A bipartisan bill to broaden powers of the Committee on Foreign Investment in the US (CFIUS) is reportedly facing pushback from industry groups, and lawmakers are listening.
Republican Senator John Cornyn’s staff is drafting changes to the legislation to alleviate industry concerns, Reuters reported on Wednesday, citing three sources familiar with the matter.
CFIUS already has broad powers to screen investments, and the uncertainty and lack of transparency associated with the lengthy review process alone is sometimes enough to discourage potential buyers. The most recent high-profile deal to fall prey to CFIUS was Alibaba affiliate Ant Financial’s bid to acquire US money-transfer firm MoneyGram.
Industry representatives honed in on two paragraphs within the 80-page bill, which define deals that would fall under CFIUS’ purvey as those related to “critical technology” or “critical infrastructure.” The vague terminology gives too much freedom in choosing what deals to investigate, some say.
“We need some guardrails around the definitions to make sure we don’t thwart foreign direct investments,” Nancy McLernon, chief executive of the Organization for International Investment, was quoted as saying of the bill.
Possible fixes for the legislation include identifying “critical technologies” within the text of the bill, or removing the mention entirely, leaving monitoring up to export-screening agencies.
The news comes after two Republican senators introduced a bill on Tuesday that would prohibit the US government from purchasing or leasing telecommunication equipment or services from Chinese giants Huawei, ZTE or any affiliates. Lawmakers have already pressured AT&T to nix an agreement with Huawei to sell handsets through the US telecoms giant.
A recent proposal from US National Security Council officials for the Donald Trump administration to build a national 5G (fifth generation) network also singled out Huawei.
In the context of these developments, China Daily said last week that the resurgence of the “China threat” theory was a sign not of danger posed by China, but of the West’s anxiety amid a fast-changing world.
“Instead of putting China under a microscope to determine the ‘level of threat’ it poses, the Western powers should find new prescriptions to revitalize themselves and overcome their sense of loss in an interdependent world in the face of China’s fast development,” the commentary suggested.