On Jul. 8, US Treasury proposed rule re foreign investment in the US.
US Treasury issued notice of proposed rulemaking (NPRM) to expand Committee on Foreign Investment in US (CFIUS) jurisdiction over certain real estate transactions.
Rule amends the definition of military installation and the list of military installations in regulations relating to transactions by foreign persons involving real estate in the US.
Background
Since 2018, CFIUS has had the authority to review certain real estate transactions near specified military installations and to take action in appropriate circumstances.
Adds over 50 military installations to the list of installations around which CFIUS has jurisdiction, and expand CFIUS’s real estate jurisdiction, improving national security.
CFIUS thoroughly reviews real estate transactions near sensitive military installations.
CFIUS reviews the purchase or lease by/to a foreign person of real estate in the US that is close to military installation or sensitive US government facility or property.
Monitors if the foreign person can collect intelligence on activities being conducted at the location or can expose the national security activities to foreign surveillance.
DoD, as a member of CFIUS, conducted an assessment re its military installations.
Proposed Rule
Expands CFIUS’s jurisdiction to include those within a one-mile radius around 40 additional military installations, 100 mile radius and 19 additional military installations.
Also expands the CFIUS’s jurisdiction over real estate transactions between 1 mile and 100 miles around eight military installations that are already listed in the regulations.
Updates names of 14 military installations, and the locations of 7 military installations already listed in regulations to better assist the public in identifying the relevant sites.
Comment Period
Comments accepted for 30 days following the NPRM’s publication in federal register.
Jul. 19, 2024 Fed Reg Proposal
On Jul. 19, 2024, US Treasury published rule in federal register, comments Aug. 19.
Nov. 2024 US Treasury Final Rule
On Nov. 1, 2024, US Treasury, as chair of CFIUS, issued a final rule expanding CFIUS coverage of real estate transactions around more than 60 military installations.
Amended military installation definition at 31 CFR 802.227, adding 59 military installations to list in Appendix A, expanding CFIUS jurisdiction over 8 already listed.
Technical changes implement Defense production act S. 721 real estate, 50 USC 4565.
Final rule will be effective in 30 days after pending publication in the federal register.
Nov. 7, 2024 Fed Reg Final Rule
On Nov. 7, 2024, US Treasury published final rule in federal register, effective Dec. 9.
Nov. 18, 2024 Fed Reg Correction
On Nov. 18, 2024, US Treasury issued correction of final rule in the federal register.
Corrected page 88133, second column, in § 802.104 (d), third line; Nov. 8 to Nov. 7.
