China is making significant investments in shipping capacity and in port facilities outside China. This is all part of the One Belt, One Road programme as well as the idea of developing national champions in each economic sector of strategic importance to China. The transport sector is clearly one in which China has placed a lot of emphasis.

In response to the fact that Chinese enterprises and in particular enterprises with a strong link, whether formal or informal or through direct ownership or not, to the state or to the Communist Party of China are purchasing strategic assets, the EU Commission has come up with a draft Regulation to monitor and control such investments. The Commission made its move having been requested by the governments of Italy, France and Germany.

The draft Regulation is now being examined by the two houses of the EU legislator, the Council and the European Parliament. The underlying debate between Brussels and the Member States is how much control powers should be given to the EU or should remain at the Member State level. Smaller Member States, keen to encourage Chinese inward investment, are concerned that these investments may be blocked.

It is unlikely that the new rules will be agreed this year and if at all would only come into effect in 2019.