Greenland proposes foreign direct investment screening regime

Background

On 13 October 2026, the Government of Greenland reintroduced a proposal for an act on the screening of certain foreign investments in Greenland (the "Act") to the Parliament of Greenland. The Act follows an earlier proposal introduced in 2025, which was subsequently withdrawn from the Parliament's spring season agenda in April 2026. The Act does not include any material changes compared with the original proposal.

The Act comes at a time of heightened political attention to potential threats to national security and public order arising from foreign direct investments and follows the agreement entered into on 22 September 2026 by the Governments of Denmark, Greenland and the United States of America on strengthening security in the Arctic and the North Atlantic (the "Security Agreement"), which includes certain limits for investors in particularly sensitive sectors or activities in Greenland.

Under Article 10 of the Security Agreement, states or investors from states that are neither a NATO member, a NATO partner nor an EU member state shall not be allowed to have control, significant influence, or access to non-public information that may constitute a threat to national security or public order within particularly sensitive sectors or activities in Greenland, unless the Governments of Denmark, Greenland and the United States of America agree that such activities do not constitute a threat. 

The Security Agreement envisages that the objective of Article 10 will be achieved by the Government of Greenland, in close cooperation with the Danish authorities, through the application of its current or future investment screening legislation. As Greenland currently has no rules in place for the screening of foreign direct investments, the Act is intended to address this gap and provide the screening regime through which the obligation under the Security Agreement will be implemented in practice.

Key elements of the Act 

Covered types of investors

The Act will apply to investments made by foreign investors, i.e.:

• Individuals, who are not Danish citizens, or individuals, who are Danish citizens, but who have not had permanent residence or full tax liability in Greenland for the preceding five years.
• Companies domiciled outside of Greenland, or companies domiciled in Greenland that are subsidiaries or branches of companies domiciled outside of Greenland, or that are otherwise under control or significant influence of such companies domiciled outside of Greenland. Domicile refers to the place where the company is registered or has its statutory office.
• National authorities and governmental bodies from countries other than Greenland.

Covered types of investments

The Act will apply to a broad range of investments, i.e.:

• Acquisitions of ownership of, or control over, at least 25 percent of the shares or voting rights of an entity domiciled in Greenland.
• Acquisitions of ownership of, or control over, additional shares or voting rights of an entity domiciled in Greenland thereby increasing an existing ownership or controlling interest to exceed one third, 50%, two thirds, or reach 100%.
• Obtaining decisive influence over decisions regarding managerial, financial, developmental, or operational matters in, or relating to business-critical areas of an entity domiciled in Greenland by means other than the acquisition of shares or voting rights. This includes asset purchases, long-term loan agreements, leasing agreements, supplier and service agreements.
• Taking over or commencing other activities in Greenland that may pose a threat to national security or public order. This includes any economic activity, such as research and innovation collaborations, obtaining control or influence over real estate at critical locations, obtaining permits to carry out activities, etc. 

The types of investments covered under the Act largely correspond to those covered by the Danish Investment Screening Act, namely acquisitions of shares and voting rights and the acquisition of similar control by other means. Unlike the Danish Investment Screening Act, however, the Act also covers the takeover or commencement of other business activities that may pose a threat to national security or public order, such as the granting of permits to carry out activities.

Mandatory authorisation for particularly sensitive sectors 

The Act establishes a mandatory authorisation regime for investments in sectors considered particularly sensitive. Such investments cannot be completed without prior authorisation from the Government of Greenland.

