I 

109TH CONGRESS 

2D SESSION S. 3549 

IN THE HOUSE OF REPRESENTATIVES 

JULY 26, 2006 

Referred to the Committee on Financial Services, and in addition to the Committees on International Relations, and Energy and Commerce for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

AN ACT 

To amend the Defense Production Act of 1950, to strengthen 

Government review and oversight of foreign investment 

in the United States, to provide for enhanced Congressional oversight with respect thereto, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Foreign Investment 

5 and National Security Act of 2006’’. 


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1 SEC. 2. AMENDMENTS TO THE DEFENSE PRODUCTION ACT 

2 OF 1950. 

3 Section 721 of the Defense Production Act of 1950 

4 (50 U.S.C. App. 2170) is amended to read as follows: 

5 ‘‘SEC. 721. REVIEW AND INVESTIGATION OF TRANSACTIONS 

6 INVOLVING FOREIGN PERSONS AND GOVERN7 MENTS. 

8 ‘‘(a) REVIEW OF TRANSACTIONS INVOLVING FOR9 EIGN PERSONS AND GOVERNMENTS.— 

10 ‘‘(1) REVIEWS REQUIRED.— 

11 ‘‘(A) IN GENERAL.—CFIUS shall review 

12 any transaction proposed or pending on or after 

13 the date of enactment of this section by, with, 

14 or on behalf of a foreign person or foreign gov15 ernment which could result in foreign control of 

16 a person engaged in interstate commerce in the 

17 United States, for which a review is requested, 

18 in the manner prescribed by regulations pro19 mulgated under this section. 

20 ‘‘(B) PURPOSES.—The purpose of such re21 view shall be to determine the effect on national 

22 security of such transaction, whether an inves23 tigation of such transaction is required under 

24 subsection (b), or both. 

25 ‘‘(2) TIMING OF REVIEWS.— 


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1 ‘‘(A) IN GENERAL.—A review of a pro2 posed or pending transaction described in para3 graph (1) shall be completed not later than 30 

4 days after the date of receipt by CFIUS of a 

5 written request for review by a person involved 

6 in the transaction, or by one or more members 

7 of CFIUS, of the proposed or pending trans8 action, as prescribed by regulations promul9 gated in accordance with paragraph (1)(A). 

10 ‘‘(B) EXTENSIONS UPON REQUEST.—Upon 

11 written request by the Secretary, Deputy Sec12 retary, or Under Secretary, or the equivalent 

13 thereof, of one or more of the agencies that 

14 make up CFIUS (including any agency de15 scribed in subsection (c)(4)(I)) for additional 

16 time to review a case, the 30-day period de17 scribed in subparagraph (A) shall be extended 

18 by not longer than an additional 30 days, if the 

19 Secretary, Deputy Secretary, or Under Sec20 retary, or the equivalent thereof, concludes that 

21 there is credible evidence to believe that if per22 mitted to proceed with the transaction, the for23 eign acquiring person may take action that 

24 threatens to impair the national security. 


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1 ‘‘(b) INVESTIGATIONS OF CERTAIN TRANS2 ACTIONS.— 

3 ‘‘(1) IN GENERAL.—CFIUS shall undertake an 

4 investigation to determine the effects on national se5 curity of any transaction described in subsection 

6 (a)(1) proposed or pending on or after the date of 

7 enactment of this section— 

8 ‘‘(A) which would— 

9 ‘‘(i) result in control of any person en10 gaged in interstate commerce in the United 

11 States by a foreign government, or a per12 son acting by, with, or on behalf of a for13 eign government; or 

14 ‘‘(ii) result in control of any critical 

15 infrastructure of or within the United 

16 States by, with, or on behalf of any foreign 

17 person, if CFIUS determines that any pos18 sible impairment to national security has 

19 not been mitigated by assurances provided 

20 or renewed with the approval of CFIUS, as 

21 described in subsection (i), during the re22 view period under subsection (a); or 

