FDI Law Update

The Swedish Parliament has approved a new law aimed at safeguarding national security by scrutinizing foreign direct investments. This law, effective from December 1, 2023, covers sensitive sectors like critical infrastructure, defence, and security-related activities. It grants the authority the power to review and potentially prohibit foreign investments affecting Sweden’s security interests.

Foreign direct investments in sensitive sectors will face mandatory scrutiny, even if the investor is Swedish. The Inspectorate of Strategic Products will oversee this process, making approvals or prohibitions within specific timeframes. Non-compliance may lead to fines of up to SEK 100 million, with avenues for appeal.

This new framework adds complexity to M&A transactions in Sweden, as they must now navigate multiple regulatory processes alongside existing laws. Businesses should consider these changes early in their transaction planning.

To learn more about this framework follow this link.