United States General Accounting Office

GAO Report to Congressional Requesters

December 1995 FOREIGN

INVESTMENT

Implementation of

Exon-Florio and

Related Amendments

GAO/NSIAD-96-12

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-256999 

December 21, 1995

The Honorable Floyd Spence

Chairman

The Honorable Ronald V. Dellums

Ranking Minority Member

Committee on National Security

House of Representatives

The Honorable Cardiss Collins

Ranking Minority Member

Committee on Government Reform and

 Oversight

House of Representatives

The Honorable William H. Zeliff

Chairman, Subcommittee on National Security,

 International Affairs, and Criminal Justice

Committee on Government Reform and

 Oversight

House of Representatives

In 1988, Congress enacted the Exon-Florio legislation1

 authorizing the

President to suspend or prohibit foreign acquisitions, mergers, or

takeovers of U.S. companies when there is credible evidence that a foreign

controlling interest might threaten national security and when other

legislation cannot provide adequate protection. The President delegated

authority to review foreign investment transactions to an interagency

group, the Committee on Foreign Investment in the United States (CFIUS).

As requested, we examined CFIUS implementation of the Exon-Florio

legislation and related amendments. Specifically, we focused on (1) the

characteristics of foreign investments and the extent to which these

investments are reported to CFIUS and (2) the factors CFIUS considers in

making decisions on whether the foreign investment would result in

foreign companies’ control of U.S. companies, whether the acquiring

company is controlled by a foreign government, and whether there are

associated national security risks. We analyzed these issues for a

judgmentally selected sample of 16 cases that were reviewed by CFIUS in

1992 and 1993. Details on our objectives, scope, and methodology are

1

The Exon-Florio legislation was a provision of the Omnibus Trade and Competitiveness Act of 1988

and is part of the Defense Production Act of 1950, 50 U.S.C. app. 2170.

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presented in appendix I. Previous products on this subject are listed on the

last page of the report.

Background Preserving U.S. industrial capabilities in sectors critical to national

security has been a traditional U.S. policy goal. An important concern in

the debate on foreign investment in the United States is the possibility that

key segments of industries critical to the national security could come

under foreign control through foreign investments.2

 Because U.S. defense

strategy relies on the deterrent effects of technological rather than

numerical superiority, concern about foreign investment focuses on the

U.S. government’s ability to identify technologies crucial to defense

systems and to act to preserve and promote U.S. leadership in them.

The United States does not screen inward investment but relies on certain

laws or regulations to ensure that foreign investment does not assume

forms harmful to the nation’s interests. For example, specific restrictions

are in place to protect classified defense information from foreign access

and to ensure U.S. production of vital defense goods in the event of a

crisis. Foreign investments in U.S. firms performing classified defense

work are monitored under the National Industrial Security Program.

Restrictions under this program provide authority to restrict or deny

foreign access to classified information. Although they do not authorize

denials of foreign investments, they can, in effect, deter potential investors

who are seeking access to classified information. The U.S. government, in

addition, restricts foreign investment in certain sectors, such as energy

resources, coastal and domestic shipping, and air transport.

To counter the loss of leading-edge or highly advanced technology and

processes that are important to the country’s security through the

acquisition of U.S. companies by foreign investors, Congress passed the

Exon-Florio legislation in 1988. Congress was concerned that foreign

takeovers of U.S. firms that harmed U.S. security could not be stopped

unless the President declared a national emergency or regulators invoked

Federal antitrust, environmental, or securities laws. The Exon-Florio

legislation grants the President the authority to take appropriate action to

suspend or prohibit foreign acquisitions, mergers, or takeovers of U.S.

businesses that threaten to impair the national security. To exercise this

authority, the President must find that (1) credible evidence exists that the

foreign interest might take action that threatens to impair national security

2

Foreign investment refers to foreign direct investment; that is, investment resulting in foreign

ownership or control of 10 percent or more equity interest in a U. S. business.

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and (2) provisions of law, other than the International Emergency

Economic Powers Act, do not provide adequate and appropriate authority

to protect the national security. However, Congress did not intend for the

legislation to raise obstacles to foreign investment.

The President designated CFIUS as responsible for reviewing transactions.

CFIUS is an existing Committee comprised of representatives from 

11 agencies or offices. The Secretary of the Treasury chairs the Committee

and the Departments of State, Commerce, and Defense are among the

agencies represented. The Defense Technology Security Administration

coordinates the positions of various Department of Defense (DOD)

components and provides the final DOD position for CFIUS reviews.

Notification to CFIUS of an acquisition is voluntary. However, it is in the

interest of foreign investors to do so because CFIUS retains the right to

review in the future any acquisition not notified to the Committee. The

Exon-Florio regulations also permit a Committee member to submit a

notice of a proposed or completed acquisition for a national security

review.

The CFIUS review process serves both to protect national security and to

minimize any potential adverse effect of the Exon-Florio legislation on

foreign investment in the United States. CFIUS determination that there are

no national security issues essentially eliminates the risk that the

President will at a later time block the transaction or order a divestiture.3

Once it is notified, CFIUS has an initial 30-day review period to determine if

the transaction involves foreign control and whether there are national

security concerns that warrant further investigation. If CFIUS decides that

there will be foreign control and that potentially serious national security

concerns are present, the Committee initiates a 45-day investigation. It

then submits a report and recommendation to the President. The President

has 15 days to decide whether or not to take appropriate action. The

President may exercise the authority conferred by the Exon-Florio

legislation, however, only if there is credible evidence that a foreign

controlling interest might threaten national security and that other

legislation cannot provide adequate protection.

As shown in table 1, between October 1988 and December 1994, CFIUS

received 918 voluntary notifications. Of these, 15 involved 45-day

3

The Exon-Florio regulations allow CFIUS to reopen its consideration of a transaction if parties fail to

provide material information or submit false or misleading information.

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investigations with recommendations to the President. In 5 of the 

15 investigations, the companies voluntarily withdrew their investment

offers. Of the remaining 10 investigations, the President decided not to

intervene in 9 transactions and ordered divestiture in 1 case involving a

Chinese company’s acquisition of a U.S. aircraft parts company.

Table 1: Disposition of CFIUS

Notifications (Oct. 1988 Through

Dec. 1994) Year

CFIUS

notifications

Notifications

investigated

Notifications

withdrawn

President

blocked

1988 14 1 0 0

1989 200 5 2 1a

1990 295 6 2 0

1991 152 1 0 0

1992 106 2 1b 0

1993 82 0 0 0

1994 69 0 0 0

Total 918 15 5 1

Note: The decrease in CFIUS notifications somewhat parallels the decline in overall foreign direct

investment in the United States.

aIn this case, the President ordered China National Aero-Technology Import and Export

Corporation, a People’s Republic of China aerospace company, to divest from MAMCO, which

involved a U.S. aircraft parts manufacturer.

bThe investors withdrew their offer on the last day of the investigation of this case, which involved

the acquisition of LTV Missiles Division by Thomson-CSF.

