Issue Note Germany Interagency Review

by Dr. Michael Brüggemann and Tim Hendricks.

The German investment screening mechanism provides cooperation between national authorities at various points. First and foremost, the Federal Ministry of Economics and Climate Action, the BMWK, as the lead ministry, involves other federal ministries whose remits could be affected by the transaction under review and requires the approval or consensus of different authorities in the event of prohibition or acquisition-restricting measures. At the EU level, coordination with other Member States takes place via the EU cooperation mechanism, the importance of which is likely to increase in practice as part of the planned revision of the EU Screening Regulation. Closer coordination between the Member States is to take place, and the Member States and the European Commission should also be able to launch the cooperation mechanism on their own initiative in future.

The investor has a central role in the German investment screening procedure and is obliged to make the notification in case of a notification requirement. The seller usually undertakes in the SPA (APA) to support the purchaser in the investment screening procedure. Investors have formal rights as the FDI screening is a procedure governed by administration law and can proactively support the procedure as well as contribute to the practical and timely processing of the review by providing additional information as part of the notification or responding quickly to queries from the ministry. Political aspects (and lobbying) can also have an influence on the outcome of the process.