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Aerospace & Defense Insights I Biden Administration executive order on outbound investment screening

01 November 2023

Through Aerospace & Defense Insights, we share with you the top legal and political issues affecting the aerospace and defense (A&D) industry. Our A&D industry team monitors the latest developments to help our clients stay in front of issues before they become problems, and seize opportunities in a timely manner.

The Biden Administration has issued its long-awaited outbound investment screening executive order ("EO"), which broadly describes the scope of the program and directs the U.S. Department of the Treasury (“Treasury”) to issue implementing regulations. Alongside the EO, Treasury issued an Advance Notice of Proposed Rulemaking (“ANPRM”) that details the potential scope and implementation plans and requests public comment on various aspects of the outbound investment screening program (“outbound investment program”) in order to inform the final program. Once Treasury issues final implementing regulations, the outbound investment program will impose on U.S. persons notification requirements for certain transactions and will outright prohibit U.S. persons from engaging in other transactions—in both cases related to certain Chinese parties that are engaged in subsets of three advanced technology sectors. More than 60 stakeholders have submitted public comments on the ANPRM, and our team is reviewing these comments in order to analyze how they might shape the final implementing regulations.

Authored by Timothy Bergreen, Brian Curran, Anne Salladin, Kelly Ann Shaw, Ari Fridman, Zach Alvarez, Hao-Kai Pai, Tyra Walker, Lourdes Catrain, Stephanie Seeuws, and Alp Ozturk.