Tag Archives: CFIUS

CFIUS UPDATE ISSUE — Well I Do Declare: Mandatory Declarations Everywhere

Enumale AgadaReid WhittenBy Enumale Agada and Reid Whitten on Posted in CFIUS
On May 21, 2020, a proposed rule change brought the threat of a mandatory CFIUS filing to investments across all U.S. industries. The U.S. Department of Treasury proposed a rule[1] that removes a restriction formerly in the Foreign Risk Review Modernization Act’s (FIRRMA) that limited mandatory filings with the Committee on Foreign Investment in the … Continue Reading

CFIUS UPDATE ISSUE — CFIUS Scrutiny in Biotech: The Ekso Case and the Eye of the Terminator

Reid WhittenLisa MaysBy Reid Whitten and Lisa Mays on Posted in CFIUS
Robotic exoskeletons may augment human strength, endurance, and mobility. The latest CFIUS action has all the makings of a Terminator movie. This month, the Committee on Foreign Investment in the United States (“CFIUS”) pushed back on a U.S. and Chinese joint venture (“JV”) in the biotech sector. The U.S. party to the JV, Ekso Bionics … Continue Reading

Who’s the Boss? The CFIUS “Control” Definition for Global Venture Capital Funds

Reid WhittenBy Reid Whitten on Posted in CFIUS, Uncategorized
My VC Fund has U.S. and non-U.S. General Partners, will I need to file CFIUS declarations for every investment I want to make in tech, in infrastructure, or in a company with customers’ personal data? This is a critical question at the fore of concerns for diversified investment funds with foreign-person directors. There are more … Continue Reading

CFIUS Proposes Rules to Implement FIRRMA

Reid WhittenBrian WeimerEamon TierneyBy Reid Whitten, Brian Weimer and Eamon Tierney on Posted in CFIUS
Key Takeaways: Technology Infrastructure and Data. CFIUS will focus its review on investments in critical Technology, critical Infrastructure, and sensitive personal Data (“TID Businesses”). Critical technologies is defined to include certain items subject to export controls along with emerging and foundational technologies under the Export Control Reform Act of 2018. CFIUS provides a very helpful … Continue Reading

The Little Regulation That Will Make a Big Change in How You Do Business: Department of Commerce to Establish New Export Controls on Emerging Technologies

Reid WhittenJ. Scott MaberryCurtis DombekLisa MaysBy Reid Whitten, J. Scott Maberry, Curtis Dombek and Lisa Mays on Posted in CFIUS, Export Administration Regulations (EAR) and Commercial Exports
Key Takeaways: Emerging technology sectors will soon be subject to new export controls. Affected sectors include biotech, computing, artificial intelligence, positioning and navigation, data analytics, additive manufacturing, robotics, brain-machine interface, advanced materials, and surveillance. New export controls on these sectors will likely require companies to obtain a license to export products to China and other … Continue Reading

FIRRMA Takes Form as CFIUS Enacts a New Pilot Program Targeting “Critical Technologies”

Reid WhittenBrian WeimerEnumale AgadaDrew SvorBy Reid Whitten, Brian Weimer, Enumale Agada and Drew Svor on Posted in CFIUS
On October 10, 2018, the Committee on Foreign Investment in the United States put into effect the first mandatory filing requirement ever imposed by CFIUS. The Department of Treasury’s summary of the Pilot Program is available here. Effective November 10, 2018, CFIUS will require reviews of critical technology investments – including certain non-controlling investments – … Continue Reading

On FIRRMA Ground: Congress to Restrict Foreign Investment and Expand Export Controls

Robert MagielnickiReid WhittenBy Robert Magielnicki and Reid Whitten on Posted in CFIUS
This week, there were reports that the Trump Administration would use emergency powers to restrict Chinese investment in the United States. On Wednesday, the White House backed away from that position after the House of Representatives passed a bill on Tuesday expanding and increasing the powers of the Committee on Foreign Investment in the United … Continue Reading

Another Day Another Tariff… and Other Recent Restrictions on China

J. Scott MaberryLisa MaysBy J. Scott Maberry and Lisa Mays on Posted in CFIUS, Import and Customs
In what has become his trademark Trumpian manner, the President announced last Friday that new tariffs and trade restrictions against China are on again, at the same moment that his senior Commerce and Treasury Department negotiators were trying to work out a deal in Beijing. This came just a handful of days after Department of … Continue Reading

Chips on Their Shoulders: CFIUS Intervenes in Broadcom’s Hostile Takeover Bid for Qualcomm

Drew SvorBrian WeimerReid WhittenBy Drew Svor, Brian Weimer and Reid Whitten on Posted in CFIUS
CFIUS takes an unprecedented step to fend off a potential foreign acquisition The threat that China will eclipse the U.S. in telecommunications infrastructure and technology is central to U.S. national security Five key takeaways from the most recent CFIUS action Since late 2017, Singapore-based semiconductor company Broadcom has been pursuing a $117 billion hostile takeover … Continue Reading

Seeking foreign investors for your tech startup? Congress says, “not so fast.”

