The U.S. Department of the Treasury, as Chair of the Committee on Foreign Investment in the United States (CFIUS), has issued a Notice of Proposed Rulemaking (NPRM) to expand CFIUS’s jurisdiction over certain real estate transactions by foreign persons near specified military installations. This expansion follows legislation passed by Congress in 2018, granting CFIUS authority to review such transactions and take appropriate action when necessary.
The proposed rule would add over 50 military installations across 30 states to the existing list under CFIUS’s jurisdiction, significantly extending its reach while maintaining a focus on national security.
“President Biden and I remain committed to using our strong investment screening tool to defend America’s national security, including actions that protect military installations from external threats,” said Secretary of the Treasury Janet L. Yellen. “CFIUS plays an integral role in U.S. national security by thoroughly reviewing real estate transactions near sensitive military installations, and this proposed rule will significantly expand its jurisdiction and ability to accomplish this vital mission.”
Assistant Secretary for Investment Security Paul Rosen added, “Today’s proposed rule is another example of CFIUS’s continuing commitment to hone our tools to protect U.S. national security and is a significant milestone in safeguarding critical U.S. military installations.”
CFIUS’s authority over real estate transactions stems from the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA). The act allows CFIUS to review purchases or leases by foreign persons of real estate close to sensitive U.S. Government facilities, potentially exposing national security activities to risks such as intelligence collection or surveillance.
The Department of Defense continuously assesses its military installations and their geographic scope under CFIUS regulations based on national security considerations. The recent comprehensive assessment conducted by the Department led to several key changes in the proposed rule:
– Expanding CFIUS’s jurisdiction over real estate transactions within a one-mile radius around 40 additional military installations.
– Expanding jurisdiction within a 100-mile radius around 19 additional military installations.
– Extending jurisdiction between one mile and 100 miles around eight already listed military installations.
– Updating names for better public identification of 14 listed military installations.
– Updating locations for better public identification of seven listed sites.
The Treasury encourages public comments on the proposed rule within 30 days following its publication in the Federal Register. The NPRM is available at https://www.cfius.gov/.
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