic focus on such issues as ensuring an independent and resilient supply chain and reliable access to healthcare resources.

Investors doing business across borders need to understand FDI restrictions as they are today, and how these laws are evolving over time, in order to avoid disruption to realizing synergies, achieving technological development and integration, and ultimately securing liquidity.

Farhad Jalinous
White & Case Global Head of Foreign Direct Investment Reviews and US National Security/CFIUS
Washington, DC