WASHINGTON Oct 3 The investigative arm of
Congress has agreed to examine whether a panel that oversees
foreign investment in the United States has the legal powers it
needs to keep up with efforts by state-owned firms in Russia and
China to buy strategic U.S. companies.
The Government Accountability Office said in a letter to
lawmakers released on Monday that it would begin the review in
about four months once the staff with the needed expertise were
cleared of other duties. The letter was dated Sept. 30.
The study is being initiated in response to a request on
Sept. 15 by 16 members of Congress, who voiced concern that
legislation governing the Committee on Foreign Investment in the
United States (CFIUS) has not been updated enough to ensure the
panel can do its job effectively.
"Now is an opportune time for GAO to review what has worked
well, and where CFIUS authorities may need to be expanded,
especially given the rise in state-owned enterprises and
state-controlled enterprises from China and Russia, among other
designated countries," the lawmakers said in their letter.
The letter from the lawmakers noted that foreign investment
oversight began as an executive order from the president and was
only codified by Congress in response to concerns about foreign
ownership of defense industries and ports.
The letter said lawmakers were now concerned about recent
investments in the telecommunications, media and agriculture
sectors that raised questions about "the degree to which foreign
ownership ... may pose a strategic rather than overt national
It noted that Chinese companies designated by Beijing as
"state champions" often benefited from illegal subsidies in
order to gain strategic access to markets like the United
The letter said Congress had raised concerns about China
National Chemical Corp's (ChemChina) planned $43
billion acquisition of Swiss agricultural seed and pesticides
provider Syngenta AG and to Dalian Wanda Group's bid
for major American movie studios like Legendary Entertainment
and Paramount Studios.
It said the media acquisitions were particularly concerning
because of "China's efforts to censor topics and exert
propaganda controls on American media."
"These examples raise serious security questions about what
authority CFIUS currently has, or may need to be added, to
address these concerns," the lawmakers said in their letter.
(Reporting by David Alexander; Editing by Diane Craft)