FDI Regime Overview The Committee has authority to review covered transactions, condition clearance on mitigation measures, suspend transactions and, where appropriate, recommend that the President block or unwind transactions. Parties can prepare for CFIUS scrutiny by conducting early diligence, structuring transactions with national security considerations in mind and developing a clear regulatory strategy before signing. The Committee’s jurisdiction encompasses: ^ Mergers, acquisitions and takeovers that could result in a non-U.S. person acquiring control of a U.S. business; ^ Certain non-controlling investments by non-U.S. persons in U.S. businesses involving critical technology, critical infrastructure or sensitive personal data, where the investment affords the foreign person specified access, governance or decision-making rights, with mandatory filing requirements for certain transactions involving critical technologies or substantial foreign-government interests; and ^ Transactions involving the purchase or lease by, or concession to, a non-U.S. person of certain U.S. real estate located at or near specified airports, maritime ports, military installations or other sensitive U.S. government facilities. Transactions are brought to the Committee’s attention through filings that take the form of either “notices” or “declarations.” Notices are multi-page, in-depth descriptions of the transaction and parties. As a general rule, parties should anticipate that Notices will add 3.5-5 months to deal time, though it can be less or more depending on the circumstances. This timing includes approximately two to four weeks to prepare a filing (though this timing can be accelerated), as well as a prefiling review by the Committee and CFIUS intake time. It also includes a 45-day review period once CFIUS accepts the Notice. CFIUS can also require a subsequent 45-day investigation period and, in
rare cases, a 15-day Presidential review period. Ultimately, Notices can result in the deal being cleared to proceed; being subject to mitigation measures to protect national security concerns; or, in rare cases, being blocked or unwound. Declarations, by contrast, are typically no longer than five pages and present a simplified method of informing CFIUS of a transaction. Following submission of a declaration, CFIUS has 30 days to review the transaction. The Committee may respond to a declaration in one of four ways, informing parties that it: has cleared the transaction; is initiating a unilateral review; is requesting that the parties submit a full formal notice; or is unable to reach a decision regarding clearance based on the declaration alone. In 2024, CFIUS cleared 91 of 116 declarations, or approximately 78%, up from approximately 76% in 2023 and 58% in 2022. This reflects the growing usefulness of the declaration pathway for appropriately scoped, lower-risk transactions, but declarations remain less suitable for transactions likely to require mitigation, extensive interagency analysis or significant policy escalation. Investors from allied and partner countries may benefit from process improvements if they can demonstrate transparency, compliance maturity and verifiable distance from foreign adversary actors. At the same time, PRC-linked investments in strategic sectors will continue to face heightened scrutiny and, in some cases, may be commercially impracticable absent a compelling national security record and a credible mitigation path. The KIP remains under development, and parties should not assume that participation will eliminate CFIUS jurisdiction, alter statutory timelines or guarantee clearance. FIRRMA’s expansion of CFIUS jurisdiction continues to require transaction parties to assess CFIUS considerations at the outset of the transaction process. The AFIP adds a policy overlay: the United States remains open to investment from trusted allies and partners, but the administration intends to restrict certain inbound investment from, and outbound investment to, China and other foreign adversaries in strategic sectors. The
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FDI and National Security Review
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