New CFIUS Executive Order Adds National Security Factors For Evaluating Foreign Investments – Terrorism, Homeland Security & Defence

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09/22/2022 On September 15, 2022, President Biden signed Executive Order (EO) 14083 expanding the list of national safety factors for the Committee on Foreign Investment in the United States (CFIUS) to consider when considering foreign investments in the United States.

A White House fact sheet summarizing the provisions of EO 14083 is available here.


Section 721(f) of the Defense Production Act (DPA), codified at 50 USC § 4565(f), establishes and authorizes the President and CFIUS to consider ten factors that CFIUS may consider in considering a foreign investment transaction in the United States determine other factors generally or in connection with a particular review or investigation.

New Factors

EO 14083 expands the list of factors in Section 721(f) to include five additional factors that CFIUS may need to consider:

  • The impact of a particular transaction on the resilience of critical U.S. supply chains that may have national security implications, including those off-base of the defense industry.

  • The impact of a particular transaction on U.S. technological leadership in areas affecting U.S. national security, including but not limited to microelectronics, artificial intelligence, biotechnology and biomanufacturing, quantum computing, advanced clean energy, and climate change adaptation technologies.

  • Industry investment trends that may impact the U.S. national security implications of a particular transaction.

  • Cybersecurity risks that threaten to compromise national security.

  • Risks to Sensitive Data of US Persons.

EO 14083 is the first regulation of its kind to provide direction to CFIUS in addition to the DPA and CFIUS regulations. In particular, EO 14083 makes no changes to the scope of jurisdiction of CFIUS or any other legal process. In practical terms, the Executive Order appears to give legal effect to factors already informally considered by CFIUS. We therefore anticipate that EO 14083 is unlikely to have a material impact on pre-CFIUS matters.

However, as other countries adopt foreign direct investment regimes similar to those in the United States, EO 14083 can also be used to outline the U.S. government’s specific expectations when considering whether those countries qualify for preferred ” Exempted Foreign State” as defined in the CFIUS regulations (ie, a country that “has established and effectively applies a robust process to analyze foreign investments for national security risks and to facilitate coordination with the United States on investment security matters).

EO 14083 underscores the need for persons making foreign investments in the United States to keep abreast of the development of CFIUS practice and its links to other national foreign direct investment regimes.

The content of this article is intended to provide a general guide to the topic. In relation to your specific circumstances, you should seek advice from a specialist.

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