The particularly sensitive sectors will include the following:

• Defence: Companies operating in the defence sector, i.e., companies engaged in developing or producing weapons, ammunition, or other military technologies.
• IT security and the processing of classified information: Companies active in IT security and the processing of classified information, i.e., companies engaged in developing, producing, or maintaining products with IT security functions, or providing services used for the processing of classified information.
• Dual-use items: Companies manufacturing dual-use items, i.e., companies engaged in manufacturing products, including technologies, which may be used for both civilian and military purposes.
• Other critical technologies: Companies manufacturing other critical technologies, i.e., companies engaged in manufacturing technologies other than military and dual-use items, such as AI, robotics, 3D printing, aerospace, energy storage, quantum, and nuclear technologies.
• Critical infrastructure: Companies operating in critical infrastructure, i.e., companies essential to maintaining or restoring functions deemed critical to society, such as companies within energy (gas, electricity, oil, water), information and communications, transport, emergency preparedness and civil protection, critical raw materials, drinking water, finance and economy, research, meteorology, the exercise of public authority in general, as well as cross-sectoral crisis management.
• Mineral resources: Companies engaged in mineral resource activities, i.e., companies holding or requiring licences under the Greenlandic Mineral Resources Act or the Mineral Activities Act.
• Self-Government-owned companies: Companies in which the Self-Government directly or indirectly holds more than 50% of the ownership interests or voting rights.
• Commercial hydropower plants: Hydropower plants that are not used for public supply. 

The list of particularly sensitive sectors also largely corresponds to the sectors covered by the Danish Investment Screening Act, with the addition of three Greenland-specific areas: (i) companies engaged in mineral resource activities, (ii) self-government-owned companies and (iii) commercial hydropower plants. The differences between the Danish and Greenlandic rules reflect Greenland's distinctive position as a territory rich in mineral resources, as well as the strategic importance of publicly owned companies and commercial hydropower plants in Greenland.The exact scope of the sectors will be determined in forthcoming executive orders to be issued by the Government of Greenland.

Voluntary notification in all other sectors

In all sectors other than those deemed particularly sensitive, the Act provides for a voluntary notification regime for investments that may pose a threat to national security or public order. Foreign investors may voluntarily submit a notification to the Government of Greenland to clarify whether an investment is considered to pose a threat to national security or public order, thereby reducing the risk of a subsequent investigation.

If an investment has not been notified under the voluntary notification regime, the Government of Greenland may, within five years of completion of the investment, initiate an investigation to assess whether the investment poses a threat to national security or public order. If the investment is found to pose such a threat, the Government of Greenland may order the investment to be unwound.

Review process 

Under both the mandatory authorisation regime and the voluntary notification regime, the application or notification must be submitted to the Government of Greenland, which will assess whether the investment may pose a threat to national security or public order. 

If the Government of Greenland considers that an investment may pose a threat to national security or public order, it may grant approval subject to conditions. Where such conditions are insufficient to mitigate the identified concerns, it may prohibit the investment altogether. It may also temporarily prohibit an investment pending its review and a determination as to whether it poses a threat to national security or public order. Further, at the request of the foreign investor, it may grant temporary approval of an investment where it does not expect the investment to pose such a threat.

If an investment covered by the mandatory authorisation regime is completed without prior approval, or if a foreign investor breaches conditions imposed by the Government of Greenland, it may order the investment to be unwound. If the order is not complied with, the Government may request the Danish Business Authority to suspend the voting rights attached to the shares in the relevant Greenlandic company.

Next steps

The Act is scheduled for its first reading in the Parliament of Greenland on 10 November 2026, with the second and third readings expected to take place in spring 2027. The Act is currently expected to enter into force on 1 July 2027 and apply to investments completed after that date. 

Plesner comments

The Act marks a significant development in Greenland's approach to foreign investment and reflects the international trend towards the adoption of foreign direct investment screening regimes to address potential threats to national security and public order. 

The Act will significantly alter the investment landscape in Greenland. Businesses and investors with existing or planned commercial interests in Greenland should therefore begin preparing for the new rules and their implications. A broad range of investments, including acquisitions of ownership interests in or control over companies domiciled in Greenland, as well as the commencement of other activities in Greenland, will require prior approval. 

The new regime will affect the planning phase, during which investors will need to assess whether an investment will require mandatory approval or whether a voluntary notification is appropriate. It will also affect the transaction timetable by extending the period between signing and closing, as completion cannot take place until the required approval has been obtained. Foreign investors should therefore assess the potential implications of the Act at an early stage.