What is CFIUS?

The Committee on Foreign Investment in the United States (CFIUS) is an interagency committee that reviews how the acquisition of stakes in American businesses by foreign people or companies affects national security.

The committee, which is headed by the Treasury Secretary, includes the departments of defense, justice, state, energy, commerce, homeland security, the U.S. Trade Representative and the White House Office of Science and Technology Policy. There are also non-voting members.

A foreign entity does not have to file for a CFIUS review, but has an incentive to do so, since successful completion means the transaction typically cannot be subjected to further action or review.

The CFIUS process used to require the committee to complete a review within 30 days; however, that was lengthened to 45 days by the Foreign Investment Risk Review Modernization Act of 2018 that went into effect in February of this year.

If CFIUS determines it needs more time to complete its assessment, the process moves into a 45-day investigation period.

At the conclusion of that period, if the committee determines the transaction has unresolved national security issues, it is referred to the president, who has 15 days to publicly announce a decision. Only six transactions in the 40-year history of CFIUS have been referred to the White House.

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Both the Defense Production Act of 1950 and the Freedom of Information Act mandate that any information filed through the CFIUS process remain confidential. The parties that have been subject to review are not revealed.