Vania Wang
90 Geo. Wash. L. Rev. 1316
Foreign investment in the United States has always been an important element of the nation’s economy, but it can leave the United States and its citizens vulnerable to foreign control. In recent years, many have grown concerned that sovereign governments have been investing in the United States with motives beyond mere business and financial strategy. Since 1975, the President and the Committee on Foreign Investment in the United States (“CFIUS” or the “Committee”) have overseen foreign investment transactions and reviewed them for any implications on national security. As their scope of review has expanded over the years and inbound investment has increased in the country, CFIUS and the President have become far more active in finding that transactions should be reversed due to national security concerns. China’s presence in this space is especially notable, with its companies forming the highest percentage of transactions reviewed and reversed.
Through the case study of TikTok’s forced divestment from ByteDance, this Essay explains the broad scope of the Committee’s and President’s power regarding Chinese transactions, and the weaknesses in the Committee’s multimember structure that make it vulnerable to presidential interference with protectionist motivations. The Essay concludes by making recommendations on how the joint goals of national security and open investment can be achieved. Proposals include restructuring the Committee to include members that are not removable at will by the President, with the ultimate recommendation to reform it completely as an independent agency.
