National Security Foreign Investment Reform and Strengthened Transparency Act of 2007

The National Security Foreign Investment Reform and Strengthened Transparency Act of 2007 was written less than one year after the Bush administration received criticism for allowing Dubai Ports World (a United Arab Emirates firm) to manage security at U.S. ports. The bill would direct the executive branch to review business transactions to determine their affect on national security. On February 28, 2007, the House passed the bill 423-0.

House passes bill
On February 28, 2007, the House passed the bill, sponsored by Rep. Carolyn Maloney (D-N.Y.), 423-0.

Prior to the vote, a motion to recommit the bill with instructions (to prevent a vote) failed 193-229.

Specifically, the bill would (if passed by the Senate and signed by President Bush) direct the executive branch to do the following :

President: Would be directed to investigate the effects of certain business transactions on national security and to take necessary steps to protect national security. Although prior law had given the president the authority to evaluate transactions at his discretion, the bill would create specific factors for evaluation of a transaction. Director of National Intelligence: Would be ordered to conduct an analysis of any threat to national security posed by such transactions.

Secretary of Treasury: Would be charged with studying investments in critical U.S. infrastructure or businesses related to national security by foreign governments and others that comply with boycotts of Israel or which do not ban foreign terrorist organizations in particular. In instances where the president moved to scrutinize a transaction further, the newly-formed Committee on Foreign Investment in the United States (CFIUS) would review the transaction to determine its effects on national security. Any review or investigation would need to be approved by a majority roll call vote of CFIUS members and be signed by the Secretaries of Treasury, Homeland Security and Commerce. A transaction could be withdrawn from a review if a written request from any party to the transaction was approved in writing by the chair and vice chair of CFIUS, but discussion on the deal could continue. The president could also return to a previously reviewed transaction if a party submitted false or misleading material information to CFIUS relating to the review or investigation of if any party to the deal breached a mitigation agreement (if the breach was considered intentional).

The cost of the bill was estimated at $10 million from 2007 to 2010.