July 26, 2018

National Security: Congress Finalizes CFIUS Reform Legislation

This DLA Piper memo says that the long-awaited CFIUS reform bill has been finalized & will be voted on this week.  Here’s the intro:

Congress has released the final version of the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) – a bill to modernize and strengthen the Committee on Foreign Investment in the United States (CFIUS) to more effectively guard against the risk to US national security posed by certain types of foreign investments. FIRRMA is incorporated into the must-pass National Defense Authorization Act for FY19, which Congress expects to pass this week.

The House and Senate passed parallel versions of the bill in June and recently completed conference negotiations to resolve various differences between the two bills. House and Senate negotiators have agreed on new provisions that would broaden the jurisdiction of CFIUS in order to address national security concerns associated with foreign investment in US critical technology and other types of foreign transactions.

Most notably, FIRRMA creates four new types of “covered transactions,” expands the definition of “critical technology” to include “emerging and foundational technologies,” imposes a deadline on the CFIUS response to written notices, extends the Committee’s timeframe for review, creates the option for (and in some cases mandates) a written declaration, imposes a CFIUS filing fee and establishes a process to identify non-notified transactions.

The memo provides a summary of the legislation, which President Trump is expected to sign within the next few weeks.

John Jenkins