Investment Screening in the EU From Liberalisation to the State of Exception

Following the adoption of the FDI Screening Regulation, security has become a dominant paradigm in EU investment law. This article examines the EU framework for investment screening through the lens of Giorgio Agamben’s theory on the ‘state of exception’. The FDI Screening Regulation is characterised by vague and open-ended screening criteria and a wide margin of discretion. This results in a blurred boundary between public law and political fact. Moreover, investment screening decisions are largely insulated from effective judicial oversight. The FDI Screening Regulation exemplifies a transition away from the policy of liberalisation and the emergence of security as guiding principle of investment regulation. The institutionalisation of the security exception creates a state of exception in investment law, which poses significant challenges to legal certainty and the rule of law.