Recently introduced, bipartisan legislation to reform the process and jurisdiction of the Committee on Foreign Investment in the United States (CFIUS) promises the most meaningful change to CFIUS in over a decade. The legislation, which is co-sponsored by prominent Democrat and Republican senators, would expand CFIUS jurisdiction to include acquisition of minority interests and certain intellectual property arrangements and real estate transactions, while providing a new “light filing” vehicle and changes to the review process. The legislation provides several practical reforms to address the way things work in practice, including extending the initial review period, mandating a standard for the use of mitigation measures, allowing CFIUS to suspend a transaction during their review, and focusing on countries that present a risk to the national security of the United States. The legislation would also authorize CFIUS to charge a filing fee of up to the lesser of one percent of the value of the transaction or $300,000. Given the increased focus on foreign investment, the challenges faced by CFIUS and transaction parties in working through the existing process, and the bipartisan support in Congress for reform which is consistent with public statements by Trump administration officials, it seems likely that this new legislation or some variant will be enacted.
On November 8, 2017, a bipartisan bill was proposed in the Senate to “modernize and strengthen the process by which the Committee on Foreign Investment in the United State (CFIUS) reviews acquisitions, mergers and other foreign investments in the United States for national security risks.”1 Co-sponsored by Senators John Cornyn (R-TX), Dianne Feinstein (D-CA) and Richard Burr (R-NC), the Foreign Investment Risk Review Modernization Act (FIRRMA) is intended to “provide CFIUS with updated tools to address present and future security needs . . . [and] strengthen CFIUS by expanding its jurisdiction and moderniz[ing] its processes.”2 The legislative proposal follows a Senate hearing held in September before the Banking, Housing and Urban Affairs Committee, which sought to examine the CFIUS process and scope.