The Committee on Foreign Investment in the United States (or CFIUS) is an inter-agency committee of the United States Government that reviews the national security implications of foreign acquisitions of U.S. companies or operations. Chaired by the Secretary of the Treasury, CFIUS includes representatives from 11 U.S. agencies, including the Defense, State and Commerce departments, as well as (most recently) the Department of Homeland Security. The government of the United States, established by the United States Constitution, is a federal republic of 50 states, a few territories and some protectorates. ... Security measures taken to protect the Houses of Parliament in London, England. ... Look up acquisition in Wiktionary, the free dictionary. ... The United States Secretary of the Treasury is the finance minister of the Federal Government of the United States. ... The United States Department of Defense, abbreviated as DoD or DOD and sometimes called the Defense Department, is a civilian Cabinet organization of the United States government. ... Department of State redirects here. ... The United States Department of Commerce is a Cabinet department of the United States government concerned with promoting economic growth. ... The United States Department of Homeland Security (DHS) is a Cabinet department of the federal government of the United States that is concerned with protecting the American homeland and the safety of American citizens. ...

Companies proposing to be involved in an acquisition by a foreign firm are supposed to voluntarily notify CFIUS, but CFIUS can review transactions that are not voluntarily submitted. CFIUS reviews begin with a 30-day decision to authorize a transaction or begin a statutory investigation. If the latter is chosen, the committee has another 45 days to decide whether to permit the acquisition or order divestment. Most transactions submitted to CFIUS are approved without the statutory investigation.^[1] In finance and economics, divestment or divestiture is the reduction of some kind of asset, for either financial or social goals. ...

CFIUS has looked at the "restrictions on sale of advanced computers to any of a long list of foreign recipients, ranging from China to Iran."^[2] CFIUS reviews even deals with firms from U.S. allies, such as BAE Systems' early-2005 acquisition of United Defense. This and the vast majority of transactions submitted to CFIUS are approved without difficulty. But at least one deal has been called off when CFIUS began to take a closer look.^[3] BAE Systems plc is the worlds fourth largest defence contractor[2] and a commercial aerospace manufacturer. ... United Defense Industries was a United States defense contractor which is now part of BAE Systems Land and Armaments. ...

Some important cases include:

• The 2005 acquisition by Lenovo, the largest personal computer company in China, of IBM's personal computer and laptop unit
• State-owned China National Offshore Oil Corporation's attempted acquisition of UNOCAL (2005)
• State-owned Dubai Ports World's planned acquisition of P&O, the operator of many US ports, including New York (2006)
• NTT Communications' acquision of Verio (2000)
• The 2005 acquisition of Sequioa Voting Systems of Oakland, California, by Smartmatic, a Dutch company contracted by Hugo Chavez's government to replace that country's elections machinery^[4]

Lenovo Group Limited, formerly known as Legend Group Limited, is the largest personal computer manufacturer in the Peoples Republic of China, and as of 2004 is the eighth largest in the world. ... Big Blue redirects here. ... China National Offshore Oil Corporation (CNOOC) HKEx: 0883 (中国海洋石油总公司) is the third-largest National Oil Company (NOC) in the Peoples Republic of China next to CNPC, Sinopec. ... The Unocal Corporation (NYSE: UCL), based in Los Angeles, California, was founded in 1890 as the Union Oil Company of California. ... DP World is a company owned by the government of Dubai in the United Arab Emirates. ... The Peninsular and Oriental Steam Navigation Company or P&O is a shipping line which started in 1840 after the Peninsular Steam Navigation Company won the British Admiralty contract to carry the mail overseas in 1837. ... Nippon Telegraph and Telephone Corporation ) (TYO: 9432 , NYSE: NTT), or NTT, is a telephone company that dominates the telecommunication market in Japan. ... Verio is an ISP in the United States. ... President Hugo Chávez Hugo Rafael Chávez Frías (born July 28, 1954) has been the President of Venezuela since 1999. ...

Opinions on the Committee

In February 2006, Richard Perle gave more insight into CFIUS when he related to CBS News his experience on the panel during the Reagan administration, "The committee almost never met, and when it deliberated it was usually at a fairly low bureaucratic level." He also added, "I think it's a bit of a joke if we were serious about scrutinizing foreign ownership and foreign control, particularly since 9/11."^[5] Richard Norman Perle, (born September 16, 1941 in New York City), is an American political advisor and lobbyist who worked for the Reagan administration as an assistant Secretary of Defense and worked on the Defense Policy Board Advisory Committee from 1987 to 2004. ... CBS News is the news division of American television and radio network CBS. Its current president is Sean McManus who is also head of CBS Sports. ...

Others emphasize the crucial role that foreign direct investment plays in the U.S. economy, and the discouraging effect that heightened scrutiny and protectionism can cause. Foreign investors in the United States, much like U.S. investors elsewhere, bring expertise and infusions of capital into often-struggling sectors of the U.S. economy. In a February 2006 interview with the New York Times, another former Reagan administration official, Clyde V. Prestowitz Jr., noted that the United States "need[s] a net inflow of capital of $3 billion a day to keep the economy afloat.... Yet all of the body language here is 'go away.'"^[6] And, as Secretary Powell once remarked, "money, capital, is a coward; it will go nowhere where it is put in fear."^[7] Foreign direct investment (FDI) is defined as a long-term investment by a foreign direct investor in an enterprise resident in an economy other than that in which the foreign direct investor is based. ... Protectionism is the economic policy of restraining trade between nations, through methods such as high tariffs on imported goods, restrictive quotas, a variety of restrictive government regulations designed to discourage imports, and anti-dumping laws in an attempt to protect domestic industries in a particular nation from foreign take-over... There are very few or no other articles that link to this one. ...

External link

• CFIUS page at US Treasury

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References

1. ^ Sills, Gay Hartwell (2006). Committee on Foreign Investments in the United States (CFIUS). U.S. Department of Treasury, Office of the Assistant Secretary International Affairs, Office of International Investment. Retrieved on 2006-03-26.
2. ^ Rash, Wayne. "Suppose IBM-Lenovo Deal Doesn't Happen", eWeek.com, January 24, 2005.
3. ^ McCarthy, Ellen. "Purchase by Israeli Firm Called Off", Washington Post, March 24, 2006, p. A06.
4. ^ http://www.nytimes.com/2006/10/31/us/politics/31vote.html
5. ^ "Bush, Congress In Dark About Port Deal", CBS News, February 22, 2006.
6. ^ Porter, Eduardo. "Dubai Deal's Collapse Prompts Fears Abroad on Trade With U.S.", The New York Times, March 10, 2006. (free registration required to access content)
7. ^ Powell, Colin. "Remarks at Sovereign Credit Rating Conference", United States Department of State, April 23, 2002.