Europeanization of FDI Screening Through Soft Law? Administrative Cooperation under the 2024 Commission Proposal for an Updated EU FDI Screening Regulation

In January 2024, the Commission unveiled its proposal for a revised foreign direct investment (FDI) Screening Regulation. While the proposal does not openly question the Member States’ final say in screening decisions, the mechanism for administrative cooperation would be considerably enhanced compared to the current legislative framework. The paper assesses in how far the changes to the cooperation mechanism under the Commission proposal may contribute to Europeanization of FDI screening. It argues that the proposal fits into the geo-economic turn of the Union. At the same time, it showcases the limits the Union’s status quo poses to reacting adequately to the ongoing geopolitical upheavals. Underlying the Commission proposal is a considerable reliance on the effectiveness of political peer pressure and soft law instruments, instead of hard regulation. Given that the Commission proposal is largely a middle ground between the negotiating positions of the Parliament and the Council in the current ongoing trilogue, it is not unlikely that this is where we will end up.