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"Section 721" a/k/a the "Exon-Florio Amendment"
Overview
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 Text
of section 721 - Topic page finder
- Section 721 of the Defense Production Act of
1950
- 50 U.S.C. § 2170
- Commonly known as the Exon-Florio Amendment
- Complete text of statute, as amended by
FINSA is
set forth below on this page
- Statute is annotated with links to definitions
and to other topic
pages that have more information, including the pending proposed rules
History
of Exon-Florio Amendment - section 721
- In 1988, amid concerns over foreign acquisition
of certain types of U.S. firms,
particularly by Japanese firms, Congress approved an amendment to the Defense
Production Act,
popularly known as the Exon-Florio amendment
- Authorizes the President to review mergers,
acquisitions, and takeovers by or with any foreign person which could result in
foreign control of any U.S. business to determine the effects of such
transactions on the national security of the United States
- In 2007, substantial amendments were made by FINSA
- Regulations proposed by FINSA refer to the Exon-Florio
amendment as
"section 721", so that the two terms are synonymous
- As amended by FINSA, section 721 codifies
aspects of the structure, role, process, and responsibilities of the Committee on
Foreign Investment in the United States ("CFIUS") and the role of executive branch
departments, agencies, and offices in CFIUS's review of transactions for national
security concerns
- For the pre-FINSA version of section 721,
see CFIUS: Archive
- Amended by Section 5021 of the Omnibus Trade and
Competitiveness Act of 1988
- Amended by Section 837(a) of the National
Defense Authorization Act for FY93
- 1 Section 721 of the Defense Production Act of 1950, 50 U.S.C. 2061, et seq.
(as
amended by Section 5021 of the Omnibus Trade and Competitiveness Act of 1988,
and by Section 837(a) of the National Defense Authorization Act for FY93). This
article
focuses on CFIUS-type restrictions, and recognizes that other regulatory tools
also
address national security risks associated with foreign investment, including
sector-specific
risks (e.g., banking, telecommunications, nuclear power) and transactional risks
(e.g., National Industrial Security Program)
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721(a) Definitions
Definitions.
-- For
purposes of this section, the following definitions
shall apply: |
 (1)
Committee; chairperson.- The terms 'Committee' and 'chairperson' mean the Committee on Foreign Investment in the United States and the chairperson thereof, respectively.
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(2)
Control.- The term 'control' has the meaning given to such term in regulations which the Committee shall prescribe.
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(3)
Covered transaction.- The term 'covered transaction' means any merger, acquisition, or takeover that is proposed or pending after August 23, 1988, by or with any foreign person which could result in foreign control of any person engaged in interstate commerce in the United States.
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(4)
Foreign government-controlled transaction.- The term 'foreign government-controlled transaction' means any covered transaction that could result in the control of any person engaged in interstate commerce in the United States by a foreign government or an entity controlled by or acting on behalf of a foreign government.
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(5)
Clarification. [re: "national security"]- The term 'national security' shall be construed so as to include those issues relating to 'homeland security', including its application to critical infrastructure.
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(6)
Critical infrastructure.- The term 'critical infrastructure' means, subject to rules issued under this section, systems and assets, whether physical or virtual, so vital to the United States that the incapacity or destruction of such systems or assets would have a debilitating impact on national security.
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(7)
Critical technologies.- The term 'critical technologies' means critical technology, critical components, or critical technology items essential to national defense, identified pursuant to this section, subject to regulations issued at the direction of the President, in accordance with
subsection (h).
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(8)
Lead agency.- The term 'lead agency' means the agency, or agencies, designated as the lead agency or agencies pursuant to subsection (k)(5) for the review of a transaction.
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Legislative
history- Section 2 of FINSA
amended section 721(a) in its entirety
- Pre-FINSA, section 721(a) authorized investigations by the President or
the President's designee
- Post-FINSA, reviews and investigations are now
authorized by section 721(b)
- For the pre-FINSA text of section 721(a), go to Archive
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| Related
Topic Pages |
721(b)(1) National security reviews
(A)
In general.
- (i) shall review the covered transaction to
determine the effects of the transaction on the national security
of the United States; and
- (ii) shall consider the factors specified in subsection (f)
for such purpose, as appropriate.
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| (B)
Control by foreign government. |
(C)
Written notice.- (i) In general.
