CFIUS Reform—The Foreign Investment Risk Review Modernization Act of 2018: FIRRMA Significantly Expands CFIUS Jurisdiction and Makes Certain Transactions Subject to Mandatory Declarations; Significant Details to Follow in Forthcoming RegulationsSullivan & Cromwell LLP - August 7, 2018
On August 1, 2018, the Senate joined the House of Representatives in passing the Foreign Investment Risk Review Modernization Act of 2018 (“FIRRMA”) as part of the conference report to the John S. McCain National Defense Authorization Act for Fiscal Year 2019. In order to address the concerns that the sponsors of this legislation have identified, FIRRMA significantly expands CFIUS jurisdiction to include new types of “covered transactions” beyond those that could result in control of a U.S. business by a foreign person. The legislation also provides CFIUS with additional time to review transactions, and requires mandatory short-form notifications of transactions in certain cases. Notably, the legislation includes Congressional findings that recognize the benefits of foreign investment in the United States, and includes a sense of Congress that “it should continue to be the policy of the United States to enthusiastically welcome and support foreign investment, consistent with the protection of national security.” The legislation now will go to President Trump for signature.