Media

Key Takeaways

• Regardless of the election outcome, U.S. businesses – especially in the technology sector – should expect additional expansion of the scope and rigor of restrictions on inbound foreign direct investment (FDI) from China and other “countries of concern.”
• The Trump administration supported Congressional efforts to expand the statutory authority of the Committee on Foreign Investment in the United States (CFIUS) to curtail China’s “Military-Civil Fusion” (MCF) and address threats to privacy, infrastructure, and critical technology. Trump pursued a more narrow, entity-based regulatory strategy that publicly elevated CFIUS and blocked specific foreign information and communications technology (ICT) and semiconductor firms from acquiring U.S. assets.
• The Biden-Harris administration built upon Trump-era measures to mold a broader, sector-oriented targeting strategy, including by expanding CFIUS’ scope to consider the implications of mergers on supply chain resilience, cybersecurity, and U.S. leadership in critical technologies. The administration sought to curtail the technological advancement of China’s defense-intelligence apparatus and developed a “whole-of-government” approach to economic security that expanded beyond CFIUS.
• A re-elected Trump may be open to retaining many of the Biden-Harris regulatory innovations that built on his previous measures, especially since U.S. lawmakers have expressed openness to granting the Executive Branch even more power to pursue sectoral controls. A Harris administration is also likely to maintain and intensify such measures, with a particular emphasis on preserving and building out its “whole-of-government” approach.