The European Parliament has officially approved a landmark agreement mandating the screening of foreign investments in critical sectors, marking a definitive shift toward economic sovereignty. With 508 votes in favour, the parliament secured a robust mandate to protect sensitive industries such as defence, semiconductors, artificial intelligence, and critical raw materials. This legislative move, agreed upon with EU Member States on May 20, 2026, ensures that foreign capital flows do not compromise the bloc's strategic autonomy.
The new rules are a direct response to growing geopolitical tensions and the increasing frequency of state-backed acquisitions in European high-tech industries. By institutionalizing mandatory screening, the EU aims to prevent the erosion of its technological edge and secure its defence supply chains. Financial services are also included in the scope, highlighting the breadth of the Commission's strategy to safeguard the continent's economic infrastructure from external interference.
This approval follows the Parliament's earlier vote on the 'safe third country' concept for asylum, indicating a broader trend of the EU tightening its borders on both security and economic fronts. The mandatory screening mechanism will empower national authorities to block or impose conditions on foreign investments that pose risks to public order or security. This creates a unified front against potential economic espionage or hostile takeovers of key European assets.
Industry analysts note that while this may slow down some investment flows, it provides long-term stability for European companies operating in strategic fields. The agreement reinforces the EU's commitment to the Critical Raw Materials Act and the Green Bonds Regulation, forming a comprehensive shield for the bloc's green and digital transitions. As the Council moves toward formal adoption, the EU is signaling that economic openness will no longer supersede national security interests.
