A spider’s web: regulatory oversight and the interplay between EU Merger Control, Foreign Direct Investment Screening (EU and National), and Foreign Subsidies Regulation

Abstract In the last few years, we have seen an intensification of regulatory oversight in the European Union (EU). The EU has increased its oversight of M&A transactions and, more recently, its oversight of investments. The European Union Merger Regulation (EUMR) has been in force for the last 35 years, but more recently, we have seen the introduction of Foreign Direct Investment (FDI) Screening regulation as well as a regulation to oversee foreign subsidies by non-EU governments. These developments are a clear illustration of the Commission’s intention to adopt a stricter approach when it comes to the assessment of such initiatives. The article will start by briefly discussing the scope of these regulatory instruments and will then focus on how the notification requirements and the substantive analysis are being conducted under each one of these regimes, trying to draw parallels but also showcasing the differences that these regulatory frameworks have, and which can lead to potential divergence in decision-making (including on the same transaction). The article will discuss in detail the arsenal of the European Commission and of the national regulators in enforcing these rules. This article examines these three regimes not only descriptively but also comparatively, asking what their coexistence means for competition, investment, and regulatory coherence in the EU. By placing the EUMR, the FDI Screening Regulation, and the foreign subsidies regime side by side, the article highlights both the strengths and the shortcomings of this emerging regulatory web. While the coexistence of these regimes gives the EU a more comprehensive approach to safeguarding competition and a level playing field, it also creates risks of duplication, inconsistent outcomes, and legal uncertainty for firms navigating multi-jurisdictional approvals. The value of the article lies in identifying these tensions and assessing whether the EU’s evolving multi-layered approach achieves an appropriate balance between regulatory protection and market openness.