Peter Altmaier

Peter Altmaier

© BMWi/Andreas Mertens

The federal cabinet today adopted changes to the rules on investment screening. This will enable the Federal Government to undertake better screening of acquisitions by foreign investors of German companies in sensitive sectors.

Federal Minister Peter Altmaier said: “Companies like to invest in Germany, and we have no desire to change that. But in the case of sensitive infrastructure, we need to be able to take a close look at who is behind the purchase and what consequences this has. Companies which supply us with electricity, gas and drinking water or which safeguard our telecommunications are of outstanding importance for our society. The same is true of the media. We therefore decided today that we should be able to undertake screening at an earlier stage in these and in other security-related areas. This will boost our national security.”
According to the Foreign Trade and Payments Act and the Foreign Trade and Payments Ordinance, any acquisition of a company by foreign/non-EU investors whereby these acquire ownership of at least 25% of the voting rights of a company resident in Germany can be subjected to such screening. The screening considers whether the respective acquisition poses a threat to public order or security, i.e. to essential security interests of the Federal Republic of Germany.

In principle the general threshold of 25% remains in place. However, the amendment to the Foreign Trade and Payments Ordinance will lower the threshold to 10% in particularly sensitive areas, in particular in the case of critical infrastructure, other security-related infrastructure and defence-related companies.

In view of the importance of the media for the functioning of democracy, media companies are also included in this category. This means that the screening can commence at an earlier stage in particularly sensitive areas; this gives the Federal Government the chance to find out at an earlier stage whether the acquisition affects essential security interests.

In parallel to this, legislation is underway at EU level – instigated by Germany, France and Italy – on the topic of investment screening. The idea is to establish a legal foundation in secondary European law so that Member States can take action against individual cases of state-controlled or state-funded strategic direct investments.

The ordinance can be found (in German) hier (PDF, 52KB).