Treasury Department Announces Fast-Track Pilot Program for Foreign Investors

The U.S. Department of the Treasury, which chairs the Committee on Foreign Investment in the United States (CFIUS), announced on May 8, 2025, its intent to launch a fast-track pilot program for known foreign investors. The goal of the pilot program is to increase efficiencies in the foreign investment review process pursuant to President Donald Trump's directive in the America First Investment Policy.

Background Relating to Foreign Investment Review Process

CFIUS is an interagency regulatory body that reviews potential acquisitions of and investments in U.S. businesses by foreign persons to evaluate any impact on U.S. national security. CFIUS conducts its review pursuant to Section 721 of the Defense Production Act of 1950, as amended by the Foreign Investment Risk Review Modernization Act (FIRRMA). CFIUS reviews foreign investment transactions to assess any potential threat to U.S. national security interests, the vulnerabilities of the U.S. business and viability of mitigation conditions. 

The CFIUS notification process is largely voluntary, and transaction parties can submit a filing to receive approval from CFIUS, which is the only "safeharbor" from subsequent review except in certain limited circumstances. However, certain transactions have a mandatory pre-closing filing requirement, including significant foreign government investments in U.S. businesses involved in critical technologies, critical infrastructure, or maintaining or collecting personally identifiable information (PII) of U.S. nationals, as well as private controlling or noncontrolling foreign investments in U.S. businesses that produce, design, test, manufacture, fabricate or develop one or more critical technologies for which a U.S. export authorization would be required to transfer to the foreign investor if the investor also acquires certain access rights.

The CFIUS review process may take anywhere from 30 calendar days for short-form declaration filings up to a few months for full notice filings. The long timeline for CFIUS review, particularly for notice filings, has been a consistent concern for transaction parties due to the uncertainty surrounding both timing of the review against the transaction life cycle and possible mitigation terms required to close a deal.

America First Investment Policy

The Trump Administration has indicated that it is prioritizing streamlining the CFIUS review process to facilitate greater investment into the U.S. On Feb. 21, 2025, President Trump issued a National Security Presidential Memorandum titled "America First Investment Policy," which outlined the Trump Administration's views on the U.S. inbound and outbound investment review regimes. (For a full summary, see Holland & Knight's previous alert, "America First Investment Policy," Feb. 28, 2025.)

A primary objective outlined in the Memorandum was to maintain an open investment environment in the U.S. and facilitate foreign investment into the U.S. from allies and partners by reducing regulatory burdens. One of the considered measures included the creation of a fast-track process to facilitate investment in U.S. businesses in advanced technology and other important areas from specified allied and partner countries. At the same time, the Memorandum identified such investors' "verifiable distance and independence" from China and other foreign adversaries as a significant factor in assessing the risk of the investment transaction under review.

The announced pilot program appears to address the fast-track review discussed in the Memorandum. The statement was issued right after the announced trade agreement between the U.S. and United Kingdom, one of the closest U.S. allies and top investors, promising increased U.K. investment in the U.S., It also comes just ahead of President Trump's visit to the Gulf nations of Saudi Arabia, United Arab Emirates and Qatar, which have committed to investing billions of dollars in U.S. businesses and infrastructure, including artificial intelligence, and advocated for the reduction of perceived burdensome administrative requirements. The announcement of the pilot program also preceded an agreement between the U.S. and China to suspend their respective tariffs for 90 days pending continued negotiations – the U.S. would reduce the tariff on Chinese imports from 145 percent to 30 percent, and China would lower its import duty on American goods from 125 percent to 10 percent.

Pilot Program for Fast-Track Foreign Investment Review

The fast-track program announced by the Treasury Department seeks to launch a "Known Investors" portal, where CFIUS can collect information from foreign investors in advance of a filing. The data collected from the Known Investors portal will be used to create a database of foreign investors in order to encourage greater investment in U.S. businesses from allied and partner countries. Though any statutory timelines will remain in effect, this database may shorten some of the optional extensions in the CFIUS review process by consolidating information on foreign investors involved in previously cleared transactions.

The program is focused on making the CFIUS process more efficient to "facilitate greater investment from allies and partners where there is verifiable distance and independence from foreign adversaries or threat actors."

The Treasury Department will initially conduct a pilot of this process and build from it over time.

For more information on the implications of this proposed pilot program, please contact the authors or another member of Holland & Knight's International Trade Group.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.