Foreign companies looking for good deals buying US businesses that were hit hard by the economic downturn need to be aware that transactions that implicate the US national security are subject to significant scrutiny by the Committee on Foreign Investment in the United States (CFIUS). Several recent foreign investments have failed because of national security concerns raised by this little-known US government committee. National security review by the CFIUS can be a frustrating process for international investors who are not well-prepared. Potential foreign investors should understand how the US national security review process works and how the Obama Administration’s trade policy and the highly politicized national security debate in the US could impact their transactions. This article provides international investors an informal guide to the CFIUS process to help them understand what is involved and benefit from lessons learned from past transactions.
Global Trade and Customs Journal