Global Trade & Foreign Policy Insights

On February 28, President Biden issued a major new executive order. The E.O. directs the Attorney General to issue regulations within 180 days that prohibit or restrict U.S. persons from engaging in transactions with “countries of concern” involving the transfer of Americans’ bulk sensitive data or U.S. government-related data. 

2024 is already shaping up to be a big year on the national security front. In less than two months, there have already been several notable national security developments.

It’s been another big year on the national security front. The Biden administration finally published its long-awaited Executive Order (E.O.) restricting U.S. investors from making investments in Chinese companies working on certain technologies and products. Evidence is mounting that the Committee on Foreign Investment in the United States (CFIUS or the Committee) is taking longer than ever to process transactions and, even when foreign investors can avoid CFIUS review, local communities are starting to fill the gaps in CFIUS’s authorities by making certain investments untenable. Finally, the Department of Energy (DOE) issued proposed guidance on its interpretation of “foreign entity of concern” (FEOC), a term that is becoming popular in national security-related statutes and regulatory frameworks.

The annual report for 2022 shows that the CFIUS process is becoming more difficult to negotiate in a timely and predictable manner, and in some cases, transactions can get bogged down in the CFIUS quagmire for several months.

On August 2, 2022, the Committee on Foreign Investment in the United States (“CFIUS” or the “Committee”) published its annual report for 2021. As we have noted in the past, the publication every summer of the annual report is a major event for CFIUS watchers. CFIUS’s annual report is one of the only times each year that CFIUS provides information to the public about its operations. The annual report provides hard data about the number of transactions that CFIUS reviewed the previous year, the time it took to complete those reviews, and the high-level results of those reviews, among other things. The annual report is the best resource for dealmakers to use when attempting to anticipate how the CFIUS process may affect a deal. 

On March 18, the U.S. State Department’s Directorate of Defense Trade Controls (DDTC) posted this notice on its site to inform industry and the public of the measures it is taking to continue service during the current COVID-19 pandemic.