Belgium’s FDI screening turns two: Reflections on protecting strategic assets
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The Belgian FDI mechanism through its broad scope has led to uncertainty for investors and practitioners. Recent efforts to streamline procedures and clarify coverage aim to balance security with economic growth.
On the occasion of its second anniversary, Belgium’s Foreign Direct Investment ("FDI") screening mechanism stands as a significant tool for protecting public order, security, and strategic interests from non-EU investments. Since its implementation on 1 July 2023, the mechanism has played an essential role in maintaining oversight in a country that, despite its size, ranks 8th in the EU for project-based foreign investments[1]. This underscores the need for robust screening.
In November 2022, Belgium adopted the FDI screening mechanism through its "Collaboration Agreement"[2], rooted in Regulation (EU) 2019/4452, which sets the EU-wide screening framework. The process primarily involves the Ministry of Economy ("FPS Economy"), its Interfederal Screening Commission ("ISC") and potentially the involvement of six different governments due to Belgium's separation of powers[3].
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Subscribe nowIn short, when a foreign investment proposal is submitted, a thorough review is initiated to assess risks — including the investor's background, the nature of the investment, and implications for Belgian national security and critical infrastructure. If concerns arise, the ISC may impose conditions or, in rare cases, block the investment. This review process is capped at 30 days. Furthermore, the foreign investor and/or the involved Belgian target company may appeal the ISC’s final decision on admissibility to the Brussels Market Court[4].
In its first two years, the screening mechanism has proven helpful in preserving Belgium’s strategic autonomy and protecting critical assets. As decisions are not published, meaningful analysis awaited the first annual report released in September 2024. Highlights from this report include:
- 68 notifications received;
- 53 investments authorized;
- 15 cases pending;
- 0 investments blocked; and
- Formal screening required in 7% of cases
Key sectors impacted were data and health (15.1% each), digital infrastructure (11.6%), transport (10.5%), and electronic communication (8.1%)[5].
Despite its successes, the mechanism’s broad scope has sometimes led to uncertainty for practitioners regarding sectoral coverage. To address this, the ISC engaged with businesses and industry experts, resulting in the publication of Q&A guidelines in April 2024 for further guidance[6].
The authorities furthermore stated that efforts are underway to optimize the practical functioning of the screening mechanism in collaboration with all parties involved. This includes improving the notification forms and the IT application used for submissions[7].
Looking forward, Belgium’s FDI screening mechanism continues to bolster national interests, though its complexity and occasional opacity could discourage potential investors. Further clarifying guidelines and implementing legal reforms, as recommended last year, will be vital to balancing security with economic growth.
In the second year, according to macro-economic forecasts from the FPS Economy, the Belgian economy is expected to grow by 1.2% for year 2024-2025[8]. Consequently, a slight increase in the number of notified investment cases is anticipated.
As more decisions are made, the scope of the covered sectors is expected to become clearer, refining the process for all stakeholders.
[1] According to the 2025 EY Belgian Attractiveness Survey (Main insights of the Belgian Attractiveness Survey 2025 | EY - Belgium)
[2] This Collaboration, also known as "Samenwerkingsakkoord" (NL) or "Accord de cooperation" (FR) is an agreement made between the federal state and the various governmental bodies as Belgium holds a decentralized constitutional approach.
[3] Belgium is a federal country with a bifurcated federal structure in which the Federal government, the Flemish, Walloon and Brussels Region and the Flemish, French-speaking, and German-speaking Community share competences, each have their own government.
[4] The appeal is non-suspensory, and successful appeals lead to a new review before the ISC. The decision to open a Phase II screening process is in contrast not appealable.
