Foreign Investment Reviews

The United States is a very open and secure environment for foreign investment. Historically, the US government has encouraged foreign investors to bring capital to this country, and foreign governments to open their markets to US investment. Nonetheless, foreign investment, acquisition or merger activity with foreign companies, or debt financing from a foreign source can trigger certain US regulatory reviews and restrictions.

In some instances, the US government may limit the amount of foreign investment or financing, or otherwise require certain additional transactional measures to satisfy US legal requirements. Depending on the nature of the transaction, the US industry involved, and the foreign country of the investor, early legal counsel can be instrumental to ensure that the transaction is consummated in a timely fashion and on the commercial terms most favorable to our clients.

Exon-Florio Review
Steptoe has assisted domestic and foreign clients with the intricacies of the Exon-Florio foreign investment review process. We counsel clients on the scope and application of the Defense Production Act of 1950, whereby a foreign investment in a US business relevant to US national security can trigger Executive Branch review or a congressional inquiry. We provide legal guidance on the interpretation of key jurisdictional terms, and assist clients in reaching informed judgments on whether to file a voluntary notification with the US government.

We are very familiar with the notification requirements, the types of information that will be relevant to US government review, and the appropriate way to provide that information without breaching confidentiality, disrupting the business transaction, or unduly delaying the underlying commercial timetable. We work with all parties to these transactions, including the US business entity, the foreign investor, third-party financiers, and related consultants and advisors.

Publications & Speaking Engagements

• National Security Review of Foreign Investments: Recent Developments Around the World
  Winter 2007, ABA's International Law News Vol 36 No 1