Chinese companies have become increasingly active in investing and acquiring businesses and assets overseas in order to satisfy the ever-rising demand in China. The United States, being the world’s largest economy with well-known companies, abundant natural resources and technologically advanced infrastructure, has been a key target for Chinese outbound investments.
Some Chinese companies have had difficulties in obtaining approval for their proposed investment or acquisition in the U.S. from the Committee on Foreign Investment in the United States (“CFIUS”) while others have proven to be successful in obtaining such approval. The Guide To Demystify The CFIUS Process (“Guide”) provides an overview of (i) the regulatory role and function of CFIUS, (ii) the scope and steps involved in the CFIUS review process, and (iii) some practical information and advices in relation to the CFIUS review process.
CFIUS is an inter-agency committee of the U.S. government that is authorized to review, investigate and block any transaction or investment that could result in the control of any U.S. businesses or assets by a foreign person that may raise national security concerns, or involve critical infrastructure. CFIUS is made up of representatives from nine federal agencies, including the Department of Defense, the Department of State and the Department of Homeland Security.
The Guide was prepared by the U.S. law firm, Baker Botts L.L.P., in collaboration with various members of the U.S.-China Energy Cooperation Program (“ECP”). ECP is a non-profit and non-governmental organization sponsored by, and with capital contributions from, various enterprises, and it focuses on the sustainable commercial development of clean energy and energy-efficient industries in China and the U.S. As a platform for government enterprises, ECP works closely with the U.S. and Chinese governments, and is officially recognized by both governments. Through the abundant technologies, products and commercial resources of its member companies, ECP pushes forward the development of commerically viable projects for clean energy and energy efficiency both in China and the U.S. and promotes the sustainable development of the energy industry in both countries.
We trust that you will find the Guide to be a useful tool in your planning and execution of acquisition or investment in businesses or assets in the United States. The aim of the Guide is to provide you with a better understanding of CFIUS and the procedures that are involved in its review process of foreign investments in the U.S. It is very much an introduction to the subject and is not intended to be a comprehensive guide to all issues relating to the CFIUS review process.
The reports can be downloaded below:
BB 10179 CFIUS Booklet PRINT.pdf