Treasury Proposes Rule to Expand CFIUS Coverage Near Military Installations

The Treasury Department proposed a rule to expand the jurisdiction of the Committee on Foreign Investment in the United States ("CFIUS") to include transactions conducted by foreign persons involved in real estate transactions near military installations in the United States.

The proposed rule would:

• expand CFIUS jurisdiction over real estate transactions to include those within a one-mile radius around an additional 40 military installations;
• expand CFIUS jurisdiction over real estate transactions to include within an 100-mile radius around an additional 19 military installations;
• expand CFIUS jurisdiction over real estate transactions to include those between 1 mile and 100 miles around eight military installations already listed in the regulations;
• update the names of 14 installations already listed in the regulations; and
• update the locations of seven installations already listed in the regulations for accuracy.

CFIUS' jurisdiction over real estate transactions is provided by Congress in the Foreign Investment Risk Review Modernization Act of 2018 ("FIRRMA"). CFIUS can "review the purchase or lease by, or concession to, a foreign person of real estate in the United States that is in close proximity to a military installation or another facility or property of the United States Government that is sensitive for reasons relating to national security." The proposed rule is the result of a recent comprehensive assessment conducted by the Department of Defense.

Comments are due 30 days following publication in the Federal Register.