Any party or parties to any
covered transaction
may initiate a review of the transaction under this paragraph by submitting
a written notice of the transaction to the Chairperson
of the Committee.
- (ii) Withdrawal of notice.
No covered transaction for which a notice was submitted under clause (i) may
be withdrawn from review, unless a written request for such withdrawal is
submitted to the Committee by any party to the transaction and approved by
the Committee.
- (iii) Continuing discussions.
A request for withdrawal under clause (ii) shall not be construed to
preclude any party to the covered transaction from continuing informal
discussions with the Committee or any member thereof regarding possible
resubmission for review pursuant to this paragraph.
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(D)
Unilateral initiation of review.
- (i) any covered transaction;
- (ii) any covered transaction that has previously
been reviewed or investigated under this section, if any party to the
transaction submitted false or misleading material information to the Committee
in connection with the review or investigation or omitted material information,
including material documents, from information submitted to the Committee; or
- (iii) any covered transaction that has
previously been reviewed or investigated under this section, if --
(I) any party to the transaction or the entity resulting from consummation of
the transaction intentionally materially breaches a mitigation agreement or
condition described in subsection (l)(1)(A);
(II) such breach is certified to the Committee by the lead department or agency
monitoring and enforcing such agreement or condition as an intentional material
breach; and
(III) the Committee determines that there are no other remedies or enforcement
tools available to address such breach.
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(E)
Timing.- Any review under this paragraph
shall be completed before the end of the 30-day period beginning on the date
of the acceptance of written notice under subparagraph (C) by the
chairperson, or beginning on the date of the initiation of the review in
accordance with subparagraph (D), as applicable.
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(F)
Limit on delegation of certain authority.-
The authority of the Committee to initiate a review under subparagraph (D)
may not be delegated to any person, other than the Deputy Secretary or an
appropriate Under Secretary of the department or agency represented on the
Committee.
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Legislative
history- Section 2 of FINSA
amended section 721(b) in its entirety
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| Related
Topic Pages |
721(b)(2) National security investigations
| (A)
In general. |
(B)
Applicability.
- (i) a review of a covered transaction under
paragraph (1) results in a determination that
(I) the transaction threatens to impair the national security
of the United
States and that threat has not been mitigated during or prior to the review of a
covered transaction under paragraph (1);
(II) the transaction is a foreign government-controlled transaction; or
(III) the transaction would result in control
of any critical
infrastructure of or within the United States by or on behalf of any foreign person, if the Committee determines that the transaction could impair national
security, and that such impairment to national security has not been mitigated
by assurances provided or renewed with the approval of the Committee, as
described in subsection (l), during the review period under paragraph (1); or
- (ii) the lead agency recommends, and the
Committee concurs, that an investigation be undertaken.
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(C)
Timing.- Any investigation under
subparagraph (A) shall be completed before the end of the 45-day period
beginning on the date on which the investigation commenced.
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(D)
Exception.- (i) In general.
Notwithstanding subparagraph (B)(i), an investigation of a foreign government-controlled transaction described in
subclause (II) of subparagraph (B)(i) or a transaction involving critical
infrastructure described in subclause (III) of subparagraph (B)(i) shall not
be required under this paragraph, if the Secretary of the Treasury and the
head of
the lead agency jointly determine, on the basis of the review of the
transaction under paragraph (1), that the transaction will not impair the
national security
of the United
States.
- (ii) Nondelegation.
The authority of the Secretary or the head of an agency referred to in
clause (i) may not be delegated to any person, other than the Deputy
Secretary of the Treasury or the deputy head (or the equivalent thereof) of
the lead agency, respectively.
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(E)
Guidance on certain transactions with
national security implications-
The Chairperson shall, not later than 180 days after the effective date of
the Foreign Investment and National Security Act of 2007, publish in the
Federal Register guidance on the types of transactions that the Committee
has reviewed and that have presented national security considerations,
including transactions that may constitute covered transactions that would
result in control of critical infrastructure relating to United States
national security by a foreign government or an entity controlled by or
acting on behalf of a foreign government.
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Legislative
history- Section 2 of FINSA
amended section 721(b) in its entirety
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| Related
Topic Pages |
721(b)(3)
Reports to Congress
| (A)
Certified notice at completion of review. |
(B)
Certified report at completion of investigation.-
As soon as is practicable after completion of an investigation under
subsection (b) that concludes action under this section, the chairperson and
the head of the lead agency
shall transmit to the members of Congress specified in
subparagraph (C)(iii) a certified written report (consistent
with the requirements of subsection (c)) on the results of the
investigation, unless the matter under investigation has been sent to the
President for decision.
