Canada
The Canadian government continues to scrutinize foreign investments by state-owned enterprises and state-linked private investors, especially if from "non-likeminded" countries.
Now a full decade in publication, White & Case's 2025 Foreign Direct Investment Reviews continues to provide a comprehensive look at foreign direct investment (FDI) laws and regulations across various countries and regions worldwide.
In this edition, we continue to offer key datapoints that can help inform parties and their advisors as they evaluate the new set of challenges presented by FDI screening requirements in cross-border transactions that span multiple countries.
FDI screening is continuously evolving, in fact, maturing. It is imperative to stay on top of the FDI requirements as transactions—be it mergers and acquisitions, investments, public equity offerings, or financial restructurings—are negotiated. Understanding the challenges, the potential remedies that could be required for approval and the proper allocation of FDI risk are key ingredients in avoiding unpleasant surprises related to timing, certainty and business plan execution.
With a new administration in the United States, a renewed US commitment to open foreign investment from allied countries, increased EU FDI cooperation, and the new geo-political lines and balances that are being drawn, the dynamics around FDI screening will be a driving consideration in the selection of investors in cross-border transactions. We continue to believe that most cross-border transactions will be successfully consummated in 2025, but understanding the evolving risks around FDI considerations will be critical.
The Canadian government continues to scrutinize foreign investments by state-owned enterprises and state-linked private investors, especially if from "non-likeminded" countries.
Foreign direct investments, whether undertaken directly or indirectly, are generally allowed without restrictions or without the need to obtain prior authorization from an administrative agency.
In the US, most FDI deals are approved without mitigation, but the landscape is evolving based on a combination of expanded jurisdiction and authorities, mandatory filings applying in certain cases, enhanced focus on a broad array of national security considerations, increased rates of mitigation, further attention to monitoring, compliance and enforcement, and a substantially increased pursuit of non-notified transactions.
The European Commission continues to be a driver of FDI screening across the EU, with Member States now moving toward coordinated enforcement.
The wide scope, low trigger thresholds and extensive interpretation of the Austrian FDI regime require a thorough assessment and proactive planning of the M&A process.
The Belgian FDI screening regime entered into force in July 2023. Investors and authorities alike are still coming to grips with the regime and the limited guidelines that help parties navigate it.
In 2024, Bulgaria established an FDI screening mechanism. Foreign investors' obligation to file for investment clearance did not become effective in 2024, but this should change soon.
The Czech Foreign Investments Screening Act took effect in May 2021, establishing the rights and duties of foreign investors and setting screening requirements for Czech targets.
The scope of the Danish FDI regime is comprehensive, and requires a careful assessment of investments and agreements involving Danish companies.
Estonia's FDI screening mechanism closed its first effective year in 2024.
FDI deals are generally not blocked in Finland, but the government is able to monitor and, if necessary, restrict foreign investment.
French FDI screening continues to focus on foreign investments involving medical and biotech activities, food security activities or the treatment, storage and transmission of sensitive data. The nuclear ecosystem is subject to very close scrutiny.
Following numerous amendments over the past years, Germany's FDI review continued in full swing in 2024, with further significant updates expected in the coming years.
Hungarian FDI regulation stands as a rock amid global economic storms, although there were few major changes in 2024.
Ireland's Screening of Third Country Transactions Act entered into force on January 6, 2025.
Italy's "Golden Power Law" review more tan ten years old and continuously expanding its reach.
The law in Latvia provides for sectoral FDI regimes for specific corporate M&A, real estate dealings and gambling companies.
All investments concerning national security are under the scope of review in Lithuania.
The Luxembourg FDI screening regime is now a year old, and the first notification filings have been made.
Malta's FDI regime regulates specific transactions that must be notified to the authorities and may potentially be subject to screening.
The Middle East continues to welcome foreign investment, subject to licensing approvals and ownership thresholds for certain business sectors or in certain geographical zones.
The Netherlands is set to expand its investment screening regime by extending the general mechanism to more sectors and by introducing additional sector-specific regulations.
Norway's foreign direct investment regime is in the process of being expanded, with more profound changes expected in the future.
After revision of the Polish FDI regime in 2024, the way the authorities are assessing transactions is evolving.
In Portugal, transactions involving acquisition of control over strategic assets by entities residing outside the EU or the EEA may be subject to FDI screening.
While far-reaching in its scope, compared to other EU countries, the Romanian FDI regime is generally perceived as investor-friendly.
The year 2024 was not marked by any major changes in the sphere of regulation of foreign investments in Russia, and the regulator continues to implement the course taken earlier in 2023.
After two years of foreign investment regulation in Slovakia, a supportive climate for foreign investments remains.
Slovenia's updated FDI regime now extends to branch offices and introduces new challenges for foreign investors navigating critical sectors.
Since 2020, certain foreign direct investments are subject to scrutiny in Spain and, since then, additional formalities have been introduced, specifically by a developing FDI regulation that entered into force on September 1, 2023. The FDI analysis is becoming increasingly crucial in the context of investments in Spain.
In its second year of operation, the Swedish FDI Act has become a standard component of a large portion of all transactions involving Swedish companies.
Apart from limited sector-specific regulations, there is currently no general FDI regime in Switzerland. An FDI Act is expected to come into force in 2026 at the earliest.
Strengthening Türkiye's position as a key investment hub remains a government priority.
Foreign direct investment is permissible in the UAE, subject to applicable licensing and ownership conditions.
FDI in the UK is covered by the National Security and Investment Act 2021, and in 2024 the government continued to update information and guidelines concerning the legislation.
Australia's FDI regimes underwent some modifications in 2024, designed to streamline the process of carrying out investments.
