The comment period on the Treasury's proposed regulations to govern security reviews of foreign investment in the U.S. ended on Monday, June 9. The comments may be found here: Regulations Pertaining to the Mergers, Acquisitions, and Takeovers by Foreign Persons.
Shortly before the period closed, Richard Willoughby and Tim Martin of the law firm Torys LLP published a short note on the content of the proposed rule: United States: The Expanding CFIUS Mandate For Review Of Foreign Investment In The United States (June 6).
As the title indicates, Willoughby and Martin are interested in the expanding scope of CFIUS. Foreign control triggers CFIUS interest, and the range of arrangements that may create control is larger under last year's legislation and the regulations; a new emphasis on critical infrastructure and critical technologies may extend the range of CFIUS authority to new sectors of the economy.
Expanding scope also crops up in a description of the proposed rule by Philip Thompson of Duane Morris LLP: United States: Treasury Department Issues Proposed Regulations Governing Review of Foreign Investment in the United States (May 22):
- The proposed regulations have expanded the procedures to make explicit the opportunity for interaction between CFIUS and the parties to a transaction before a notice is formally filed. Information provided to CFIUS as part of a pre-notice consultation becomes part of the formal notice and is accorded the existing confidentiality protections of section 721(c).
- The proposed regulations have expanded the scope of information required to be submitted to CFIUS to include additional data that CFIUS has routinely requested of parties in connection with a voluntary notice. This includes, for example, additional information regarding ultimate and intermediate parents of the foreign person making the acquisition; identification of any special government rights over the foreign person making the acquisition; and personal identification information for certain key personnel.
Comments