[Federal Register Volume 85, Number 12 (Friday, January 17, 2020)]
[Rules and Regulations]
[Pages 3158-3188]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-00187]
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Vol. 85
Friday,
No. 12
January 17, 2020
Part III
Department of the Treasury
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Office of Investment Security
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31 CFR Part 802
Provisions Pertaining to Certain Transactions by Foreign Persons
Involving Real Estate in the United States; Final Rule
Federal Register / Vol. 85, No. 12 / Friday, January 17, 2020 / Rules
and Regulations
[[Page 3158]]
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DEPARTMENT OF THE TREASURY
Office of Investment Security
31 CFR Part 802
RIN 1505-AC63
Provisions Pertaining to Certain Transactions by Foreign Persons
Involving Real Estate in the United States
AGENCY: Office of Investment Security, Department of the Treasury.
ACTION: Final rule; interim rule with request for comments.
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SUMMARY: The final rule establishes regulations to implement the
provisions relating to real estate transactions in section 721 of the
Defense Production Act of 1950, as amended by the Foreign Investment
Risk Review Modernization Act of 2018. This rule sets forth the scope
of, and process and procedures relating to, the national security
review by the Committee on Foreign Investment in the United States of
certain transactions involving the purchase or lease by, or concession
to, a foreign person of certain real estate in the United States. The
interim rule also adds a new definition for the term ``principal place
of business,'' and the Department of the Treasury is seeking comments
on this definition.
DATES:
Effective date: The final rule is effective on February 13, 2020.
The interim rule adding Sec. 802.232 is effective on February 13,
2020.
Comment date: The Department of the Treasury (Treasury Department)
is seeking written comments from the public on the definition of
``principal place of business'' found at Sec. 802.232, which must be
received by February 18, 2020.
ADDRESSES: Written comments on Sec. 802.232 may be submitted through
one of two methods:
Electronic Submission: Comments may be submitted
electronically through the Federal government eRulemaking portal at
https://www.regulations.gov. Electronic submission of comments allows
the commenter maximum time to prepare and submit a comment, ensures
timely receipt, and enables the Treasury Department to make the
comments available to the public.
Mail: Send to U.S. Department of the Treasury, Attention:
Laura Black, Director of Investment Security Policy and International
Relations, 1500 Pennsylvania Avenue NW, Washington, DC 20220.
We encourage comments to be submitted via https://www.regulations.gov. Please submit comments only and include your name
and company name (if any), and cite ``Provisions Pertaining to Certain
Transactions by Foreign Persons Involving Real Estate in the United
States'' in all correspondence. In general, the Treasury Department
will post all comments to https://www.regulations.gov without change,
including any business or personal information provided, such as names,
addresses, email addresses, or telephone numbers. All comments
received, including attachments and other supporting material, will be
part of the public record and subject to public disclosure. You should
only submit information that you wish to make publicly available.
FOR FURTHER INFORMATION CONTACT: Laura Black, Director of Investment
Security Policy and International Relations; Meena R. Sharma, Deputy
Director of Investment Security Policy and International Relations; or
James Harris, Senior Policy Advisor, at U.S. Department of the
Treasury, 1500 Pennsylvania Avenue NW, Washington, DC 20220; telephone:
(202) 622-3425; email: [email protected].
SUPPLEMENTARY INFORMATION:
I. Background
A. The Statute and Proposed Rule
On August 13, 2018, the Foreign Investment Risk Review
Modernization Act of 2018 (FIRRMA), Subtitle A of Title XVII of Public
Law 115-232, 132 Stat. 2173, became law. FIRRMA amended and updated
section 721 (section 721) of the Defense Production Act of 1950 (DPA),
which delineates the authorities and jurisdiction of the Committee on
Foreign Investment in the United States (CFIUS or the Committee).
FIRRMA maintains the Committee's jurisdiction over any transaction
which could result in foreign control of any U.S. business, and it
broadens the authorities of the President and CFIUS under section 721
to review and to take action to address any national security concerns
arising from certain non-controlling investments and real estate
transactions. Additionally, FIRRMA modernizes CFIUS's processes to
better enable timely and effective reviews of transactions falling
under its jurisdiction. In FIRRMA, Congress acknowledged the important
role of foreign investment in the U.S. economy and reaffirmed the
United States' open investment policy, consistent with the protection
of national security. See section 1702(b) of FIRRMA.
FIRRMA requires the issuance of regulations implementing its
provisions. In Executive Order 13456, 73 FR 4677 (January 23, 2008),
the President directs the Secretary of the Treasury to issue
regulations implementing section 721. On September 24, 2019, the
Treasury Department published two proposed rules to implement
provisions of FIRRMA. See 84 FR 50174 (September 24, 2019); 84 FR 50214
(September 24, 2019). (The Office of the Federal Register made versions
available for public inspection on September 17, 2019.) Public comments
on the proposed rules were due by October 17, 2019.
The proposed rule at 84 FR 50214 proposed establishing new
regulations at part 802 of title 31 of the Code of Federal Regulations
(CFR). These regulations specifically relate to CFIUS's authorities and
the process and procedures to review transactions involving the
purchase or lease by, or concession to, a foreign person of certain
real estate in the United States. Further explanation of FIRRMA and the
proposed provisions can be found in the proposed rule at 84 FR 50214;
changes to the proposed rule are explained in further detail below.
The proposed rule at 84 FR 50174, which proposed amendments to the
CFIUS regulations codified at part 800 of title 31 of the CFR, is being
finalized in a separate rulemaking (the part 800 rule). The part 800
rule specifically relates to CFIUS's authorities and the process and
procedures to review: (1) A merger, acquisition, or takeover by or with
a foreign person that could result in foreign control of a U.S.
business; (2) a non-controlling ``other investment'' in a U.S. business
that affords a foreign person specified access to information in the
possession of, rights in, or involvement in the substantive
decisionmaking of certain U.S. businesses related to critical
technologies, critical infrastructure, or sensitive personal data
(which the part 800 rule and this preamble describe as ``covered
investments''); (3) any change in a foreign person's rights if such
change could result in foreign control of a U.S. business or a covered
investment; and (4) any other transaction, transfer, agreement, or
arrangement, the structure of which is designed or intended to evade or
circumvent the application of section 721.
FIRRMA also authorizes the Committee to assess and collect fees
with respect to covered real estate transactions for which a written
notice is filed. The Treasury Department will publish a separate
proposed rule implementing the Committee's fee authority at a later
date.
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B. Structure of FIRRMA Rulemaking and This Rule
Consistent with CFIUS processes generally, this rule reflects
extensive consultation with CFIUS member agencies, as well as other
relevant U.S. Government agencies.
This action finalizes the provisions for the new part 802 of title
31 of the CFR. This rule focuses on the Committee's expanded
jurisdiction over certain types of real estate transactions.
Accordingly, this rule implements one part of the overall scope of
CFIUS's jurisdiction under section 721, as amended by FIRRMA. There are
additional provisions in FIRRMA that are the subject of the part 800
rule. As explained in the preamble to the proposed rule, the Treasury
Department is creating a new part (part 802) because it has determined
that the technical and procedural aspects of CFIUS's review of
transactions involving real estate are sufficiently distinct from those
related to control transactions and certain non-controlling investments
to warrant separate rulemaking. Nevertheless, this rule incorporates
certain features and relevant provisions from part 800, which should be
familiar to parties that have filed with CFIUS in the past.
There are additional provisions in FIRRMA that are the subject of
the part 800 rule. In particular, a transaction that could result in
control of a U.S. business by a foreign person is subject to part 800,
and is not a covered real estate transaction under this rule.