23 ‘‘(B) if the review by CFIUS under sub24 section (a) produces sufficient information to 

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1 tional security, after consideration of the fac2 tors listed in subsection (g), and the issues that 

3 could result in an impairment to national secu4 rity are not resolved through negotiation of as5 surances between one or more members of 

6 CFIUS and the entities involved in the trans7 action. 

8 ‘‘(2) TIMING OF INVESTIGATIONS.—An inves9 tigation required to be undertaken under this sub10 section— 

11 ‘‘(A) shall commence at such time as 

12 CFIUS determines under subsection (a) that 

13 such investigation is required, as prescribed by 

14 regulations promulgated pursuant to this sec15 tion; and 

16 ‘‘(B) shall be completed not later than 45 

17 days after the date of its commencement. 

18 ‘‘(3) RESUBMITTED FILINGS.—An investigation 

19 of a transaction under this subsection which is inter20 rupted because the notification or filing is withdrawn 

21 by the applicant, and which is subsequently resub22 mitted, shall require up to a 45-day investigation 

23 from the date on which CFIUS receives the new 

24 submission. The investigation shall include a review 


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1 of the rationale for the withdrawal and resubmission 

2 of the proposed transaction to CFIUS. 

3 ‘‘(4) MONITORING OF WITHDRAWN TRANS4 ACTIONS.—If the notification or filing with respect 

5 to a proposed transaction is withdrawn or rescinded, 

6 CFIUS shall continue to monitor such transaction, 

7 unless the transaction is terminated by agreement of 

8 the parties to the transaction. If CFIUS has reason 

9 to believe that the proposed transaction has not been 

10 so terminated, CFIUS shall initiate a review or in11 vestigation under this section if the parties do not 

12 resubmit the notification or filing within an appro13 priate period of time.’’ 

14 ‘‘(5) MANDATARY NOTIFICATION RELATED TO

15 CERTAIN TRANSACTIONS AFFECTING NATIONAL SE16 CURITY.—The chairperson and vice chairperson of 

17 CFIUS shall, not later than 90 days after the date 

18 of enactment of the Foreign Investment and Na19 tional Security Act of 2006, issue rules, including 

20 the imposition of appropriate penalties for failure to 

21 comply with this paragraph, that require each per22 son controlled by or acting on behalf of a foreign 

23 government to notify the chairperson of CFIUS in 

24 writing of any proposed transaction involving such 


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1 person and United States critical infrastructure re2 lating to United States national security.’’ 

3 ‘‘(c) COMMITTEE ON FOREIGN INVESTMENT IN THE

4 UNITED STATES.— 

5 ‘‘(1) ESTABLISHMENT.—There is established 

6 the Committee on Foreign Investment in the United 

7 States, which shall serve as the President’s designee 

8 for all purposes under this section. 

9 ‘‘(2) CHAIRPERSON.—The Secretary of the 

10 Treasury shall serve as the chairperson of CFIUS. 

11 ‘‘(3) VICE CHAIRPERSON.—The Secretary of 

12 Defense shall serve as the vice chairperson of 

13 CFIUS. 

14 ‘‘(4) MEMBERSHIP.—The members of CFIUS 

15 shall include— 

16 ‘‘(A) the Secretary of the Treasury; 

17 ‘‘(B) the Secretary of State; 

18 ‘‘(C) the Secretary of Defense; 

19 ‘‘(D) the Secretary of Commerce; 

20 ‘‘(E) the Secretary of Homeland Security; 

21 ‘‘(F) the Attorney General of the United 

22 States; 

23 ‘‘(G) the Director of the Office of Manage24 ment and Budget; 


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1 ‘‘(H) the Director of National Intelligence; 

2 and 

3 ‘‘(I) the heads of those other executive de4 partments or agencies as the President deter5 mines appropriate, on a case-by-case basis. 

