Screening of Third Country Transactions Bill 2022 – key considerations

Screening of Third Country Transactions Bill 2022 – key considerations

The introduction of the Screening of Third Country Transactions Bill 2022 (the “Bill”) is expected to come into force in early 2024.

The Bill will deal with the investigation and screening of certain transactions which involve persons, connected persons or undertakings from outside of the European Union, the European Economic Area and Switzerland. It will also allow the Minister for Enterprise Trade and Employment the power to block, or impose certain conditions on these transactions. As the Bill is still working its way through the legislative process, it may be subject to further amendments before it is enacted.


The Bill gives effect to Regulation (EU) 2019/452 (the “Regulation”) and provides for the establishment of a framework for the investigation and screening of foreign direct investment involving third countries to include third country nationals and/or third country undertakings.

Third countries, for the purposes of the Bill, are countries outside of the EU, the EEA and Switzerland. Third country nationals (being persons ordinarily resident in a third country) and third country undertakings (being undertakings governed by the laws of a third country or controlled by a person resident in a third country) are also captured. The United Kingdom (following Brexit) and the United States are considered a third country for the purposes of investment screening. As such, notifiable transactions involving US or UK companies, and/or involving persons ordinarily resident in the US or the UK, will need to be notified.

What type of transactions are notifiable?

The Bill sets out certain criteria to determine if a transaction is notifiable, including that the value of the transaction is at least €2,000,000 or an amount prescribed by the Minister. The transaction must also directly or indirectly relate to or impact upon at least one of the prescribed sectors noted below.

Sectors captured by the Bill

Transactions involving the following sectors may constitute notifiable transactions for the purposes of the Bill:-

  • transactions involving critical infrastructure, whether physical or virtual, including energy, transport, water, health, communications, media, data processing or storage, aerospace, defence, electoral or financial infrastructure, and sensitive facilities, as well as land and real estate crucial for the use of such infrastructure;
  • transactions involving critical technologies and dual use items as defined in point 1 of Article 2 of Council Regulation (EC) No 428/2009, including artificial intelligence, robotics, semiconductors, cybersecurity, aerospace, defence, energy storage, quantum and nuclear technologies as well as nanotechnologies and biotechnologies;
  • transactions involving the supply of critical inputs, including energy or raw materials as well as food security;
  • transactions involving access to sensitive information, including personal data, or the ability to control such information; or
  • transactions involving the freedom and pluralism of the media.

Requirement to notify

Parties to a notifiable transaction are required to submit a notification to the Minister at least 10 days prior to the completion of the transaction. Failure to notify within this timeframe would result in the transaction being deemed to be the subject of a negative screening decision by the Minister made on the day before the date on which the transaction is completed. In addition, a failure to notify a notifiable transaction within this time-frame is a criminal offence.

If further information is required to assist the investigation, a notice in writing can be issued to the relevant party or parties by the Minister. The notice must allow the party/parties at least 30 days to gather and provide the information requested.

Right to ‘call-in’ transactions

Even if a transaction does not meet the criteria for notification, the Minister has, in certain circumstances, the right to ‘call in’ a transaction for review. In respect of transactions that were non-notifiable, the Minister may nonetheless investigate / ‘call-in’ such transactions up to 15 months after that transaction completes. Accordingly, in respect of transactions that were completed before the commencement of the legislation, the Minister will be able to ‘call-in’ and investigate any transactions that were completed up to 15 months before the commencement of the legislation. It is therefore important that this look back review mechanism should be factored into any potential deals, notwithstanding that the legislation is not yet in force.

Review process

The Minister will be required to issue a written “screening notice” to the parties as soon as practicable following the commencement of the review. The screening notice will summarise the reasons for which the transaction is being reviewed and will invite the parties to make written submissions.
Where a screening notice has been issued, the transaction cannot be completed and the parties cannot take any action for the purposes of completing or furthering the transaction until the Minister makes a screening decision approving the transaction.

A screening decision must be made by the Minister within 90 days from the date on which the screening notice was issued, however, this may be extended to no more than 135 days by the Minister by notice in writing.

In circumstances where the transaction has already completed (e.g. a non-notified transaction), the Minister can require the parties to the transaction to do or refrain from doing multiple different actions, including, but not limited to, to sell or divest, to cease a conduct or practice, and not to complete the transaction. The Minister may also require the parties to pay the Minister such amounts as the Minister may specify to cover the costs of monitoring compliance with any conditions imposed by the Minister.


The Bill provides that the parties to a transaction may appeal a screening decision to an independent adjudicator and must notify the Minister that they are appealing no later than 30 days after being notified of the screening decision. The appellant must submit the appeal to the adjudicator within 14 days after providing notice to the Minister. A decision of an adjudicator may be appealed on a point of law to the High Court.

Penalties for non-compliance

Under the Bill, it is a criminal offence to:-

  • fail to notify a notifiable transaction as required under the Bill;
  • where a screening notice has issued in respect of a transaction, complete the transaction, or take any action for the purpose of completing or furthering the transaction until the Minister makes a screening decision approving the transaction;
  • where a transaction is subject to a conditional screening decision, complete the transaction other than in accordance with the conditions;
  • where the Minister makes a screening decision blocking a transaction, complete the transaction, or take any action for the purpose of completing or furthering the transaction;
  • fail to comply with a notice for information;
  • provide the Minister with information that the party knows is false in a material respect, or is reckless as to whether it is false in a material respect.

Criminal penalties for non-compliance on any of these grounds may apply to companies and individuals, and include fines of up to €4 million and/or a term of imprisonment of up to 5 years (for conviction on indictment).

Practical Considerations

Once enacted, the legislation will establish the State’s first foreign investment screening process. Parties should be mindful of the potential scope of the transactions that may be impacted and take care when considering whether or not a transaction involving any of the relevant sectors will constitute a notifiable transaction. Parties may also consider preventative structural measures such as carving out assets, operations or subsidiaries.

For further information contact Elaine McGrath

Elaine McGrath
Author: Elaine McGrath