German Foreign Investment Control
Advice related to foreign direct investments
To safeguard against threats to the security and public order of Germany and Europe, the German Federal Ministry for Economic Affairs and Energy (BMWi) may, on a case by case basis, review acquisitions of or investments in German companies by foreign investors, impose requirements or conditions on such transactions or even prohibit them. German investment screening has repeatedly been tightened in recent years and now covers not only armaments and critical infrastructures but also e.g. technologies deemed to be critical as well as the healthcare sector. In this context it has become increasingly important to look at the period before the conclusion of a sales contract. At the same time, the vagueness of numerous legal terms and long review periods create considerable legal uncertainty. That makes it all the more important for both purchasers and sellers to know and comply with the relevant requirements.
We provide comprehensive assistance to German and foreign sellers and purchasers
in reviewing whether a proposed sale or purchase might require or trigger an examination under investment control law
in complying with the requirements of foreign trade law relating to German investment screening during the sale process
in determining an approach to reporting acquisitions concerned which is characterised by both legal certainty at the same time economic efficiency
in representing clients when dealing and communicating with the BMWi prior to and during the examination process
in applying for a clearance certificate or approval from BMWi as well as in negotiating public law contracts.
Avoiding costly rescissions and serious sanctions
The more stringent approach to investment control can be seen primarily and particularly in the potential sanctions to be imposed for violations against requirements of foreign trade law. Not only does a prohibition on closing exist with regard to certain notifiable acquisitions – including in certain scenarios also the risk of being required to rescind contracts already closed in a process that is both complex and costly –, but companies and individuals failing to comply with the rules may also face serious penalties and administrative fines, and even imprisonment. Our experienced lawyers provide you with full advice throughout the various stages of a direct investment transaction to avoid violations and bring your investment project to a swift and successful conclusion.
