Senate panel clears bill to bolster probes of foreign investment deals

The Senate Banking Committee on Tuesday approved a bill to give a secretive federal agency expanded powers to probe foreign acquisitions of American businesses that could pose threats to national security.

The panel voted unanimously to advance a bill to bolster the authority of the Committee on Foreign Investment in the U.S. (CFIUS), a panel housed by the Treasury Department that reviews attempts by foreign businesses to control U.S. firms.

The bill, introduced by Sens. John Cornyn (R-Texas) and Dianne Feinstein (D-Calif.), seeks to widen the types of business deals subject to CFIUS approval and mirrors a measure introduced by Rep. Robert Pittenger (R-N.C.) in the House.

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The House Financial Services Committee had also been reviewing its version of the bill Tuesday and is expected to vote to clear the measure later this afternoon. 

Congress could pass the bill with broad bipartisan support, after addressing concerns from U.S. businesses that say the bill could create unnecessary and redundant restrictions.

The push to boost the powers of CFIUS comes as President Trump and Congress seek to foil attempts by China to dominate key technology industries essential to U.S. defense and infrastructure.

The Banking Committee cleared the bill after scrapping a provision that would subject joint ventures between U.S. and foreign businesses to CFIUS review.

The amended bill would create an interagency process for identifying critical emerging technologies and intellectual property not yet subject to export control. The changes would also set up another interagency process led by the Commerce Department focused on the ways sensitive material can end up in foreign hands.

Banking panel members also approved an amendment to rebuke Trump’s efforts to loosen sanctions on Chinese telecom firm ZTE, which the intelligence community and trade regulators consider a threat to U.S. national security.

The committee amended the bill on a 23-2 vote to block Trump from easing sanctions on ZTE without first certifying to Congress that the company is complying with U.S. law. The Commerce Department had barred U.S. businesses from selling to ZTE last month after it found that the firm lied to investigators probing its business with Iran and North Korea, violating U.S. sanctions on the countries.

Trump had floated easing national security-based sanctions on ZTE amid trade talks with China, a move that invoked bipartisan concern in Congress.

The president tweeted earlier this month that he wants to come up with a way to help the company in order to save Chinese jobs. Lawmakers urged Trump to reconsider aiding a firm considered to be a national security threat to boost the economy of a major geopolitical rival.