Greece Introduces National Screening Mechanism for Foreign Investments

14:06 15/5/2025 - Πηγή: Dikaiologitika

Greece is moving to tighten its control over foreign direct investments (FDIs) with a new bill aimed at safeguarding national security and public order.

The legislation, introduced by the Ministry of Foreign Affairs and currently under debate in Parliament, proposes the creation

of a national screening mechanism that would scrutinize foreign investments in critical sectors, particularly in sensitive border regions such as Thrace and the Northeastern Aegean.

This move is widely seen as a response to growing concerns over unchecked foreign acquisitions—especially by Turkish interests—in areas considered strategically important. While the European Union already has a framework for FDI screening, the Greek government believes a national mechanism is necessary to address gaps in enforcement and provide more direct oversight. The initiative, led by Foreign Minister George Gerapetritis, reflects a broader trend among EU member states seeking greater autonomy in controlling investment flows that may have geopolitical implications.

Under the proposed system, an inter-ministerial committee made up of senior officials from various ministries will be established to review investment proposals. The committee will assess whether an investment poses a risk to national security or public order, and then issue a recommendation. The final decision will rest with the Foreign Minister, who can approve, block, or conditionally approve the investment. A key provision of the bill is a 60-day deadline for the government to make a decision; if no decision is issued within that timeframe, the investment will be automatically approved.

The mechanism will apply to a wide range of sectors, including defense, energy, transport, digital infrastructure, cybersecurity, artificial intelligence, and critical underwater and port infrastructure. Notably, the bill also extends oversight to tourism-related investments in border regions, a late addition driven by political pressure from within the ruling New Democracy party. Several lawmakers had raised alarms about a surge in Turkish purchases of land and property in Thrace and nearby islands, prompting the government to include this sector within the scope of the new controls.

Government officials have emphasized that the bill does not aim to exclude investors from any particular country but rather to ensure transparency about the origin of investment funds and the identity of the ultimate beneficial owner. In many cases, they argue, the true investor is hidden behind a network of intermediaries, making it difficult to assess potential risks.

Although the European FDI framework provides for cooperation among member states, it is limited in practice. For example, a foreign investment can only be formally reviewed by the European Commission if at least nine member states request it, a threshold that is rarely met. By establishing its own mechanism, Greece is positioning itself to act unilaterally when necessary to protect strategic assets.

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