Kevin Wolf Discusses New CFIUS Legislation in The Hill, Inside U.S. Trade

In an op-ed he co-wrote for The Hill, “A rare, nonpartisan good news story in Washington,” Akin Gump international trade partner Kevin Wolf, a former Commerce Department official, discusses the new Foreign Investment Risk Review Modernization Act (FIRRMA) and Export Control Reform Act (ECRA), which were passed with overwhelming bipartisan majorities.

The two combined pieces of legislation, Wolf and his co-author, a former Treasury Department official write, “will combine to modernize the interagency committee assigned to review foreign direct investments to ensure that they don’t create unresolved national security risks – known as the Committee on Foreign Investment in the United States (CFIUS), and the export control system administered by the Commerce Department and supported by multiple other parts of the government.” While the new law isn’t perfect, it is “remarkable on both substantive and process grounds.”

The authors recognize there may be concerns “that the new CFIUS and export control authorities could be implemented poorly, abused, or not adequately supported with sufficient staff.” That said, they write that “such concerns should not lead to unfounded fears that it will be harder to invest in the United States or engage in domestic research involving emerging and foundational technologies.”

In a separate article in Inside U.S. Trade, “Implementation of export controls under FIRRMA seen as critical,” Wolf is quoted as saying, “Everybody wants to know what new technology they’re going to propose for new controls.” He added that export controls for emerging technologies was a “tradeoff” made in the drafting of the legislation. Instead of allowing CFIUS to review outbound investments, lawmakers decided on enhanced export control authority.

According to the article, there may be a China-specific addendum to the export control legislation included in FIRRMA, but Wolf does not expect much in the way of actions targeting Beijing. He noted that FIRRMA does not explicitly mention China, aside from requiring the Commerce Department to submit a report on Chinese investment to CFIUS and Congress every two years. Concerns about China, he added, instead created the “policy context” for how CFIUS will handle investments under FIRRMA.