Screening of Third Country Transactions Act 2023

The Screening of Third Country Transactions Act 2023 (the ‘Act’) was signed into law on 31 October 2023 and is expected to come into effect in the second quarter of 2024. The Act will ensure Ireland meets its obligations under Regulation (EU) 2019/452 of the European Parliament and of the Council of 19 March 2019. The Act enables the Minister for Enterprise, Trade and Employment (the ‘Minister’) to review and potentially halt transactions which may present a risk to Ireland’s security and public order, particularly transactions related to critical infrastructure and technologies.

Notification Regime

The Act establishes a mandatory notification regime for transactions meeting certain specified criteria. A transaction must be notified to the Minister where:

  • a third country undertaking (i.e. one outside the EU, EEA or Switzerland), or a person connected with such an undertaking, as a result of the transaction: (i) acquires control of an asset or undertaking in the State, or (ii) changes the percentage of shares or voting rights it holds in an undertaking in the State from 25% or less to more than 25%, or from 50% or less to more than 50%;
  • the value of the transaction is €2,000,000 or greater (subject to a cumulative assessment of transactions involving the same parties over the prior 12-month period); and
  • it is related to/impacts one of the following:
    • Critical Infrastructure – whether physical or virtual, including energy, transport, water, health, communications, data processing/storage, defence, electoral and financial infrastructure;
    • Critical technologies – including AI, robotics, cybersecurity, energy storage and nano/bio-technologies;
    • Critical inputs – including energy, food security and raw materials;
    • Access to sensitive information – including personal data or the ability to control such information; or
    • Freedom and pluralism of the media.

Notification Requirements

A relevant transaction must be notified to the Minister at least 10 days before the date on which the transaction is to be completed, with such notification obligation applying to all parties to the transaction.

If the parties fail to notify the Minister of a notifiable transaction, such a transaction shall be deemed subject to a screening decision of the Minister that it is one which affects or would likely affect the security or public order of Ireland. Such a decision shall be deemed to be made the day before the transaction’s completion. Failure to notify is a criminal offence and may result in fines of up to €4 million and/or 5 years’ imprisonment.

Review Process

From notification, the Minister has 90 days, which can be extended to 135 days, to issue a decision. The review period is paused if the Minister seeks further information. The Minister may decide to:

  • prohibit the transaction or certain parts of it;
  • authorise the transaction; or
  • authorise the transaction subject to certain conditions – such as a requirement that a party divests itself of certain assets, shares, or business interests.

Parties have 30 days to notify the Minister of an appeal, with any such appeal heard by a designated adjudicator. The parties may appeal the decision of an adjudicator to the High Court on a point of law.

Call-in rights of the Minister on non-notified Transactions

The Minister has a right, when they have reasonable grounds for believing the transaction affects or might affect public order or security in Ireland, to ‘call-in’ transactions for review.

  • For notifiable transactions which were not notified, the Minister has the power to review such transactions before the later of 5 years from the date the transaction was completed or 6 months from when the Minister first became aware of the transaction.
  • For non-notifiable transactions the Minister may exercise the power to review provided such ‘call-in’ occurs within 15 months of the transaction completing.
  • For transactions which completed before the Act came into effect the Minister may exercise the power to review any such transaction where it completed within 15 months of the Act’s commencement.

For further information please contact Eoin Mackessy (Solicitor), Barry O’Reilly (Solicitor) or your usual AMOSS contact.