As of 24 April 2023, all Belgian legislators had ratified the interfederal cooperation agreement of 30 November 2022 on FDI screening (the Cooperation Agreement). The French community’s parliament was the first to publish its ratification statute in the Official Belgian Gazette at the beginning of May¹. More recently, on 7 and 13 June 2023, the federal and the remaining regional legislative acts adopting the Cooperation Agreement were published in the Official Belgian Gazette². This paves the way for the entry into force of Belgium’s first comprehensive³ Foreign Direct Investment (FDI) regime on 1 July 2023⁴.

Under the new FDI regime, “foreign investors”[5] acquiring at least (i) 10% of the voting rights in companies or entities that are based in Belgium whose activities touch on the defence sector, energy, cybersecurity, electronic communication, digital infrastructures, and whose turnover consisted of more than EUR100m in the financial year prior to the acquisition of such voting rights, or (ii) 25% of the voting rights in companies or entities that are based in Belgium whose activities touch on a number of “strategic sectors” such as vital infrastructure for energy, transport, water, health, electronic communication, digital infrastructure, media, data processing and storage, air- and aerospace and defence, elections or financial infrastructure, will be required to submit a notification to a newly established ’interfederal screening commission” (the Screening Commission), and an actual FDI screening process may be initiated subsequently.

The Screening Commission will  serve as a single point of contact for FDI notifications in Belgium, and issued on 31 May 2023 its (long-awaited) guidelines (available here) aimed at clarifying the scope and applicability of the FDI rules. These guidelines are still in draft form, quite high-level and may be subject to further changes. In addition, the Screening Commission still needs to issue further guidance on how an FDI filing should be made. 

Anticipating  more precise and definitive guidelines from the Screening Commission, we share some practical tips and tricks derived from our experience of the currently existing FDI regimes in the European Union (EU), so you can  start preparing in the run up to 1 July 2023 deadline, and for the period thereafter. To view our tips and tricks, please consult the document below. 

Footnotes

1. The parliament of the French Community adopted a statute ratifying the Cooperation Agreement on 9 February 2023, and this was published in the Belgian Official Gazette on 3 May 2023.   

2.  In addition to above, the Cooperation Agreement has now also been ratified the parliaments of the Belgian Federal State, Flemish Region, Walloon Region, Brussels-Capital Region, Flemish Community, French-speaking Community, German-speaking Community, French Community Commission and Common Community Commission. At the federal level, the Cooperation Agreement was approved by the act dated 14 February 2023. At the regional level, in addition to the above, the Cooperation Agreement was approved by (i) statutes of the Walloon Parliament dated 20 April 2023, (ii) the statute of the Flemish Parliament dated 31 March 2023, (iii) the statute of the German Community’s Parliament dated 24 April 2023, (iv) the statute of the Brussels Capital Region’s Parliament dated 13 April 2023, (v) the Statute of Parliament of the French Community Commission dated 30 April 2023, and (vi) the statute of the Parliament of the Common Community Commission dated 13 April 2023. The latter act / remaining statutes were published in the Official Belgian Gazette of 7 and 13 June 2023.  

3. To date, no such fully-fledged FDI screening mechanism exists in Belgium. Only a limited post-factum screening mechanism exists in Flanders, but its scope is limited to foreign (ie non-EU) investments in certain Flemish government entities.

4. For the purposes of the Cooperation Agreement, a “foreign investor” means (i) a natural person whose main residence is outside the EU, (ii) a company constituted or organized under the laws of a non-EU country, or (iii) a company where the ultimate beneficial owner’s (UBO’s) main residence is outside the EU.