On August 13, 2018, President Donald Trump signed into law the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA). FIRRMA expands the jurisdiction and powers of the Committee on Foreign Investment in the United States (CFIUS or the Committee), the U.S. interagency committee that conducts national security reviews of foreign investment.
FIRRMA authorizes CFIUS to conduct pilot programs to implement provisions of the legislation that did not become effective immediately upon enactment. On October 10, the U.S. Department of the Treasury issued interim regulations to conduct a FIRRMA pilot program that addresses specific risks to U.S. critical technologies. Separately, CFIUS issued updated regulations formally implementing some of FIRRMA’s provisions that became effective upon enactment.
The FIRRMA pilot program expands the scope of transactions subject to review by CFIUS to include certain noncontrolling investments made by foreign persons in U.S. businesses involved in critical technologies related to specific industries. The program also makes mandatory the filing of a “declaration” (an abbreviated CFIUS notice) for all transactions that fall within its specific scope.
The pilot program, discussed in further detail below, will affect all transactions with a completion date after November 10, 2018.
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