As global investment strategies adapt to stricter environmental standards, tensions are rising between major investors and European regulators. Yasir Al-Rumayyan, Governor of Saudi Arabia’s Public Investment Fund (PIF), has voiced strong concerns about the European Union’s upcoming sustainability regulations, describing them as “outrageous” and a threat to investor confidence.

Speaking at the FII Priority Summit in Tirana, Al-Rumayyan criticized the EU’s new framework, which includes over 1,000 compliance metrics and is set to take effect in 2028 following a two-year delay. He warned that the rules create uncertainty and risk for global investors, potentially leading to disinvestment from the region.

He highlighted that companies could face penalties not only for their European operations but also on their parent companies—up to 5% of global revenue—if found non-compliant. This, he argued, is excessive and a deterrent to investment.

Al-Rumayyan also questioned the scope and retroactive nature of the regulations, calling the lack of predictability the biggest obstacle to financing in Europe. He warned that businesses may be pushed to relocate operations outside the EU to avoid the regulatory burden.

To illustrate the risks of abrupt policy changes, Al-Rumayyan cited PIF’s experience with Credit Suisse. The fund had owned about 5% of the bank when, according to him, a sudden regulatory shift by Swiss authorities erased its entire investment. He described the move as a fundamental breach of the legal framework, stating that “150 years of rule of law was changed overnight,” which he called a major red flag for investors.

Despite his criticism, Al-Rumayyan reaffirmed PIF’s commitment to Europe, noting that the fund has invested $85 billion across the EU since 2017 and aims to increase that to $170 billion by 2030. He said these investments have contributed $52 billion to EU GDP and created around 254,000 jobs.

Calling for a clearer and more consistent regulatory environment, he concluded by urging European leaders to make the continent more welcoming to global investors who want to grow and maintain their investments.