6 ‘‘(5) REFERRAL TO APPROPRIATE MEMBERS OF

7 CFIUS.—Upon receipt of notification of a proposed 

8 or pending transaction under this section, the chair9 person of CFIUS shall assign the appropriate mem10 ber of CFIUS to lead the review and investigation 

11 of such proposed or pending transaction under this 

12 section. 

13 ‘‘(6) INTELLIGENCE REVIEWS.—The Director 

14 of National Intelligence shall— 

15 ‘‘(A) direct the intelligence community, to 

16 collect and analyze information related to any 

17 proposed or pending transaction pursuant to 

18 this section, and to prepare a report of its find19 ings, which the Director shall make available to 

20 members of CFIUS not later than 15 days 

21 after the date of the commencement by CFIUS 

22 of a 30-day review of any such transaction 

23 under subsection (a), and before the commence24 ment of any investigation under subsection (b); 

25 and 


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1 ‘‘(B) ensure that the intelligence commu2 nity remains engaged in the collection, analysis, 

3 and dissemination to CFIUS of any additional 

4 relevant information that may become available 

5 during the course of any investigation con6 ducted under subsection (b) with respect to a 

7 transaction. 

8 ‘‘(7) ASSESSMENTS OF FOREIGN COUNTRIES

9 FOR USE IN REVIEWS AND INVESTIGATIONS.— 

10 ‘‘(A) IN GENERAL.—Not later than 120 

11 days after the date of enactment of the Foreign 

12 Investment and National Security Act of 2006, 

13 the chairperson and vice chairperson of CFIUS, 

14 in consultation with the Secretary of State, the 

15 Secretary of Commerce, the Secretary of En16 ergy, the Chairman of the Nuclear Regulatory 

17 Commission, and the Director of National Intel18 ligence, shall develop and implement a system 

19 for assessing individual countries, including— 

20 ‘‘(i) an assessment of the adherence of 

21 the country to nonproliferation control re22 gimes, including treaties and multilateral 

23 supply guidelines, which shall draw on, but 

24 not be limited to, the annual report on Ad25 herence to and Compliance with Arms 


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1 Control, Nonproliferation and Disar2 mament Agreements and Commitments re3 quired by section 403 of the Arms Control 

4 and Disarmament Act; 

5 ‘‘(ii) an assessment of the relationship 

6 of such country with the United States, 

7 specifically on its record on cooperating in 

8 counter-terrorism efforts, which shall draw 

9 on, but not be limited to, the report of the 

10 President to Congress under section 7120 

11 of the Intelligence Reform and Terrorism 

12 Prevention Act of 2004; and 

13 ‘‘(iii) an assessment of the potential 

14 for transshipment or diversion of tech15 nologies with military applications, includ16 ing an analysis of national export control 

17 laws and regulations. 

18 ‘‘(B) CONFIDENTIALITY.—The assessment 

19 system required by subparagraph (A) and any 

20 information or documentary material main21 tained or developed thereunder— 

22 ‘‘(i) shall be used solely by those 

23 agencies involved in reviewing and inves24 tigating acquisitions, mergers, and take25 overs pursuant to this section; 


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1 ‘‘(ii) may not be made available to the 

2 public; and 

3 ‘‘(iii) shall be exempt from disclosure 

4 under section 552 of title 5, United States 

5 Code. 

6 ‘‘(8) STAFF OF CFIUS.—Employees of the De7 partment of the Treasury who serve as staff for 

8 CFIUS shall report directly to the Deputy Secretary 

9 of the Treasury, and shall perform no official func10 tions other than as CFIUS staff. 

11 ‘‘(d) ACTION BY THE PRESIDENT.— 

12 ‘‘(1) IN GENERAL.—Subject to subsection (e), 

13 the President may take such action for such time as 

14 the President considers appropriate to suspend or 

15 prohibit any transaction which would result in con16 trol of any critical infrastructure or person engaged 

17 in interstate commerce in the United States, pro18 posed or pending on or after the date of enactment 

19 of this section, by or with a foreign person or gov20 ernment, so that such control will not threaten to 

21 impair the national security. 