Additionally, CFIUS's new authority over covered investments in certain
U.S. businesses, as provided by FIRRMA, is subject to part 800 (under
the concurrent rulemaking).
The Treasury Department recognizes that FIRRMA's expansion of the
Committee's jurisdiction over certain real estate transactions may
impact parties who have not traditionally had reason to file with
CFIUS. This rule therefore seeks to provide clarity to the business and
investment communities with respect to the types of real estate
transactions that are covered by the new authority under FIRRMA. In
particular, this rule implements CFIUS's new real estate jurisdiction
following the approach described in the proposed rule and is generally
structured around specific sites--certain airports, maritime ports, and
military installations--and specific geographic areas in or around
those sites. (While the rule allows that ``other facilities or
properties of the U.S. Government'' may in the future be included in
the list of sites identified in the rule, none has been included at
this time.) Given the specificity of certain provisions of this rule,
the Treasury Department anticipates that it will periodically review,
and when necessary, amend the regulations to address changes in the
national security landscape.
In response to public comments, this action also implements an
interim rule with respect to the definition of ``principal place of
business'' found at Sec. 802.232, and the Treasury Department is
seeking public comment on this definition.
II. Overview of Comments on the Proposed Rule
During the public comment period, the Treasury Department received
a number of written submissions on the proposed rule reflecting a wide
range of views. All comments received by the end of the comment period
are available on the public rulemaking docket at https://www.regulations.gov. Additionally, the Treasury Department hosted a
public teleconference call to discuss the proposed rule on September
27, 2019, and a summary is available on the Committee's section of the
Treasury Department website.
The Treasury Department considered each comment submitted on the
proposed rule. Some of the comments were general in nature, for
example, supporting the Treasury Department's efforts and approach with
respect to aspects of the proposed rule. Other commenters noted the
potential impact of the proposed rule on certain types of real estate
and related transactions. The Treasury Department recognizes the vital
importance of foreign investment to the U.S. economy, including
investments in real estate. The Treasury Department drafted the
proposed rule, and made revisions in finalizing the rule, to protect
U.S. national security from the risk posed by certain foreign
investment while at the same time maintaining the open foreign
investment policy of the United States. The Treasury Department has
determined that the specificity provided in the rule--with respect to,
for example, identification of specific sites and relevant distances--
provides clarity to the business and investment communities with
respect to the types of real estate transactions that are covered by
the Committee's new authority under FIRRMA. The Treasury Department
will evaluate implementation of the rule and will provide, as
appropriate, additional information to assist the public.
Some commenters requested clarification of specific provisions.
Where appropriate, the Treasury Department provided additional
clarification in the text of the rule and included more illustrative
examples. Some commenters, however, requested greater specificity than
is appropriate in regulations of general applicability or revisions
that conflict with the Committee's statutory authority under FIRRMA.
The section-by-section analysis below includes responses to comments.
Further edits were made to the rule for consistency and clarity.
In addition to comments on the substance of the rule, several
commenters requested an extension of the public comment period. The
Treasury Department did not extend the public comment period in light
of the fixed effective date established by FIRRMA. The Treasury
Department anticipates that it will periodically review, and as
necessary, make changes to the regulations (and any appendices),
consistent with applicable law, and when appropriate, will provide the
public an opportunity to comment.
III. Discussion of the Rule
A. Relationship With Part 800
Before addressing individual sections of the rule raised in the
comments or otherwise revised from the proposed rule, it is important
to address the relationship between this rule and the part 800 rule,
which as noted is being issued concurrently with this rule.
The structure of the part 802 regulations is similar to the
regulations at part 800, which are being updated and replaced through
the concurrent rulemaking. Parties familiar with the part 800
regulations should find that this rule takes a comparable approach with
respect to defining key terms, describing transactions that are covered
and not covered under the rule, listing the information requirements
for a filing to be complete, and setting forth the Committee's process
and procedures, among other things. While differences exist between
this rule and the part 800 rule, the scope and overall approach taken
by the Committee to evaluating, concluding action on, or taking action
on a transaction is consistent with part 800 and section 721.
Some commenters raised questions regarding specific sections of the
rule that suggested additional clarity with respect to the relation
between these two parts may be helpful. This rule is focused on certain
types of real estate transactions involving a foreign person. Parties
should be aware that certain transactions involving real estate could
be covered transactions under the part 800 rule. For example,
transactions that could result in foreign control or certain non-
controlling investments by a foreign
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person in an entity engaged in interstate commerce in the United States
and that owns real estate could be subject to part 800 instead of part
802. In some cases, a collection of assets that includes real estate
may constitute a U.S. business under part 800. Additionally, a long-
term lease or concession arrangement under which a lessee makes
substantially all business decisions concerning the operation of a
leased entity, as if it were the owner, could be subject to part 800
instead of part 802. In order to comprehensively understand the
transactions that could fall within the scope of this rule, in contrast
to the transactions that could fall within the scope of the part 800
rule, the public is encouraged to be aware of the separate and
concurrent rulemaking on part 800.
Finally, although FIRRMA introduces the term ``close proximity'' in
the context of real estate transactions, and this rule defines the
geographic coverage for real estate transactions, CFIUS has and will
continue to retain the authority to assess and, if necessary, take
action with respect to any covered transaction under the part 800 rule
that gives rise to national security concerns on the basis of proximity
to any government site and activity. The Committee's authority under
the part 800 rule to review and take action on a transaction is not
limited in any way by the sites or distances specified in this rule.
B. Interim Rule: Section 802.232--Principal Place of Business
This rule includes a definition of ``principal place of business''
as an interim rule. The interim rule is effective as of February 13,
2020, and the Treasury Department is seeking public comment on the new
definition through February 18, 2020.
The proposed rule used the term ``principal place of business'' but
did not define it. A commenter urged the Committee to provide
additional clarity by defining the term. In response to this comment
and comments received on the part 800 rule, Sec. 802.232 now provides
a definition of a party's ``principal place of business'' as ``the
primary location where an entity's management directs, controls, or
coordinates the entity's activities, or, in the case of an investment
fund, where the fund's activities and investments are primarily
directed, controlled, or coordinated by or on behalf of the general
partner, managing member, or equivalent,'' subject to the qualification
in Sec. 802.232(b). For those entities whose nerve center is in the
United States, the purpose of the qualification in Sec. 802.232(b) is
to nevertheless ensure consistent treatment of an entity's principal
place of business in accordance with its own assertions to government
entities, provided the facts have not changed since those assertions.
Because the definition of ``principal place of business'' in Sec.
802.232 is new, it is being made effective by this rule on an interim
basis and may be amended based on comments received. As an interim
rule, Sec. 802.232 will become effective on the same date as the other
provisions in this rule (i.e., February 13, 2020) to provide clarity
and certainty for transaction parties. The Treasury Department invites
comments on this interim rule.
C. Summary of Comments and Changes From the Proposed Rule
1. Subpart A--General
Section 802.102--Risk-Based Analysis
The proposed rule, at Sec. 802.102, defined the terms ``threat,''
``vulnerabilities,'' and ``consequences to national security'' in
describing the risk-based analyses undertaken by the Committee to
determine whether a specific transaction represents a risk to national
security. One commenter sought clarification about how, specifically,
these terms would be applied to use and lease agreements with foreign
airlines.
