Congressman Van Taylor Introduces Legislation to Increase National Security Congressional Oversight

Strengthens Congressional Oversight of CFIUS

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Washington, July 14, 2020 | Anna R. McCormack ((202) 570-0927) | comments
U.S. Congressman Van Taylor (R-TX-03) introduced legislation in the House of Representatives to strengthen Congressional oversight of the Committee on Foreign Investment in the United States (CFIUS).
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WASHINGTON - This week, United States Congressman Van Taylor (R-TX-03) introduced legislation in the House of Representatives with Congressman Jim Himes (D-CT-04) to strengthen Congressional oversight of the Committee on Foreign Investment in the United States (CFIUS).

As the People's Republic of China continues to aggressively focus on acquiring sensitive American military and national security technologies, Congress must improve oversight of CFIUS’ actions to safeguard our nation. Recently, China has demonstrated a troubling hostility towards the United States, including the coverup of the COVID-19 outbreak, coercion of U.S. allies, enforcement of malicious trade policies, and the attempted seizure of sensitive U.S. capabilities. In fact, China has been more active than any other nation in terms acquisitions, takeovers, and mergers with U.S. entities and accounted for more than a quarter of all transactions reviewed by CFIUS between 2015 and 2017. China’s recent aggressive actions clearly illustrate the dire necessity of ensuring Congressional oversight of foreign transaction reviews to ensure that those which pose a threat to national security are terminated.

Congressman Van Taylor (TX-03) said, “Our nation faces serious threats from foreign adversaries, including China, who have sought to acquire American businesses and technologies with military or national security applications. The national security reviews conducted by CFIUS can block these kinds of transactions that may harm American national security.” He continued, “This bipartisan legislation requires CFIUS to report back to Congress on all transactions, including those which are expedited, thus allowing Congress to ensure America’s national security interests are protected from predatory actions from foreign actors.”

Congressman Jim Himes (CT-04), said, “National security oversight is one of Congress’s most important functions. Making sure we defend against potential incursions is essential because any vulnerability can be exploited by our geopolitical rivals. This bipartisan bill tightens our oversight mechanisms and closes loopholes, showing that Congress is taking our responsibility seriously and is playing an active role in comprehensive defense of national interests.”

H.R. 7603, the Improving Congressional Oversight of CFIUS Determinations Act amends the Defense Production Act of 1950 to ensure expedited transactions are subject to the same Congressional disclosure as other CFIUS reviews.

Complete text of H.R. 7603 can be found here.

An inter-agency committee responsible for overseeing national security implications of foreign investments in the United States, CFIUS has the ability to review foreign investment transactions to determine national security impacts, and from those determinations, the President has the authority to block proposed foreign transactions if it is determined they pose a threat to national security.

During the 115th Congress, as part of the FY2019 NDAA (Title XVII, P.L. 115-232) the Foreign Investment Risk Review Modernization Act (FIRRMA) of 2018 was signed into law. These reforms strengthened the ability of CFIUS to address national security concerns with foreign transactions by expanding the scope of covered transactions within CFIUS’ jurisdiction. FIRRMA also created a new declaration process where parties to a transaction can seek to expedite consideration of a deal in certain circumstances. However, the law left out explicit Congressional oversight over CFIUS’s assessment of those declarations.

Congressman Taylor’s Improving Congressional Oversight of CFIUS Determinations Act aims to correct this by requiring Congressional notification when CFIUS has completed its review of expedited transactions, just as it currently does with other CFIUS reviews.

A 7th generation Texan, Van Taylor is a dedicated family man, successful businessman, and decorated Marine Officer. Taylor served Collin County both in the Texas House and Senate. Today, Taylor is proud to serve on the House Committee on Financial Services.

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