WASHINGTON – Today, the U.S. House of Representatives passed Congressman Robert Pittenger’s (NC-09) landmark legislation to modernize the national security review process of potential foreign investments in the United States.
Chinese investment in the United States increased more than 900 percent between 2010 and 2016. Much of this investment was part of a strategic, coordinated Chinese government effort to target critical American infrastructure and defense applicable technologies.
The Foreign Investment Risk Review Modernization Act (FIRRMA, H.R. 5841), strengthens how the Committee on Foreign Investment in the United States (CFIUS) reviews the national security risks of potential foreign investments.
“For over two years, we have fought for CFIUS reform and the implementation of stronger policies to combat strategic and disruptive Chinese activities. Today, I am grateful that the House is taking action on this issue. This landmark legislation will take enormous steps to improve our foreign investment review process to prevent further transfers of military applicable technologies to the Chinese government.”
Companion legislation was included in the National Defense Authorization Act (NDAA), which passed the Senate on June 18th, 2018. FIRRMA is expected to be included in the final NDAA conference report.
The Committee on Foreign Investment in the United States (CFIUS) is the only government mechanism to ensure potential foreign investments do not harm our national security. However, CFIUS has not been substantially updated in many years.
Congressman Pittenger and Senate Majority Whip John Cornyn (R-TX) introduced FIRRMA on November 8th, 2017. The legislation has been publicly endorsed by the White House, Defense Secretary Jim Mattis, Attorney General Jeff Sessions, Treasury Secretary Steven Mnuchin, Commerce Secretary Wilbur Ross, Senate and House Intelligence Chairs Richard Burr and Devin Nunes, and hundreds of defense experts, generals, elected officials and private businesses.
The Foreign Investment Risk Review Modernization Act:
*Allows CFIUS to review sensitive non-controlling investments involving countries such as China, Russia, and state sponsors of terrorism.
*Puts special emphasis on investments that could release U.S. citizens’ personal data or reveal sensitive information on critical technologies or critical infrastructure to potential adversaries.
*Allows CFIUS to review the purchase or lease of real estate near U.S. military installations, as well as government properties that are sensitive for national security reasons, and land at air and sea ports.
*Requires that export controls be calibrated and regularly updated to support continued U.S. leadership in science, technology, engineering, manufacturing, and other sectors critical to the industrial base.
*Closes gaps in U.S. export controls that could permit the transfer of cutting edge technologies – like artificial intelligence and advanced semiconductors -China and other countries of concern.
*Provides explicit authority for an interagency process to identify and appropriately