Stephanie Kirchgaessner reports that the Treasury may release draft rules governing national security reviews of foreign investments by the end of the month: US set to lower Cfius threshold (Financial Times, April 8).
She also reports that the draft will propose lower thresholds for the level of foreign ownership that may trigger review:
The US Treasury is expected to clarify in new regulations that foreign investments falling below the 10 per cent threshold can be investigated on security grounds....
The subtle, but significant, change will affect any minority investor and is aimed at quelling concerns in Congress about foreign government-controlled investment funds.
Under current regulations, foreign investments of less than 10 per cent are generally not considered outright acquisitions and do not come under the purview of Cfius.
Many attorneys who handle sensitive cross-border deals say the changes might prove to be largely symbolic because Cfius already has the authority to examine sensitive takeovers and investments of any size. The change also reflects the growing political salience of state-owned funds in the US.
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