WASHINGTON: President Joe Biden on Thursday was to sign an executive order tightening scrutiny of foreign investments in a bid to protect US national security from sophisticated new threats, officials said.
The order is the first such update to the work of the Committee on Foreign Investment in the United States, which monitors transactions, since it was established in 1975 and it reflects hyper-modern new realities facing the world’s biggest economy.
“The order explicitly recognizes that some countries use foreign investment to obtain access to sensitive data and technologies for purposes that are detrimental to US national security,” the White House said, adding the aim is to ensure that the committee, known as CFIUS, “remains an effective tool.”
The White House said the five new factors Biden is asking officials to scrutinize when weighing foreign investors are:
Effect of the transaction on critical supply chain resilience, including both military and civilian sectors.
Impact on US high-tech leadership, including in the areas of microelectronics, artificial intelligence, biotechnology and biomanufacturing, quantum computing, advanced clean energy, and climate adaptation technologies.
Risk to national security associated with multiple companies in the same sector being sold to foreign buyers.
A senior administration official briefing reporters declined to give examples of transactions that had been flagged as national security risks and was vague about the scope of the threat.
Asked if the order targeted Russia and China in particular, the official, who spoke on condition of anonymity, said it was not “country specific.”