The rule makes no change to the proposed text of Sec. 802.102 in
response to this comment because the rule applies to many types of real
estate transactions, and it would be inappropriate in regulations of
general applicability to specify the application of this provision to a
particular type of transaction. In conducting a risk-based analysis for
any transaction, CFIUS analyzes the particular facts and circumstances
of the transaction to identify the national security considerations, if
any, presented by the transaction. Section 721(f) of the DPA, as
amended, provides an illustrative list of factors for consideration by
CFIUS and the President in determining whether a covered transaction
poses a national security risk. Some of these factors may be relevant
to covered real estate transactions. While further discussing the
specific factors relevant to particular types of real estate
transactions in one sector is not appropriate for a broader rule, the
Committee will consider whether additional information can be made
publicly available to assist parties in understanding the Committee's
analysis in general. In the meantime, parties may find helpful the
Treasury Department's previously published Guidance Concerning the
National Security Review Conducted by CFIUS, 73 FR 74567 (December 8,
2008), which is still in effect.
Section 802.105--Rules of Construction and Interpretation
The rule adds a new section to clarify that the examples included
in the regulations are provided for informational purposes and should
not be construed to alter the meaning of the text of the regulations in
this part, as well as to clarify that, as used throughout the
regulations, the term ``including'' means ``including without
limitation.''
2. Subpart B--Definitions
Subpart B sets forth the defined terms for part 802. More than half
of the defined terms in this rule are incorporated from the part 800
rule, with conforming changes to apply in the context of real estate
transactions, as applicable. The remainder of the terms are
specifically defined for part 802.
Section 802.203--Close Proximity
The proposed rule defined ``close proximity'' as the area that
extends outward one mile from the boundary of a relevant site. Some
commenters encouraged the Committee to ensure that applicable set-back
distances are appropriately tailored to each individual site. A number
of commenters supported an online resource--such as a map or other
interactive tool--to assist the public in understanding the geographic
areas that are subject to CFIUS jurisdiction under the rule.
The rule makes no change to this definition in response to these
comments. The identification of particular military installations and
the distances around those sites were determined by the Department of
Defense based upon an evaluation of national security considerations.
The Department of Defense will continue on an ongoing basis to assess
its military installations and the geographic scope set under the rule
to ensure appropriate application in light of national security
considerations.
With respect to the comments seeking an online resource, the
Treasury Department anticipates making available a web-based tool to
help the public understand the geographic coverage of the rule. In the
meantime, information relevant to certain aspects of the rule is
available online. For example, the Census Bureau within the Department
of Commerce maintains a web-based system, TIGERweb, which allows users
to select features (e.g., military installations, urbanized areas,
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and urban clusters) and view such attributes on a map. Additionally,
each of the National Oceanic and Atmospheric Administration and the
Bureau of Ocean Energy Management maintains a web-based map delineating
U.S. maritime boundaries, including the territorial sea and other
attributes relevant to the geographic coverage under the rule.
Section 802.206--Concession
The proposed rule defined ``concession'' as a grant of rights by a
U.S. public entity for the purpose of developing or operating
infrastructure for an airport or maritime port. A commenter noted that
this term is defined differently in the Department of Transportation
regulations regarding airport concessions and suggested that the
specific definition in the proposed rule might cause confusion given
the term's usage in the Department of Transportation regulations.
The rule makes no change to this definition in response to the
comment. The Department of Transportation definition does not match the
intended scope of real estate transactions subject to CFIUS's
jurisdiction as implemented by the rule. Nevertheless, parties in all
industries, including the airport concession industry, should not be
confused about the meaning of the term ``concession'' in the rule as it
is explicitly defined as a type of real estate transaction. For greater
clarity, the rule does contain a revision specifying that the defined
term includes the assignment of part of a concession.
Section 802.208--Control
The proposed rule adopted the definition of ``control'' from the
proposed rule for part 800. The part 800 rule makes a technical
correction to the definition of ``control,'' and in order to remain
consistent with part 800, this rule makes the same technical
correction. In particular, Sec. 802.208(c)(4) has been revised to
clarify that anti-dilution protections are more accurately
characterized as a right instead of a power.
Section 802.210--Covered Port
The proposed rule provided definitions for the terms ``airport''
and ``maritime port.'' A commenter suggested that the Committee publish
an appendix listing the airports and maritime ports that meet the
definitions in the proposed rule, noting that the list of relevant
sites may change and some practitioners are not familiar with
information published by the Department of Transportation. Another
commenter suggested that the Committee make available on its website
hyperlinks to the relevant lists of airports and maritime ports
maintained by the Department of Transportation.
Several revisions have been made to the rule in response to the
comments. First, the rule combines the definitions of ``airport'' and
``maritime port'' from the proposed rule into a new term, ``covered
port.'' This definition of ``covered port'' identifies in Sec.
802.210(a) the relevant lists maintained by the Department of
Transportation and clarifies the specific references to the various
lists. Second, the definition includes provisions to clarify the
effective date of any changes to the Department of Transportation
lists. Specifically, Sec. 802.210(b)(1) sets forth a 30-day delayed
effectiveness for any additions to any of the airport and maritime port
lists under the definition of ``covered port'' in paragraph (a). This
was done because changes to the lists are not published in the Federal
Register, and the Treasury Department wanted to provide the public with
a notice period for any additions. By contrast, when an airport or
maritime port no longer meets the rule's definition of covered port in
paragraph (a), the removal of the port from the relevant list will be
recognized immediately upon publication of the updated list by the
Department of Transportation. The rule adds Sec. 802.210(b)(2) to make
clear that the airport or maritime port list that applies for any
particular transaction is the list that is in effect (taking into
account the 30-day delayed effectiveness in paragraph (b)(1)) on the
day prior to the earlier of the date on which the parties have signed a
written document establishing the material terms of the transaction or
the completion date.
With respect to compiling all covered ports into a single list, the
Treasury Department has determined it most practicable to direct the
public to available online resources maintained and updated by the
Department of Transportation. The Treasury Department anticipates
making information available on the CFIUS web page that will assist the
public in navigating to the relevant lists maintained by the Department
of Transportation.
Section 802.211--Covered Real Estate
The proposed rule defined ``covered real estate'' in a manner that
connected specific sites with the relevant geographic coverage in and
around those sites. Commenters did not suggest specific changes to the
text of this definition. Instead, commenters generally supported the
approach in the proposed rule of identifying specific sites and
distances, and supported having online resources available to assist
the public in understanding the geographic coverage of the rule. In
particular, commenters expressed an interest in understanding the
delineation of certain boundaries, including the U.S. coastline.
The rule revises paragraph (b)(4) of this section by replacing the
12 nautical mile reference with a reference to the territorial sea. The
Treasury Department has determined that a reference to the territorial
sea provides greater clarity to the public. Additionally, as noted
above, the Treasury Department anticipates making a web-based tool
available in the near-term to assist the public. In the meantime,
existing U.S. Government resources provide relevant information for
purposes of understanding various aspects of this rule.
Section 802.212--Covered Real Estate Transaction
The proposed rule defined ``covered real estate transaction'' to
capture the types of transactions subject to CFIUS's jurisdiction under
the rule. A commenter suggested that the definition explicitly exclude
transactions between a foreign person and its parent as well as between
a foreign person and one or more of its controlled affiliates. The
commenter also requested clarification with respect to submitting a
single declaration or filing a single notice for multiple covered real
estate transactions that are in close proximity to one another and
associated with a single project such as in the renewable energy
industry. Another commenter suggested that the rule cover other
categories of real estate transactions--such as those involving
cropland and rare earth minerals.
The rule makes no change to the definition of ``covered real estate
transaction'' in response to the comments. First, an intra-company
transfer of assets, including real estate, carried out to achieve some
legal, financial, or other business objective, might not constitute a
covered real estate transaction, and in any case might not result in a
change in the ultimate parent of the entity with the covered real
estate and, therefore, might not present new national security
considerations. However, the particular facts and circumstances of the
specific arrangement would need to be considered. Second, with respect
to multiple covered real estate transactions that are part of a larger
project, a revision to the rule is not necessary
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because parties can and should consider the particular circumstances of
any transaction, including related transactions, in determining whether
to submit a single declaration or notice or multiple to the Committee
for review. National security factors, timing considerations, and other
transaction characteristics may weigh in favor of taking a particular
approach. Related to this comment, however, the rule has been revised
in the sections describing the contents of declarations and notices to
include a description of whether the transaction is part of a larger
project undertaken by the foreign person. Finally, the Committee has
not expanded this definition to cover other categories of real estate
transactions because the categories suggested by the commenter are not
authorized under FIRRMA.
