DealLawyers.com Blog

The Committee on Foreign Investment in the United States recently delivered its 2024 Annual Report to Congress. This Fried Frank memo reviews the report. Here are some of the highlights:

– While CFIUS remained busy in 2024, the 325 total filings it reviewed was below the level of prior years. This slowdown likely reflects the overall pace of deal-making in 2024.

– The CFIUS process was more efficient again in 2024, with decreases (or no change) in both the number and percentage of notices proceeding to investigation, declarations that required a subsequent notice filing, and withdrawn notices. However, CFIUS was still responsible for scuttling four deals in 2024.

– CFIUS remained very active in enforcement and monitoring in 2024. It requested filings for 12 non-notified transactions, imposed four penalties for violations of mitigation agreements or CFIUS regulations, and issued additional notices of noncompliance for failure to make mandatory filings. The President also blocked two transactions that CFIUS reviewed in 2024.

The memo notes that the report indicates that China was once again the largest filing country, but that the number of notices filed by Chinese acquirers was still below 2022 and 2023 levels. The memo says that the decline in the number of notices filed by Chinese buyers is “likely a product of the perceived hostile CFIUS environment and particularly strict scrutiny by CFIUS of inbound Chinese investment.”

– John Jenkins