Reed Smith Client Alerts

On January 13, 2020, the U.S. Department of the Treasury published final regulations to comprehensively implement the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) in order to strengthen the Committee on Foreign Investment in the United States (CFIUS or the Committee) and to better address national security concerns arising from certain investments and real estate transactions. As anticipated, the final regulations leave intact existing CFIUS authority to review transactions that will result in foreign “control” of a U.S. business, but dramatically expand the Committee’s authority to review non-controlling investments in U.S. businesses related to critical technologies, infrastructure, and data and to review certain real estate transactions. Notably, the Committee has identified Australia, Canada, and the United Kingdom as initial “excepted foreign states,” which will inform stakeholders’ analyses of whether a foreign investor is excepted from filing requirements. In addition, the final regulations introduce exceptions to mandatory filing requirements for investments in critical technologies not previously included in the proposed rules.

The final regulations become effective February 13, 2020.

Authors: Michael J. Lowell Sarah S. Wronsky Lynwood E. Reinhardt Lizbeth Rodriguez-Johnson Paula A. Salamoun Manasi Venkatesh

Close up pen on paperwork and woman hand calculate finance


CFIUS is a federal multi-agency panel chaired by the Department of the Treasury that reviews the national security implications of foreign investments in the United States. In August 2018, President Trump signed FIRRMA into law to strengthen and modernize CFIUS and to better address national security concerns arising from certain investments and real estate transactions. FIRRMA required implementing regulations to become effective no later than February 13, 2020. The final regulations follow (1) CFIUS’s launch in November 2018 of a “pilot program,” as authorized by FIRRMA; (2) proposed regulations issued in September 2019; (3) two public briefings and Q&A sessions held by the Department of the Treasury; and (4) a 30-day period of public comment in which stakeholders provided substantive and significant commentary to the Treasury in anticipation of the final regulations.

To read more about our CFIUS team’s analysis of the proposed regulations, see our two alerts.