Page 19 - The CFIUS Book

U.S. nationals. Assuming no other relevant facts, Corporation A is not a foreign person.9
l
1.1.3. Control
Control means the power, direct or indirect, whether or not exercised, to determine, direct, or decide important matters affecting an entity. It is important to remember that CFIUS regulations and guidance do not offer a bright- line rule on control. However, we break down the definition and examine a few illustrative examples in the regulations to help you analyze whether your transaction will result in control of a U.S. business.
1.1.3.1. The power to determine direct or decide important matters
Under the same facts as above, except that one of the foreign investors controls Corporation A. Assuming no other relevant facts, Corporation A is a foreign person because it is controlled by a foreign person.10
THE CFIUS BOOK
CFIUS provides a list of “important matters,” but that list is only illustrative.11 CFIUS makes clear that the power to determine other, similarly important matters may constitute control. If you consider CFIUS’s stated goals, the list of important matters seems intuitive. Some examples of important matters follow:
iMPorTAnT MATTers are actions by which production of a critical item may be altered or halted or actions by which a foreign person takes control of or may release sensitive information or technology.
l The sale, lease, mortgage, pledge, or other transfer of an entity’s principal assets; l The reorganization, merger, or dissolution of the entity;
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