The Committee on Foreign Investment in the United States ("CFIUS"), a multi-agency U.S. regulatory body empowered to review transactions involving a foreign person and a U.S. business that may affect U.S. national security, recently delivered its unclassified Annual Report to Congress for the calendar years 2016 and 2017 (“Annual Report”). The report confirms what was known anecdotally - that there has been a steady increase in the number of CFIUS filings, CFIUS is extending more cases into the investigation period, and more parties are abandoning transactions due to CFIUS objections.
As in previous years, the Annual Report summarizes CFIUS’s activities during the covered period, including the number and disposition of CFIUS notices, the nature and prevalence of mitigation arrangements, and the geographic source and sector concentration of covered transactions. In addition, the Annual Report describes its 2016 and 2017 calendar year activities in comparative and cumulative perspective for the years 2009 to 2017. In accordance with the legal prohibition against public disclosure of such information, the Annual Report contains no information with respect to specific transactions. Nonetheless, it remains a remarkable window into the reach and operation of CFIUS, and its impact on transactions involving U.S. businesses.