22 ‘‘(2) ANNOUNCEMENT BY THE PRESIDENT.— 

23 The President shall announce the decision on wheth24 er or not to take action pursuant to this subsection 


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1 not later than 15 days after an investigation de2 scribed in subsection (b) is completed. 

3 ‘‘(3) ENFORCEMENT.—The President may di4 rect the Attorney General to seek appropriate relief, 

5 including divestment relief, in the district courts of 

6 the United States in order to implement and enforce 

7 this subsection. 

8 ‘‘(e) FINDINGS OF THE PRESIDENT.—The President 

9 may exercise the authority conferred by subsection (d) 

10 only if the President finds that— 

11 ‘‘(1) there is credible evidence that leads the 

12 President to believe that the foreign interest exer13 cising control might take action that threatens to 

14 impair the national security; and 

15 ‘‘(2) provisions of law, other than this section 

16 and the International Emergency Economic Powers 

17 Act, do not, in the judgment of the President, pro18 vide adequate and appropriate authority for the 

19 President to protect the national security in the 

20 matter before the President. 

21 ‘‘(f) ACTIONS AND FINDINGS NONREVIEWABLE.— 

22 The actions of the President under subsection (d) and the 

23 findings of the President under subsection (e) shall not 

24 be subject to judicial review. 


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1 ‘‘(g) FACTORS TO BE CONSIDERED.—For purposes 

2 of determining whether to take action under subsection 

3 (d) and for purposes of reviews and investigations under 

4 this section, the President and CFIUS, respectively, shall 

5 consider, among other factors— 

6 ‘‘(1) potential effects on United States critical 

7 infrastructure, including major energy assets; 

8 ‘‘(2) potential effects on United States critical 

9 technologies; 

10 ‘‘(3) domestic production needed for projected 

11 national defense requirements; 

12 ‘‘(4) the capability and capacity of domestic in13 dustries to meet national defense requirements, in14 cluding the availability of human resources, prod15 ucts, technology, materials, and other supplies and 

16 services; 

17 ‘‘(5) the control of domestic industries and 

18 commercial activity by foreign citizens as it affects 

19 the capability and capacity of the United States to 

20 meet the requirements of national security; 

21 ‘‘(6) the potential effects of the proposed or 

22 pending transaction on sales of military goods, 

23 equipment, or technology to any country— 

24 ‘‘(A) identified by the Secretary of State— 


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1 ‘‘(i) under section 6(j) of the Export 

2 Administration Act of 1979, as a country 

3 that supports terrorism; 

4 ‘‘(ii) under section 6(l) of the Export 

5 Administration Act of 1979, as a country 

6 of concern regarding missile proliferation; 

7 or 

8 ‘‘(iii) under section 6(m) of the Ex9 port Administration Act of 1979, as a 

10 country of concern regarding the prolifera11 tion of chemical and biological weapons; 

12 ‘‘(B) identified by the Secretary of Defense 

13 as posing a potential regional military threat to 

14 the interests of the United States; or 

15 ‘‘(C) listed under section 309(c) of the Nu16 clear Non-Proliferation Act of 1978, on the 

17 ‘Nuclear Non-Proliferation-Special Country 

18 List’ (15 C.F.R. Part 778, Supplement No. 4) 

19 or any successor list; 

20 ‘‘(7) the potential effects of the proposed or 

21 pending transaction on United States international 

22 technological leadership in areas affecting United 

23 States national security; 


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1 ‘‘(8) the long term projection of United States 

2 requirements for sources of energy and other critical 

3 resources and materials; and 

4 ‘‘(9) the assessments developed under sub5 section (c)(7) of the country in which the foreign 

6 persons acquiring United States entities are based. 

