On 25 March 2020 the EC issued Guidance in which it noted that (i) there was increased risk of acquisition of healthcare capacities (for example for the productions of medical or protective equipment) and of related industries such as research establishments (for instance developing vaccines); (ii) there was a need to restrict the acquisition of companies whose valuation on capital markets was due to Covid-19 well below their true or intrinsic value in cases where such acquisition may lead to over-reliance on foreign investors for essential supplies or essential services; (iii) strategic assets are crucial to EU’s security; and (iv) small and medium size companies (SMEs), and in particular, start-ups may be of strategic importance regardless of their size. It, therefore, called on EU MS to prioritise the adoption of FDI screening laws to deal with the fallout from Covid-19.
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