With an eye on China, Germany tightens foreign investment rules
Measures are meant to protect vital infrastructure
Berlin — Germany agreed new rules on Wednesday to lower the threshold for screening and even blocking purchases of stakes in German firms by non-Europeans, in a move to fend off unwanted takeovers by Chinese investors in strategic areas. The decision by Chancellor Angela Merkel’s cabinet is a response to mounting concern that China’s state-backed companies are gaining too much access to key technologies in Europe’s biggest economy while Beijing shields its own companies. Under the new rules, Berlin can intervene on grounds of public interest if a non-European investor buys a 10% stake in a company, sharply reducing the threshold from 25%. “Germany is an open-market economy where foreign investments are welcome. That will remain the case in future. But we must not be naive,” said Joachim Pfeiffer, spokesperson for economic affairs in Merkel’s conservative bloc. If foreign states pursue political goals with targeted investments in key areas, Berlin must be able to act, he said. “It is...
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