Navigating the EU Foreign Subsidies Regulation and FDI screening regimes in Europe: strategic considerations for Chinese businesses

The EU Foreign Subsidies Regulation (FSR) and the proliferation of foreign direct investment (FDI) screening regimes in Europe and the UK are reshaping the regulatory landscape for foreign investment, with Chinese investors often at the centre of scrutiny. This article outlines the FSR’s notification tools, the breadth of ‘foreign financial contributions’ and early enforcement practice. It also examines the EU’s coordination framework for FDI screening and the move toward a revised Regulation, alongside detailed case studies of France’s Minefi regime and, as a non-EU example, the UK’s National Security and Investment Act. The analysis shows that while these new and developing regimes should not impose insuperable obstacles for Chinese investors, much will depend on the specific circumstances of the deal and sectors involved, and adequate preparation will be key, with practical implications for cross-border investment strategy