7 ‘‘(h) CONFIDENTIALITY OF INFORMATION.— 

8 ‘‘(1) IN GENERAL.—Any information or docu9 mentary material filed with CFIUS pursuant to this 

10 section shall be exempt from disclosure under section 

11 552 of title 5, United States Code, and no such in12 formation or documentary material may be made 

13 public, except as may be relevant to any administra14 tive or judicial action or proceeding. 

15 ‘‘(2) NOTIFICATION TO GOVERNOR.—Notwith16 standing paragraph (1), CFIUS shall notify the 

17 Governor of any State regarding a transaction in18 volving critical infrastructure in that State for the 

19 purpose of discussing any security concerns that 

20 arise or may arise from that transaction. Informa21 tion or documentary material made available to a 

22 Governor under this paragraph may not be made 

23 public, including under any law of a State pertaining 

24 to freedom of information or otherwise, but the ex25 ception in paragraph (3) for disclosures to either 


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1 House of Congress or Congressional Committees 

2 shall not apply to Governors who receive information 

3 under this paragraph. 

4 ‘‘(3) DISCLOSURE.—Nothing in this subsection 

5 shall be construed to prevent disclosure to either 

6 House of Congress or to any duly authorized com7 mittee or subcommittee of Congress. 

8 ‘‘(i) ASSURANCES.— 

9 ‘‘(1) IN GENERAL.—This subsection shall gov10 ern the provision of any assurances to one or more 

11 agencies of the United States in connection with the 

12 review or investigation of, or any Presidential deci13 sion concerning, any transaction under this section. 

14 ‘‘(2) CONDITION TO DETERMINATION.—Any 

15 such assurances shall be deemed to be a continuing 

16 covenant of the persons on whose behalf such review 

17 is sought (and of all persons controlling such per18 son), the observance of which shall be a condition of 

19 the determination of CFIUS, the President, or both, 

20 on whether to take any action with respect to such 

21 transaction. 

22 ‘‘(3) CONTRACT WITH THE UNITED STATES.— 

23 Such assurances shall be embodied in an agreement 

24 executed by the foreign person or foreign govern25 ment on whose behalf a review of a transaction is 


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1 sought under this section and the chairperson or vice 

2 chairperson of CFIUS, on behalf of the United 

3 States. 

4 ‘‘(4) MONITORING OF AGREEMENT.—Compli5 ance with assurances provided under this subsection 

6 shall be monitored, and may be investigated, in the 

7 same manner as a violation of a civil statute, by the 

8 agency designated by the chairperson of CFIUS, in 

9 consultation with the vice chairperson of CFIUS and 

10 the Attorney General of the United States. 

11 ‘‘(5) GRANT OF JURISDICTION; REMEDIES.— 

12 The United States District Court for the District of 

13 Columbia shall have jurisdiction to enforce an agree14 ment referred to in this subsection upon application 

15 by the Attorney General. Available remedies shall in16 clude divestiture, injunctive relief, enforcing the 

17 terms of such agreement, and monetary damages, as 

18 appropriate. 

19 ‘‘(j) NOTICE AND REPORTS TO CONGRESS.— 

20 ‘‘(1) NOTICE REGARDING REVIEWS.— 

21 ‘‘(A) NOTICE AT INITIATION OF REVIEW.— 

22 CFIUS shall transmit written notice of a pro23 posed or pending transaction subject to this 

24 section to the members of Congress specified in 

25 paragraph (3)(C), not later than 10 days after 


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1 the date of receipt of a notice of such proposed 

2 or pending transaction, including the identities 

3 of all parties involved and any foreign govern4 ment ownership or control of any such party. 

