On September 17, 2019, the Treasury Department issued highly anticipated proposed final regulations intended to implement fully the reforms in the foreign investment review process wrought by the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA), passed in August 2018. The proposed regulations are divided into two parts.  The Provisions Pertaining to Certain Investments in the United States by Foreign Persons would, among other things:  (i) permanently expand the jurisdiction of the Committee on Foreign Investment in the United States (CFIUS) to reach non-controlling investments in certain U.S. businesses; (ii) create exceptions to this expanded authority for certain types of investors; (iii) expand the scope of mandatory filing transactions beyond the current “Pilot Program”which CFIUS implemented in the fall of 2018; and (iv) establish a streamlined voluntary declaration process for covered transactions to supplement the voluntary notice option.

CFIUS also issued a separate proposed rule on transactions involving real estate, Provisions Pertaining to Certain Transactions by Foreign Persons Involving Real Estate in the United States, which, for the first time in CFIUS’s history, asserts jurisdiction over real property even if that property is not part of a U.S. business.