On May 11, 2023, the Committee on Foreign Investment in the United States (“CFIUS”) issued a Frequently Asked Question (“FAQ”), which calls into question the use of “springing rights,” a broadly used instrument to expedite financings while complying with mandatory filing requirements. The FAQ addresses the timing for when a filing must be made for a transaction triggering a mandatory filing. Since implementation of the mandatory filing requirements, transaction parties have used springing or deferred…
On October 20, 2022, the US Treasury Department released the first Committee on Foreign Investment in the United States (“CFIUS”) Enforcement and Penalty Guidelines (the “Guidelines”). The Guidelines provide visibility into factors CFIUS considers when assessing violations of CFIUS laws and regulations, and determining potential penalties. The Guidelines are applied by the Monitoring and Enforcement office, which is part of the US Treasury Department’s Office of Investment Security. The Guidelines apply when CFIUS assesses the…
On August 2, 2022, the Committee on Foreign Investment in the United States (“CFIUS” or “the Committee”) released its annual report for calendar year 2021 (the “Annual Report”). The Annual Report provides data concerning transactions filed with CFIUS in 2021, the first full calendar year following the introduction of the implementing regulations for the Foreign Investment Risk Review Modernization Act of 2018 (“FIRRMA”). Reflecting the increasingly routine nature of CFIUS, investors from a broad range…
On September 15, 2022, the President issued an Executive Order (“EO”) directing the Committee on Foreign Investment in the United States (“CFIUS”) to prioritize certain factors in its assessment of risks associated with a foreign investment. This EO does not modify the CFIUS process or impact its jurisdiction, but it essentially codifies the Biden administration’s approach to CFIUS reviews. In doing so, the EO provides insight to businesses into how CFIUS will analyze transactions before…
On July 26, 2021, the Committee on Foreign Investment in the United States (“CFIUS”) released its annual report for calendar year 2020 (the “Annual Report”). The Annual Report, which provides data on transactions filed with CFIUS in 2020, shows procedural improvements to the CFIUS process following full implementation of the Foreign Investment Risk Review Modernization Act (“FIRRMA”) on February 13, 2020. Short-form declaration filings are up by 35% from 2019 and CFIUS has cleared over…
As of October 15, 2020, the critical technology mandatory filing requirement under the regulations of the Committee on Foreign Investment in the United States (“CFIUS”) closely tracks US export licensing requirements. This development in the foreign investment space aligns with the US government’s initiative to promote innovation and the protection of US technologies for national security purposes, as set out in the National Strategy for Critical and Emerging Technologies, released on October 15. Filings with…
On September 15, 2020, the Treasury Department published the anticipated final rule modifying the scope of the critical technology filing requirement under the regulations of the Committee on Foreign Investment in the United States (“CFIUS”). The final rule tracks the proposed rule issued on May 21, 2020 in aligning more closely filing requirements for foreign investments with export licensing requirements. Effective October 15, 2020, filings will be mandatory for foreign investments in US critical technology…
On January 13, 2020, the U.S. Department of Treasury (“Treasury”) issued two anticipated final rules (the “Final Rules”) that replace the existing regulations governing the Committee on Foreign Investment in the United States (“CFIUS”). The Final Rules implement the Foreign Investment Risk Review Modernization Act (“FIRRMA”) enacted in August 2018, which expanded the United States’ foreign investment review regime. FIRRMA mandated pre-closing notification of certain foreign investments and expanded the scope of transactions subject to…
On September 17, 2019, the Department of Treasury (“Treasury”) released for public comment two proposed rules (the “Proposed Rules”) implementing the Foreign Investment Risk Review Modernization Act (“FIRRMA”) enacted in August 2018. FIRRMA expanded the jurisdiction of the Committee on Foreign Investment in the United States (“CFIUS”) and granted CFIUS new tools to regulate foreign investments raising national security concerns. Our previous analysis of FIRRMA is available here, and our analysis of the “critical technologies”…