5 ‘‘(B) CERTIFICATION AT COMPLETION OF

6 REVIEW.—Upon completion of a review under 

7 subsection (a), the chairperson and vice chair8 person of CFIUS and the head of the lead 

9 agency assigned under subsection (c)(5), shall 

10 transmit a certified notice to the members of 

11 Congress specified in paragraph (3)(C). 

12 ‘‘(2) NOTICE REGARDING INVESTIGATIONS.— 

13 ‘‘(A) NOTICE AT INITIATION OF INVES14 TIGATIONS.—Upon commencement of an inves15 tigation under subsection (b), CFIUS shall no16 tify in writing the members of Congress speci17 fied in paragraph (3)(C). 

18 ‘‘(B) CERTIFICATION AT COMPLETION OF

19 INVESTIGATIONS.—As soon as practicable after 

20 completion of an investigation under subsection 

21 (b), the chairperson and vice chairperson of 

22 CFIUS and the head of the lead agency as23 signed under subsection (c)(5), shall transmit 

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1 sistent with the requirements of subsection (h)) 

2 on the results of the investigation, unless the 

3 matter under investigation has been sent to the 

4 President for decision. 

5 ‘‘(3) CERTIFICATIONS.— 

6 ‘‘(A) IN GENERAL.—Each certified notice 

7 and report required by this subsection shall be 

8 submitted to the members of Congress specified 

9 in subparagraph (C), and shall include— 

10 ‘‘(i) information on whether or not an 

11 investigation occurred under subsection (b) 

12 and has been completed; 

13 ‘‘(ii) a description of the actions taken 

14 by CFIUS with respect to the transaction; 

15 and 

16 ‘‘(iii) identification of the determina17 tive factors considered under subsection 

18 (g). 

19 ‘‘(B) CONTENT OF CERTIFICATION.—Each 

20 notice required to be certified by this subsection 

21 shall be signed by the chairperson and vice 

22 chairperson of CFIUS and the head of the lead 

23 agency assigned under subsection (c)(5), and 

24 shall contain a specific attestation of each such 

25 person that, in the determination of CFIUS, 


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1 the transaction that is the subject of the notice 

2 does or does not impair the national security. 

3 ‘‘(C) MEMBERS OF CONGRESS.—The no4 tices and reports required by this subsection 

5 shall be transmitted to— 

6 ‘‘(i) the Majority Leader and the Mi7 nority Leader of the Senate; 

8 ‘‘(ii) the chair and ranking member of 

9 the Committee on Banking, Housing, and 

10 Urban Affairs of the Senate and of any 

11 committee of the Senate having oversight 

12 over the agency assigned to lead a review 

13 or investigation under subsection (c)(5); 

14 ‘‘(iii) the Speaker and the Minority 

15 Leader of the House of Representatives; 

16 and 

17 ‘‘(iv) the chair and ranking member of 

18 the Committee on Financial Services of the 

19 House of Representatives and of any com20 mittee of the House of Representatives 

21 having oversight over the agency assigned 

22 to lead a review or investigation under sub23 section (c)(5). 

24 ‘‘(D) TRANSMITTAL TO OTHER MEMBERS

25 OF CONGRESS.—The Majority Leader or the 


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1 Minority Leader, in the case of the Senate, and 

2 the Speaker or the Minority Leader, in the case 

3 of the House of Representatives, may provide 

4 the notices and reports required by this para5 graph regarding a proposed or pending trans6 action involving critical infrastructure— 

7 ‘‘(i) in the case of the Senate, to 

8 members of the Senate from the State in 

9 which such critical infrastructure is lo10 cated; and 

11 ‘‘(ii) in the case of the House of Rep12 resentatives, to a member from a Congres13 sional District in which such critical infra14 structure is located. 

15 ‘‘(E) LIMITATION ON DELEGATION OF

16 CERTIFICATIONS.—Notices and reports required 

17 to be certified under this subsection shall be 

18 signed by the chairperson and vice chairperson 

19 of CFIUS, and such certification requirement 

20 may not be delegated. 