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(C)
Certification procedures.- (i) In general.
Each certified notice and report required under subparagraphs (A) and (B),
respectively, shall be submitted to the members of Congress specified in
clause (iii), and shall include --
- (I) a description of the actions taken by the
Committee with respect to the transaction; and
- (II) identification of the determinative factors
considered under subsection (f).
- (ii) Content of certification.
Each certified notice and report required under subparagraphs (A) and (B),
respectively, shall be signed by the chairperson and the head of the lead agency, and shall state that, in the determination of the Committee, there
are no unresolved national security concerns with the transaction that is
the subject of the notice or report.
- (iii) Members of congress.
Each certified notice and report required under subparagraphs (A) and (B),
respectively, shall be transmitted --
- (I) to the Majority Leader and the Minority
Leader of the Senate;
- (II) to the chair and ranking member of the
Committee on Banking, Housing, and Urban Affairs of the Senate and of any
committee of the Senate having oversight over the lead agency;
- (III) to the Speaker and the Minority Leader of
the House of Representatives;
- (IV) to the chair and ranking member of the
Committee on Financial Services of the House of Representatives and of any
committee of the House of Representatives having oversight over the lead agency;
and
- (V) with respect to covered transactions
involving critical
infrastructure, to the members of the Senate from the State in which the
principal place of business of the acquired United States person is located, and
the member from the Congressional District in which such principal place of
business is located.
- (iv) Signatures; limit on delegation.
- (I) In general.
Each certified notice and report required under subparagraphs (A) and (B),
respectively, shall be signed by the chairperson and the head of the lead
agency, which signature requirement may only be delegated in accordance with
subclause (II).
- (II) Limitation on delegation of certifications.
The chairperson and the head of the lead agency may delegate the signature
requirement under subclause
(I) --
(aa) only to an appropriate employee of the Department of the Treasury (in the
case of the Secretary of the Treasury) or to an appropriate employee of the lead
agency (in the case of the lead agency) who was appointed by the President, by
and with the advice and consent of the Senate, with respect to any notice
provided under paragraph (1) following the completion of a review under this
section; or
(bb) only to a Deputy Secretary of the Treasury (in the case of the Secretary of
the Treasury) or a person serving in the Deputy position or the equivalent
thereof at the lead agency (in the case of the lead agency), with respect to any
report provided under subparagraph (B) following an investigation under this
section.
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Legislative
history- Section 2 of FINSA
amended section 721(b) in its entirety
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| Related
Topic Pages |
721(b)(4)
Director of national intelligence
(A)
In general.- The Director of National
Intelligence shall expeditiously carry out a thorough analysis of any threat
to the national security of the United States posed by any covered transaction. The Director of National Intelligence shall also seek and
incorporate the views of all affected or appropriate intelligence agencies
with respect to the transaction.
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(B)
Timing.- The analysis required under
subparagraph (A) shall be provided by the Director of National Intelligence
to the Committee not later than 20 days after the date on which notice of
the transaction is accepted by the Committee under paragraph (1)(C), but
such analysis may be supplemented or amended, as the Director considers
necessary or appropriate, or upon a request for additional information by
the Committee. The Director may begin the analysis at any time prior to
acceptance of the notice, in accordance with otherwise applicable law.
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(C)
Interaction with intelligence community.-
The Director of National Intelligence shall ensure that the intelligence
community remains engaged in the collection, analysis, and dissemination to
the Committee of any additional relevant information that may become
available during the course of any investigation conducted under subsection (b) with respect to a transaction.
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(D)
Independent role of director.- The
Director of National Intelligence shall be a nonvoting, ex officio member of
the Committee, and shall be provided with all notices received by the
Committee under paragraph (1)(C) regarding covered transactions, but shall
serve no policy role on the Committee, other than to provide analysis under
subparagraphs (A) and (C) in connection with a covered transaction.