Source: CFIUS data as of January 1995.

In 1992, Thomson-CSF, a French government-owned company, attempted

to acquire the LTV Corporation’s Missile Division, which prompted

legislation aimed at strengthening Exon-Florio.4

 One provision made a

distinction between foreign control and foreign government control and

mandated 45-day investigations when the acquiring company is controlled

by or acting on behalf of a foreign government and the acquisition could

result in foreign government control that could affect the national security.

Another provision required intelligence agency assessments of the risk of

diversion of a defense critical technology when the U.S. company is

engaged in the development of such a technology or is otherwise

important to the defense industrial and technology base.

4

See sections 837 and 838 of the Fiscal Year 1993 National Defense Authorization Act (P.L. 102-484),

Oct. 23, 1992, which amended 50 U.S.C. app. 2170 and added 10 U.S.C. 2537, respectively.

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Results in Brief About two-thirds of the cases notified to CFIUS between October 1988 and

May 1994 involved defense-related and high-technology industries that

raised possible national security concerns. The remaining cases involved

transactions in industry sectors such as construction, real estate,

entertainment, and consumer products, which would be unlikely to raise

national security concerns.

Many companies voluntarily notified CFIUS of proposed investments in and

acquisitions of U.S. companies, but, according to two private sector data

bases, many others did not. These data bases included foreign acquisitions

of or investments in U.S. companies involved in aerospace, electronics,

computers, and advanced materials. We do not know if there is any

significance to be attached to the fact that not all foreign investments are

notified. The CFIUS process was not intended to provide a comprehensive

screening mechanism for all foreign investment although CFIUS officials

expressed the view that, because CFIUS clearance essentially eliminates the

risk of a forced divestiture, most transactions affecting national security

are reported. However, after discussing these unnotified transactions with

CFIUS officials, they advised us that other committee members will be

reminded of their authority under the regulations to bring transactions to

the committee’s attention.

In deciding whether a foreign investment will result in a foreign company

gaining control of a U.S. company, CFIUS considers many factors related to

the investor’s ability to affect key company decisions. CFIUS does not

decide that a foreign company will gain control based solely on the

company’s percentage of ownership because a minority shareholder can

exercise control under various circumstances.

When deciding on foreign government control, CFIUS examines the extent

to which a foreign government owns and controls the acquiring company.

Of the 174 transactions filed between the 1992 legislation and

December 1994, CFIUS decided there was foreign government control in 

18 cases. None of these cases were investigated since CFIUS decided the

national security concerns were not sufficient to warrant further

investigation.

The Exon-Florio legislation does not provide a precise definition of

national security. It does identify certain factors to consider in deciding

what constitutes a threat to national security, but neither the statute nor

the implementing regulations contain guidelines for weighing the various

factors considered in examining the national security risks of a

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transaction. As a result, CFIUS agencies have significant flexibility in

making such judgments. Agency officials noted that the threshold for

determining a national security threat is high and that the Exon-Florio

provision requires them to consider whether other laws provide adequate

protection. CFIUS members noted that they rely primarily on DOD’s

assessment of national security risks. In evaluating those risks, DOD

officials stated they consider several factors, including whether the

company being acquired is a sole-source supplier to DOD, whether it has

classified contracts, and whether the diversion of critical technologies is a

risk.

The 1992 legislation requires DOD to direct appropriate defense intelligence

and other agencies to assess the risk of diversion when DOD decides that a

CFIUS case involves a company engaged in the development of a

defense-critical technology or is otherwise important to the defense

industrial and technology base. Of the 174 cases reviewed between

October 1992 and December 1994, the Office of the Assistant Secretary of

Defense for Economic Security found that 9 cases required a risk of

diversion assessment.

Characteristics of

Investments Reported

and Not Reported to

CFIUS

Our analysis of data on CFIUS cases from October 1988 through May 1994

showed that about two-thirds of the filings involved high-technology

industries in which there could be potential national security concerns.5

Among these industries are computers and semiconductors, electronics,

aerospace, advanced materials, chemicals, biotechnology, and

telecommunications. About one-third of the notifications to CFIUS involved

industries in which national security concerns would be unlikely to arise.

Examples of these industries include mining, plastics and rubber,

construction, retailing, real estate, and entertainment. (App. III contains

additional information on the industries with foreign investments that

were reported to CFIUS.)

Companies from Japan, the United Kingdom, France, and Germany

accounted for over 65 percent of the notifications to CFIUS since 1988.

Japanese companies were the leading investors notifying CFIUS, primarily

on investments in computers and semiconductors. British companies were

the second most active investors filing with CFIUS, most frequently on

investments in advanced materials and electronics. French companies

most frequently notified CFIUS of investments in aerospace, computers, and

5

We used a Commerce Department database maintained on CFIUS cases and other sources to develop

high-technology and low-technology industry categories. We also consulted with government and

private sector experts to develop these categories.

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telecommunications companies, while German companies filed with CFIUS

for investments in chemicals, industrial controls, equipment and

machinery, and energy industries. Our comparison of CFIUS data with two

private sector databases on foreign investments showed somewhat

comparable investment concentrations by country and by industry.

(Details on the four countries’ CFIUS filings by industry are in app. IV.)

The 1992 legislation required the President to report on various aspects of

foreign investment in U.S. critical-technology companies. The National

Economic Council formed a working group to respond to the requirement

and reported its findings in 1994. The group found no credible evidence

that a country or private companies had a coordinated strategy to acquire

U.S. critical-technology companies. It also noted that the absence of

credible evidence demonstrating a coordinated strategy should not be

viewed as conclusive proof that a coordinated strategy does not exist. The

report also indicated that foreign governments, including those of France,

Germany, and Japan, provide indirect assistance and guidance to their

companies regarding foreign investments in high-technology U.S. firms.

Investments Not Reported

to CFIUS

The Exon-Florio legislation and implementing regulations do not define

which investments are important to review for national security reasons.

Moreover, notification to CFIUS is voluntary. CFIUS officials believe that the

Committee has been notified of most foreign investments in key or

high-technology companies that could affect national security. CFIUS

officials pointed out that investors have a strong inducement to notify

CFIUS and seek its prior approval because the President retains the

authority to order divestitures of transactions not cleared by CFIUS.