21 ‘‘(4) ANNUAL REPORTS.— 

22 ‘‘(A) REPORT REQUIRED.—The Secretary 

23 of the Treasury, on behalf of and after con24 sultation with the members of CFIUS, shall 

25 submit to the Committee on Banking, Housing, 


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1 and Urban Affairs of the Senate and the Com2 mittee on Financial Services of the House of 

3 Representatives, on or before March 15 of each 

4 year, a written report on the policy of the 

5 United States with respect to the preservation 

6 of the Nation’s defense production and critical 

7 infrastructure. The Secretary shall appear be8 fore both committees to provide testimony on 

9 such reports. 

10 ‘‘(B) CONTENTS OF REPORT.—Each report 

11 submitted under subparagraph (A) shall con12 tain— 

13 ‘‘(i) an analysis of each transaction 

14 involving a foreign person or foreign gov15 ernment affecting national security that 

16 has occurred during the preceding year to 

17 which the report relates, including the na18 ture of the acquisitions and the effect or 

19 potential impact of such acquisitions on 

20 the United States defense industrial base 

21 and critical infrastructure; 

22 ‘‘(ii) a similar updated analysis for 

23 any transaction that occurred during the 4 

24 years immediately preceding the year dealt 

25 with in the report in clause (i), including 


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1 a separate section discussing the impact of 

2 transactions involving foreign governments 

3 or persons acting on behalf of or in concert 

4 with foreign governments; 

5 ‘‘(iii) a detailed discussion of all per6 ceived risks to national security or United 

7 States critical infrastructure that CFIUS 

8 will take into account in its deliberations 

9 during the year in which the report is de10 livered to the committees; 

11 ‘‘(iv) a table showing on a cumulative 

12 basis, by sector, product, and country of 

13 foreign ownership, the number of acquisi14 tions reviewed, investigated, or both, by 

15 CFIUS, to provide a census of production 

16 potentially relevant to the Nation’s defense 

17 industrial base owned or controlled by for18 eign persons or foreign governments; 

19 ‘‘(v) an evaluation of whether there is 

20 credible evidence of a coordinated strategy 

21 by 1 or more countries or companies to ac22 quire critical infrastructure of or within 

23 the United States or United States compa24 nies involved in research, development, or 

25 production of critical technologies for 


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1 which the United States is a leading pro2 ducer; 

3 ‘‘(vi) an evaluation of whether there 

4 are industrial espionage activities directed 

5 or directly assisted by foreign governments 

6 against private United States companies 

7 aimed at obtaining commercial secrets re8 lated to critical technologies or critical in9 frastructure; and 

10 ‘‘(vii) such other matters as are nec11 essary to give a complete disclosure and 

12 analysis of the work of CFIUS during the 

13 year to which the report relates. 

14 ‘‘(C) CLASSIFIED REPORTS.—The evalua15 tions required by clauses (v) and (vi) of sub16 paragraph (B) may be classified. If they are 

17 submitted in classified form, an unclassified 

18 version of such evaluations shall be made avail19 able to the public. 

20 ‘‘(D) OTHER INFORMATION WITHHELD

21 FROM PUBLIC REPORTS.— 

22 ‘‘(i) PROPRIETARY INFORMATION.— 

23 The chairperson of CFIUS, in consultation 

24 with the vice chairperson of CFIUS, may 

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1 formation as the chairperson determines is 

2 proprietary information. 

3 ‘‘(ii) RULE OF CONSTRUCTION.— 

4 Nothing in this subparagraph shall pro5 hibit such information from being provided 

6 to relevant Committees of Congress. 

7 ‘‘(5) APPEARANCES BEFORE CONGRESS.—The 

8 chairperson and vice chairperson of CFIUS, and the 

9 heads of such additional CFIUS member agencies 

10 specified in a written request by the Chairman of 

11 the Committee on Banking, Housing, and Urban Af12 fairs of the Senate shall annually appear before the 

13 Committee on Banking, Housing, and Urban Affairs 

14 and the Committee on Financial Services of the 

15 House of Representatives to provide testimony on 

16 the activities of CFIUS. 

