In the Media
Tyler McGaughey Discusses a New Bill that Would Establish a “Presumption of Non-Resolvability” by CFIUS for Certain Transactions
In the Media
July 18, 2023, 7:00 AM
Winston & Strawn Partner Tyler McGaughey discussed a recent bipartisan bill titled “The Protecting U.S. Farmland and Sensitive Sites From Foreign Adversaries Act,” which includes a provision that proposes a “presumption of non-resolvability” by CFIUS that “raises the approval threshold for CFIUS transactions by a foreign adversary entity purchasing near sensitive sites,” such as major military sites and intelligence facilities.
Other key provisions include:
- expanded CFIUS jurisdiction over certain land purchases,
- the consideration of U.S. food security in CFIUS’ national security reviews,
- a mandatory filing requirement for certain land purchases,
- and an expansion of the number of national security sites designated for CFIUS jurisdiction.
Tyler is quoted in the article saying that “the bill doesn’t say that it’s banning Chinese real estate transactions, but that’s what it’s doing.” He adds that if a transaction involves a Chinese entity purchasing real estate near a military base or other location, “the Committee will presume that the transaction creates a risk to U.S. national security and prohibit the transaction.”
In the article, Tyler also shares that “no member agency is going to dedicate time and resources to prove by clear and convincing evidence that a particular Chinese real estate transaction does not present a risk to U.S. national security.”
Sharing additional thoughts on the bill, Tyler also says that “The proposed bill, which would prohibit foreign investment even in circumstances where a member agency doesn’t have ‘credible evidence’ of a national security risk, does not appear consistent with the open investment policy.”
Read the full article originally published by Foreign Investment Watch and republished with permission.