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Recent public announcements indicate that the Committee on Foreign Investment in the United States (CFIUS) (controlled effectively by the US Treasury, shown in our illustration) was preparing to recommend that President Obama disapprove an attempt by a Chinese company – Northwest Non Ferrous International Investment Company – to invest in a US mining company, because the mining facilities are located near certain US military installations.
The Chinese company apparently withdrew its application to CFIUS on December 21, 2009, thus forestalling a referral to the president.
If the president had ultimately rejected the transaction, it would have marked only the second time since the creation of the CFIUS review process more than 20 years ago that a president had taken such action. (The first presidential rejection occurred in 1990 by President George H.W. Bush and also involved a Chinese investment.)
CFIUS’s counterpart in Australia, the Foreign Investment Review Board, has also in the past year objected to a number of Chinese investments based on proximity to defense installations.
Mondaq has a very full and well-researched article on the subject.
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