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Legislative
history- Section 2 of FINSA
amended section 721(b) in its entirety
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| Related
Topic Pages |
721(b)(5)
Additional information
Submission
of additional information.- No provision
of this subsection shall be construed as prohibiting any party to a
covered transaction from submitting additional information concerning the
transaction, including any proposed restructuring of the transaction or any
modifications to any agreements in connection with the transaction, while
any review or investigation of the transaction is ongoing.
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Legislative
history- Section 2 of FINSA
amended section 721(b) in its entirety
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| Related
Topic Pages |
721(b)(6) Notice of results to parties
Notice
of results to parties.- The Committee
shall notify the parties to a covered transaction of the results of a review
or investigation under this section, promptly upon completion of all action
under this section.
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Legislative
history- Section 2 of FINSA
amended section 721(b) in its entirety
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| Related
Topic Pages |
721(b)(7) Regulations
Regulations.-
Regulations prescribed under this section shall include standard procedures
for --
- (A) submitting any notice of a covered transaction to the Committee;
- (B) submitting a request to withdraw a covered
transaction from review;
- (C) resubmitting a notice of a covered
transaction that was previously withdrawn from review; and
- (D) providing notice of the results of a review
or investigation to the parties to the covered transaction, upon completion of
all action under this section.
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Legislative
history- Section 2 of FINSA
amended section 721(b) in its entirety
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| Related
Topic Pages |
721(c) Confidentiality of information
Confidentiality
of information.- Any information or
documentary material filed with the President or the Presidents designee
pursuant to this section shall be exempt from disclosure under section 552
of title 5, United States Code, and no such information or documentary
material may be made public, except as may be relevant to any administrative
or judicial action or proceeding. Nothing in this subsection shall be
construed to prevent disclosure to either House of Congress or to any duly
authorized committee or subcommittee of the Congress.
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Legislative
history
- FINSA
did not amend section 721(c)
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| Related
Topic Pages |
721(d) Presidential
authority SEC_CODE_REF_0090001192884
Action
by the President.- (1) In general.
Subject to paragraph (4), the President may take such action for such time
as the President considers appropriate to suspend or prohibit any covered transaction that threatens to impair the national security of the United States.
- (2) Announcement by the president.
The President shall announce the decision on whether or not to take action
pursuant to paragraph (1) not later than 15 days after the date on which an
investigation described in subsection (b) is completed.
- (3) Enforcement.
The President may direct the Attorney General of the United States to seek
appropriate relief, including divestment relief, in the district courts of
the United States, in order to implement and enforce this subsection.
- (4) Findings of the president.
The President may exercise the authority conferred by paragraph (1), only if
the President finds that --
- (A) there is credible evidence that leads the
President to believe that the foreign interest exercising control might take
action that threatens to impair the national security; and
- (B) provisions of law, other than this section
and the International Emergency Economic Powers Act, do not, in the judgment of
the President, provide adequate and appropriate authority for the President to
protect the national security in the matter before the President.
- (5) Factors to be considered.
For purposes of determining whether to take action under paragraph (1), the
President shall consider, among other factors each of the factors described
in subsection (f), as appropriate. |
Legislative
history- Section 6 of FINSA
amended section 721(d) in its entirety
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| Related
Topic Pages |
721(e)
Actions nonreviewable
Actions
and Findings Nonreviewable.-
The actions of the President under paragraph (1) of subsection (d) and the
findings of the President under paragraph (4) of subsection (d) shall not be
subject to judicial review.