However, we found that many foreign investments occur in

high-technology or defense-related industries that were not reported to

CFIUS. While the significance of the gap is unclear, it does suggest that the

CFIUS process alone cannot be relied on to surface transactions posing

potential national security concerns.6

Our comparison of two private databases on foreign investment in the

United States with CFIUS data showed that many transactions occurred in

high-technology industries that were not filed with CFIUS. Among these

industries were telecommunications, advanced materials, biotechnology,

electronics, computers, and aerospace. We verified selected transactions

and determined that an acquisition of a U.S. aircraft parts manufacturer

6

The U.S. government has other mechanisms to safeguard national security, such as export control

laws and industrial security regulations that protect classified facilities.

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and investments in biotechnology and chemical companies occurred

without being reported to CFIUS. However, these databases do not contain

sufficient information to establish a link to national security, since they do

not contain information on, for example, whether the acquired company

had DOD contracts or produced products subject to U.S. export controls.

(See app. I for an explanation of our comparison and app. II for details on

transactions not notified to CFIUS, according to these private databases.)

Furthermore, because Exon-Florio was never intended to be a

comprehensive foreign investment review act, it is to be expected that

there would be foreign investments that are not notified to CFIUS.

CFIUS Decisions on

Foreign Companies’

Control and Foreign

Governments’ Control

Over Acquiring

Companies

Under the Exon-Florio legislation, CFIUS has considerable flexibility to

decide if a transaction results in foreign company control over a U.S. firm

or if a foreign government has control over an acquiring company. The

implementing regulations do not specify that a given percentage of foreign

ownership automatically results in control because minority owners can

exercise control under various conditions. For example, a minority owner

might hold board membership and have special voting rights over certain

company actions. For this reason, the regulations broadly define control to

mean having the power to directly or indirectly effect key company

decisions and actions. CFIUS generally relies on a company’s stated

intentions regarding the structure of the investment and the

decision-making framework of the corporation. While decisions about

foreign control are straightforward in complete acquisitions and majority

investments, such decisions can be complicated and difficult in minority

investment cases. Also, deciding foreign government control over the

acquiring company can be difficult and involves a high degree of judgment.

Decisions on Foreign

Control

Of the 16 cases we reviewed, 12 involved majority investments or

100 percent acquisitions, and 4 involved minority investments. In two of

the minority investment cases, CFIUS found foreign control and in two

cases it determined there was no foreign control.

• A British company notified CFIUS of its intention to acquire 20 percent of a

U.S. company. The U.S. company had classified contracts and provided a

critical U.S. government emergency service. The acquisition would give

the British company 3 of the 15 seats on the company’s board of directors

and certain “consent rights” that would enable the British company to

block several corporate actions. CFIUS found that foreign control would

result on the basis of the British company’s right to veto certain

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acquisitions, joint ventures, and asset sales as well as any company charter

amendment adversely affecting the British company. CFIUS conducted a

30-day review. However, this review determined that national security

concerns were not sufficient to warrant an investigation.

• A German company notified CFIUS of its intention to purchase

12.25 percent of the common stock of a U.S. company. The U.S. parent

company controlled 51 percent of the stock, and three European

companies controlled the remaining 49 percent. The proposed investment

would redistribute the stock among the foreign owners, leaving the U.S.

majority ownership intact. The U.S. company had classified DOD and other

U.S. government contracts that were protected by facility security

clearances.7 CFIUS determined that the purchase of 12.25 percent of the

company’s voting stock constituted foreign control because of several

minority veto rights. These rights included the ability of any single foreign

director to block decisions such as the adoption of a strategic plan or

annual budget or the development of a new product that varies from the

types of business stated in the strategic plan. CFIUS reviewed the

company’s notification for national security concerns and decided to

proceed with a 45-day investigation. During the investigation, CFIUS

addressed issues relating to DOD’s ability to mitigate foreign control and

influence over the company under the existing security agreement. As

required, CFIUS prepared a report to the President. The transaction was not

blocked.

• A Singaporean company proposed acquiring 22.8 percent of the voting

stock in an investor group formed to acquire all of a U.S. company. A

majority of the investor group’s voting stock was held by U.S. entities. The

Singaporean company was indirectly owned by a holding company that

was 99.9 percent owned by the Singapore Ministry of Finance. The U.S.

company had classified contracts with DOD, necessitating a security

agreement protecting classified information and technologies. CFIUS based

its finding that the foreign company would not have control partly on the

minority investor’s willingness to execute a proxy agreement under

industrial security regulations that would give the minority investor’s

voting rights to two U.S citizens.8

 (The minority foreign investor later

7

The industrial security regulations require a company to obtain a security clearance when working on

DOD classified contracts and prescribe procedures for defense companies to protect classified

information. A defense company under foreign ownership or control can be eligible for a security

clearance if it takes action to effectively negate or reduce the risk posed by foreign ownership or

control. See Defense Industrial Security: Weaknesses in DOD Security Arrangements at

Foreign-Owned Defense Contractors (GAO/NSIAD-96-64, forthcoming).

8

The proxy agreement was referenced in a letter to the company notifying it of CFIUS’s finding of no

foreign control and explaining the basis for this determination. The letter also referred to

correspondence in which the company explains the proxy agreement it planned to enter into in

response to DOD industrial security regulations.

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entered into a security agreement that would allow the foreign investor to

gain board membership.) In our discussions on this case, CFIUS officials

agreed that a proposed security agreement should not be used to

determine foreign control. The Exon-Florio control standards are not

comparable to the control issues under the industrial security regulations,

which intend to isolate foreign control and influence over certain aspects

of the business, not to determine whether the entire company will become

foreign controlled. Although CFIUS’s letter to the company notifying it of its

decision referenced the proxy agreement, CFIUS officials stated the finding

of no foreign control was based on other factors, including a requirement

for a two-thirds stockholder majority for certain decisions. Because CFIUS

found no foreign control, it did not review the transaction for national

security concerns.

• Two Israeli companies acquired a total of 35.6 percent of the outstanding

stock of a U.S. company. One of the Israeli companies increased its

ownership from 10.5 percent of the outstanding stock to 17.4 percent,

while the second company acquired 18.2 percent of the outstanding stock.

The notification to CFIUS stated that the two companies were considering

entering into a shareholders’ agreement to vote their respective shares in

concert. In subsequent correspondence, CFIUS was informed that the two

Israeli companies had not concluded a shareholders’ agreement. CFIUS

found that there was no foreign control because the two firms were not

acting together and did not either individually or collectively have the

ability to control the U.S. company. Because CFIUS found no foreign

control, it did not review the transaction for national security concerns.

