Accelerated by the Covid-19 crisis and rising concerns over the sell-off of Austrian key industries, the new federal law on the control of foreign direct investments in sectors concerning the security and public order, the so-called “Investment Control Act” (Investitionskontrollgesetz), entered into force on July 25, 2020. The Investment Control Act also implements Regulation (EU) 2019/452 establishing a European framework for the screening of foreign direct investments into the European Union[1] (“FDI-Screening-Regulation“).

The new Investment Control Act replaces the current Austrian foreign direct investment control regime, in particular section 25a of the Austrian Foreign Trade Act (Außenwirtschaftsgesetz). The aim of the Investment Control Act is to provide for a comprehensive and pan-European control of foreign direct investments in Austrian companies of strategic importance.

The Investment Control Act applies to investments entered into after the entry into force of the Investment Control Act. However, depending on the circumstances, the Investment Control Act may also become applicable to pending transactions.

Mag. Dr. Philipp Nidal Karaman, Mag. Ulrike Sehrschön, and Mag. Martin Zankl summarize what’s new and how it affects specific areas.

Download the newsletter here: New Austrian law on foreign direct investments (FDI)

[1]     Please see our newsletter in this regard dated February 15, 2019.