New FDI Screening Regime

Lxembourg established its foreign direct investment (FDI) on 1 Sep 2023 to restrict critical activities that could impact security or public order. This law aligns with EU Regulation 2019/452. It excludes portfolio investments but include the production, exploitation, and sale of dual-use goods, operations in various sectors like energy, transport, health, AI, cybersecurity, aerospace, defense, and more. Additionally, the definition of critical activities is expanded to cover research and production activities connected to critical sectors, and related activities involving access to sensitive information. This applies to non European Economic Area investors exceeding 25% of voting rights or effective control over a Luxembourg entity.

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