Page 7 - The CFIUS Book

What is CFIUS?
The Committee is led by the U.S. Department of Treasury’s Office of Investment Security (OIS) and includes the offices of the U.S. Attorney General, Homeland Security, Commerce, Defense, State, Energy, Science and Technology Policy, and the Trade Representative. Certain other offices may also be brought in on reviews related to their area of expertise.
What is FIRRMA?
The Foreign Investment Risk Review Modernization Act, signed into law on August 13, 2018, expanded the scope of CFIUS jurisdiction beyond transactions in which a foreign company takes control of a U.S. business. FIRRMA added to CFIUS’s authority the review of investments in U.S. critical technologies and critical infrastructure as well as certain real estate investments even where the foreign person does not take control of a U.S. business. FIRRMA created the first mandatory CFIUS filings as well as “light” filings that require less information and pass through a faster review track.
THE CFIUS BOOK
CFIUS is the Committee on Foreign
Investment in the United States.1 It is
a Committee of nine U.S. agencies that
is authorized to review any
transaction that may result in foreign
control of a U.S. company. It was
established and operates pursuant to
Section 721 of the Defense Production
Act of 1950 (50 U.S.C. App. 2170).
Typically, CFIUS reviews transactions resulting in foreign control of U.S. businesses that may affect U.S. national security.2 Later, we will detail what constitutes foreign control (Section 1.1.3) and what types of transactions may affect U.S. National Security (Section 1.2.2).
CFIUS REvIEWS INvESTMENT IN THE U.S. TO DETERMINE WHETHER IT MAy AFFECT NATIONAL SECURITy, THEN CLEARS IT, PROPOSES STEPS TO MITIGATE NATIONAL SECURITy RISK, OR PROHIBITS OR UNWINDS THE DEAL.
FIRRMA IS A ONCE-IN-A-GENERATION ExPANSION OF U.S. GOvERNMENT AUTHORITy TO INvESTIGATE AND INTERvENE IN FOREIGN INvESTMENT IN THE UNITED STATES.
Imposition of FIRRMA. Most of FIRRMA’s rule changes will take immediate effect, notably the extension of the initial review period from 30 days to 45 days, with a possible 45-day investigation to follow with an optional 15-day extension of
that investigation. However, most of FIRRMA’s clauses require that the Committee publish procedures, definitions, and other details in order for the new requirements to be effectively implemented. Those
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