Decisions on Foreign

Government Control

The 1992 legislation required mandatory investigations of CFIUS cases in

which the foreign company proposing an investment is controlled by a

foreign government and the transaction could result in foreign control that

“could affect the national security.” As a result, CFIUS also reviews cases

for foreign government control. Of the 174 cases reviewed between

October 1992 and December 1994, CFIUS found foreign government control

in 18 cases. None of these cases resulted in investigations. CFIUS found the

national security concerns in these cases were not sufficient to warrant

investigations. In implementing the legislative requirement, CFIUS has

determined that even when there is foreign government control, the

provision does not mandate an investigation for a notification that does

not pose a credible threat to the national security.

Of the 16 cases we reviewed, 13 occurred after the 1992 legislation. Six

cases involved some level of foreign government ownership of or

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participation in the acquiring companies. In two of these cases, CFIUS

determined there was foreign government control.

• A subsidiary of a German company proposed acquiring a U.S.

manufacturer of large machine tools. The U.S. company had unclassified

contracts with DOD, and its products were subject to export controls

applying to dual-use products, but it did not possess unique capabilities,

and its technology was not considered defense critical. About one-third of

the German company was indirectly owned by one German state

government and two German city governments. Under German law, this

level of ownership gave the government-owned entities the power to block

certain decisions, such as the acquisition or closing down of businesses.

The government-owned entities offered to abstain on shareholder

decisions affecting the U.S. company. CFIUS found that there was foreign

control because the acquiring company was German-owned and planned

to purchase substantially all the assets of the U.S. company. Because the

government entities had the power to block certain decisions, CFIUS

determined there was foreign government control. CFIUS also concluded

that there were not sufficient national security concerns to warrant an

investigation.

• A subsidiary of a French company proposed purchasing a U.S. developer

and manufacturer of software tools. The U.S. company had unclassified

contracts with DOD and other U.S. government entities, but the technology

was not militarily sensitive. The ultimate parent of the acquiring company

is 100 percent owned by the French government. CFIUS determined that the

acquiring company was foreign owned and that the outright acquisition of

the U.S. company would result in foreign control. Because the buyer was

owned by the French government, CFIUS decided that foreign government

control would result from this acquisition. CFIUS also concluded that there

were not sufficient national security concerns to warrant an investigation.

In the other four cases, CFIUS determined that there was no foreign

government control. Two of these cases are discussed below for

illustrative purposes. In the other two cases, CFIUS decided there was no

foreign government control because either multiple intervening layers of

ownership diluted government control or the foreign government could

not appoint board members.

• A South Korean company notified CFIUS of its intent to acquire a U.S.

designer and manufacturer of semiconductor devices. The U.S. company

was a defense subcontractor engaged in a defense-critical but not

state-of-the-art technology. The foreign buyer indicated its intention to

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transfer the U.S. company’s technology to Korea and establish a

production facility there. The foreign buyer received a small proportion of

its total assets from two banks owned by the Korean government. Because

this was a 100-percent acquisition by a Korean-owned company, CFIUS

made a determination of foreign control. Although the foreign buyer had

financing arrangements with the government-owned banks, CFIUS

determined the amount of capital provided was not sufficient to constitute

foreign government control. CFIUS also determined that there were not

sufficient national security concerns to warrant a 45-day investigation.

• A British company notified CFIUS of its intention to acquire 20 percent of a

U.S. company. The U.S. company had classified contracts and provided a

critical U.S. government emergency service. Although the British

government owned only 1.5 percent of the acquiring company’s issued

shares, it retained special powers over the acquiring company. These

powers included requiring the government shareholder’s written consent

to alter certain sections of the foreign buyer’s articles of incorporation.

For example, consent must be obtained when there are changes in the

limit of any single shareholder owning more than 15 percent. The British

government could also appoint two directors. As discussed on page 8,

CFIUS determined that the minority investment would result in foreign

control. CFIUS decided that there was no foreign government control

because the government owned only a small amount of stock, had not

recently appointed directors to the board, and had no significant consent

rights over the acquiring company. CFIUS conducted a 30-day review and

determined that there were not sufficient national security concerns to

warrant a 45-day investigation.

DOD’s Reviews of

CFIUS Cases for

National Security

Risks

DOD has no special statutory role in reviewing transactions for national

security concerns, and all other CFIUS members have equal standing to

raise such concerns. However, officials from other CFIUS agencies stated

that they look to DOD to make key judgments regarding the national

security risks of a transaction. DOD considers, among numerous factors,

whether (1) the technologies and products involved are critical to the

national security, (2) the firm being acquired is a sole-source supplier to

DOD, and (3) the U.S. company has classified contracts with the U.S.

government. In addition, DOD reviews and analyzes information from the

intelligence community regarding the foreign buyer’s past record of

compliance with export controls, proliferation of sensitive

weapons-related technologies, and other matters.9

9

The other CFIUS participants also receive and consider intelligence information in their deliberations.

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Our sample included some cases involving intelligence information on the

acquiring company or its government’s practices, including violations of

U.N. sanctions and transfers of U.S. technology to proscribed countries;

for most of these cases, DOD did not recommend a 45-day investigation.

According to Defense Technology Security Administration officials, this

information alone did not provide sufficient grounds to warrant

investigations. They said that in some cases the technology at the U.S.

company was not deemed to be critical and in others the intelligence

information was not sufficiently corroborated, did not show violations of

U.S. laws, or had occurred so long ago that it was no longer relevant.

DOD Determinations

of Defense-Critical

Technologies for Risk

of Diversion

Assessments

As required by the 1992 legislation, DOD agencies, including defense

intelligence entities, assess the risk of diversion when the Secretary of

Defense determines that a proposed merger, acquisition, or takeover may

involve a firm engaged in the development of a defense-critical technology

or is otherwise important to the defense industrial and technology base.

These assessments are to be shared with all the Committee members,

according to CFIUS officials. The Office of the Assistant Secretary of

Defense for Economic Security found that 9 of the 174 CFIUS cases

reviewed between October 1992 and December 1994 required a risk of

diversion assessment. The responsible DOD official noted that the

legislation requires a risk of diversion assessment only when the company

is involved in the development, not the application, of a critical technology

or is otherwise important to the defense industrial base. DOD uses the Key

Technologies Plan, as authorized by the legislation, to decide whether the

company is developing a defense-critical technology.

