The Committee on Foreign Investment in the U.S. is “demanding” that TikTok’s owner, China-based ByteDance, sell its shares in the app or face a potential U.S. ban of the app, The Wall Street Journal reported March 15. The CFIUS demand, which the report said came “recently,” is a major shift in policy for the Biden administration, which has been reviewing TikTok for months (see 2209260008). It also comes amid pressure from Congress to quickly conclude the review with strong restrictions between the app and ByteDance (see 2302220024). The Treasury Department didn’t comment.
The U.S. should do more to address China’s growing trade influence in Ecuador and throughout Latin America, Rep. Jason Smith, the chair of the House Way and Means Committee, said during a March 15 visit to Ecuador. Smith, R-Mo., told Ecuador President Guillermo Lasso and members of his Cabinet that he is concerned about the country’s “expanding trade ties” with China.
Sen. Todd Young, R-Ind., complained this week that Brazil is not in the Americas Partnership for Economic Prosperity, and that APEP, once its negotiations are completed, is unlikely to increase U.S. agricultural exports to member countries. Young, speaking at a Senate Foreign Relations Committee hearing on the future of U.S.-Brazil relations, said farmers in his state rely on market access-opening trade deals, and said the U.S. should try to convince Brazil to lower its tariff barriers on corn, soybeans and ethanol.
The Committee on Foreign Investment in the U.S. should “be prepared to carefully review” any investments related to the closures of Silicon Valley Bank and Signature Bank, Sen. Marco Rubio, R-Fla., said in a March 15 letter to Treasury Secretary Janet Yellen. Rubio said he’s concerned China and its companies may be looking to “exploit this moment for their own” benefit after both banks collapsed this week.
The Committee on Foreign Investment in the U.S. is placing a significant focus on investments that could present data or cybersecurity risks, said CFIUS head Paul Rosen and FBI official Cynthia Kaiser. Rosen also said CFIUS continues to actively pursue non-notified deals and said the administration is still discussing the idea of an outbound investment review regime.
Democrats and Republicans applauded the Australia-U.K.-U.S. (AUKUS) partnership announcement this week, saying the delivery of nuclear-powered submarines to Australia will help shore up security in the Indo-Pacific 2303130035). But lawmakers also said the U.S. should do more to make sure it can easily share sensitive technology within the group, adding that they would support legislation that would revise U.S. defense export regulations.
Although the Committee on Foreign Investment in the U.S. has increased scrutiny of Chinese investments in recent years, it still continues to clear a range of transactions involving China, said Antonia Tzinova, a CFIUS lawyer with Holland & Knight. Chinese investors are using several tactics to ensure their deals aren’t blocked, Tzinova said, and in some cases are restructuring their investment agreements.
The U.S. this week released a timeline for sharing sensitive nuclear submarine technology with Australia, saying the country will be operating nuclear-powered submarines before the end of the 2030s. The Biden administration also said it’s considering revising its defense export controls to allow it to more easily share controlled technologies with allies, including within the Australia-U.K.-U.S. (AUKUS) partnership.
The Biden administration's FY 2024 budget request includes funding to support a new outbound investment review “program” and more money for U.S. agencies to carry out export control and sanctions authorities.
The U.S. this week removed sanctions on a former Kazakhstan-based subsidiary of Russia’s Sberbank after the subsidiary changed ownership and asked the Treasury Department to delete the bank from its Specially Designated Nationals List. The subsidiary, now owned by the Kazakhstan government, is "one of the largest banks in Kazakhstan" and "systemically important to the Kazakhstani financial industry," a Treasury spokesperson said March 8, adding that the agency worked "closely" with the Kazakhstan government to help it complete the purchase.