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24 March 2023

Proposal to expand the Field of Application of the Danish Foreign Direct Investment Regime

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Introduction

A proposal for adjusting the field of application of the Danish Act on Screening of Foreign Investments (the “Act”) was recently put forward by the Danish Business Authority with 29 March 2023 as the deadline set for responding.

The Danish foreign direct investment regime has been in force since 1 July 2021 and implies that all foreign investors intending to invest into certain sensitive companies will need to obtain approval from the Danish Business Authority before the investment is completed.

The proposal adds another dimension to the current regime which will require parties entering into public contracts related to critical infrastructure with a public customer to obtain prior approval of the contract. As a start, this will only apply to parties contracting within the energy sector. It is, however, the intention that this should also apply to other sectors, and a decision is expected to be made in this regard by the end of 2023.

Out of consideration for the tender process regarding the construction of the North Sea Energy Island, the Danish Business Authority has proposed that the proposal should come into force on the day after the announcement in the Danish Official Journal. This shall secure that all bidders are screened before a partnership agreement is entered into between a private participant and the Danish Energy Agency.

The overall purpose of this additional regime is to increase control with parties contracting with public customers active within management, servicing, and/or delivery of critical infrastructure, which is defined as infrastructure which is necessary to maintain or restore essential societal functions, and this covers sectors as transportation, health, drinking water and food, finance and economy, information technology, etc. 

In addition to the above, the proposal suggests certain changes to the procedures for handling notification under the Danish Foreign Direct Investment Regime.

Pernille Nørkær

Partner

+45 30 37 96 40

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Jeanette Kjeldgaard Rasmussen

Senior Associate

+45 30 37 96 44

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