Agency Comments The Departments of Defense, State, and the Treasury generally agreed

with our draft report and provided minor technical comments. The

Department of Defense said it concurred with the report as presented. The

Department of State, in official oral comments, said that the report fairly

and thoroughly describes the activities of CFIUS and accurately reflects the

role of CFIUS members. The Department of the Treasury discussed the

voluntary nature of CFIUS notification and said it will remind agencies to

bring to CFIUS’s attention transactions in high-technology industries that

have not been notified to CFIUS. Treasury also stated that it believes

Exon-Florio implementation “has increased the awareness of investors to

national security issues, brought transactions into conformity with

existing laws where needed, and caused investors to consider explicitly

national security when putting together proposals to acquire U.S.

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businesses.” The full text of the comments from the Departments of the

Treasury and Defense are included in appendixes V and VI, respectively.

The Department of Commerce reviewed the final draft and provided minor

technical comments. The Department of Justice also reviewed the report

but did not comment.

We are sending copies of this report to other congressional committees;

the Secretaries of the Treasury, State, Defense, Commerce, and Justice;

and the Director, Office of Management and Budget. We are also making

copies available to other interested parties upon request.

Please contact me at (202) 512-4125 if you or your staff have any questions

concerning this report. Major contributors to this report are listed in

appendix VII.

David E. Cooper

Director, Acquisition Policy,

 Technology, and Competitiveness Issues

Page 14 GAO/NSIAD-96-12 Foreign Investments
Page 15 GAO/NSIAD-96-12 Foreign Investments
Contents

Letter 1

Appendix I 

Objectives, Scope,

and Methodology

18

Appendix II 

Foreign Investment

Transactions Not

Reported to CFIUS

25

Appendix III 

CFIUS Cases

Reviewed for National

Security Concerns

30

Appendix IV 

CFIUS Filings From

Japan, the United

Kingdom, France, and

Germany

36

Appendix V 

Comments From the

Department of the

Treasury

40

Appendix VI 

Comments From the

Department of

Defense

42

Page 16 GAO/NSIAD-96-12 Foreign Investments
Contents

Appendix VII 

Major Contributors to

This Report

43

Related GAO Products 44

Tables Table 1: Disposition of CFIUS Notifications 4

Table I.1: Sixteen Selected CFIUS Notifications in 1992-93 22

Table II.1: Data From the Economic Strategy Institute on

Transactions Not Reported to CFIUS

26

Table II.2: Data From the Securities Data Company on

Transactions Not Reported to CFIUS

28

Table III.1: CFIUS Cases Involving All Industries Reviewed for

National Security Concerns

30

Table III.2: CFIUS Cases Involving High-Technology Industries

Reviewed for National Security Concerns

32

Table III.3: CFIUS Cases Involving Non-High-Technology

Industries Reviewed for National Security Concerns

34

Figures Figure IV.1: CFIUS Cases Involving Japanese Companies

Investing in High-Technology Industries

36

Figure IV.2: CFIUS Cases Involving British Companies Investing

in High-Technology Industries

37

Figure IV.3: CFIUS Cases Involving French Companies Investing

in High-Technology Industries

38

Figure IV.4: CFIUS Cases Involving German Companies Investing

in High-Technology Industries

39

Abbreviations

CFIUS Committee on Foreign Investment in the United States

DOD Department of Defense

ESI Economic Strategy Institute

SDC Securities Data Company

Page 17 GAO/NSIAD-96-12 Foreign Investments
Appendix I 

Objectives, Scope, and Methodology

Our examination of the implementation of Exon-Florio legislation and its

amendments was requested by the former Chairs of the Subcommittee on

Legislation and National Security and the Subcommittee on Commerce,

Consumer, and Monetary Affairs, House Committee on Government

Operations, and the Chairs and Ranking Minority Members of the

Subcommittee on Research and Technology and the Subcommittee on

Oversight and Investigation, House Committee on Armed Services.

Specifically, we focused on (1) the extent foreign investments are reported

to the Committee on Foreign Investment in the United States (CFIUS) and

the characteristics of these investments and (2) the factors CFIUS considers

in making decisions on whether the foreign investment would result in

foreign companies’ control of U.S. companies, whether the acquiring

foreign company is controlled by a foreign government, and whether there

are associated national security risks.

To address these objectives, we interviewed officials and examined

records at the Departments of Defense (DOD), the Treasury, State, and

Commerce. We also discussed CFIUS procedures and selected foreign

company notifications with officials from the Defense Technology Security

Administration and other DOD participants, including the Office of the

Under Secretary of Defense for Acquisition and Technology; the Office of

the Assistant Secretary of Defense for Command, Control,

Communications, and Intelligence; the military services; the Defense

Intelligence Agency; the National Security Agency; the Defense

Investigative Service; the Defense Logistics Agency; and the Advanced

Research Projects Agency. We also obtained information from other CFIUS

participants, including the Department of Justice, and contacted the

Council of Economic Advisers, the Office of Management and Budget, the

Office of Science and Technology Policy, and the National Security

Council.

To examine the scope of foreign investments voluntarily filed with CFIUS,

we used an unofficial Department of Commerce database on CFIUS cases

maintained by the Office of Strategic Industries and Economic Security.1

We also compared the CFIUS data with foreign investment databases

maintained by the Economic Strategy Institute (ESI) and Securities Data

Company (SDC). The ESI database tracks foreign investments in and

acquisitions of U.S. companies involved in high, key, or critical

technologies. These technology categories are developed by consultation

with technical experts and generally follow broad standard technology

categories. The SDC tracks investments, acquisitions, and mergers

1

CFIUS does not maintain an official database on its cases.

Page 18 GAO/NSIAD-96-12 Foreign Investments
Appendix I 

Objectives, Scope, and Methodology

worldwide, but we obtained selected data on foreign investment in the

United States in technology areas comparable to those tracked by ESI. SDC

categorizes the technology sector by ascertaining the primary business of

each company and by identifying pertinent standard industrial

classification codes. From this comparison of the databases, we identified

transactions not reviewed by CFIUS. We further selected transactions

involving foreign acquisitions of or majority investments in

high-technology industries and verified that these transactions were

completed without CFIUS review for foreign control and national security

concerns.

We eliminated duplications in the Commerce database and deleted

notifications withdrawn from CFIUS review. To develop industry categories,

we relied primarily on those used by Commerce but also considered ESI’s

categories. We divided the U.S. industries listed in the database into two

categories, high technology and low technology, by referring to DOD’s Key

Technologies Plan and the Militarily Critical Technologies List. We

consulted with experts within and outside the government on our industry

groupings and made changes in response to their recommendations.

