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The Swedish government is drafting a new law that would allow the country to veto foreign investments on national security grounds, a move that Sweden’s business lobby worries would impact investment in the wealthy Nordic nation, Bloomberg reported Tuesday.

The proposal comes a month after an investigation from public broadcaster Sveriges Television found that around 1,500 Swedish companies from various sectors – including car manufacturer Volvo – have Chinese owners.

Sweden’s move follows similar initiatives in the European Union with many nations in the bloc rethinking their relations with China. Sweden is one of the few EU countries with no specific legislation barring foreign investments on security grounds.

If approved, the new bill could change that, which has prompted concerns from the Confederation of Swedish Enterprise. The business group noted that an emphasis on security in international trade relations could come with economic risks and hinder Sweden’s reputation as an investment destination.

More than half of Sweden’s gross domestic product derives from exports. Meanwhile, the Nordic nation is working to become a hub for green technologies.

The focus on green technology has led to a number of Chinese companies setting up operations in Sweden and supplying vital components to the emerging sector.

Despite concerns, some Chinese companies and investors said they do not expect a big impact on their businesses from the proposed legislation.