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Overview
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 Use
of mitigation agreements
- When a covered transaction
presents national security concerns, FINSA provides statutory authority for
CFIUS, or a lead agency acting on behalf of CFIUS, to enter into a mitigation
agreement with the parties to the transaction or impose conditions on the
transaction
- This authority enables CFIUS to mitigate any
national security risk posed by the transaction, rather than barring the
transaction because it could impair U.S. national security
- Mitigation agreements are expressly authorized
by section 721(l)
- Mitigation agreements, although not called such,
were used in the Alcatel-Lucent merger
Penalties
- Violations of a mitigation agreement are subject
to penalties
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Section 721(l) Mitigation
agreements
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Mitigation, Tracking, and
Postconsummation Monitoring and Enforcement |
 (1)
Mitigation- (A) In general.
The
Committee or a lead agency may, on behalf of the Committee, negotiate,
enter into or impose, and enforce any agreement or condition with any party
to the covered transaction in order to mitigate any threat to the national security of the United States that arises as a result of the covered
transaction.
- (B) Risk-based analysis required.
Any agreement entered into or condition imposed under subparagraph (A) shall
be based on a risk-based analysis, conducted by the Committee, of the threat
to national security of the covered transaction.
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(2)
Tracking authority for withdrawn notices-
(A) In general.
If any written notice of a covered transaction that was submitted to the
Committee under this section is withdrawn before any review or investigation
by the Committee under subsection (b) is completed, the Committee shall
establish, as appropriate --
- (i) interim protections to address specific
concerns with such transaction that have been raised in connection with any such
review or investigation pending any resubmission of any written notice under
this section with respect to such transaction and further action by the
President under this section;
- (ii) specific time frames for resubmitting any
such written notice; and
- (iii) a process for tracking any actions that
may be taken by any party to the transaction, in connection with the
transaction, before the notice referred to in clause (ii) is resubmitted.
- (B) Designation of agency.
The lead agency, other than any entity of the intelligence community (as
defined in the National Security Act of 1947), shall, on behalf of the
Committee, ensure that the requirements of subparagraph (A) with respect to
any covered transaction that is subject to such subparagraph are met.
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(3)
Negotiation, modification, monitoring, and
enforcement.SEC_CODE_REF_0090001192884 -
(A) Designation of lead agency.
The lead agency shall negotiate, modify, monitor, and enforce, on behalf of
the
Committee, any agreement entered into or condition imposed under
paragraph (1) with respect to a covered transaction, based on the expertise
with and knowledge of the issues related to such transaction on the part of
the designated department or agency. Nothing in this paragraph shall
prohibit other departments or agencies in assisting the lead agency in
carrying out the purposes of this paragraph.
- (B) Reporting by designated agency.
- (i) Modification reports.
The lead agency in connection with any agreement entered into or condition
imposed with respect to a covered transaction shall --
(I) provide periodic reports to the Committee on any material modification to
any such agreement or condition imposed with respect to the transaction; and
(II) ensure that any material modification to any such agreement or condition is
reported to the Director of National Intelligence, the Attorney General of the
United States, and any other Federal department or agency that
may have a material interest in such modification.
- (ii) Compliance.
The Committee shall develop and agree upon methods for evaluating compliance
with any agreement entered into or
condition imposed with respect to a covered transaction that will allow the
Committee to adequately assure compliance, without --
(I) unnecessarily diverting Committee resources from assessing any new covered
transaction for which a written notice has been filed pursuant to subsection
(b)(1)(C), and if necessary, reaching a mitigation agreement with or imposing a
condition on a party to such covered transaction or any covered transaction for
which a review has been reopened for any reason; or
(II) placing unnecessary burdens on a party to a covered transaction.'
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Legislative
history- Added by Section 5 of FINSA
(2007)
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| Related
Topic Pages |
31 CFR 800.508 Role of the Secretary of Labor
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- In response to a request from the Chairperson, the Secretary of
Labor shall identify for the Committee any risk mitigation provisions
proposed to or by the Committee that would violate U.S. labor laws.
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- Proposal release commentary
"Section 800.508. FINSA requires that the regulations provide for an appropriate role for the Secretary of Labor with respect to mitigation agreements. Under the proposed regulations, the Secretary of Labor will identify for CFIUS any risk mitigation provisions proposed to or by CFIUS that would violate U.S. labor laws."
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Executive Order 13456 Jan 2008
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Text
Addresses
use of mitigation agreements
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Lead Agency Oversight
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Related Topics
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