To evaluate the overall concentration or frequency of foreign investments

by country and industry, we obtained data from federal government

reports and interviewed agency officials at Commerce’s Bureau of

Economic Analysis about aspects of their data collection efforts. We also

obtained information from several private sector firms tracking foreign

investment in U.S. companies, including SDC, Ulmer Brothers, Inc., and

Technology Strategic Planning, Inc. We did not independently verify the

information in the Commerce, ESI, or SDC databases.

To examine the factors CFIUS considers in its decision-making process, we

selected a judgmental sample of notifications from 1992 and 1993. We used

the Defense Intelligence Agency’s list of 188 CFIUS filings for these years to

select 33 notifications that the agency ranked high, moderate, and low

risk. After an initial examination, we focused on 16 cases for in-depth

review on the basis of the following criteria: (1) the technologies and

industries involved, including cases DOD found to involve critical

technologies; (2) the countries and companies involved in the

transactions, including foreign government-owned companies; (3) whether

validated export licenses are required; (4) the risk and intelligence

analyses done; (5) the presence of DOD classified contracts and associated

security agreements; and (6) the presence of sole-source or last supplier

Page 19 GAO/NSIAD-96-12 Foreign Investments
Appendix I 

Objectives, Scope, and Methodology

considerations. The 16 cases we reviewed covered 8 foreign countries and

6 industrial sectors. Table I.1 shows the 16 cases we selected for review.

Page 20 GAO/NSIAD-96-12 Foreign Investments
Appendix I 

Objectives, Scope, and Methodology

Page 21 GAO/NSIAD-96-12 Foreign Investments
Appendix I 

Objectives, Scope, and Methodology

Table I.1: Sixteen Selected CFIUS

Notifications in 1992-93

CFIUS file

number Foreign country

Foreign

government

owner/control

State

munitions

licenses

Commerce

export licenses

92-022 United Kingdom N/Aa Yes No

92-027 France N/Aa Yes No

92-057 Germany N/Aa Yes No

92-087 France Yes No No

92-105 Japan No No Yes

93-004 Israel No Yes Yes

93-013 South Korea No No Yes

93-014 France No No Yes

93-038 Germany Yes No Yes

93-054 Israel No No Yes

93-059 Singapore No Yes Yes

93-060 France No Yes Yes

93-064 Israel No No Yes

93-065 France No No Yes

93-069 Hong Kong No Yes Yes

93-078 United Kingdom No No Yes

Page 22 GAO/NSIAD-96-12 Foreign Investments
Appendix I 

Objectives, Scope, and Methodology

Classified

contracts Percent acquired Risk of diversion Case withdrawn Investigated Technology

Yes 100.0 N/A No No Electronics

Yes 100.0 N/A Yes Yes Aerospace

Yes 12.0 N/A No Yes Aerospace

No 100.0 No No No Computers

No 100.0 No No No Computers

No 100.0 No No No Aerospace

No 100.0 Yes No No Electronicstelecommunications

No 51.0 No No No Telecommunications

No 100.0 No No No Machine tools

No 17.4b

18.2

No Yesc No Electronics

Yes 23.0 No Yesc No Electronics

No 100.0 No No No Telecommunicationselectronics

No 100.0 Yes No No Telecommunications

No 100.0 No No No Aerospace

Yes 100.0 Yes Yesc No Advanced materials

Yes 20.0 Yes No No d

aThese cases were reported before the October 1992 legislation requiring (1) investigations of

cases involving foreign government control that could affect the national security and

(2) intelligence assessments of diversion risk in cases involving defense-critical technologies.

bRepresents two investors.

cNotifications were determined to involve no foreign control and therefore did not come under

Exon-Florio jurisdiction.

dTechnology information is not included to avoid revealing the transaction.

The sampling is not statistically representative of the entire CFIUS caseload,

but these cases illustrate the CFIUS process and allowed us to examine the

more difficult cases (that is, those involving minority investments, foreign

government ownership and control, critical defense technologies, and/or

adverse intelligence information).

We reviewed records for each of the 16 cases at the Departments of the

Treasury, Defense, State, and Commerce because CFIUS does not maintain

a central file repository. DOD and State screened their CFIUS files and

documents before making them available to us, which may have impeded

Page 23 GAO/NSIAD-96-12 Foreign Investments
Appendix I 

Objectives, Scope, and Methodology

our scope. The Defense Intelligence Agency and Central Intelligence

Agency also provided information on our sample cases, where applicable.

We reviewed the Exon-Florio legislation and subsequent amendments,

implementing regulations, and the legislative history. We considered DOD’s

role in the legislation and focused on the implementation of recently

related legislation.

We performed our work between March 1994 and April 1995 in accordance

with generally accepted government auditing standards.

Page 24 GAO/NSIAD-96-12 Foreign Investments
Appendix II 

Foreign Investment Transactions Not

Reported to CFIUS

Tables II.1 and II.2 provide information on foreign investment transactions

from two private databases that were not in the Commerce Department’s

database on CFIUS notifications. In our tables, we include only those

transactions involving high-technology industries.

Page 25 GAO/NSIAD-96-12 Foreign Investments
Appendix II 

Foreign Investment Transactions Not

Reported to CFIUS

Table II.1: Data From the Economic

Strategy Institute on Transactions Not

Reported to CFIUS (Oct. 1988 through

May 1994) 

High-technology industry Japan

United

Kingdom France Germany

Computers 93 18 7 2

Semiconductor equipment 27 1 1 1

Semiconductors 39 2 0 1

Electronics 35 11 2 1

Aerospace 11 3 1 1

Advanced materials 23 4 0 3

Chemicals 19 5 9 6

Biotechnology 24 9 3 11

Telecommunications and

information

29 7 2 3

Machine tools 9 2 0 0

Environmental technologies 1 0 1 0

Robotics 3 0 0 0

Miscellaneous 25 6 2 0

Total 338 68 28 29

Page 26 GAO/NSIAD-96-12 Foreign Investments
Appendix II 

Foreign Investment Transactions Not

Reported to CFIUS

y Canada Switzerland Taiwan Australia Finland South Korea Other countries Total

2 7 2 10 1 0 5 11 156

0 3 0 1 0 0 0 34

1 0 1 0 0 1 1 46

1 1 0 1 0 2 10 64

4 1 0 0 0 0 1 22

3 0 0 0 1 0 0 2 33

6 3 1 0 0 0 0 5 48

0 8 0 1 0 0 9 65

3 4 2 1 2 0 1 5 56

0 1 0 0 0 0 0 2 14

0 0 0 0 0 0 0 0 2

0 0 1 0 0 0 0 0 4

0 0 0 0 0 0 0 1 34

9 21 19 12 7 0 9 47 578

Page 27 GAO/NSIAD-96-12 Foreign Investments
Appendix II 

Foreign Investment Transactions Not

Reported to CFIUS

Table II.2: Data From the Securities

Data Company on Transactions Not

Reported to CFIUS (Oct. 1988 through

May 1994) 

