DENMARK Law and Practice Contributed by: Thomas Maaberg Hansen and Peter Sand, Gorrissen Federspiel
but also through ongoing controls concerning access to and handling of classified information. Reporting Obligations Under the Danish Security Circular, a security-cleared supplier must immediately report any loss or compro - mise of classified information – or any suspicion that an unauthorised person may have gained knowledge of its contents – to its security officer. The security officer must then notify the responsible manager, initi - ate an investigation, notify the originator of the infor - mation, and take the necessary steps to limit the con - sequences of the actual or suspected compromise. For companies subject to the FE’s military security regime, the reporting obligations are broader. The company’s security officer must immediately report to the FE’s Industrial Security Section ( Sektionen for Industrisikkerhed ) any suspicion or detection of espi - onage, sabotage, subversion, terrorism, or similar activity. Reporting is also required in relation to other security-significant incidents, including attempted or actual break-ins, theft, loss or disappearance of mate - rial or components, compromise of classified informa - tion, suspicious behaviour, and actual or suspected breaches of the confidentiality, integrity or availability of information systems. Following such an incident, the security officer must consult the FE regarding any specific considerations or additional measures required, including whether immediate contact with the police is appropriate. A written report must be submitted to the FE’s Industrial Security Section promptly following any suspected or confirmed security breach. Separately, where a defence-sector company falls within the scope of the Danish NIS2 Act (Act No 434 of 6 May 2025), cybersecurity incidents may trigger additional statutory reporting obligations.. 5.8 Foreign Ownership, Control and Influence (FOCI) Mitigation As further described in the foregoing sections and in 6 M&A, Joint Ventures and Foreign Direct Investment in the Defence Sector , the Danish FDI Act allows the Danish Business Authority to impose conditions on foreign investments, including restrictions on owner -
ship and management. Companies producing war material, etc are also subject to restrictions on foreign ownership and board composition under the Danish War Material Act that may have a similar effect. 5.9 Interaction Between National Security Regulation and Other Regimes Denmark regulates defence-related national secu - rity through several separate regimes rather than a single overarching framework. These include export controls, sanctions, foreign direct investment (FDI) screening, defence procurement, and the protection of classified information, as described in the forego - ing sections and 6 M&A, Joint Ventures and Foreign Direct Investment in the Defence Sector . 6. M&A, Joint Ventures and Foreign Direct Investment in the Defence Sector 6.1 FDI Screening Legislation and Regulatory Framework Legislation The primary Danish legislation governing the screen - ing of foreign direct investment is the Danish Act No 1256 of 17 October 2023 on Foreign Direct Invest - ments (the “Danish FDI Act”). The Danish FDI Act is supplemented by executive orders – the two most significant being: • Executive Order No 1491 of 25 June 2021 on Delimitation of the Scope of Application of the Act on Screening of Certain Foreign Direct Investments in Denmark (the “Executive Order on Application”); and • Executive Order No 958 of 26 June 2023 on Procedure, etc for Applications for Approval of or Notification of Certain Foreign Direct Investments or Special Economic Agreements in Denmark (the “Executive Order on Procedure”). In addition, foreign investments in companies that produce war material are subject to a separate regime under the Danish War Material Act. If an investment is covered by the Danish War Material Act, the general rules on FDI under the Danish FDI Act do not apply.
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