Insights

On February 21, 2025, President Trump issued a National Security Policy Memorandum (“NSPM”) announcing the Administration’s “America First Investment Policy” (the “Investment Policy”)[1] affirming the United States’ commitment to open investment while safeguarding national security. Aimed at promoting investment in the United States from allied countries while imposing stricter measures on both inbound and outbound investments from “foreign adversaries,” the Investment Policy incentivizes foreign investment in the United States by announcing a “fast track” process “to facilitate greater investment from specified allied and partner sources in United States businesses involved with United States advanced technology and other important areas.” The NSPM defines “foreign adversaries” to include the People’s Republic of China (the “PRC” or “China”), including Hong Kong and Macau, Cuba, Iran, North Korea, Russia, and the Maduro regime in Venezuela.[2]

On Monday, November 18, 2024, the Committee on Foreign Investment in the United States (“CFIUS” or the “Committee”) announced that it had finalized the regulatory changes previewed in April that will enhance certain CFIUS procedures and sharpen its penalty and enforcement authorities.[1]  The changes go into effect on December 26, 2024 and as described in more detail below: (a) expand the types of information that CFIUS can require transaction parties and other persons (i.e., third-parties) submit when engaging with them on transactions that were not filed with CFIUS; (b) broaden the instances in which CFIUS may use its subpoena authority, including when seeking to obtain information from third persons not party to a transaction notified to CFIUS and in connection with assessing national security risk associated with non-notified transactions; and (c) substantially increase monetary penalties for violations of CFIUS regulations from a maximum of U.S. $250,000 to U.S. $5 million per violation, or the value of the transaction, whichever is greater.

On April 11, 2024, the Committee on Foreign Investment in the United States (“CFIUS” or the “Committee”) announced proposed amendments to its enforcement and mitigation regulations, marking the first substantive update to CFIUS’s mitigation and enforcement provisions since the enactment of the Foreign Investment Risk Review Modernization Act of 2018.  The Committee issued a notice of proposed rulemaking ("NPRM”) that would modify the regulations that apply to certain investments and acquisitions, as well as real estate transactions, by foreign persons as follows:

On October 20, 2022, the Committee on Foreign Investment in the U.S. (CFIUS) adopted long-awaited CFIUS Enforcement and Penalty Guidelines (the “Guidelines”) identifying how it will review and consider three categories of non-compliances that may be subject to penalties:

On September 15, 2022, the Biden Administration issued a new executive order (“EO”) and accompanying fact sheet, designed to sharpen the current U.S. foreign investment screening process as administered by the Committee on Foreign Investment in the United States (“CFIUS” or the “Committee”). [1] This EO is the first to specifically identify certain additional national security factors for CFIUS to consider when evaluating transactions involving foreign investors. 

On May 14, 2020, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC), the U.S. Department of State, and the U.S. Coast Guard issued a long-awaited “Sanctions Advisory for the Maritime Industry, Energy and Metals Sectors, and Related Communities” (the “Advisory”). The Advisory substantially expands on previous shipping advisories that OFAC and other U.S. agencies have issued that were specific to the Iran, Syria, and North Korea programs (see our previous summary) by not only offering global guidance, but also by issuing more than a dozen pages of detailed industry-specific recommendations across 10 sectors that touch the maritime industry. In many cases, these recommendations go substantially beyond the compliance expectations that OFAC or its peers had previously articulated.

In response to criticism that sanctions are hampering the global response to the COVID-19 pandemic, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) has released new guidance to encourage those interested in humanitarian trade involving jurisdictions sanctioned by the United States to “avail themselves of longstanding exemptions, exceptions, and authorizations” pertaining to that trade. On April 16, 2020, OFAC published an extensive fact sheet outlining relevant authorizations, exemptions, and guidance available to support the provision of humanitarian assistance under its Iran, Venezuela, North Korea, Syria, Cuba, and Ukraine/Russia-related sanctions programs, and how these might be applied to personal protective equipment (PPE) and other COVID-19 pandemic-related humanitarian assistance. OFAC provides specific examples by program of PPE and other medical and humanitarian assistance that qualifies under these provisions. Even when an exemption is not available, OFAC indicates that it will consider license requests on a case-by-case basis and that it will prioritize applications, compliance questions, and other requests related to humanitarian support. The fact sheet underscores the United States’ commitment “to ensuring that humanitarian assistance continues to reach at-risk populations through legitimate and transparent channels as countries across the globe fight [COVID-19].”

Keeping pace with the rapidly changing geopolitics in the region, the last week has brought a series of Iran-related sanctions developments with which global businesses need to keep up.  First, on January 10, the United States further escalated sanctions against Iran, creating new designation authorities for those “operating in” Iran’s construction, mining, manufacturing, and textile sectors under Executive Order 13902 (“EO 13902”).  These new measures come amidst the recent escalation of conflict between the U.S. and Iran.  With the issuance of EO 13902 the U.S. announced it is taking additional steps “to deny Iran revenue, including revenue derived from the export of products from key sectors of Iran’s economy that may be used to fund and support its nuclear program, missile development, terrorism and terrorist proxy networks, and malign regional influence.”1  Concurrently, the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) announced sanctions against key Iranian officials as well as several of the largest companies in the Iranian metals industries as well as certain Chinese and Seychelles based entities involved in the purchase and transport of certain metals from Iran.

In this issue:

As 2019 draws to an end, Congress has been busy on economic sanctions legislation. This includes passing new Russia-related sanctions and a Venezuela-related government contracts procurement restriction as part of the National Defense Authorization Act for Fiscal Year 2020 (NDAA 2020). The U.S. Senate Foreign Relations Committee has also approved two new pieces of legislation that would increase sanctions on Russia and Turkey, respectively. Full details on each of these developments are below the jump.

Over the course of the last week, the United States has escalated its sanctions programs targeting Russia and Venezuela. It began by implementing the long-delayed second round of sanctions on Russia mandated by the Chemical and Biological Weapons Act of 1991 (CBW Act) on Saturday, August 3, 2019. While the CBW sanctions will have a limited impact on most companies, the same cannot be said of the issuance of Executive Order 13884 (“E.O. 13884”) on Monday, August 5, 2019, which designated the Government of Venezuela and all entities that it owns or controls as “blocked.” Full details on each action are below.