financialservices.house.gov

Cmte Financial Services (R)
Contact:


Hensarling Statement on CFIUS Modernization Agreement

Washington, Jul 23 -

House Financial Services Committee Chairman Jeb Hensarling (R-TX) issued the following statement on an agreement to modernize the Committee on Foreign Investment in the U.S. (CFIUS) as a part of the National Defense Authorization Act (NDAA).

“The House has spent the past several months examining how to modernize CFIUS in a way that will allow us to address emerging national security needs while keeping America’s doors open to investment. Our Committee worked together to come up with a bipartisan plan that fundamentally altered proposals affecting outbound and inbound investments. A 400-2 vote for the House version of the bill could not have been stronger. After meaningful discussions and negotiations with our Senate colleagues, we were able to reach agreement on a plan that will enhance the review process without massive government overreach.

“I especially want to thank the sponsor of the House’s CFIUS bill, Congressman Robert Pittenger, who has been a tireless advocate for reform. I also want to congratulate my colleague and Monetary Policy and Trade Subcommittee Chairman Andy Barr, whose leadership was critical to the process, and Congressman Ed Royce, the Chairman of the House Foreign Affairs Committee, for his export control reforms which will help our country keep its technological edge while bolstering our national security.”

The provisions in the final CFIUS agreement taken from the House bill include:

• Elimination of concepts such as “non-passive investment,” “critical infrastructure companies,” and “critical technology companies,” thereby sparing thousands of U.S. businesses with no nexus to national security from potential CFIUS reviews;
• Elimination of ownership and dollar amount thresholds as triggers for CFIUS jurisdiction;
• Elimination of “catch-all” and “parallel business partnership” triggers for expanded CFIUS jurisdiction;
• Elimination of CFIUS discretion to name critical technologies by bypassing export controls;
• Elimination of blanket CFIUS discretion to mandate declarations for any covered transaction;
• Elimination of CFIUS certification authorities for Deputy Assistant Secretary-level individuals, which would have eroded political accountability;
• Inclusion of jurisdiction for certain investments involving the release of U.S. citizens’ sensitive personal data;
• Inclusion of a permanent statutory authority for the administration of export controls;
• Restriction on CFIUS’s use of the term “critical infrastructure,” which will focus resources on specific systems and assets that are likely to be of importance to national security;
• Restriction on regulators’ discretion over the term “material nonpublic technical information;”
• Restriction on how “involvement in substantive decision-making” is applied for minority investments;
• Restriction on filing fee amounts that may be charged by CFIUS.