17 ‘‘(k) REGULATIONS.— 

18 ‘‘(1) IN GENERAL.—The Secretary shall issue 

19 regulations to carry out this section. Such regula20 tions shall, to the extent possible, minimize paper21 work burdens and shall, to the extent possible, co22 ordinate reporting requirements under this section 

23 with reporting requirements under any other provi24 sion of Federal law. 


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1 ‘‘(2) REGULATIONS RELATING TO DEFINI2 TIONS.—Not later than 30 days after the date of en3 actment of the Foreign Investment and National Se4 curity Act of 2006, the Secretary of the Treasury 

5 and the Secretary of Defense shall jointly agree to 

6 and issue rules concerning the manner in which the 

7 definition of the term ‘critical infrastructure’ in sub8 section (m)(2) shall be applied to particular acquisi9 tions, mergers, and takeovers, for purposes of the 

10 mandatory investigation requirement of subsection 

11 (b)(1)(A), except that, until such rules are issued in 

12 final form and become effective, such definition shall 

13 be applied without regard to any such rules (whether 

14 proposed or otherwise). 

15 ‘‘(l) EFFECT ON OTHER LAW.—Nothing in this sec16 tion shall be construed to alter or affect any existing 

17 power, process, regulation, investigation, enforcement 

18 measure, or review provided by any other provision of law, 

19 including the International Emergency Economic Powers 

20 Act, or of the President or Congress. 

21 ‘‘(m) DEFINITIONS.—As used in this section— 

22 ‘‘(1) the term ‘assurances’ means any term, un23 derstanding, commitment, agreement, or limitation, 

24 however described, that relates to ameliorating in 


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1 any way the potential effect of a transaction on the 

2 national security; 

3 ‘‘(2) the term ‘critical infrastructure’ means, 

4 subject to rules issued under subsection (k)(2), any 

5 systems and assets, whether physical or cyber-based, 

6 so vital to the United States that the degradation or 

7 destruction of such systems or assets would have a 

8 debilitating impact on national security, including 

9 national economic security and national public 

10 health or safety; 

11 ‘‘(3) the term ‘critical technologies’ means tech12 nologies identified under title VI of the National 

13 Science and Technology Policy, Organization, and 

14 Priorities Act of 1976, or other critical technology, 

15 critical components, or critical technology items es16 sential to national defense identified pursuant to this 

17 section; 

18 ‘‘(4) the terms ‘Committee on Foreign Invest19 ment in the United States’ and ‘CFIUS’ mean the 

20 committee established under subsection (c); 

21 ‘‘(5) the term ‘foreign government’ means any 

22 government or body exercising governmental func23 tions, other than the Government of the United 

24 States or of a State or political subdivision thereof, 

25 and includes national, State, provincial, and municVerDate Aug 31 2005 23:30 Jul 27, 2006 Jkt 049196 PO 00000 Frm 00027 Fmt 6652 Sfmt 6201 E:\BILLS\S3549.RFH S3549

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1 ipal governments, including their respective depart2 ments, agencies, government-owned enterprises, and 

3 other agencies and instrumentalities; 

4 ‘‘(6) the term ‘foreign person’ means any non5 United States national, any organization owned or 

6 controlled by such a person, and any entity orga7 nized under the laws of a country other than the 

8 United States, and any entity owned or controlled by 

9 such entity; 

10 ‘‘(7) the term ‘intelligence community’ has the 

11 same meaning as in section 3 of the National Secu12 rity Act of 1947 (50 U.S.C. 401a); and 

13 ‘‘(8) the term ‘transaction’ means a proposed or 

14 pending merger, acquisition, or takeover’’. 

Passed the Senate July 26, 2006. 

Attest: EMILY J. REYNOLDS, 

Secretary. 


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