WASHINGTON, D.C. – This week, Senators Thom Tillis (R-NC), John Cornyn (R-TX), and Marco Rubio (R-FL) introduced legislation to expand the Committee on Foreign Investment in the United States (CFIUS’s) jurisdiction to review foreign investments in emerging and foundational technology in the United States.
“Right now, CFIUS relies heavily on the Commerce Department to determine what qualifies as an emerging and foundational technology as it relates to reviewing foreign investments,” said Senator Tillis.“This legislation will simply extend the powers of the CFIUS chair and one other member of CFIUS to determine what technologies are deemed essential to the national security of the United States. This is a necessary fix to current law and I am proud to introduce this legislation alongside my colleagues.”
“American ingenuity has been the driving force of our most important technological advancements, something potential adversaries like China have tried to exploit,” said Senator Cornyn. “By being able to efficiently identify technology that could impact national security, we can stop the theft of American intellectual property while ensuring companies can continue to benefit from foreign investment.”
“As Congress and the Administration consider additional action in response to the national security threat posed by technologies from hostile foreign actors – including recent actions on China’s TikTok and WeChat – it is critical that the CFIUS has the authority to review foreign investment in emerging technologies,” Senator Rubio said. “I am proud to join with Senators Tillis and Cornyn on this important legislation, and will continue to push for policies that adopt a more expansive approach to protecting Americans’ user data and our national security.”
In 2018, Congress passed the Foreign Investment Risk Review Modernization Act (FIRRMA) and the Export Control Reform Act (ECRA) to expand CFIUS’s jurisdiction to cover certain “critical technologies.” With this law, Congress intended to prevent China from using investment capital to steal emerging and foundational technologies with a clear U.S. national security application, such as artificial intelligence, additive manufacturing, quantum computing, autonomous vehicles, augmented or virtual reality, robotics, and blockchain technology. However, the statute relies on the Commerce Department rule making process to determine what is considered an emerging or foundational technology and should be added to the Commerce Control List (CCL) and thereby be subject to CFIUS review.
Instead of only relying on the Commerce Department to make a determination on what technologies qualify as emerging and foundational for the purpose of CFIUS review, this amendment expands the statute to state that a technology is also considered emerging and foundational if at least the Chair of CFIUS (Treasury) and one other interagency member deem a technology essential to the national security of the United States.
Read the full bill text here.