This section incorporates other revisions including to Sec.
802.212(b) to clarify that a purchase, lease, or concession, where
there is a subsequent change in rights that could result in the foreign
person having at least three property rights, is a covered real estate
transaction.
Section 802.214--Excepted Real Estate Foreign State
The Treasury Department received a number of comments on the
definition of ``excepted real estate foreign state.'' Commenters
supported the concept of the excepted real estate foreign state and
requested that the initial list be published as soon as possible.
Commenters suggested particular countries or defined groups of
countries be included as excepted real estate foreign states and that
advance notice be given prior to any rescission. Commenters also
requested that the factors for a determination under Sec. 802.1001 be
precise and transparent and that the Committee consult with foreign
states seeking to qualify as excepted real estate foreign states.
The rule makes no change to the proposed text in response to these
comments. With respect to the eligible foreign states, the Committee
has initially selected Australia, Canada, and the United Kingdom of
Great Britain and Northern Ireland. The Committee identified these
countries due to aspects of their robust intelligence-sharing and
defense industrial base integration mechanisms with the United States.
Additionally, as noted in the preamble to the proposed rule, the
concept and definition of ``excepted real estate foreign states'' are
new and an expansive application carries potentially significant
implications for the national security of the United States.
Consequently, the Committee is initially identifying a limited number
of eligible foreign states and may expand the list in the future.
The rule revises this section to clarify that the definition of
``excepted real estate foreign state'' operates as a two-criteria
conjunctive test, with delayed effectiveness for the second criterion.
Thus, as of February 13, 2020, each of the three foreign states that
the Committee identifies as eligible foreign states will be an excepted
real estate foreign state, without regard to the second criterion
(i.e., favorable determination under Sec. 802.1001). In order for each
of these countries to remain an excepted real estate foreign state
after the end of the two-year delayed effectiveness period (i.e.,
February 13, 2022), the Committee must make a determination under Sec.
802.1001. This two-year period is intended to provide these initial
eligible foreign states time to ensure that their national security-
based foreign investment review processes and bilateral cooperation
with the United States on national security-based investment reviews
meet the requirement under Sec. 802.1001. This two-year period also
provides the Committee time to develop processes and procedures for
making determinations under Sec. 802.1001, which could be applied to a
broader group of countries in the future. In selecting the initial
eligible foreign states, the Committee takes no position on whether the
foreign states currently meet the determination factors discussed below
at Sec. 802.1001.
Finally, the rule removes language regarding internal Committee
processes (for which a conforming change was also made in Sec.
802.1001), and revises note 1 to Sec. 802.214 to clarify the
publication mechanics for identifying the foreign states that have met
each of the two separate criteria of the definition of ``excepted real
estate foreign state.''
Section 802.215--Excepted Real Estate Investor
The proposed rule set forth a definition of ``excepted real estate
investor,'' taking into account increasingly complex ownership
structures and accounting for such structures in the application of the
Committee's jurisdiction. With respect to the criteria to qualify as an
excepted real estate investor, commenters discussed the board
composition requirement, noting that it was limiting and suggested
changes. Commenters also sought additional clarity regarding the
process to be considered an excepted real estate investor, including
how an excepted real estate investor can prove that status, or whether
an excepted real estate investor would receive a form or certificate
from the Committee establishing that status. Other commenters suggested
that the Committee adopt a parallel category to excepted real estate
investor, which some termed ``excepted trusted real estate investor,''
that would allow certain investors who are not connected to an excepted
real estate foreign state to receive the benefits of being an excepted
real estate investor. A commenter suggested various criteria for this
concept, including the individual investor's previous interactions with
the Committee.
In response to these comments and similar comments received on the
part 800 proposed rule, the rule modifies the definition of ``excepted
real estate investor.'' First, the board member nationality criterion
is revised to allow up to 25 percent representation by foreign
nationals of foreign states that are not excepted real estate foreign
states. Second, the percentage ownership limit for an individual
investor in an excepted real estate investor is revised from five to 10
percent. Third, the definition of ``minimum excepted ownership'' under
Sec. 802.228 is revised as discussed below.
The rule does not make other changes in response to the comments.
All of the conditions under Sec. 802.215(a)(3), including the minimum
excepted ownership conditions, apply to each parent (as defined at
Sec. 802.229) of the foreign person. There is no separate process for
the Committee to provide a determination for a prospective investor on
whether it qualifies as an excepted real estate investor. As with other
jurisdictional determinations, parties themselves should assess whether
they qualify as excepted real estate investors. It is important to note
that not qualifying as an excepted real estate investor should not be
interpreted as an individualized assessment that the particular foreign
person poses a threat to national security.
Consistent with FIRRMA, the ``excepted real estate investor''
definition focuses on the investor's connection to an excepted real
estate foreign state, which provides the greatest clarity to the
business and investment communities while protecting national security
interests. Such a definition also furthers the Committee's efforts to
encourage partner countries to implement robust processes to review
foreign investment in their countries and increase cooperation with the
United States. Notably, the excepted real estate investor definition
eliminates
[[Page 3163]]
Committee jurisdiction for specified real estate transactions by
certain investors. Therefore, some criteria suggested by commenters as
part of the ``excepted trusted real estate investor'' concept are less
suitable for determining jurisdiction and more suitable for other
issues, such as certain aspects of the part 800 rule relating to
mandatory declarations.
Finally, the rule revises Sec. 802.215(b) to specify when the
ownership interests of separate foreign persons will be aggregated for
the purposes of Sec. 802.215(a)(3)(iv). The rule also modifies Sec.
802.215(d) to include the criteria in Sec. 802.215(c)(1)(i) through
(iii) in order to retain jurisdiction over certain transactions where
the foreign investor is deemed not to be an excepted real estate
investor subsequent to the transaction due to action by the President
under section 721, or enforcement by the Committee of violations under
this part, parts 800 or 801, or section 721.
Section 802.216--Excepted Real Estate Transaction
The proposed rule defined ``excepted real estate transaction'' by
listing specific types of transactions that are not covered real estate
transactions, as well as examples. Some commenters sought clarification
with respect to when the acquisition of commercial real estate
constitutes the acquisition of a U.S. business. Some commenters
suggested broadening certain exceptions. A couple of these comments
noted the application of the rule in the airport context and suggested
broadening the exception for retail trade, accommodation, and food
service sector establishments, as well as excepting foreign air carrier
leasing arrangements. One commenter sought clarification on the
exception related to commercial space and whether 10 percent of tenants
should be determined by the number of leaseholders or by the number of
employee-occupants in the commercial space. Another commenter suggested
excluding certain shore-based and offshore areas and structures.
The rule is revised in response to certain of the comments. First,
the rule adds an exception for ``foreign air carriers,'' as defined in
49 U.S.C. 40102, to the extent that the lease or concession is related
to the foreign person's activities as a foreign air carrier, and for
whom the Department of Homeland Security's Transportation Security
Administration has accepted a security program under 49 CFR 1546.105.
This exception was added in light of the Department of Homeland
Security's existing oversight with respect to foreign air carriers.
