Committee on Foreign Investment in the United States Proposes Regulations for Implementing FIRRMA Legislation
On September 17, the U.S. Department of the Treasury published proposed regulations that would effectively implement the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA), originally signed into law in August 2018. FIRRMA serves to buttress the authority of the Committee on Foreign Investment in the United States (CFIUS), whose main purpose is to monitor transactions involving foreign investment in the United States and to determine the effects such transactions may have on national security. The primary benefit afforded to CFIUS by the implementation of FIRRMA will be a significant expansion of CFIUS’s jurisdiction. CFIUS currently holds jurisdiction over transactions that could result in the foreign control of a U.S. business. FIRRMA would broaden this scope to include certain non-controlling investments by foreign persons that may afford those persons access to sensitive information related to personal data of U.S. citizens, critical technologies, or critical infrastructure. We can expect the final FIRRMA regulations to become effective by February 13, 2020.