GERMANY Law and Practice Contributed by: Daniela Seeliger, Christoph Barth, David-Julien dos Santos Goncalves and Kaan Gürer, Linklaters
wirtschaftsverordnung , AWV). Filings to the Federal Ministry for Economic Affairs and Energy have to be made in proceedings separate to the merger control proceeding with the Federal Cartel Office. Since 2017, the German legislature has substantially strength - ened and extended the rules in Germany and there has been a significant increase in the number of fil - ings. More than ever, it is imperative for dealmakers to consider foreign investment issues upfront in order • a screening process for non-EU/EFTA investors, which applies a 25% filing threshold for all sectors and a reduced 10% filing threshold for transac - tions in sensitive industries (such as critical infra - structures, cloud computing services or media companies), and a reduced 20% filing threshold for specific high-tech and future technologies as well as certain healthcare target companies; and • a screening process for non-German investors, which applies a 10% filing threshold for transac - tions in the wider military sector. to mitigate potential risks and/or delays. The regime essentially has two prongs: In addition, asset deals are also in scope of the for - eign investment regime. If a transaction raises con - cerns, the transaction may be subject to remedies or, in severe cases, even prohibited. Transactions triggering a mandatory filing require - ment are subject to a comprehensive prohibition on gun-jumping, which carries severe criminal penal - ties for non-compliance. Since the regime has gen - erally become significantly stricter in recent years and the co-ordination of regulators on an EU level has increased, companies engaged in M&A activities should consider the potential applicability of any for - eign regime early on and allow for a lengthier approval process.
The foreign investment regime has been subject to numerous changes in the past years. Recently, the German legislature reformed the Foreign Trade and Payments Act with regards to some of the rules on penalties by implementing the EU Directive 2024/1226, inter alia introducing new criminal offences and set - ting higher maximum fines. Furthermore, while the previous 21st amendment included an expansion of the national dual-use items list (German export list Ausfuhrliste Part I, Section B), the most recent 22nd amendment to the Foreign Trade and Payments Ordi - nance entered into force on 1 November 2025 has not had specific relevance for the foreign investment process. In the annual economic report 2026, the Federal Min - istry for Economic Affairs and Energy announced that it will present a draft Foreign Investment Screening Act ( Investitionsprüfungsgesetz ) by mid-2026, a major legislative project already discussed within the for - mer federal government, which will consolidate the regulations on foreign investment screening that are included in the Foreign Trade and Payments Act and the Foreign Trade and Payments Ordinance. However, it remains unclear what the revision will look like and whether it will be introduced in the shape of the envi - sioned Investment Screening Act. There are no national rules regarding foreign subsi - dies, due to the Foreign Subsidies Regulation on the EU level.
268 CHAMBERS.COM
Powered by FlippingBook