New EU economic‑security roadmap resets the bar for foreign investment into Europe
Published on 8th December 2025
European Commission tightens foreign investment scrutiny, with plans to monitor portfolio investments for the first time
The European Commission unveiled a new economic security roadmap that will subject inbound investments to stricter scrutiny. This includes plans to monitor portfolio investments for the first time and coordinate screening practices across Member States.
The Commission announced its intention to move from being reactive to proactive. It says that existing tools will be used and reshaped, "irrespective of their original purpose", which it calls a "paradigm shift".
What changed?
On 3 December 2025, the Commission and the High Representative for Foreign Affairs and Security Policy published a Joint Communication on strengthening EU economic security. It builds on the 2023 Economic Security Strategy and outlines a more strategic and assertive use of the Union's tools to support Europe's economic security.
While Europe remains open to investment, the direction is clear: in high‑risk areas, authorities will probe who funds what, how influence is exercised, where technology and talent are anchored, and whether a transaction creates new dependencies. For foreign investors, this may mean earlier triage, longer lead times, and more negotiations on governance, data and localisation commitments.
Key elements
A central proposal is the plan to start monitoring portfolio investments in areas identified as high risk for economic security purposes. These currently fall outside the EU's foreign direct investment (FDI) coordination mechanism. The Commission appears to be targeting hedge funds and asset managers taking stakes in EU-based companies. It will work with the national supervisory authorities to monitor these portfolio investments.
The Commission will develop FDI guidelines to drive uniform screening approaches across national authorities, including how to address cumulative risk from multiple investments. Additionally, it will clarify the interplay between EU‑level requirements and national financial sector screening mechanisms.
The Commission will implement targeted measures to limit foreign control over cutting-edge technologies, such as battery electric vehicles and other sensitive sectors. These measures will include technology transfer conditions for inbound investments, implemented through trade tools and other levers. The goal is to ensure critical know‑how and skilled workforces are retained within the EU, especially in these high-tech and sensitive areas.
The roadmap highlights six high‑risk areas:
- Strengthening supply chains and counteract strategic dependencies;
- Attracting value‑added inbound investment;
- Supporting defence and space industrial base and other high-risk industrial sectors;
- Developing and maintaining leadership in critical technologies;
- Protecting sensitive information and data;
- Preventing and mitigating disruptions to EU critical infrastructure.
Certain third countries and businesses have demonstrated their interest in acquiring control of nascent or advanced EU technology and know-how, pursuing this aim through acquisitions, research and development (R&D) cooperation, reverse engineering or industrial espionage. The Commission will continue to map key EU quantum actors and infrastructures and track foreign investments, partnerships and intellectual property flows to feed FDI screening, export control and research security risk assessments.
The Commission also plans a comprehensive evaluation of the dual-use export control regulation. This review will assess whether the current rules remain effective given new geopolitical and geo-economic conditions. A key part of the evaluation will be exploring options to adopt new controls for emerging technologies quickly and efficiently.
Additionally, a new Economic Security Information Hub will consolidate intelligence on critical supply chains, infrastructure and technologies, enabling more frequent information requests and enhanced coordination between national and EU‑level regulators.
The Commission also intends to make full use of the foreign subsidies regulation. This will probably lead to more proactive use, resulting in more ex officio investigations. Due to a high number of notifications, it has only made limited use of its powers to date.
Implications for stakeholders
| Stakeholder | Key Implications |
| Investment funds and asset managers | Expect monitoring of portfolio investments in high risk areas:
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| Targets/companies seeking inbound investment | Anticipate technology transfer and value creation conditions:
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| Start-ups in critical technology areas | Be aware of a pilot EU-level start-up monitoring mechanism in critical technology sector:
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| Regulatory/compliance teams | Prepare for enhanced compliance costs due to:
|
Osborne Clarke comment
The roadmap confirms that economic security now sits alongside competition, trade and industrial policy as a lens through which Brussels will assess cross-border capital.
The EU maintains that it remains firmly committed to open and rules-based trade, investment relations and international cooperation. However, in today's geopolitical environment, safeguarding the EU's economic security is imperative.
The Commission, European Parliament and EU Member States must work together in close cooperation with industry. This collaboration is essential for efficient and informed decision-making. The EU is determined to use all available tools in a more proactive, strategic and coordinated way. The aim is to build a strong, secure and resilient economy for the long term.
Investors who integrate economic security risk into their origination, structuring and portfolio governance will be better placed to navigate the new regime.
The Commission's new Economic Security Information Hub will consolidate intelligence on critical supply chains, infrastructure and technologies, enabling more frequent information requests and enhanced coordination between national and EU-level regulators.
Forthcoming FDI screening guidelines will establish consistent approaches across Member States and clarify the interplay between EU-level requirements and national mechanisms, particularly in the financial sector.
This is likely to entail less divergence in national FDI regimes, with each regime expected to become increasingly tough rather than less strict. For example, the Dutch FDI regime – which is currently rather limited – may be considerably expanded.
On the other hand, the Commission envisages offering a helping hand to companies whose financial viability may be at risk due to being blocked from non-EU funding as a result of the (tougher) FDI rules, as well as proposing EU preference criteria for public procurement in specific strategic sectors. In other words: EU companies and institutions should buy European.
