EP trade committee approves draft rules to screen foreign investment

Investment

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BRUSSELS, May 29 (Xinhua) — The trade committee of the European Parliament (EP) on Monday approved draft rules to screen foreign direct investment (FDI).

The aim is to ensure that foreign investments do not pose a threat to critical infrastructure, key technologies or access sensitive information,EP said in a statement.

The draft rules were approved by 30 votes to 7.

“We are not against foreign investment, but against strange investment,” said Parliament’s rapporteur Franck Proust.

“We hope to finalize new rules before the end of Parliament’s term and look forward to fruitful negotiations with the (European) Council under the leadership of the Austrian Presidency,” added the trade committee chair Bernd Lange.

Currently 12 of the 28 European Union (EU) member states each has a screening mechanism that examines FDI on grounds of security or public order. But the systems vary widely, and member states do not coordinate well.

The EP’s trade committee stipulated that a member state who decides to screen an FDI should inform other member states and the European Commission (EC) of the fact within five working days and be open to comments.

Civil society organizations and trade unions would have the right to ask for screening procedures to be launched, and the Parliament could ask the Commission to issue an opinion on a FDI that is planned or has been completed in a member state.

The draft rules are part of a trade and investment proposal package the EC announced in September 2017.

The proposal does not seek to harmonize a national screening mechanisms, but to enhance “cooperation among member states and the Commission.”

[“Source-xinhuanet”]

Written by Loknath Das