Czech Republic expands the pool for mandatory FDI screening

With the new Czech Cybersecurity Act coming into effect on 1 November 2025, the Czech Republic has broadened the scope of transactions that fall within the scope of its mandatory FDI screening regime.

FDI review regimes

The need for Czech FDI screening can be triggered in two situations:

• a mandatory obligation that applies to investments in specified sensitive sectors; and
• an ex officio method where the Czech Ministry of Industry and Trade (“MIT”) decides to initiate a review of foreign investments that could pose a risk to national security or public order. MIT is authorised to commence a review within five years after a transaction has been completed.

To minimise the risk of a transaction being reviewed after completion, foreign investors whose deals do not clearly fall under the mandatory obligation can request a preliminary consultation with the MIT. This process could lead either to a binding clearance or to a full-scope FDI review with a standard decision such as approval, conditional approval, or rejection.

Key developments

The Cybersecurity Act introduces a new category of “providers of a regulated service under the regime of higher obligations”. These are entities that, due to their size, number of users, geographical reach, impact on their sector or other regulated service providers, or operational risk, are considered economically, socially, or security-wise significant to the Czech Republic. This category is expected to include businesses in areas such as information infrastructure, utilities distribution, healthcare, transport, and financial services.

Providers in this category must self-assess and register with the Czech National Cyber and Information Security Agency (“NCISA”) in accordance with the criteria set out in Implementing Decree No. 409/2025 Coll. Any transaction involving such providers will automatically be subject to mandatory FDI screening.

Conclusion

The introduction of the new Czech Cybersecurity Act significantly widens the scope of transactions subject to mandatory FDI screening, particularly in sectors critical to national security and public order. Foreign investors should carefully assess whether their planned deals involve a regulated service provider under the regime of higher obligations and factor in additional time for regulatory clearance when planning deals in the Czech Republic.

Early legal assessment and voluntary engagement with the MIT can help mitigate the risk of delays or post-completion reviews. For more information on how these changes could affect your investments, please contact one of our CMS experts: Lukas Janicek or Huyen Vu Novotna.