China continues to optimize its foreign investment environment by reducing investment restrictions, opening up market access and lowering investment thresholds into listed companies.
FDI continues to be an area of focus for the Indian government, which has announced plans to attract further foreign investment into the country.
The Japanese government expands business sectors subject to Japan's FDI regime to secure stable supply chains and mitigate the risk of technology leakage and diversion of commercial technologies into military use.
The Republic of Korea continues to welcome foreign investment, offering enhanced incentive packages and easing regulations while heightening scrutiny over transactions involving strategic industrial.
New Zealand has recently seen a period of stabilization of the overseas investment regime. However, following the formation of the coalition government at the end of 2023, this government has proposed significant changes to the overseas investment rules for 2025, making it easier for overseas investors to acquire New Zealand assets.
Taiwan continues to promote FDI under a two-track screening mechanism for foreign and PRC investors.
Taiwan continues to promote FDI under a two-track screening mechanism for foreign and PRC investors.
Explore Trendscape Our take on the interconnected global trends that are shaping the business climate for our clients.
Benjamin Y. Li, Derrick Yang and Yu-ting Su, Lee (Li Attorneys at Law) authored this publication
In Taiwan, the Department of Investment Review (DIR, previously known as the Investment Commission) of the Ministry of Economic Affairs (MOEA) oversees two separate regulatory regimes for inbound investments from the People's Republic of China (PRC, excluding Macau and Hong Kong) and from the rest of the world.
All inbound investments are subject to the DIR's review under either the foreign investment or PRC investment track.
A foreign investor should file an investment application according to the Statute for Investment by Foreign Nationals, which allows foreign investors to invest in any Taiwanese company unless the company engages in prohibited or restricted businesses, or the investment poses a risk to national security, public order, morals or public health. The government has a "negative list" that specifies the restricted or prohibited industries, such as military-related chemicals, firearms, electricity and gas supply, transportation, telecommunications and mass media.
A PRC investor should file an investment application according to the Measures Governing Investment Permits to the People of the Mainland Area. A PRC investor refers to an individual, juristic person, organization or any other institution of the PRC; and any company located in any third area (other than the PRC or Taiwan) in which, in aggregate, more than 30 percent of its equity or capital is held by PRC nationals or which is controlled by PRC nationals. Unlike foreign investors, PRC investors can only invest in industries on the government's "positive list."
The DIR will review two types of investments.
The first is foreign investments, including: the acquisition of stock or capital contribution of a Taiwanese company; setting up a branch office, proprietary business or partnership in Taiwan; and providing shareholder loans for a term of one year or longer to those invested Taiwanese companies in the first two categories.
The DIR also reviews PRC investments including: acquiring stock or capital contribution of a Taiwanese company, proprietary business, partnership, or limited partnership (subject to certain exceptions for acquiring shares in a TWSE or TPEX listed company); setting up a branch office, proprietary business or partnership in Taiwan; providing shareholder loans for a term of one year or longer to those invested Taiwanese companies referred to above; having control over a Taiwanese proprietary business, partnership, limited partnership or a private company via contractual arrangement; and acquiring the business or assets of a Taiwanese private company by a third-area company.
When reviewing an investment application, the DIR applies a totality test by taking into account the nature of the business, scale of investment, parties involved, potential impact on national security, public order, public health, technology advancement, local economics, rights of the local stakeholder and employees, and other relevant factors.
If the investment involves a PRC investor or sensitive business, such as critical infrastructure, telecommunications or other restricted business, the DIR will increase its scrutiny by requesting detailed information on the ownership structure and the intended purpose, and seeking relevant government bodies' opinions. As such, it will generally take longer for the DIR to review PRC applications.
The DIR's approval is usually a condition precedent to the closing of a transaction. While the DIR has sole discretion to reject or impose conditions on a transaction, it has approved most of the applications received and only rejected a limited number of cases because of national security concerns or adverse impacts on the local economy. In some cases, the DIR may also require undertakings from the investors per other competent authorities' requests, or attach conditions to an approved investment.
The DIR's review process usually takes one to two months for foreign investments and two to four months for PRC investments, depending on the scale and complexity of the investment. The DIR has sole discretion to request further information from the prospective applicants, consult intra-governmental bodies or conduct ad hoc reviews on a case-by-case basis, which may prolong this timeline.
How foreign investors can protect themselves
While reviewing an application submitted by a foreign investor, the DIR will review the foreign investor's shareholding structure, including each layer of the investment vehicle up to the ultimate beneficial owner, to ensure that the investor is not a de facto PRC investor.
As foreign investors and PRC investors are subject to different regulatory reviews, investors should examine their shareholding structure and the business they wish to invest in carefully with an experienced counsel, to fully assess the risks and structure the transaction effectively.
The global supply chain is being reshaped due to geopolitical tensions and the need for diversification. This shift is encouraging companies to invest in Taiwan as a strategic outpost. From January to November 2024, the DIR approved a total of 2,064 foreign investment cases totaling about US$7.25 billion.
This highlights Taiwan's attractiveness to overseas investors. The top-three sectors drawing foreign investments are scientific and technological services; finance and insurance; and electricity supply.
Taiwan is expected to continue its positive momentum to attract foreign investment, especially in high-tech and renewable energy sectors. This is likely to lead to a broader trend in FDI in 2025.
White & Case means the international legal practice comprising White & Case LLP, a New York State registered limited liability partnership, White & Case LLP, a limited liability partnership incorporated under English law and all other affiliated partnerships, companies and entities.
This article is prepared for the general information of interested persons. It is not, and does not attempt to be, comprehensive in nature. Due to the general nature of its content, it should not be regarded as legal advice.
© 2025 White & Case LLP