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 is expanding its reach. Where the Committee on Foreign Investment in the United States has generally scrutinized foreign acquisition of U.S. “critical infrastructure,” it has now signaled that it may look closely at any deal where the target collects or maintains sensitive personal information.… Continue Reading
The other day I spoke to a colleague at the U.S. Department of the Treasury who works in the Office of Investment Security and said, “I heard CFIUS filings were going to break last year’s record total.” He just laughed. He said the OIS received one hundred and seventy-some filings in 2016, the most they … Continue Reading
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
On Monday, August 14, President Trump signed an executive memorandum directing U.S. Trade Representative Robert Lighthizer to consider a “Section 301” investigation against China. Now, many of us have heard the phrase Section 301 investigation and, as we do when we are at a party where everyone is talking about that movie we haven’t seen, … Continue Reading
As the Trump administration comes into its third month, we have clues, but must speculate on how that administration will modify Iran sanctions, NAFTA, foreign investment, and tariffs on China. In contrast, recently issued executive orders shed clear light on the Trump administration’s approach to antidumping and countervailing duties (AD/CVD). (See our August 2016 blog … Continue Reading
CFIUS has the power to unwind your M&A deal. That power will likely expand. That is the headline. The Committee on Foreign Investment in the United States (CFIUS) reviews acquisitions by foreign parties of “critical industries” and “critical infrastructure” in the United States. The inter-agency committee’s actions warrant plenty of explanation, and you can find … Continue Reading
President Trump has stated that he would impose tariffs on imports from China ranging from ten to forty-five percent. Can he do it? And will it cause a trade war? The Effects of Increased Tariffs In the 18th Century, tariffs were considered a method of generating revenue and protecting domestic industry. The first U.S. customs … Continue Reading
For the first time since the era of pagers, dial-up, and Y2K hysteria, U.S. trade remedy cases are experiencing a resurgence. Under U.S. law, U.S. producers of goods may petition the U.S. government to impose extra tariffs on the import of competing goods deemed to be traded unfairly.… Continue Reading
The Open Road: Approaching the TPP Summarizing the behemoth 12-nation TPP agreement in a few-hundred word blog is a task beyond the reach of a practicing attorney . . . assuming he wants to continue practicing. In this article we will examine automobiles, an area of particular interest to two big economies in the TPP, the United States and Japan.… Continue Reading
On August 30, 2015, the Washington Post broke a story that the Obama administration is developing a package of economic sanctions that will target Chinese companies and individuals who have benefitted from cybertheft. The new sanctions would come at a time when commerce between the two countries is thriving, but political relations are strained.… Continue Reading
On February 12, 2015, the Department of Justice (DOJ) announced that three U.S.-based importers had agreed to pay more than $3 million to resolve a lawsuit brought by the United States under the False Claims Act (FCA) alleging that they had made false declarations to U.S. Customs and Border Protection (CBP) and conspired with other … Continue Reading
By: James Zimmerman and Cheryl Palmeri
The recent enforcement of Chinese anti-bribery laws against British pharmaceutical company GlaxoSmithKline (GSK) highlights the compliance challenges faced by foreign companies operating in China.
GSK’s Chinese subsidiary is accused of funneling almost $500 million in bribes to doctors and hospitals in China exchange for purchasing or prescribing the company’s products. The alleged bribes included sexual favors, cash, and invitations to join high-end academic conferences. GSK employees also allegedly accepted kickbacks and improper commission fees, issued fake invoices, and wrote special bills related to the value-added tax.
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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
By: Reid Whitten and Thad McBride
For years, a significant number of Foreign Corrupt Practices Act (FCPA) enforcement actions have focused on or involved the People’s Republic of China (PRC), Chinese subsidiaries, or Chinese officials. It is hard to avoid the conclusion that the PRC is fertile ground for corruption: many of its major industries are dominated by state-owned or -controlled companies. A tradition of gift-giving and hospitality may blur the distinction between friendly gesture and kickback. And the sheer volume of business transacted in the country makes policing illicit exchanges for business advantages a tall order for any enforcement agency. … Continue Reading
By: Thad McBride and Cheryl Palmeri
The start of the new year is the perfect time to reflect on the international trade enforcement actions of the past year and to predict what they might mean for the year ahead. This exercise is made exponentially easier by the “Summary of Major U.S. Export Enforcement, Economic Espionage, Trade Secret, and Embargo-Related Criminal Cases” (the “Enforcement Summary”) which recently was updated through December 6, 2012. The Enforcement Summary suggests a number of important trends in export enforcement and embargo-related cases.
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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.
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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.
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By: Reid Whitten
The story of one man prosecuted by the SEC and the DOJ for an FCPA violation may run a little below the radar these days, when allegations of bribery by manufacturing, retail, and entertainment companies plaster the headlines. The guilty plea entered by an ex-Morgan Stanley executive, Garth Peterson, however, holds a very important lesson for companies that do not wish to see their own names on the broadsheets above a story about corruption enforcement actions. The lesson is simple: robust corporate compliance can protect a company even when a high-level employee commits brazen acts of bribery.… Continue Reading
By: Curt Dombek, Brian Weimer, Dan Brooks, and Reid Whitten
Since 1999, strict controls on the export of U.S. satellites and satellite components have drastically eroded U.S. manufacturers’ market share in the global satellite industry. On April 18, 2012, the U.S. Departments of State and Defense released the “1248 Report” containing findings related to reducing some of those controls. The 1248 Report assesses the national security risks of removing certain satellites and related components from the tightly controlled United States Munitions List (USML) and transferring them to the generally less restrictive Commerce Control List (CCL). The report concludes that most communications satellites, lower-performing remote sensing satellites, and related components could be transferred from the USML to the CCL without harming U.S. national security. The transfer of these items to the CCL could greatly benefit the U.S. satellite industry by significantly easing the export controls placed on its products.… Continue Reading
By: Thad McBride and Mark Jensen
On March 26, 2012, U.S. medical device maker Biomet, Inc. (Biomet) agreed with the U.S. Department of Justice (DOJ) and U.S. Securities and Exchange Commission (SEC) to settle charges related to alleged bribes paid to obtain business in Argentina, Brazil, and China. This is the third – though almost certainly not the last – Foreign Corrupt Practices Act (FCPA) settlement with medical device manufacturers.
In the wake of recent setbacks in the Shot Show and Lindsey cases, the settlement serves as a reminder that the U.S. government is still aggressively enforcing the FCPA and broadly interpreting its provisions. … Continue Reading