The European Commission is drafting regulations that would require foreign companies to form joint ventures with EU-based firms to access the European market. Spearheaded by industry commissioner Stéphane Séjourné, the proposal aims to boost industrial production within the EU to 20 percent of gross added value by 2030, up from 14.3 percent in 2020.
The current draft, which found its way to Politico, mandates that foreign investments above 100 million euros in sectors deemed strategically important – such as batteries, solar panels and automotive – would be screened by authorities. Foreign investors would be restricted to a maximum 49 percent ownership stake in EU companies operating in these sectors. Additional requirements include the localization of 50 percent of manufacturing in the EU, a one percent reinvestment of joint venture revenues into EU-based R&D and the transfer of know-how with intellectual property remaining in EU hands.
The policy draft sparks controversy, as the EU has always criticized similar Chinese policies. Following a leak, the Commission delayed the official proposal to 25 February to allow further internal discussion.