Second, the rule revises the exception for retail trade, accommodation,
and food service sector establishments by eliminating the reference to
the North American Industry Classification System codes and instead
applying the exception to leases and concessions of real estate that
may be used only for the purposes of engaging in the retail sale of
consumer goods or services to the public. This revision provides a
broader exception for retail services as compared to the proposed rule,
with respect to, for example, car rental and parking. Finally, the rule
clarifies through the text of Sec. 802.216(f) and illustrates through
a new example that the exception related to commercial space in a
building is based on the number of parties that own, lease or have a
concession to the commercial space in the building.
The rule makes other clarifying edits to this section, including in
the illustrative examples. Changes were not made in this section in
response to the comment regarding certain shore-based and offshore
areas and structures based on a balancing of various considerations.
Section 802.217--Extended Range
The proposed rule defined the ``extended range'' to mean the area
that extends 99 miles outward from the outer boundary of close
proximity of certain military installations, but, where applicable, no
more than 12 nautical miles seaward of the coastline of the United
States. Commenters sought to understand the rationale behind the
specific distance set in the regulations and the interaction with the
exception under Sec. 802.216(c) for urbanized areas and urban
clusters.
The rule makes no change to the proposed definition of ``extended
range'' in response to the comments. The particular military
installations listed in the appendix and the covered distances defined
in the regulations were determined by the Department of Defense based
upon an evaluation of national security considerations. The Department
of Defense will continue on an ongoing basis to assess its military
installations and the geographic scope set under the rule to ensure
appropriate application in light of national security considerations.
The rule does replace the reference to 12 nautical miles with a
reference to the territorial sea. As noted above in the definition of
``covered real estate,'' the Treasury Department has determined that a
reference to the territorial sea will be more useful to the public as a
geographic reference.
Section 802.224--Investment Fund
The rule adds a definition for investment fund that conforms to the
term used in the part 800 rule. This term was added in part 802 to
provide clarity with respect to the new interim definition of
``principal place of business.''
Section 802.226--Lease
The definition of ``lease'' is modified in the rule to clarify that
the term includes assignments in whole or part.
Section 802.228--Minimum Excepted Ownership
To conform with changes to part 800, in response to comments
received on specific provisions of that separate rulemaking, the rule
amends the text of Sec. 802.228 by revising the minimum excepted
ownership percentage in Sec. 802.228(b) from 90 to 80 percent.
Section 802.229--Parent
To conform with changes to part 800, in response to comments
received on that separate rulemaking, the rule adds a provision at
Sec. 802.229(a)(2) that explicitly includes a general partner,
managing member, or equivalent of an entity within the definition of
``parent.'' The rule also makes some minor technical edits and adds an
example illustrating an entity with more than one parent.
Section 802.233--Property Right
The proposed rule included as an element of a covered real estate
transaction that certain ``property rights'' be afforded to the foreign
person through the purchase, lease, or concession of covered real
estate. The rule adds examples under this definition. The first example
illustrates that the right to exclude others from physically accessing
the property need not be absolute with respect to all other persons or
activities. The second example illustrates that a right is afforded,
even if it is not exercisable until a separate regulatory approval is
received.
Section 802.238--United States
The rule revises the definition of ``United States'' for
consistency with the definition in FIRRMA.
Section 802.241--U.S. Business
The proposed rule defined ``U.S. business'' to conform to the
definition in FIRRMA. Commenters to the proposed rule for part 800
requested clarity with respect to the Committee's intended
interpretation of the term U.S. business. Consistent with the
concurrent rulemaking finalizing part
[[Page 3164]]
800, the rule makes no change to the proposed definition of ``U.S.
business.'' The proposed definition tracks the language of FIRRMA and
is not intended to suggest that the extent of a business's activities
in interstate commerce in the United States is irrelevant to the
Committee's analysis of national security risk.
Section 802.244--Voting Interest
The proposed rule provided a definition for the term ``voting
interest.'' One commenter sought clarification of the term and whether
it includes consent, veto, right to appoint a board member (without a
shareholder vote), or other special rights. The commenter also
suggested the term be limited to voting interests in major decisions.
Similar comments were made on this provision in the part 800 rule.
The rule makes no change in response to the comments. The
definition of ``voting interest'' is long-established, and, any
revisions will have wide-ranging effects throughout the part 802 and
part 800 regulations because voting interest is incorporated into other
defined terms, such as parent. Where appropriate, the Treasury
Department provided clarification through revisions to the part 800
rule.
3. Subpart C--Coverage
Section 802.302--Transactions That Are Not Covered Real Estate
Transactions
One commenter requested a sample list of transactions that are not
covered real estate transactions. The commenter provided examples and
noted its understanding that such scenarios would not be covered real
estate transactions because they would not meet the criteria under the
rule if a foreign person were an investor.
No change was made to this section in response to this comment
because whether a particular type of transaction is covered by the rule
is determined by the particular facts and circumstances. This section
was revised for clarity by streamlining the provisions and removing an
example.
Section 802.303--Lending Transactions
The proposed rule discussed lending transactions at Sec. 802.303,
which include commercial mortgages. While a lending transaction
generally shall not, by itself, constitute a covered real estate
transaction, the proposed rule discussed factors that CFIUS will
consider in determining whether the lending transaction is a covered
real estate transaction. One commenter requested language be added that
would except from CFIUS jurisdiction lenders who take possession of
property in foreclosure and put the property back on the market a short
period of time later. No change was made to this section in response to
this comment because an assessment of the particular facts and
circumstances would be needed to determine whether national security
concerns arise from the transaction. The proposed rule noted the
factors the Committee will consider with respect to whether a default
under a lending transaction would afford the foreign person the
property rights defined in the proposed rule. In determining whether to
accept a declaration or notice, the Committee also will consider the
immediacy or occurrence of the default or other condition. The rule
makes clarifying revisions in this section including incorporating the
change in rights construct to paragraph (a)(1) and consideration of
whether the foreign person had made arrangements to transfer the
ownership or property rights to an excepted real estate investor under
paragraph (a)(2).
4. Subpart D--Declarations
The proposed rule, in subpart D, set out an abbreviated filing
process through the submission of a declaration.
Section 802.401--Procedures for Declarations
A commenter expressed concern about having public entities, such as
airports, submit declarations or file notices. No change was made to
this section in response to this comment. The Treasury Department has
attempted to minimize the burden of this rule on U.S. public entities,
particularly where the counterparty has the relevant information to
submit a notice or file a declaration.
Section 802.402--Contents of Declarations
The rule modifies this section to require additional information
including to allow the Committee to more efficiently assess whether a
transaction falls under its jurisdiction for real estate transactions.
The rule requires a brief description of whether the transaction is
part of a larger project undertaken by the foreign person, and whether
the foreign person is acquiring a collection of assets or interest in
an entity. This information will help the Committee better determine
whether there is a U.S. business that is the subject of the
transaction. Additionally, this section is revised to require parties
to provide a brief description of any U.S. Government leases involved
in the transaction. With respect to the foreign person and its
affiliates, the final rule further clarifies what relevant address
information should be included in a declaration. Finally, the rule
requires that parties provide additional information about the
transaction such as any applicable term, current physical security of
premises, and distance to covered port(s) or military installation(s)
relevant to CFIUS's geographic coverage under the rule.
Section 802.405--Committee Actions
The rule clarifies that the Committee may request that parties file
a written notice under subpart E if it has reason to believe that the
transaction may raise national security considerations.
5. Subpart E--Notices
The rule makes revisions to Sec. 802.502(b) similar to the
revisions discussed above under Sec. 802.402, and makes other
clarifying edits.
6. Subpart I--Penalties and Damages
The proposed rule set out the penalty provisions, at subpart I. A
number of clarifying and technical edits were made to this subpart.
