An unprecedented release of information has occurred detailing confidential discussions of the Committee on Foreign Investment in the United States (CFIUS). On December 17, 2009, Firstgold Corp. (Firstgold), a Nevada mining company issued a press release stating that on December 21, CFIUS would "recommend to President Obama that he reject the proposed investment by the China-based company Northwest Non Ferrous International Investment Company Ltd. ("Northwest") in Firstgold" due to national security concerns.

Subsequently, and remarkably, a memorandum from Firstgold's legal counsel was published by the New York Times. The memorandum details the transaction and confidential internal discussions among the parties, the Deputy Secretary of Treasury and CFIUS staff. Such a memorandum has never before been released.

While CFIUS members are required by law not to divulge the nature of or even the existence of a CFIUS transaction unless the matter is "public knowledge," parties to a CFIUS transaction can freely talk to the press. However, they rarely do so, especially on such sensitive matters, due to potential reputational and financial risk.

While Firstgold's reasons for issuing its press release are not entirely clear, these developments could have implications for how CFIUS interacts with parties to transactions (i.e., they may become less forthcoming regarding the national security concerns they have identified). Divulging sensitive details related to a transaction under review risks politicizing the CFIUS process to the potential detriment of parties and the process in general.

Firstgold's press release can be viewed here.