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Legislative
history- Section 6 of FINSA
amended section 721(e) in its entirety
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| Related
Topic Pages |
721(f) Factors to be considered
Factors
to be considered
For purposes of this section, the President or the
Presidents designee may,
taking into account the
requirements of national security, consider
- (1) domestic production needed for
projected national defense requirements,
- (2) the capability and capacity of domestic industries to meet national
defense requirements, including the availability of human resources,
products, technology, materials, and other supplies and services,
- (3) the control of domestic industries and commercial activity by
foreign citizens as it affects the capability and capacity of the United
States to meet the requirements of national security,
- (4) the potential effects of the proposed or pending transaction on
sales of military goods, equipment, or technology to any country
- (A) identified by the Secretary of State
(i) under section 6(j) of the Export Administration Act of 1979 [section 2405
(j) of this Appendix], as a country that supports terrorism;
(ii) under section 6(l) of the Export Administration Act of 1979 [section 2405
(l) of this Appendix], as a country of concern regarding missile proliferation;
or
(iii) under section 6(m) of the Export Administration Act of 1979 [section 2405
(m) of this Appendix], as a country of concern regarding the proliferation of
chemical and biological weapons;
- (B) identified by the Secretary of Defense as
posing a potential regional military threat to the
interests of the United States; or'
- (C) listed under section 309(c) of the Nuclear
Non-Proliferation Act of 1978 [42 U.S.C. 2139a (c)] on the "Nuclear
Non-Proliferation-Special Country List" (15 C.F.R. Part 778, Supplement No. 4)
or any successor list;
- (5) the potential effects of the proposed or pending transaction on
United States international technological leadership in areas affecting
United States national security;
- (6) the potential national security-related effects on
United States critical infrastructure, including major energy
assets;
- (7) the potential national security-related effects on United States
critical technologies;
- (8) whether the covered transaction is a foreign government-controlled
transaction, as determined under subsection (b)(1)(B);
- (9) as appropriate, and particularly with respect to transactions
requiring an investigation under subsection (b)(1)(B), a review of the
current assessment of --
- (A) the adherence of the subject country to
nonproliferation control regimes, including treaties and multilateral supply
guidelines, which shall draw on, but not be limited to, the annual report on
'Adherence to and Compliance with Arms Control, Nonproliferation and Disarmament
Agreements and Commitments' required by section 403 of the Arms Control and
Disarmament Act;
- (B) the relationship of such country with the
United States, specifically on its record on cooperating in counter-terrorism
efforts, which shall draw on, but not be limited to, the report of the President
to Congress under section 7120 of the Intelligence Reform and Terrorism
Prevention Act of 2004; and
- (C) the potential for transshipment or diversion
of technologies with military applications, including an analysis of national
export control laws and regulations;
- (10) the long-term projection of United States requirements for sources
of energy and other critical resources and material; and
- (11) such other factors as the President or the Committee may determine
to be appropriate, generally or in connection with a specific review or
investigation.
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Legislative
history
- Deleted "among other factors" from the end of
the introductory clause
- Added subparagraph (4)(B)
- Added paragraphs 6 to 11
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| Related
Topic Pages |
721(g) Additional
Reports to Congress
(1)
Briefing requirement on request- The
Committee
shall, upon request from any Member of Congress specified in subsection (b)(3)(C)(iii), promptly provide briefings on a covered transaction for which all action has concluded under this section, or on
compliance with a mitigation agreement or condition imposed with respect to
such transaction, on a classified basis, if deemed necessary by the
sensitivity of the information. Briefings under this paragraph may be
provided to the congressional staff of such a Member of Congress having
appropriate security clearance.
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(2)
Application of confidentiality provisions.
- (A) In general.--The disclosure of information under this subsection
shall be consistent with the requirements of subsection (c). Members of
Congress and staff of either House of Congress or any committee of Congress,
shall be subject to the same limitations on disclosure of information as are
applicable under subsection (c).
- (B) Proprietary information.--Proprietary information which can be
associated with a particular party to a covered transaction shall be
furnished in accordance with subparagraph (A) only to a committee of
Congress, and only when the committee provides assurances of
confidentiality, unless such party otherwise consents in writing to such
disclosure.
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Legislative
history- Section 7(a) of FINSA
amended section 721(d) in its entirety
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Topic Pages |
721(h) Regulations
(1)
In general.- The President shall direct,
subject to notice and comment, the issuance of regulations to carry out this
section.
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(2)
Effective date.- Regulations issued under
this section shall become effective not later than 180 days after the
effective date of the Foreign Investment and National Security Act of 2007.
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(3)
Content.- Regulations issued under this
subsection shall --
- (A) provide for the imposition of civil
penalties for any violation of this section, including any mitigation agreement
entered into or conditions imposed pursuant to subsection (l);
- (B) to the extent possible --
(i) minimize paperwork burdens; and (ii) coordinate reporting requirements under
this section with reporting requirements under any other provision of Federal
law; and
- (C) provide for an appropriate role for the
Secretary of Labor with respect to mitigation agreements.
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Legislative
history- Section 9 of FINSA
amended section 721(h) in its entirety
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| Related
Topic Pages |
721(i) Effect on other law
Effect
on other law- No provision of this
section shall be construed as altering or affecting any other authority,
process, regulation, investigation, enforcement measure, or review provided
by or established under any other provision of Federal law, including the
International Emergency Economic Powers Act, or any other authority of the
President or the Congress under the Constitution of the United States.
