Reinforced obligation for Member States to establish screening and prior authorization systems for certain foreign investments in sensitive sectors
On June 26, 2026, Regulation (EU) 2026/1386 of June 17, 2026, on the screening of foreign investments in the European Union and repealing Regulation (EU) 2019/452, was published in the Official Journal of the European Union.
The Regulation will be fully applicable from January 17, 2028; however, certain institutional and preparatory provisions will apply from July 16, 2026.
Under the Regulation, all Member States must have a screening mechanism to require prior authorization for certain foreign investments in a common minimum scope of sensitive sectors.
The Regulation extends the screening regime to intra-EU investments made through European subsidiaries of foreign investors. The extension of the screening regime to this type of transaction is also a new development for Portugal, whose national regime did not expressly provide for this scenario.
Companies operating in sensitive sectors, funds, and investors with shareholders residing outside the European Union, and buyers in M&A transactions will have to anticipate the impact of the new regulatory framework, even after the closing of the investment transactions.
For further information, please do not hesitate to contact our Cuatrecasas specialists through the Knowledge and Innovation Department.