Foreign Investment Regulation: USA (2024)

FAQs

What triggers CFIUS review? ›

If the parties agree not to file a notice, CFIUS may still determine that the transaction should be subject to review. In such cases, CFIUS will unilaterally begin a review to determine if the foreign investment raises potential national security issues.

The review period for any notice accepted after FIRRMA became effective is a maximum of 45 days, rather than 30 days. If an investigation is required, it will commence no later than the end of the 45-day review period prescribed by FIRRMA.

become a U.S. resident or U.S. citizen. Ultimately, there are not outright restrictions on foreign investors owning real estate, but instead conditions and limitations at the state level.

The process remains largely voluntary, where parties may submit a short-form declaration notifying CFIUS of a covered transaction in order to receive a potential “safe harbor” letter (which limits CFIUS from subsequently initiating a review of a transaction except in certain limited circ*mstances).

CFIUS is an interagency committee of the US government tasked with reviewing the national security implications of foreign acquisitions of and direct investments in US businesses.

After addressing those comments, parties will formally file the notice with CFIUS. CFIUS then has to accept the filing, after which a 45-calendar-day initial review begins. At the end of the review, CFIUS will either clear the transaction or proceed to a 45-calendar-day investigation.

Since there is no statute of limitations for CFIUS to exert jurisdiction over a transaction, failure to make an appropriate filing will increasingly result in unnecessary risk of a penalty and potentially to the transaction itself.

CFIUS has broad authority to evaluate whether such investments could impair US national security. If a transaction could pose a risk to national security, CFIUS can recommend to the President of the United States to block or unwind the investment.

Source: OECD International Direct Investment Statistics database. The top recipients of FDI inflows worldwide in Q3 2023 were the United States (USD 73 billion), and Ireland (USD 26 billion); Canada and Brazil both equally ranked as third largest FDI recipient (USD 15 billion).

What is the foreign investment limit? ›

RBI limits queer the pitch for international funds

This was to avoid a breach of industry-wide overseas limits imposed by the RBI. For one, there's an overall industry-level limit imposed by the Reserve Bank of India (RBI) of $7 billion for mutual funds to invest in overseas securities and funds.

The United States has always provided foreign investors a stable and welcoming market. As a place to do business, the United States offers a predictable and transparent legal system, low taxes, outstanding infrastructure, and access to the world's most lucrative consumer market.

CFIUS is an interagency committee authorized to review certain transactions involving foreign investment in the United States and certain real estate transactions by foreign persons, in order to determine the effect of such transactions on the national security of the United States.

This proposed rule increases the maximum penalty amount to $5 million per violation for material misstatements, omissions, or false certifications; the greater of $5 million or the value of the transaction per violation for failure to comply with mandatory declarations; and the greater of $5 million, the value of the ...

CFIUS is chaired by the United States Secretary of the Treasury, and it includes representatives from 16 U.S. executive departments and agencies, including the Departments of Defense, State and Commerce, as well as (most recently) the Department of Homeland Security.

DPA Triggering Rights means: (i) “control,” (ii) access to any “material non-public technical information,” (iii) membership or observer rights on the board of directors or equivalent governing body or the right to nominate an individual to a position on the board of directors or equivalent governing body, (iv) any ...

Since CFIUS may unwind a transaction, even after closing, if the transaction impacts national security, parties should assess whether filing a voluntary notice with CFIUS would be prudent.

After CFIUS review, the parties file a joint formal notice. CFIUS has 45 calendar days to review the formal notice. CFIUS may ask questions and request additional information during the process. If CFIUS cannot complete its review in 45 days or if foreign government involved, CFIUS has an additional 45 days.