House panel will consider bill to boost foreign investment review powers next week

House panel will consider bill to boost foreign investment review powers next week
© Greg Nash

The House Financial Services Committee will mark up a bill next week that would boost the power of a secretive federal panel that analyzes foreign investments for national security risks, according to a source familiar with the plan.

The Financial Services panel will hold a hearing to amend a measure to give the Committee on Foreign Investment in the U.S. (CFIUS) broader authority to block and scrutinize foreign deals involving U.S. businesses.

The bill, sponsored by Rep. Robert PittengerRobert Miller PittengerBottom Line North Carolina reporter says there could be 'new crop' of GOP candidates in 9th Congressional District race North Carolina board calls for new election in contested House race MORE (R-N.C.), has received bipartisan support and is expected to pass Congress. The White House endorsed the bill, which was also introduced in the Senate by Sens. John CornynJohn CornynGOP senators urge Trump not to restrict guest worker visas Castro, Warren, Harris to speak at Texas Democratic virtual convention Democratic unity starts to crack in coronavirus liability reform fight MORE (R-Texas) and Dianne FeinsteinDianne Emiel FeinsteinGraham announces hearing on police use of force after George Floyd killing Frustration builds in key committee ahead of Graham subpoena vote  The Hill's Morning Report - Presented by Facebook - Major space launch today; Trump feuds with Twitter MORE (D-Calif.).

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But the measure had been held up over concerns from some lawmakers and U.S. technology companies that the bill created unnecessary and redundant restrictions.

The Senate Banking Committee will attempt to settle those concerns during their own markup on Tuesday with an amendment that would subject joint ventures between U.S. and foreign businesses to export controls outside of CFIUS review process. The current version of the bill would expand CFIUS jurisdiction to joint ventures.

The initial backlash delayed a Financial Services panel markup of the bill earlier this month, Politico reported.

CFIUS was established in 1975 to stop foreign acquisitions of U.S. businesses that could put the country at a competitive disadvantage to rivals or threaten critical intellectual property. The panel, chaired by the Treasury secretary, includes the heads of several Cabinet departments, along with leaders of intelligence agencies.

The bill would expand CFIUS’s oversight to include investments where a foreign company would not necessarily gain control of a U.S. firm, including minority stake investments and transactions near military bases or U.S. government facilities.

CFIUS has been unusually active during the Trump administration, which has taken several steps meant to hinder China’s attempts to expand its economic influence and dominate critical tech industries.

Trump in September blocked the pending sale of Lattice, an Oregon-based semiconductor and chip manufacturer, to a group of investors including Chinese state-owned entities. The president in January also blocked the sale of MoneyGram, a money transfer firm, to a subsidiary of the Chinese company Alibaba. Then, in March, Trump froze Singapore-based Broadcom’s attempt at a hostile takeover of Qualcomm.