Business Workshop: Watch out for CFIUS

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More Western Pennsylvania businesses than ever are looking to foreign investors for capital or as potential buyers. But entrepreneurs should understand that the federal government, in the form of the Committee on Foreign Investment in the United States (CFIUS), may block or modify such deals.

CFIUS monitors all foreign investments, no matter how small, that may have an impact on U.S. national security. The committee has the authority to approve or disapprove a proposed transaction or to reverse a completed deal if it is found to be against U.S. policy or critical to national security interests.

CFIUS includes representatives from the Departments of Homeland Security, Justice, Defense, Treasury, Commerce, State and Energy and of the Offices of U.S. Trade Representatives and Science & Technology Policy

CFIUS gets involved when a proposed transaction involves a foreign entity acquiring control of an American business that has products, services or intellectual property important to U.S. national security or critical to our infrastructure. Its definitions of "national security" and "critical infrastructure" are extremely broad.

Investors with ties to foreign governments must give advance warning of any pending transaction to CFIUS, but other foreign investors can decide not seek advance notice.

Advance notice must include disclosure of information about the investor, the assets to be acquired and the nature, scope and expected closing date of the transaction. The danger of not informing CFIUS ahead of time lies in the possibility that the deal will be rejected after it is completed.

If CFIUS determines that a transaction may have possible negative national security implications, the foreign investor can work with the U.S. government to modify the transaction.

-- Dennis Unkovic, Meyer, Unkovic & Scott,


Business Workshop is a weekly feature from local experts offering tidbits on matters affecting business. To contribute, contact Business Editor Brian Hyslop at

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