Additionally, the rule revises Sec. 802.901(e) to allow tolling of the
Committee's deadline to respond to a petition, upon written agreement
with the party, to facilitate further negotiations, including for
settlement of the potential civil monetary penalty.
7. Appendix A
The appendix to the proposed rule identified bases, ranges, and
other installations that meet the definition of ``military
installation'' at Sec. 802.227, and, as applicable, related counties
or other geographic areas throughout the United States that are covered
real estate for the purposes of this part. A commenter sought
additional information about whether, and how, appendix A will be
revised in the future. The Treasury Department anticipates updating
appendix A, as appropriate, through notices published in the Federal
Register.
The rule includes revisions to appendix A to remove one site and to
further refine the geographic areas covered in connection with the
sites listed at part 3 of the appendix.
8. Other Comments
The Treasury Department received several comments that did not
address any specific provision of the rule. For example, one commenter
sought guidance from the Committee on when parties should submit a
declaration rather than file a notice. Such advice is beyond the
purview of this rule; whether a party files a notice or submits a
declaration will depend on many
[[Page 3165]]
factors specific to the party and to the transaction.
IV. Rulemaking Requirements
Executive Order 12866
These regulations are not subject to the general requirements of
Executive Order 12866, which governs review of regulations by the
Office of Information and Regulatory Affairs (OIRA) in the Office of
Management and Budget (OMB), because they relate to a foreign affairs
function of the United States, pursuant to section 3(d)(2) of that
order. In addition, these regulations are not subject to review under
section 6(b) of Executive Order 12866 pursuant to section 7(c) of the
April 11, 2018 Memorandum of Agreement between the Treasury Department
and OMB, which states that CFIUS regulations are not subject to OMB's
standard centralized review process under Executive Order 12866.
Justification for Interim Rule
The proposed rule, and the proposed rule for part 800 at 84 FR
50174, included provisions that use the term ``principal place of
business.'' The Treasury Department received comments on these
provisions, including recommendations to add a definition for the term.
In response to these comments, a definition for ``principal place
of business'' has been included. The Treasury Department believes it
would benefit the public and the Committee to receive comments from the
public on this definition before it is made final. This rule therefore
contains an interim rule that implements a definition for the term
``principal place of business'' that will become effective with the
rest of the rule, and the Treasury Department is providing the public
30 days to comment on the new definition of ``principal place of
business.''
It is in the public interest to make the ``principal place of
business'' definition effective on the same date as the rule.
Commenters requested greater clarity concerning which parties are
subject to CFIUS jurisdiction. The new definition directly addresses
those requests and provides greater transactional certainty. By
clarifying that certain transactions are not subject to CFIUS
jurisdiction, the addition of the definition of ``principal place of
business'' reduces the regulatory burden on the public, allowing some
parties to forego the expense, time, and uncertainty involved in
submitting a declaration or filing a notice with the Committee. Because
of the added clarity and potential reduction in regulatory burden the
definition provides to the public, having it become effective
immediately is in the public's interest. Nonetheless, the Treasury
Department is requesting comments to that definition and will consider
them before finalizing the interim rule.
Paperwork Reduction Act
The collections of information contained in this rule were
submitted to OMB for review along with the proposed rule, in accordance
with the Paperwork Reduction Act of 1995 (PRA, 44 U.S.C. 3507(d)). No
comments were received to the PRA estimates. However, and as noted
above, the Treasury Department has modified some of the information
requests associated with notices and on the declarations form. These
changes represent clarifications that the Treasury Department
identified in its review of the information requirements, as well as
changes necessary to implement certain provisions that were modified
from the proposed rule. The additional information requested is not
substantially different from the information that was proposed to be
collected, and the Treasury Department's estimates of burden hours for
completing declarations and notices do not differ from those estimated
at the proposed rule stage. These collections have been submitted to
OMB under control number 1505-0121.
Under the PRA, an agency may not conduct or sponsor, and a person
is not required to respond to, a collection of information unless it
displays a valid control number assigned by OMB.
Regulatory Flexibility Act
Regardless of whether the provisions of the Regulatory Flexibility
Act (RFA, 5 U.S.C. 601 et seq.), apply to this rulemaking, for reasons
noted in the preamble to the proposed rule, the Treasury Department
prepared for public comment an Initial Regulatory Flexibility Analysis
and determined through that analysis that the proposed rule would most
likely not affect a substantial number of small entities. The Treasury
Department specifically requested comments on the proposed rule's
effect on small entities; no such public comments were received. The
Secretary of the Treasury hereby certifies that the rule will not have
a significant economic impact on a substantial number of small
entities, based on the following reasons.
The rule expands the jurisdiction of the Committee to review the
purchase or lease by, or concession to, a foreign person of certain
real estate in the United States. Accordingly, the rule may impact any
U.S. business, including a small U.S. business, that engages in a
covered real estate transaction.
There is no single source for information on the number of small
U.S. businesses that would be involved in some way in the purchase or
lease by, or concession to a foreign person of real estate that could
be covered under this rule. However, the Treasury Department
anticipates only 350 real estate transactions, out of the thousands or
more of the annual number of real estate transactions in the United
States, will be the subject of a declaration or notice of a covered
real estate transaction. Even if each of these 350 transactions
involved a small U.S. business, based on past experience it is likely
that only a small, and not significant, percentage of those anticipated
350 real estate transactions will incur impacts, such as incurring
additional costs through mitigation or action by the President.
Additionally, the Treasury Department also has taken steps to
reduce the burden of this rule on small entities. For example, in
addition to filing notices of transactions with the Committee, the rule
allows parties to submit shorter declarations to the Committee using an
online fillable form. Also, the Committee anticipates making available
a free, web-based tool to help the public understand the geographic
coverage of the rule. As noted above, in the meantime, information
relevant to certain aspects of the rule is available online. These
tools should help reduce compliance costs for small entities.
Congressional Review Act
This rule has been submitted to OIRA, which has determined that the
rule is a ``major'' rule under the Congressional Review Act (CRA).
However, the Treasury Department has determined there is good cause
under 5 U.S.C. 808(2) to publish the rule notwithstanding the timing
requirements for major rules under 5 U.S.C. 801(a)(3) because delaying
the effectiveness of this rule beyond 30 days is impracticable,
unnecessary, and contrary to the public interest. Under FIRRMA, the
provisions expanding jurisdiction over real estate transactions and
establishing declarations, among others, will become effective on
February 13, 2020, regardless of whether this rule is published and
effective. See Section 1727(b)(1)(A) of FIRRMA. Without the processes,
procedures and definitions provided by the rule as directed by FIRRMA,
market participants will face substantial hardship, delay, and expense
in complying with the requirements of
[[Page 3166]]
FIRRMA. Accordingly, the Treasury Department finds good cause that
notice and public procedure under 5 U.S.C. 801(a)(3) are impracticable,
unnecessary, and contrary to the public interest. This rule will become
effective on February 13, 2020, notwithstanding 5 U.S.C. 801(a)(3).
List of Subjects in 31 CFR Part 802
Foreign investments in the United States, Federal buildings and
facilities, Government property, Investigations, Investments,
Investment companies, Land sales, National defense, Public lands, Real
property acquisition, Reporting and recordkeeping requirements.
0
For the reasons set forth in the preamble, the Treasury Department adds
part 802 to title 31 of the Code of Federal Regulations to read as
follows:
PART 802--REGULATIONS PERTAINING TO CERTAIN TRANSACTIONS BY FOREIGN
PERSONS INVOLVING REAL ESTATE IN THE UNITED STATES
Subpart A--General
Sec.
