Germany's US-style national security oversight regime risks stifling foreign investment, say trade specialists.
James Mendenhall, trade partner at Sidley Austin, says that there is a risk European authorities will misjudge the balance to be struck between security and investment.
"The danger is that there will be an overreaction," says Mendenhall. "Germany is struggling with where to draw the line and the situation is all very confused."
Germany is working on legislation that will scrutinise wealth-fund investments that raise national-security concerns. Sectors defined as national security-sensitive could include energy, banking, telecoms and media.
Germany is reported to be replicating the US system where a Committee...