The EU will unveil plans on Wednesday to restrict foreign sovereign wealth funds investing in Europe. It comes after Russia passed a law allowing its fund to buy into stocks abroad. But Russian business leaders argue the West should embrace rather than fe

Last month Russia assigned $US 32 billion of its oil money into a new Fund for National Wellbeing. From next September this pension fund was expected to join cash-rich Asian nations swooping on Western corporations like Citigroup, and Merrill Lynch.

But on Monday EU Commission President, Jose Manuel Barroso, expressed “real concerns” about this. He pledged to unveil a code of conduct by Wednesday, to make non-European funds follow the example of Norway's pension fund, which lists all its purchases.

“Europe-based public and private investment funds are subject to stringent rules on governance and disclosure. We cannot allow non-European funds to be run in an opaque manner or used as an implement of geopolitical strategy,” he announced.

Russian business experts dismissed the EU's claims, insisting neither the fund's managers nor the Russian people would let it run for anything other than pure profit. Some also believe the Kremlin wouldn't allow a code of conduct on its foreign investments without a fight.

Last summer Germany became the first country to have top level officials voice fears that the likes of China and Russia's government could seize control of strategic firms, and steal sensitive technology.

At the moment the U.S. government, the OECD and IMF are all trying a softer approach than the EU – bilateral negotiations. They hope to coax voluntary exposure from Abu Dhabi and Singapore's sovereign funds about what they're investing in, and how much.