Committee Examines CFIUS Role in US Investment Security and Outbound Regulations

The U.S. House Committee on Financial Services convened on July 13, 2025, to discuss critical issues surrounding U.S. policy on investment security, focusing on the role of the Committee on Foreign Investment in the United States (CFIUS). The hearing aimed to evaluate how CFIUS safeguards national security against foreign investment risks while promoting beneficial investments.

Chairman Davidson opened the meeting by emphasizing CFIUS's importance in reviewing foreign investments that may threaten American interests. Established in 1975, CFIUS has expanded its jurisdiction through the 2018 Foreign Investment Risk Review Modernization Act (FIRRMA) to include noncontrolling investments in key sectors such as technology and infrastructure. Davidson highlighted the need for a robust outbound investment bill to prevent U.S. capital from supporting adversarial nations, urging Congress to create a streamlined framework that protects national interests without imposing excessive burdens on American businesses.

Ranking Member Beatty echoed these sentiments, noting that while CFIUS rarely recommends blocking transactions, its thorough vetting process is essential for national security. She pointed out the Biden administration's establishment of an outbound investment security program, which screens U.S. investments in sensitive technologies in China. Beatty raised concerns about past actions taken by the Trump administration that could undermine CFIUS's effectiveness, particularly regarding high-profile cases like TikTok and U.S. Steel.

The hearing featured testimonies from various experts, including Jonathan Sanford, CEO of the Global Business Alliance, and others who provided insights into the current investment security framework and potential improvements. The discussions underscored the bipartisan commitment to strengthening CFIUS and ensuring that national security remains a priority in foreign investment decisions.

As the committee continues its work, the focus remains on balancing the need for foreign investment with the imperative to protect U.S. interests, highlighting the ongoing challenges in navigating this complex landscape.