On January 15, 2025, the European Commission (the “EC”) published a recommendation (the “Recommendation”)[1] addressed to all EU Member States urging them to review “outbound investments” in certain critical technologies sectors, notably semiconductors, artificial intelligence (“AI”), and quantum technologies.
Continue Reading The EU Commission Urges Member States to Review Outbound InvestmentsOFAC Expands Sanctions against Russian Energy Sector
On January 10, 2025, the U.S. Department of the Treasury, Office of Foreign Assets Control (“OFAC”) issued sweeping new sanctions targeting Russia’s energy sector, including the imposition of a new petroleum services ban, expanded secondary sanctions authority, and designations of certain Russian oil producers, insurance providers, and more than 180 so-called “shadow fleet” vessels. Until this time, U.S. sanctions specific to the Russian energy sector generally were limited to a ban on maritime services for oil and petroleum products sold at or below the relevant price caps, designations of specific projects, traders, or vessels, and certain pre-2022 targeted sectoral sanctions and secondary sanctions authorities.
Continue Reading OFAC Expands Sanctions against Russian Energy SectorCommerce Issues Final ICTS Rule; Takes Steps to Implement the Program
By Chase D. Kaniecki, Samuel H. Chang & Ryan Brown on
On December 5, 2024, the U.S. Department of Commerce, Bureau of Industry and Security (“BIS”) issued a final rule (the “Final Rule”) implementing the procedures BIS will follow when reviewing information and communications technology (“ICTS”) transactions that may pose a risk to U.S. national security pursuant to Executive Order (E.O.) 13873.[1] In particular, the Final Rule authorizes the Secretary of Commerce (the “Secretary”) (or the Secretary’s designee, e.g., the Under Secretary of Commerce for Industry and Security) to review, prohibit, or impose mitigation measures on certain types of transactions (“Covered ICTS Transactions”) that involve ICTS designed, developed, manufactured, or supplied by persons owned by, controlled by, or subject to the jurisdiction or direction of a foreign adversary and that pose an undue or unacceptable risk to U.S. national security. We consider each of these concepts below, after which we discuss the review, prohibition, and mitigation processes associated with covered transactions.
Continue Reading Commerce Issues Final ICTS Rule; Takes Steps to Implement the ProgramPresident Biden Issues Order Blocking the Proposed Acquisition of United States Steel Corporation by Nippon Steel Corporation, and The Parties Sue for a New Review
On January 3, 2025, President Biden issued an executive order (the “Order”) prohibiting the proposed acquisition of United States Steel Corporation (“U.S. Steel”) by Japan-based Nippon Steel Corporation (“Nippon Steel”) on the basis that the transaction could threaten to impair the national security of the United States (the “Order”). The Committee on Foreign Investment in the United States (“CFIUS”) referred the transaction to the President on December 23, 2024.
Continue Reading President Biden Issues Order Blocking the Proposed Acquisition of United States Steel Corporation by Nippon Steel Corporation, and The Parties Sue for a New ReviewYou’re Invited: U.S. Outbound Investment Security Program Webinar on January 7, 2025
By Cleary Gottlieb on
The Treasury Department has released its “Final Rule” which will impose on U.S. persons notification requirements and restrictions for transactions involving entities engaged in activities relating to semiconductors and microelectronics, quantum information technologies, and artificial intelligence systems in “countries of concern.” The rule will go into effect on January 2, 2025.
Continue Reading You’re Invited: U.S. Outbound Investment Security Program Webinar on January 7, 2025You’re Invited: U.S. Outbound Investment Security Program Webinar on December 16, 2024
By Cleary Gottlieb on
The Treasury Department has released its “Final Rule” which will impose on U.S. persons notification requirements and restrictions for transactions involving entities engaged in activities relating to semiconductors and microelectronics, quantum information technologies, and artificial intelligence systems in “countries of concern.” The rule will go into effect on January 2, 2025.
Continue Reading You’re Invited: U.S. Outbound Investment Security Program Webinar on December 16, 2024Sanctions on Russian Securities Infrastructure Create Additional Hurdles to Divesting from Russia
The Russian financial services sector remains a key target of U.S., UK, and EU sanctions. As discussed below, a number of recent such sanctions against Russia and countermeasures by the Russian government have further complicated efforts for investors seeking to divest listed securities from Russia.
Continue Reading Sanctions on Russian Securities Infrastructure Create Additional Hurdles to Divesting from RussiaTreasury Issues Final Rule Enhancing CFIUS Mitigation and Enforcement Authority
By Chase D. Kaniecki & Ryan Brown on
On November 18, 2024, the U.S. Department of the Treasury (“Treasury”), as Chair of the Committee on Foreign Investment in the United States (“CFIUS”), issued a final rule (the “Final Rule”) that enhances CFIUS’s mitigation and enforcement authority. The Final Rule, which will take effect December 26, 2024 (30 days after the Final Rule was published in the Federal Register), represents a continued evolution of CFIUS’s approach to monitoring, compliance, and enforcement and largely is consistent with the Notice of Proposed Rulemaking (the “Proposed Rule”) issued on April 11, 2024, which we wrote about here. We previously wrote about the first-ever 2022 CFIUS Enforcement and Penalty Guidelines here.
Continue Reading Treasury Issues Final Rule Enhancing CFIUS Mitigation and Enforcement AuthorityOFAC Sanctions Gazprombank, Continues to Target Russian Financial Sector and Foreign Financial Institutions
On November 21, 2024, the U.S. Department of the Treasury, Office of Foreign Assets Control (“OFAC”) designated additional entities operating in the Russian financial services sector, including Gazprombank Joint Stock Company (“Gazprombank”), the largest and, until November 21, most significant remaining non-sanctioned Russian bank that has served as the primary conduit for processing payments for Russian gas sold to third countries since March 2022. Specifically, OFAC designated Gazprombank pursuant to Executive Order 14024 (“E.O. 14024”) for operating or having operated in the financial services sector of the Russian Federation economy, and noted that Gazprombank had served as a “conduit for Russia to purchase military materiel,” and also was used by the Russian government to pay military personnel and their families.
Continue Reading OFAC Sanctions Gazprombank, Continues to Target Russian Financial Sector and Foreign Financial InstitutionsEU FDI: State Of The Union (2024)
On October 17, 2024, the European Commission (“Commission“) published its forth annual report on the screening of foreign direct investments (“FDI“) into the Union (the “Report“), following previous editions published in October 2023, September 2022 and November 2021. Notable findings include the follow:
Continue Reading EU FDI: State Of The Union (2024)