The Rise of Public Security Interests in Corporate Mergers and Acquisitions
5th Radboud Economic Law Conference
Friday, 8 October 2021 (afternoon)
Openness to foreign takeovers and investments is a key principle in the EU and a major source of growth. However, in recent years the geopolitical landscape has changed considerably. The EU and its Member States have voiced concerns about investors from outside the EU, notably state-owned enterprises from China, taking over European companies with key technologies for strategic reasons. Moreover, the United States have recently adopted new legislation to increase scrutiny of foreign investment and are stretching the concept of national security to pursue their economic and geopolitical interests.
The concerns about China led to a new Regulation (EU) 2019/452 on screening of foreign direct investments (FDI) into the European Union. The Regulation applies since 11 October 2020. Essential elements of the Regulation are that Member States may have in place a national screening mechanism for FDI from outside the EU on grounds of (widely defined) public order or security, that a cooperation mechanism is established between the Member States and the European Commission, and that the European Commission is authorised to make a non-binding recommendation on cases of Union interest. Many of the Regulation’s provisions remain on the liberal end of the spectrum in comparison with the US approach and other advanced economies. Yet, the framework is more ambitious than anticipated and creates incentives for Member States to put in place robust FDI monitoring mechanisms.
Other initiatives have been taken by the Commission to prevent distortions on the EU market by foreign subsidies. The Commission recently issued a proposal for a new Regulation aimed at addressing competitive distortions caused by foreign subsidies. In its proposal, the Commission introduces multiple rules to prevent mergers and acquisitions and public bids being influenced by subsidies from a non-EU country.
The developments in EU law mentioned above raise many new questions and may have an influence on the economic climate in the EU. Furthermore, questions can arise on the interaction between international agreements aimed at the removal of barriers to investment and measures taken by the Union legislator to protect the internal market.
In this context, the 5th Radboud Economic Law Conference aims to provide a forum where law enforcers, judges, academics, practitioners, etc. debate such important issues and exchange ideas on future directions.
The conference is chaired by Bas de Jong (professor of Capital Markets Law) and Johan van de Gronden (professor of European Law) at Radboud University. It will be held via Zoom. A Zoom link will be send to registered participants the day before the conference. The full outline of the conference can be found on the next page. For more information regarding the conference and the registration procedure, please check: www.ru.nl/law/relc.
In order to attend this event, registration is required. Please click here or on the registration link on the left panel in the menu. Participation in this event is free of charge.