New CFIUS Law: Key Issues Affecting The Energy Sector

Key Points

• FIRRMA broadens the scope of a CFIUS review beyond transactions that could result in a foreign person gaining the ability to control a U.S. business. Consequently, more energy deals could be captured through expanded authorization to review (1) foreign investments in real estate located in sensitive locations even when no U.S. business is acquired, (2) certain non-controlling foreign investments in U.S. companies involved in "critical infrastructure," "critical technologies" and "sensitive personal data," and (3) changes in investor rights that could lead to foreign control or covered non-controlling investments.
• Under the current law, CFIUS filings are voluntary unless the Committee requests or initiates a review in a specific case. FIRRMA will require filings in deals where a foreign government will obtain a "substantial interest" in a U.S. business, and potentially in transactions involving certain critical technology. As a result, CFIUS filings