802.101 Scope.
802.102 Risk-based analysis.
802.103 Effect on other law.
802.104 Applicability rule.
802.105 Rules of construction and interpretation.
Subpart B--Definitions
802.201 Business day.
802.202 Certification.
802.203 Close proximity.
802.204 Committee; Chairperson of the Committee; Staff Chairperson.
802.205 Completion date.
802.206 Concession.
802.207 Contingent equity interest.
802.208 Control.
802.209 Conversion.
802.210 Covered port.
802.211 Covered real estate.
802.212 Covered real estate transaction.
802.213 Entity.
802.214 Excepted real estate foreign state.
802.215 Excepted real estate investor.
802.216 Excepted real estate transaction.
802.217 Extended range.
802.218 Foreign entity.
802.219 Foreign government.
802.220 Foreign national.
802.221 Foreign person.
802.222 Hold.
802.223 Housing unit.
802.224 Investment fund.
802.225 Lead agency.
802.226 Lease.
802.227 Military installation.
802.228 Minimum excepted ownership.
802.229 Parent.
802.230 Party to a transaction.
802.231 Person.
802.232 Principal place of business.
802.233 Property right.
802.234 Purchase.
802.235 Real estate.
802.236 Section 721.
802.237 Transaction.
802.238 United States.
802.239 Urban cluster.
802.240 Urbanized area.
802.241 U.S. business.
802.242 U.S. national.
802.243 U.S. public entity.
802.244 Voting interest.
Subpart C--Coverage
802.301 Transactions that are covered real estate transactions.
802.302 Transactions that are not covered real estate transactions.
802.303 Lending transactions.
802.304 Timing rule for a contingent equity interest.
Subpart D--Declarations
802.401 Procedures for declarations.
802.402 Contents of declarations.
802.403 Beginning of 30-day assessment period.
802.404 Rejection, disposition, or withdrawal of declarations.
802.405 Committee actions.
Subpart E--Notices
802.501 Procedures for notices.
802.502 Contents of voluntary notices.
802.503 Beginning of 45-day review period.
802.504 Deferral, rejection, or disposition of certain voluntary
notices.
802.505 Determination of whether to undertake an investigation.
802.506 Determination not to undertake an investigation.
802.507 Commencement of investigation.
802.508 Completion or termination of investigation and report to the
President.
802.509 Withdrawal of notices.
Subpart F--Committee Procedures
802.601 General.
802.602 Role of the Secretary of Labor.
802.603 Materiality.
802.604 Tolling of deadlines during lapse in appropriations.
Subpart G--Finality of Action
802.701 Finality of actions under section 721.
Subpart H--Provision and Handling of Information
802.801 Obligation of parties to provide information.
802.802 Confidentiality.
Subpart I--Penalties and Damages
802.901 Penalties and damages.
802.902 Effect of lack of compliance.
Subpart J--Foreign National Security Investment Review Regimes
802.1001 Determinations.
802.1002 Effect of determinations.
Appendix A to Part 802--List of Military Installations and Other
U.S. Government Sites
Authority: 50 U.S.C. 4565; E.O. 11858, as amended, 73 FR 4677.
Subpart A--General
Sec. 802.101 Scope.
(a) Section 721 of title VII of the Defense Production Act of 1950,
as amended (50 U.S.C. 4565) authorizes the Committee on Foreign
Investment in the United States to review transactions involving real
estate that meet specified criteria, which are referred to in this part
as ``covered real estate transactions'' and defined at Sec. 802.212,
and to mitigate any risk to the national security of the United States
that arises as a result of such transactions. Section 721 also
authorizes the President to suspend or prohibit any covered real estate
transaction when, in the President's judgment, there is credible
evidence that leads the President to believe that the foreign person
engaging in a covered real estate transaction might take action that
threatens to impair the national security of the United States, and
when provisions of law other than section 721 and the International
Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) do not, in the
judgment of the President, provide adequate and appropriate authority
for the President to protect the national security of the United States
in the matter before the President.
(b) This part implements regulations pertaining to covered real
estate transactions. Regulations pertaining to ``covered transactions''
are addressed in part 800 of this chapter.
Sec. 802.102 Risk-based analysis.
Any determination of the Committee with respect to a covered real
estate transaction, to suspend, refer to the President, or to
negotiate, enter into or impose, or enforce any agreement or condition
under section 721 shall be based on a risk-based analysis, conducted by
the Committee, of the effects on the national security of the United
States of the covered real estate transaction. Any such risk-based
analysis shall include credible evidence demonstrating the risk and an
assessment of the threat, vulnerabilities, and consequences to national
security related to the transaction. For purposes of this part, any
such analysis of risk shall include and be informed by consideration of
the following elements:
(a) The threat, which is a function of the intent and capability of
a foreign person to take action to impair the national security of the
United States;
(b) The vulnerabilities, which are the extent to which the nature
of the covered real estate presents susceptibility to impairment of
national security; and
[[Page 3167]]
(c) The consequences to national security, which are the potential
effects on national security that could reasonably result from the
exploitation of the vulnerabilities by the threat actor.
Sec. 802.103 Effect on other law.
Nothing in this part shall be construed as altering or affecting
any other authority, process, regulation, investigation, enforcement
measure, or review provided by or established under any other provision
of federal law, including the International Emergency Economic Powers
Act, or any other authority of the President or the Congress under the
Constitution of the United States.
Sec. 802.104 Applicability rule.
(a) Except as provided in paragraph (b) of this section and
otherwise in this part, the regulations in this part apply from
February 13, 2020.
(b) The regulations in this part do not apply to any transaction
for which:
(1) The completion date is prior to February 13, 2020; or
(2) The parties to the transaction have executed, prior to February
13, 2020, a binding written agreement, or other binding document,
establishing the material terms of the transaction.
Sec. 802.105 Rules of construction and interpretation.
(a) The examples included in this part are provided for
informational purposes and should not be construed to alter the meaning
of the text of the regulations in this part.
(b) As used in this part, the term ``including'' means ``including
but not limited to.''
Subpart B--Definitions
Sec. 802.201 Business day.
The term business day means Monday through Friday, except the legal
public holidays specified in 5 U.S.C. 6103, any day declared to be a
holiday by federal statute or executive order, or any day with respect
to which the U.S. Office of Personnel Management has announced that
Federal agencies in the Washington, DC, area are closed. For purposes
of calculating any deadline imposed by this part triggered by the
submission of a party to a transaction under Sec. 802.501(i), any
submissions received after 5 p.m. Eastern Time are deemed to be
submitted on the next business day.
Note 1 to Sec. 802.201: See Sec. 802.604 regarding the
tolling of deadlines during a lapse in appropriations.
Sec. 802.202 Certification.
(a) The term certification means a written statement signed by the
chief executive officer or other duly authorized designee of a party
filing a notice, declaration, or information, certifying under the
penalties provided in the False Statements Accountability Act of 1996,
as amended (18 U.S.C. 1001) that the notice, declaration, or
information filed:
(1) Fully complies with the requirements of section 721, the
regulations in this part, and any agreement or condition entered into
with the Committee or any member of the Committee, and
(2) Is accurate and complete in all material respects, as it
relates to:
(i) The transaction; and
(ii) The party providing the certification, including its parents,
subsidiaries, and any other related entities described in the notice,
declaration, or information.
(b) For purposes of this section, a duly authorized designee is:
(1) In the case of a partnership, any general partner thereof;
(2) In the case of a corporation, any officer or director thereof;
(3) In the case of any entity lacking partners, officers, and
directors, any individual within the organization exercising executive
functions similar to those of a general partner of a partnership or an
officer or director of a corporation; and
(4) In the case of an individual, such individual or his or her
legal representative.
(c) In each case described in paragraphs (b)(1) through (4) of this
section, such designee must possess actual authority to make the
certification on behalf of the party filing a notice, declaration, or
information.
