FDI Screening notification regime to commence in the first week of September 2024

The new Irish FDI screening regime will commence in the first week of September 2024.
 
The new regime will require the prior notification to the Minister for Enterprise, Trade & Employment (Minister) of transactions meeting the following criteria: 

  • a third country undertaking (or a person connected with such an undertaking):
    • acquires control of an asset or undertaking in the State, or
    • changes the percentage of shares or voting rights it holds in an undertaking in the State from 25% or less to more than 25% or from 50% or less to more than 50%
  • the cumulative value of the transaction and each transaction between the parties to the transaction (or persons connected with third country undertakings that are parties to the transaction) in the 12 months before the date of the transaction is at least €2m
  • the same undertaking does not directly or indirectly control all the parties to the transaction
  • the transaction relates to or impacts upon at least one of a list of prescribed matters (these include, for example, critical infrastructure, critical technologies and dual use items, the supply of critical inputs, access to or the ability to control sensitive information or the freedom and pluralism of the media)

The test to be applied by the Minister is whether or not the transaction affects or would be likely to affect the security or public order of the State. In reaching a decision on this issue, the Minister will be obliged to consider any comments submitted by other EU Member States/any opinion of the European Commission, as well as the views of a specially appointed advisory panel.
The new regime envisages a screening timeline of 90 days from the date of the screening notice, which can be extended to 135 days on written notice by the Minister to the parties.
Additional information can be requested from the parties, which will further extend the above timelines.
As notification is mandatory and suspensory, parties to a qualifying transaction will need to factor these timings into their deal planning, consider the potential outcomes of an FDI screening process (which could include the imposition of an obligation on the parties to take or to refrain from taking certain actions) and calibrate their transaction documents accordingly.          
Parties will also need to consider the possibility of a call-in by the Minister (including for non-notifiable deals), which can occur even in respect of transactions which completed up to 15 months before the commencement of the Act i.e. back to June 2023.

For more information, contact a member of ALGs EU, Competition & Procurement team.

Date published: 21 March 2024