Brussels is expected to announce measures to cover perceived gaps in vetting foreign takeovers in the European Union's high-tech manufacturing, energy and infrastructure sectors, the Financial Times reported.
Jean-Claude Juncker, European Commission president, is set to announce these measures in a keynote speech in September, according to people briefed on the talks.
The commission is also considering a proposal to introduce EU-level investment screening, which could apply to takeovers of companies that have obtained EU funding.
These measures are in response to a reported surge of Chinese investment in the bloc's strategic sectors and concerns that China could gain technological advantage by buying European know-how.
Presently, only 13 out of 28 EU nations have systems in place for screening takeovers and other investments to evaluate whether they pose a risk to national security or public policy goals.
A report by the Mercator Institute for China Studies and the Rhodium Group said Chinese foreign direct investment into the EU reached around €35 billion in 2016; an increase of more than two-thirds from 2015.