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Legislative
history- Section 10 of FINSA
amended section 721(i) in its entirety
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| Related
Topic Pages |
721(j) Technology risk assessments
Effect
on other law- In any case in which an
assessment of the risk of diversion of defense critical technology is
performed by a designee of the President, a copy of such assessment shall be
provided to any other designee of the President responsible for reviewing or
investigating a merger, acquisition, or takeover under this section.
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| Related
Topic Pages |
721(k) CFIUS
organization
(1)
Establishment.- The Committee on Foreign
Investment in the United States, established pursuant to Executive Order No.
11858, shall be a multi agency committee to carry out this section and such
other assignments as the President may designate.
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(2)
Membership.- The Committee shall be
comprised of the
following members or the designee of any such member:
- (A) The Secretary of the Treasury.
- (B) The Secretary of Homeland Security.
- (C) The Secretary of Commerce.
- (D) The Secretary of Defense.
- (E) The Secretary of State.
- (F) The Attorney General of the United States.
- (G) The Secretary of Energy.
- (H) The Secretary of Labor (nonvoting, ex
officio).
- (I) The Director of National Intelligence
(nonvoting, ex officio).
- (J) The heads of any other executive department,
agency, or office, as the President determines appropriate, generally or on a
case-by-case basis.
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| (3)
Chairperson. |
(4)
Assistant secretary for the department of the treasury.-
There shall be established an additional position of Assistant Secretary of
the Treasury, who shall be appointed by the President, by and with the
advice and consent of the Senate. The Assistant Secretary appointed under
this paragraph shall report directly to the Undersecretary of the Treasury
for International Affairs. The duties of the Assistant Secretary shall
include duties related to the Committee on Foreign Investment in the United
States, as delegated by the Secretary of the Treasury under this section.
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(5)
Designation of lead agency.- The Secretary
of the Treasury shall designate, as appropriate, a member or members of the
Committee to be the lead agency or agencies on behalf of the Committee --
- (A) for each covered transaction, and for
negotiating any mitigation agreements or other conditions necessary to protect
national security; and
- (B) for all matters related to the monitoring of
the completed transaction, to ensure compliance with such agreements or
conditions and with this section.
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(6)
Other members.- The chairperson shall
consult with the heads of such other Federal departments, agencies, and
independent establishments in any review or investigation under subsection
(a), as the chairperson determines to be appropriate, on the basis of the
facts and circumstances of the covered transaction under review or
investigation (or the designee of any such department or agency head).
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(7)
Meetings.- The Committee shall meet upon
the direction of the President or upon the call of the chairperson, without
regard to section 552b of title 5, United States Code (if otherwise
applicable).
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Legislative
history- Section 3 of FINSA
amended section 721(k) in its entirety
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| Related
Topic Pages |
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.-
(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
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| Related
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721(m) Annual Report to Congress
(1)
In general.- The chairperson shall
transmit a report to the chairman and ranking member of the committee of
jurisdiction in the Senate and the House of Representatives, before July 31
of each year on all of the reviews and investigations of covered
transactions completed under subsection (b) during the 12-month period
covered by the report.
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(2)
Contents of report relating to covered transactions.-
The annual report under paragraph (1) shall contain the following
information, with respect to each covered transaction, for the reporting
period:
- (A) A list of all notices filed and all reviews
or investigations completed during the period, with basic information on each
party to the transaction, the nature of the business activities or products of
all pertinent persons, along with information about any withdrawal from the
process, and any decision or action by the President under this section.
- (B) Specific, cumulative, and, as appropriate,
trend information on the numbers of filings, investigations, withdrawals, and
decisions or actions by the President under this section.
- (C) Cumulative and, as appropriate, trend
information on the business sectors involved in the filings which have been
made, and the countries from which the investments have originated.
- (D) Information on whether companies that
withdrew notices to the Committee in accordance with subsection (b)(1)(C)(ii)
have later refiled such notices, or, alternatively, abandoned the transaction.
- (E) The types of security arrangements and
conditions the Committee has used to mitigate national security concerns about a
transaction, including a discussion of the methods that the Committee and any
lead agency are using to determine compliance with such arrangements or
conditions.
