Louis Lehot and Christopher Swift Discuss New Outbound Investment Regime Under Review

Foley & Lardner LLP Partners Louis Lehot and Christopher Swift are quoted in the IFLR article, “Reverse CFIUS: US gets a grip on outbound investment,” discussing the new outbound investment regime U.S. regulatory agencies and the Biden administration are mulling which would subject some types of capital, goods, and services exports to certain countries to stronger restrictions and disclosure requirements.

Swift said it is important to think about the pending “reverse CFIUS,” which reference the existing Committee on Foreign Investment in the U.S., from “a national security perspective, rather than a business perspective.”

“When you look at fundamental security exceptions, it’s going to be the sanctioned countries, the countries that are state sponsors of terrorism, but also the BRICS and the Middle East, especially the United Arab Emirates, Saudi Arabia, and Qatar for geopolitical reasons,” Swift said. “Some of these have also been a little friendly with Putin lately, and the Biden administration doesn’t like that.”

Louis noted the importance of the Chinese consumer market for products to really go from “garage to global” and explained the impact of the discussed outbound investment regime may have on what he says is the best way to gain exposure to the Chinese: partnering with a local entity to create a joint venture.

“That means we’ve got to get our technology into there from Silicon Valley, which is controlled by export regimes. Now, when we will want to put money into China and other countries, it will be reviewed too,” Lehot added.

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