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5 National Security and FDI Screening in the US

From: Merger Control, National Security, and Foreign Direct Investment Screening: A Comparative Perspective (1st Edition)

Ioannis Kokkoris

From: Oxford Competition Law (http://oxcat.ouplaw.com). (c) Oxford University Press, 2023. All Rights Reserved.date: 19 July 2024

This chapter examines the US approach to assessing national security concerns in the context of merger control and FDI. It highlights the role of the CFIUS in evaluating risks to national security posed by foreign acquisitions. It explores instances where CFIUS has blocked transactions, emphasizing the secrecy surrounding its decision-making. While the number of transactions blocked by CFIUS remains relatively low, its scope for intervention is wide, and its criteria are highly discretional. The chapter also looks at changing presidential attitudes towards FDI, particularly from China, with increasing concerns about technology and innovation transfers and issues raised by state-owned enterprises (SOEs). In conclusion, the chapter underscores the importance of transparency, accountability, and efficiency in the national security assessment process, arguing for a more detailed perspective of CFIUS’s rationale, to enhance the understanding of its decisions.

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