- (F) A detailed discussion of all perceived
adverse effects of covered transactions on the national security or critical
infrastructure of the United States that the Committee will take into account in
its deliberations during the period before delivery of the next report, to the
extent possible.
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(3)
Contents of report relating to critical technologies.-
(A) In general.
In order to assist Congress in its oversight responsibilities with respect
to this section, the President and such agencies as the President shall
designate shall include in the annual report submitted under paragraph (1)
--
- (i) an evaluation of whether there is credible
evidence of a coordinated strategy by 1 or more countries or companies to
acquire United States companies involved in research, development, or production
of critical technologies for which the United States is a leading producer; and
- (ii) an evaluation of whether there are
industrial espionage activities directed or directly assisted by foreign
governments against private United States companies aimed at obtaining
commercial secrets related to critical technologies.
- (B) Release of unclassified study.
All appropriate portions of the annual report under paragraph (1) may be
classified. An unclassified version of the report, as appropriate,
consistent with safeguarding national security and privacy, shall be made
available to the public.
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Legislative
history
- Added by Section 7(b) of FINSA
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| Related
Topic Pages |
721(n) Certifications
required
Certification
of Notices and Assurances.- Each notice,
and any followup information, submitted under this section and regulations
prescribed under this section to the President or the Committee by a party
to a covered transaction, and any information submitted by any such party in
connection with any action for which a report is required pursuant to
paragraph (3)(B) of subsection (l), with respect to the implementation of
any mitigation agreement or condition described in paragraph (1)(A) of
subsection (l), or any material change in circumstances, shall be
accompanied by a written statement by the chief executive officer or the
designee of the person required to submit such
notice or information certifying that, to the best of the knowledge and
belief of that person --
- (1) the notice or information submitted fully
complies with the requirements of this section or such regulation, agreement, or
condition; and
- (2) the notice or information is accurate and
complete in all material respects.
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Legislative
history
- Added by Section 8 of FINSA
- See FINSA
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| Related
Topic Pages |
721 - Note
Foreign investment study
(1)
Study required.- Before the end of the
120-day period beginning on the date of enactment of this Act and annually
thereafter, the Secretary of the Treasury, in consultation with the
Secretary of State and the Secretary of Commerce, shall conduct a study on
foreign direct investments in the United
States, especially investments in critical infrastructure and industries
affecting national security, by --
- (A) foreign governments, entities controlled by
or acting on behalf of a foreign government, or persons of foreign countries
which comply with any boycott of Israel; or
- (B) foreign governments, entities controlled by
or acting on behalf of a foreign government, or persons of foreign countries
which do not ban organizations designated by the Secretary of State as foreign
terrorist organizations.
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(2)
Report.- Before the end of the 30-day
period beginning upon the date of completion of each study under paragraph
(1), and thereafter in each annual report under section 721(m) of the
Defense Production Act of 1950 (as added by this section), the Secretary of
the Treasury shall submit a report to Congress, for transmittal to all
appropriate committees of the Senate and the House of Representatives,
containing the findings and conclusions of the Secretary with respect to the
study described in paragraph (1), together with an analysis of the effects
of such investment on the national security of the United States and on any
efforts to address those effects.
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Legislative
history
- Added by Section 7(c) of FINSA
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Topic Pages |
721 - Note Inspector General
investigation
(1)
In general.- The Inspector General of the
Department of the Treasury shall conduct an independent investigation to
determine all of the facts and circumstances concerning each failure of the
Department of the Treasury to make any report to the Congress that was
required under section 721(k) of the
Defense Production Act of 1950, as in effect on the day before the date of
enactment of this Act.
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(2)
Report to the congress.- Before the end of
the 270-day period beginning on the date of enactment of this Act, the
Inspector General of the Department of the Treasury shall submit a report on
the investigation under paragraph (1) containing the findings and
conclusions of the Inspector General, to the chairman and ranking member of
each committee of the Senate and the House of Representatives having
jurisdiction over any aspect
of the report, including, at a minimum, the Committee on Foreign Relations,
the Committee on Banking, Housing, and Urban Affairs, and the Committee on
Commerce, Science, and Transportation of the Senate, and the Committee on
Foreign Affairs, the Committee on Financial Services, and the Committee on
Energy and Commerce of the House of
Representatives.
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Legislative
history
- Added by Section 7(d) of FINSA
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| Related
Topic Pages |
Related Topics
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