What is the Committee on Foreign Investment in the United States (CFIUS)?

The Committee on Foreign Investment in the United States is an interagency committee chaired by the Secretary of the Treasury to review proposed mergers, acquisitions or takeovers of US persons by foreign interests under section 721 of the Defense Production Act.  CFIUS is a voluntary process that affords an opportunity for foreign  and US persons and organizations considering entering into a covered transaction to submit the transaction for review by CFIUS to assess the impact of the transaction on US national security.  Note that CFIUS and  DCSA FOCI reviews are conducted in parallel but separate processes.

Who comprises the Government Security Committee?

The Government Security Committee is composed of cleared officers/directors and the Outside Directors who are also directors, and who hold personnel security clearances at the level of the company's facility clearance.

What is the role of the Government Security committee (GSC)?

The Government Security Committee ensures the organization maintains policies and procedures necessary to safeguard classified information and CUI and that violations of those policies and procedures are promptly investigated and reported to the appropriate authority when it has been determined that a violation has occurred. The GSC should also ensure that the organization complies with US export control laws and regulations and does not take action contrary to performance on classified contracts.

Who can serve as a nominee for outside director, proxy holder or trustee?

The nominee must be a US citizen, residing in the US, who can exercise management prerogatives in a way that ensures that the foreign owner can be effectively insulated from the company and have personnel security clearance consistent with the level of the facility clearance.        

Can a company be colocated with its foreign parent organization or one of its affiliates and still be cleared through the auspices of a PA, VTA, OR SSA?

No.  DCSA will determine when a company is collocated, and if a company is located within close proximity to its foreign parent or  affiliate a Facilities Location Plan (FLP) must be approved by DCSA in advance.         

When can a board resolution be used to mitigate FOCI?

A board resolution can be implemented when a foreign entity does not own voting stock sufficient to elect directors or is not otherwise entitled to representation to the company's board of directors.      

What is the role of the FSO?

The FSO serves as the principal advisor to the organization's Government Security Committee concerning the safeguarding of classified information. The FSO's responsibility includes the operational oversight of the company's compliance with National Industrial Security Program requirements.

What is a technology control officer (TCO) and must one be appointed?

The TCO is the principal advisor to the organization's Government Security Committee for the protection of controlled unclassified information (CIU), and proprietary technology and data subject to regulatory or contractual control by the US Government.

Can officers and/or directors of the foreign parent organization or one of its affiliates also serve as an officer and/or director of the cleared company?

No.

Can non-US citizens serve as key management personnel at the company?

No.

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