FIRRMA

The Foreign Investment Risk Review Modernization Act of 2018 was enacted as part of the John S. McCain National Defense Authorization Act for Fiscal Year 2019, signed by President Donald Trump on August 13, 2018. FIRRMA represented the most significant overhaul of the U.S. foreign investment review regime since the Exon-Florio Amendment of 1988, substantially expanding the jurisdiction of the Committee on Foreign Investment in the United States (CFIUS), an interagency body chaired by the Treasury Secretary.

Before FIRRMA, CFIUS could generally only review transactions resulting in foreign control of a U.S. business. FIRRMA broadened this in several key ways:

• Non-controlling investments: CFIUS gained authority to review certain non-controlling foreign investments in U.S. businesses involved in critical technologies, critical infrastructure, or that collect sensitive personal data of U.S. citizens (so-called "TID U.S. businesses").
• Real estate: Jurisdiction was extended to certain purchases or leases of real estate near sensitive U.S. government facilities, including military installations and airports.
• Mandatory filings: FIRRMA introduced mandatory declarations for certain covered transactions, replacing the previously voluntary-only notification system.
• Expanded review timelines: The initial review period was extended from 30 to 45 days, with provisions for additional investigation phases.
• Export controls coordination: FIRRMA was paired with the Export Control Reform Act (ECRA) of 2018 to address emerging and foundational technologies.

The legislation was widely understood as a response to concerns about Chinese acquisitions of U.S. technology firms, particularly in semiconductors, artificial intelligence, biotechnology, and robotics. Treasury issued final implementing regulations in January 2020, which took effect February 13, 2020.

FIRRMA has materially reshaped global M&A practice. Notable post-FIRRMA actions include the forced divestiture proceedings against ByteDance regarding TikTok and heightened scrutiny of Chinese-backed venture capital flows into U.S. startups. The law is frequently cited in debates over economic statecraft, technology decoupling, and the securitization of investment policy.