Several companies recently disclosed their filings with the Committee on Foreign Investment in the U.S. or updated the status of their ongoing CFIUS reviews.
As the Biden administration enacts legislation to bolster the green energy and semiconductor industries, the U.S. likely will see an influx of foreign investment in both sectors, which could lead to more filings with the Committee on Foreign Investment in the U.S., said Michael Considine, a Department of Energy official, speaking during a Vinson & Elkins webinar last week. He also expects some emerging clean-energy technologies to have dual-use capabilities, which also could trigger more CFIUS reviews.
A new Senate bill would add USDA to the Committee on Foreign Investment in the U.S. and broaden disclosure requirements for land purchases by foreign entities. The Security and Oversight of International Landholdings Act, set to be introduced by Sen. James Lankford, R-Okla., will “provide oversight and transparency of purchases of U.S. agricultural land that threaten national security,” the lawmaker said this month, and will require CFIUS reviews of “agriculture real estate purchases by certain foreign entities.” Other lawmakers also have proposed adding the agriculture secretary to CFIUS (see 2106010003).
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The Committee on Foreign Investment in the U.S.’s annual report to Congress (see 2208020043) shows CFIUS is reviewing record numbers of investments and sheds light on how the Biden administration is approaching screening efforts, especially surrounding Chinese companies, law firms said. The report also indicates that companies should expect even more government scrutiny of foreign direct investments in coming years, firms said, including for non-notified transactions.
The U.S. should transform the Committee on Foreign Investment in the U.S. into a new Commission on Foreign Investment and National Security, which would improve transparency and reduce uncertainty around investment reviews, Morgan Lewis lawyers said. Although the process of standing up a new government commission and issuing regulations may be “arduous and expensive,” the lawyers say the benefits will outweigh the costs.
The Committee on Foreign Investment in the U.S. this week issued its annual report to Congress, outlining statistics from the first full calendar year in which CFIUS operated under expanded authorities granted to it by the Foreign Investment Risk Review Modernization Act (see 2002270049 and 2001140060). CFIUS said it received 164 declarations in 2021, an increase from the 126 it received in 2020 2107260017, and 272 notices, up from the 187 from 2020.
Brian Fleming, a former official in the National Security Division at DOJ, has joined Steptoe & Johnson as a partner in the International Trade and Regulatory Compliance Group, the firm announced. Fleming most recently worked as a member at Miller & Chevalier Chartered, advising clients on economic sanctions, export controls and Committee on Foreign Investment in the United States proceedings.
The Committee on Foreign Investment in the U.S. is investigating Swiss renewable energy company Viston United Swiss' proposed acquisition of California-based Petroteq Energy, an oil production and technology company. The CFIUS investigation, disclosed by Petroteq this month, began after CFIUS completed a 45-day review period earlier this year (see 2206130025). CFIUS told Petroteq it plans to complete its investigation by Aug. 22. Viston plans to extend its offer to purchase Petroteq until after Aug. 22.
A potential provision in the bipartisan China package (see 2207120049) that would create an outbound investment screening mechanism received more opposition (see 2206280051 and 2201140038) this week, including from lawmakers on the Senate Banking Committee and former U.S. investment screening officials. While opponents of the provision say some form of outbound screening may eventually be necessary to further restrict sensitive technology transfers to China, they also said the current wording is too broad and leaves too many questions unanswered.