High-technology industry Japan

United

Kingdom France Germany

Biotechnology 29 30 5 7

Computers 62 27 4 1

Semiconductors 22 3 0 1

Electronics 19 26 2 4

Telecommunications 11 9 3 1

Advanced materials 5 2 1 0

Lasers 6 3 0 0

Robotics 3 2 0 1

Other 2 5 1 0

Total 159 107 16 15

Page 28 GAO/NSIAD-96-12 Foreign Investments
Appendix II 

Foreign Investment Transactions Not

Reported to CFIUS

y Canada Switzerland Taiwan Australia Finland South Korea Other countries Total

7 10 9 0 4 1 0 47 142

27 6 8 4 0 3 58 200

1 0 2 0 0 1 6 36

4 4 3 0 2 0 1 17 78

6 1 1 1 0 1 14 48

0 0 1 0 0 1 0 3 13

0 0 0 0 0 0 0 1 10

0 0 0 0 0 0 2 8

0 2 0 0 0 0 0 4 14

5 50 20 11 11 2 6 152 549

Page 29 GAO/NSIAD-96-12 Foreign Investments
Appendix III 

CFIUS Cases Reviewed for National

Security Concerns

From the Commerce Department’s database on CFIUS cases, we obtained

data on cases reviewed for national security concerns between October

1988 through May 1994. Table III.1 shows the number of CFIUS cases

reviewed during that period, by country, in high-technology and

non-high-technology industry categories. Table III.2 provides further

details of CFIUS cases reviewed for national security concerns by

high-technology industry category and by country. Table III.3 illustrates

CFIUS cases in non-high-technology industries by country. We developed

these industry categories using the Commerce Department’s groupings

and by consulting with industry experts within and outside the U.S.

government.

Table III.1: CFIUS Cases Involving All

Industries Reviewed for National

Security Concerns (Oct. 1988 through

May 1994) 

Country

High-technology

cases

Non-hightechnology cases Total

Japan 134 73 207

United Kingdom 131 53 184

France 62 25 87

Germany 41 18 59

Netherlands 20 21 41

Switzerland 25 9 34

Canada 20 10 30

Sweden 15 5 20

Taiwan 14 0 14

Australia 9 5 14

Finland 9 5 14

Italy 4 8 12

Belgium 7 5 12

South Korea 8 2 10

Norway 7 3 10

Singapore 8 0 8

Israel 5 2 7

South Africa 4 1 5

China 4 1 5

India 3 1 4

Austria 3 1 4

Venezuela 3 0 3

Mexico 0 3 3

Liechtenstein 3 0 3

Kuwait 2 1 3

Bermuda 2 1 3

(continued)

Page 30 GAO/NSIAD-96-12 Foreign Investments
Appendix III 

CFIUS Cases Reviewed for National

Security Concerns

Country

High-technology

cases

Non-hightechnology cases Total

Spain 2 0 2

Soviet Union 1 1 2

Panama 2 0 2

Luxembourg 0 2 2

United Arab Emirates 1 0 1

Thailand 1 0 1

Saudi Arabia 1 0 1

New Zealand 1 0 1

Malaysia 1 0 1

Ireland 1 0 1

Indonesia 0 1 1

Hong Kong 0 1 1

Greece 1 0 1

Denmark 1 0 1

British Virgin Islands 0 1 1

British West Indies 0 1 1

Brazil 0 1 1

Total 556 261 817

Page 31 GAO/NSIAD-96-12 Foreign Investments
Appendix III 

CFIUS Cases Reviewed for National

Security Concerns

Table III.2: CFIUS Cases Involving

High-Technology Industries Reviewed

for National Security Concerns (Oct.

1988 through May 1994) 

High-technology industry Japan

United

Kingdom France Germany

Computers 30 12 9 0

Energy 4 9 6 5

Semiconductors 32 3 5 3

Electronics 12 17 3 4

Aerospace 7 15 11 2

Industrial controls,

equipment, instruments, and

machinery

6 13 7 6

Advanced materials 7 21 2 3

Chemicals 7 12 1 7

Biotechnology, medical, and

pharmaceutical

7 4 2 3

Telecommunications and

information

6 5 8 1

Electrical equipment 6 4 3 4

General components 3 5 1 3

Optics 2 6 1 0

Coatings and adhesives 2 3 1 0

Analytical instruments 1 2 0 0

Environmental technologies 0 0 1 0

Robotics 1 0 0 0

Specialty gases 1 0 0 0

Micro-machines 0 0 0 0

Submersibles 0 0 1 0

Total 134 131 62 41

Page 32 GAO/NSIAD-96-12 Foreign Investments
Appendix III 

CFIUS Cases Reviewed for National

Security Concerns

y Canada Switzerland Taiwan Australia Finland South Korea Other countries

Number

of cases

0 3 4 3 0 1 4 11 77

5 6 3 2 2 1 0 17 55

3 0 0 4 0 0 2 4 53

4 0 1 3 1 1 0 7 49

2 2 3 1 0 0 0 8 49

6 0 2 0 1 2 1 11 49

3 1 1 1 1 2 0 5 44

7 0 0 0 1 1 0 8 37

3 0 5 0 0 0 0 15 36

5 1 0 0 0 0 8 34

4 1 1 0 0 1 0 1 21

3 1 0 0 1 0 1 3 18

0 0 3 0 0 0 0 4 16

0 0 1 0 2 0 0 0 9

0 0 0 0 0 0 0 0 3

0 0 0 0 0 0 0 1 2

0 0 0 0 0 0 0 0 1

0 0 0 0 0 0 0 0 1

0 1 0 0 0 0 0 0 1

0 0 0 0 0 0 0 0 1

20 25 14 9 9 8 103 556

Page 33 GAO/NSIAD-96-12 Foreign Investments
Appendix III 

CFIUS Cases Reviewed for National

Security Concerns

Table III.3: CFIUS Cases Involving

Non-High-Technology Industries

Reviewed for National Security

Concerns (Oct. 1988 through

May 1994) 

