The European Parliament gave the green light to new measures that will allow for more intense screening of foreign takeovers in Europe’s strategic sectors, a move that comes amid heightened concerns about investments by Chinese companies.

The draft legislation was adopted by a margin of 500-49, with 56 abstentions. Though limited in scope, the new powers aim to protect EU sectors like water, transport, communications and technologies, including semiconductors, artificial intelligence, and robotics.
During the September 2017 State of the European Union speech to the European Parliament,  EU Commission President Jean-Claude Juncker pledged to seek powers that would act as better filters for foreign takeovers in Europe’s strategic sector.
The legislation also had the backing of French President Emmanuel Macron, as well as the governments of Germany and Italy, all of whom want to counter a wave of takeovers by Chinese companies in the EU.

“With this tool, Europe will be able to better shield itself,” said the French MEP Franck Proust as the file’s rapporteur. “Acquiring infrastructure, technologies or strategic interests is becoming a political objective,” he added).

The EU executive, which has pushed for the screening of investments, has become increasingly worried about the situation with Chinese company Huawei, which is in the process of building 5G mobile networks across the EU despite coming under intense scrutiny in recent months due to the company’s ties to China’s intelligence services.

European Commissioner for Trade Cecilia Malmstrom, underlined that”it is no secret that if you follow the debate in certain countries right now … there is a question on China. There could be other countries as well,” who also added that the final decision on whether or not to block certain legislation remains with the individual national governments within the EU.