David Marchick and David Fagan think this year's reform of the process by which foreign direct investment is vetted for national security issues (done through Treasury's Committee on Foreign Investment in the US, so the "CFIUS" process) was done well: Rational security (TheLawyer.com, August 20). The authors - attorneys at Covington and Burlington - provide a brief but useful analysis of each of the major revisions. In sum:
The newly enacted legislation is a success for foreign investors and the US market because it codifies existing practice and timeframes, creates greater accountability for members of the CFIUS and should lead to regulations that create greater transparency and predictability for transactions. Moreover, by enabling Congress to return to a more dispassionate oversight role the legislation has two additional effects: first, it eases the political risk environment for transactions; and second, it provides executive agency decision-makers with important breathing room to conduct their reviews, based strictly on the merits of particular transactions, without having to worry about being hauled before a hostile congressional committee.
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