COMMISSION STAFF WORKING DOCUMENT on FOREIGN DIRECT INVESTMENT IN THE EU Following up on the Commission Communication "Welcoming Foreign Direct Investment while Protecting Essential Interests" of 13 September 2017
1. This Commission Staff Working Document is a detailed report on Foreign Direct Investment (FDI) into the European Union and analyses these investments by country of origin, sector, and investor type.
2. The publication supports the EU Regulation to establish a framework for screening FDI into the EU which was adopted by the Council on 5 March 2019 and will come into force in October 2020.
3. Underpinning this report is a new EU database, the Foreign Ownership Database that, for the first time, allows FDI data to be analysed at firm-level. Fundamental to the utility of this database for investment screening is its ability to provide information on greenfield investments, mergers and acquisitions, and to identify the ultimate owner of investments. Another important distinction is that this database analyses FDI based on control of the company rather than a 10% ownership threshold, which is more commonly used in FDI analysis but may not capture all relevant investments.
4. From the publication’s sample, overall only 3% of EU companies were owned by non-EU investors yet these companies represent 35% the total assets of all EU companies. This is mainly due to foreign investors acquiring large, listed companies whose assets are on average 150 times larger than non-listed companies, which are much more common.