Non-high-technology

industry Japan

United

Kingdom France Germany

Mining, metals, and

metal-working equipment

18 19 12 8

Plastics and rubber 5 3 2 1

Construction and

construction material

9 4 2 0

Automotive 5 4 0 2

Transportation services 3 1 0 1

Engineering services 2 4 0 1

Financial 7 0 0 0

Printing and publishing 1 2 0 1

Food, beverage, and tobacco 4 2 2 0

Consumer products 2 3 0 0

Environmental services 0 4 0 2

Real estate 6 0 0 0

Entertainment 6 0 0 0

Retailing 2 2 1 0

Information services 0 0 1 1

Consulting 0 1 2 0

Textiles 2 0 0 0

Small arms 0 1 1 1

Educational services 0 1 0 0

Wood products 0 1 0 0

Cans and containers 0 0 1 0

Photographic 1 1 0 0

Parts fabrication 0 0 1 0

Total 73 53 25 18

Page 34 GAO/NSIAD-96-12 Foreign Investments
Appendix III 

CFIUS Cases Reviewed for National

Security Concerns

y Canada Switzerland Taiwan Australia Finland South Korea Other countries

Number

of cases

8 2 1 0 1 1 1 10 73

0 1 0 0 1 0 13 26

0 2 1 0 1 0 1 6 26

2 2 0 0 0 0 0 6 19

1 1 0 0 0 0 4 11

0 0 0 0 1 0 2 10

0 0 0 0 1 0 0 10 18

0 1 0 2 0 0 3 10

0 0 0 0 0 0 0 1 9

0 2 1 0 0 0 0 0 8

2 0 1 0 0 0 0 0 7

0 0 0 0 0 1 0 0 7

0 0 0 0 0 0 0 0 6

0 0 0 0 0 0 0 1 6

1 1 0 0 0 0 1 5

0 0 0 0 0 0 0 1 4

0 0 1 0 0 0 0 1 4

0 0 0 0 0 0 0 3

0 0 0 0 0 0 0 1 2

0 0 0 0 0 1 0 0 2

0 0 0 0 0 0 0 1 2

0 0 0 0 0 0 0 0 2

0 0 0 0 0 0 0 0 1

8 10 9 0 5 5 2 61 261

Page 35 GAO/NSIAD-96-12 Foreign Investments
Appendix IV 

CFIUS Filings From Japan, the United

Kingdom, France, and Germany

Figure IV.1: CFIUS Cases Involving

Japanese Companies Investing in

High-Technology Industries (Oct. 1988

through May 1994)

24% • Semiconductors

22% • Computers

•

9%

Electronics

•

5%

Aerospace

•

5%

Advanced materials

•

5%

Chemicals

•

5%

Biotechnology

•

4%

Telecommunications and

information

•

4%

Industrial controls, equipment,

instruments, and machinery

•15%

Other high-technology industries

Note: Total does not equal 100 percent due to rounding.

Page 36 GAO/NSIAD-96-12 Foreign Investments
Appendix IV 

CFIUS Filings From Japan, the United

Kingdom, France, and Germany

Figure IV.2: CFIUS Cases Involving

British Companies Investing in

High-Technology Industries (Oct. 1988

through May 1994)

16% • Advanced materials

13% • Electronics

11% • Aerospace

• 10%

Industrial controls, equipment,

instruments, and machinery

•

9%

Chemicals

•

9%

Computers

•

7%

Energy

•

5%

Optics

•

4%

Telecommunication and

information

•16%

All other high-technology

industries

Page 37 GAO/NSIAD-96-12 Foreign Investments
Appendix IV 

CFIUS Filings From Japan, the United

Kingdom, France, and Germany

Figure IV.3: CFIUS Cases Involving

French Companies Investing in

High-Technology Industries (Oct. 1988

through May 1994)

18% • Aerospace

15% • Computers

13% • Telecommunications and

information

11%•

Industrial controls, equipment,

instruments, and machinery

•

10%

Energy

•

8%

Semiconductors

•

5%

Electronics

•

5%

Electrical equipment

•

3%

Advanced materials

•13%

All other high-technology

industries

Note: Total does not equal 100 percent due to rounding.

Page 38 GAO/NSIAD-96-12 Foreign Investments
Appendix IV 

CFIUS Filings From Japan, the United

Kingdom, France, and Germany

Figure IV.4: CFIUS Cases Involving

German Companies Investing in

High-Technology Industries (Oct. 1988

through May 1994)

17% • Chemicals

15% • Industrial controls, equipment,

instruments, and machinery

12% • Energy

• 10%

Electrical equipment

•

10%

Electronics

•

7%

Semiconductors

•

7%

General components

•

7%

Advanced materials

•

7%

Biotechnology

•

7%

All other high-technology

industries

Note: Total does not equal 100 percent due to rounding.

Page 39 GAO/NSIAD-96-12 Foreign Investments
Appendix V 

Comments From the Department of the

Treasury

Page 40 GAO/NSIAD-96-12 Foreign Investments
Appendix V 

Comments From the Department of the

Treasury

Page 41 GAO/NSIAD-96-12 Foreign Investments
Appendix VI 

Comments From the Department of Defense

Page 42 GAO/NSIAD-96-12 Foreign Investments
Appendix VII 

Major Contributors to This Report

National Security and

International Affairs

Division, Washington,

D.C.

Davi M. D’Agostino

Maria Cristina Gobin

Anne-Marie Lasowski

Russell Reiter

James J. Ungvarsky

Karen S. Zuckerstein

Office of General

Counsel

Margaret Armen

Raymond J. Wyrsch

Page 43 GAO/NSIAD-96-12 Foreign Investments
Related GAO Products

Defense Industrial Security: Issues in the Proposed Acquisition of LTV

Corporation Missiles Division by Thomson-CSF (GAO/T-NSIAD-92-45, June 25,

1992).

Foreign Investment: Analyzing National Security-Related Investment

Under the Exon-Florio Provision (GAO/T-GGD-92-49, June 4, 1992).

National Security Reviews of Foreign Investment (GAO/T-NSIAD-91-8, Feb. 26,

1991).

National Security Review of Two Foreign Acquisitions in the

Semiconductor Sector (GAO/T-NSIAD-90-47, June 13, 1990).

Foreign Investment: Analyzing National Security Concerns (GAO/NSIAD-90-94,

Mar. 29, 1990).

The President’s Decision to Order a Chinese Company’s Divestiture of a

Recently Acquired U.S. Aircraft Parts Manufacturer (GAO/T-NSIAD-90-21,

Mar. 19, 1990).

Strategic Minerals: Implications of Proposed Takeover of a Major British

Mining Company (GAO/NSIAD-89-123, Mar. 3, 1989).

(705039) Page 44 GAO/NSIAD-96-12 Foreign Investments
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