J. Scott MaberryReid WhittenHwan KimBy J. Scott Maberry, Reid Whitten and Hwan Kim on Posted in CFIUS
The U.S. Congress is currently considering legislation that would tap the brakes on foreign direct investment in the United States, particularly on investments in sensitive industries like artificial intelligence, robotics, and semiconductors. We know: you’re saying we already have that in the form of the Committee on Foreign Investment in the United States (known as … Continue Reading

CFIUS for Europe? New Screening of Foreign Direct Investments in Europe

Reid WhittenBy Julien Blanquart* and Reid Whitten on Posted in CFIUS
On September 13, 2017, the EU Commission released a proposed regulation establishing a framework for screening Foreign Direct Investments (FDI) in Europe. Several EU Member States have already implemented national mechanisms enabling them to intervene in transactions that the States believe endanger their national interest. However, there is no harmonized regime for reviewing FDI into … Continue Reading

Shedding Light on CFIUS: Appeals Court Holds That CFIUS Review Lacks Constitutional Due Process

J. Scott MaberryRobert MagielnickiBrian WeimerBy J. Scott Maberry, Robert Magielnicki and Brian Weimer on Posted in CFIUS
In a stunning ruling issued on July 15, 2014, the U.S. Court of Appeals for the D.C. Circuit held that review by the Committee on Foreign Investment in the United States (“CFIUS”) and the subsequent unwinding of the investment deprived the foreign investor of due process under the 5th Amendment to the U.S. Constitution.  Ralls … Continue Reading

An Assessment of the CFIUS 2012 Annual Report

By Sheppard Mullin CFIUS Attorneys on Posted in CFIUS
In December 2013, the Committee on Foreign Investment in the United States (“CFIUS”) released its annual report to Congress (the “Report”) covering transactions it reviewed in Calendar Year 2012.  (Yes, Calendar Year 2012 – CFIUS takes its time publishing its annual reports.)  CFIUS is the U.S. interagency government body that reviews acquisitions of U.S. businesses … Continue Reading

Pay Attention to the Man Behind the Curtain: The Mysterious Methods to CFIUS Approval

By Sheppard Mullin on Posted in CFIUS
By: Reid Whitten On February 25, 2013, the Chinese state oil company, CNOOC, closed a $15.1 billion deal to take over Canadian oil company, Nexen.  Along with interests in the Canadian oil sands of Alberta and offshore production in west Africa and the North Sea, CNOOC will acquire more than 200 drilling leases in the Gulf of Mexico, a primary source of U.S. oil.  According to Nexen, its existing assets in the area include facilities producing more than 15,000 barrels of oil per day in 2012, with notable exploration potential for future growth.… Continue Reading

CFIUS Update: President Blocks Ralls Transaction

By Sheppard Mullin on Posted in CFIUS, Sanctions
By: Thad McBride As addressed in our September 27 blog, the Committee on Foreign Investment in the United States (CFIUS) was sued in U.S. District Court by Ralls Corp relating to the acquisition by Ralls of four Oregon companies whose assets consisted solely of windfarm development rights and to CFIUS’s determination to block the transaction. On September 28, President Barack Obama did just that. … Continue Reading

CFIUS Sued by Chinese Investors

By Sheppard Mullin on Posted in CFIUS, Sanctions
By: Thad McBride The Committee on Foreign Investment in the United States (CFIUS) has been sued.  CFIUS is the U.S. government inter-agency committee that reviews foreign investment in the United States.  (For more information about CFIUS, including its operations and recent actions, please look here.) According to a filing in U.S. District Court for the District of Columbia, Ralls Corp is requesting a Temporary Restraining Order and Preliminary Injunction to enjoin CFIUS from prohibiting Ralls from developing and operating a wind farm in Oregon.  Ralls is owned by executives of Sany Group Co., a Chinese company that, among other things, manufactures wind turbine generators.  In recent years, CFIUS has tended to be especially cautious with respect to transactions involving China. … Continue Reading

CFIUS Submits Annual Report to Congress

By Sheppard Mullin on Posted in CFIUS
By: Thaddeus McBride, Brian Weimer, and Dan Brooks The Committee on Foreign Investment in the United States (“CFIUS” or the “Committee”) recently submitted its annual report to Congress for calendar year 2010.  The report, which provides general information on notices filed, reviews and investigations completed by CFIUS during the year, and the types of security arrangements and conditions that the Committee has employed to mitigate national security concerns, reveals that a larger number of reviews are proceeding to the investigation stage and that the Committee is increasingly conditioning its tacit approval of transactions upon the parties’ adoption and implementation of various mitigation measures. … Continue Reading
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