Note 1 to Sec. 802.202: A sample certification may be found at
the Committee's section of the Department of the Treasury website.
See Sec. Sec. 802.402(f) and 802.502(k) regarding filing procedures
for transactions in which a U.S. public entity is a party to the
transaction.
Sec. 802.203 Close proximity.
The term close proximity means, with respect to a military
installation or another facility or property of the U.S. Government
identified in this part, the area that extends outward one mile from
the boundary of such military installation, facility, or property.
Sec. 802.204 Committee; Chairperson of the Committee; Staff
Chairperson.
The term Committee means the Committee on Foreign Investment in the
United States. The Chairperson of the Committee is the Secretary of the
Treasury. The Staff Chairperson of the Committee is the Department of
the Treasury official so designated by the Secretary of the Treasury or
by the Secretary's designee.
Sec. 802.205 Completion date.
The term completion date means, with respect to a transaction, the
earliest date upon which the purchase, lease, or concession is made
legally effective, or a change in rights that could result in a covered
real estate transaction occurs.
Note 1 to Sec. 802.205: See Sec. 802.304 regarding the timing
rule for a contingent equity interest.
Sec. 802.206 Concession.
The term concession means an arrangement, other than a purchase or
lease, whereby a U.S. public entity grants a right to use real estate
for the purpose of developing or operating infrastructure for a covered
port. This term includes the assignment of a concession, in whole or in
part, by the party who is not the U.S. public entity.
Sec. 802.207 Contingent equity interest.
The term contingent equity interest means a financial instrument
that currently does not constitute an equity interest but is
convertible into, or provides the right to acquire, an equity interest
upon the occurrence of a contingency or defined event.
Sec. 802.208 Control.
(a) The term control means the power, direct or indirect, whether
or not exercised, through the ownership of a majority or a dominant
minority of the total outstanding voting interest in an entity, board
representation, proxy voting, a special share, contractual
arrangements, formal or informal arrangements to act in concert, or
other means, to determine, direct, or decide important matters
affecting an entity; in particular, but without limitation, to
determine, direct, take, reach, or cause decisions regarding the
following matters, or any other similarly important matters affecting
an entity:
(1) The sale, lease, mortgage, pledge, or other transfer of any of
the tangible or intangible principal assets of the entity, whether or
not in the ordinary course of business;
(2) The reorganization, merger, or dissolution of the entity;
(3) The closing, relocation, or substantial alteration of the
production, operational, or research and development facilities of the
entity;
(4) Major expenditures or investments, issuances of equity or debt,
or dividend payments by the entity, or approval of the operating budget
of the entity;
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(5) The selection of new business lines or ventures that the entity
will pursue;
(6) The entry into, termination, or non-fulfillment by the entity
of significant contracts;
(7) The policies or procedures of the entity governing the
treatment of non-public technical, financial, or other proprietary
information of the entity;
(8) The appointment or dismissal of officers or senior managers or,
in the case of a partnership, the general partner;
(9) The appointment or dismissal of employees with access to
critical technology or other sensitive technology or classified U.S.
Government information; or
(10) The amendment of the Articles of Incorporation, constituent
agreement, or other organizational documents of the entity with respect
to the matters described in paragraphs (a)(1) through (9) of this
section.
(b) In examining questions of control in situations where more than
one foreign person has an ownership interest in an entity,
consideration will be given to factors such as whether the foreign
persons are related or have formal or informal arrangements to act in
concert, whether they are agencies or instrumentalities of the national
or subnational governments of a single foreign state, and whether a
given foreign person and another person that has an ownership interest
in the entity are both controlled by any of the national or subnational
governments of a single foreign state.
(c) The following minority shareholder protections shall not in
themselves be deemed to confer control over an entity:
(1) The power to prevent the sale or pledge of all or substantially
all of the assets of an entity or a voluntary filing for bankruptcy or
liquidation;
(2) The power to prevent an entity from entering into contracts
with majority investors or their affiliates;
(3) The power to prevent an entity from guaranteeing the
obligations of majority investors or their affiliates;
(4) The right to purchase an additional interest in an entity to
prevent the dilution of an investor's pro rata interest in that entity
in the event that the entity issues additional instruments conveying
interests in the entity;
(5) The power to prevent the change of existing legal rights or
preferences of the particular class of stock held by minority
investors, as provided in the relevant corporate documents governing
such shares; and
(6) The power to prevent the amendment of the Articles of
Incorporation, constituent agreement, or other organizational documents
of an entity with respect to the matters described in paragraphs (c)(1)
through (5) of this section.
(d) The Committee will consider, on a case-by-case basis, whether
minority shareholder protections other than those listed in paragraph
(c) of this section do not confer control over an entity.
Note 1 to Sec. 802.208: This definition is included herein for
the purpose of determining whether a foreign person may be involved
in a covered real estate transaction. For additional information,
see the examples provided at Sec. 800.208, as relevant.
Sec. 802.209 Conversion.
The term conversion means the exercise of a right inherent in the
ownership or holding of a particular financial instrument to exchange
any such instrument for an equity interest.
Sec. 802.210 Covered port.
(a) The term covered port means, subject to paragraph (b) of this
section, any port that is listed:
(1) In the Department of Transportation, Federal Aviation
Administration's annual final enplanement data as a ``large hub
airport,'' as that term is defined in 49 U.S.C. 40102;
(2) In the Department of Transportation, Federal Aviation
Administration's annual final all-cargo landed weight data as an
airport with annual aggregate all-cargo landed weight greater than 1.24
billion pounds;
(3) By the Department of Transportation, Federal Aviation
Administration as a ``joint use airport,'' as that term is defined in
49 U.S.C. 47175;
(4) By the Department of Transportation, Maritime Administration as
a commercial strategic seaport within the National Port Readiness
Network; or
(5) By the Department of Transportation, Bureau of Transportation
Statistics as a top 25 tonnage, container, or dry bulk port.
(b) For purposes of determining whether a port constitutes a
covered port under paragraph (a) of this section,
(1) Any port that is added after February 13, 2020 to any of the
lists described in paragraph (a) of this section shall be deemed not to
be in effect as a covered port until 30 days after the port's addition
to the relevant list maintained by the Department of Transportation;
and
(2) In the context of a particular transaction, the covered ports
in effect on the day immediately prior to, the earlier of, the date on
which the parties sign a written document establishing the material
terms of the transaction, or the completion date of the transaction,
shall apply.
Note 1 to Sec. 802.210: The lists described in paragraph (a)
of this section are published on the Department of Transportation
website.
Sec. 802.211 Covered real estate.
The term covered real estate means real estate that:
(a) Is, is located within, or will function as part of, a covered
port; or
(b) Is located within:
(1) Close proximity of any military installation described in Sec.
802.227(b) to (o), or another facility or property of the U.S.
Government, in each case as identified in the list at part 1 or part 2
of appendix A to this part;
(2) The extended range of any military installation described in
Sec. 802.227(h), (k), or (m), as identified in the list at part 2 of
appendix A to this part;
(3) Any county or other geographic area identified in connection
with any military installation described in Sec. 802.227(a), as
identified in the list at part 3 of appendix A to this part; or
(4) Any part of a military installation described in Sec.
802.227(p), as identified at part 4 of appendix A to this part, to the
extent located within the limits of the territorial sea of the United
States.
Sec. 802.212 Covered real estate transaction.
The term covered real estate transaction means:
(a) Other than an excepted real estate transaction, any purchase or
lease by, or concession to, a foreign person of covered real estate,
that affords the foreign person at least three of the property rights
under Sec. 802.233;
(b) Other than an excepted real estate transaction, any purchase or
lease by, or concession to, a foreign person of covered real estate,
that, through a subsequent change in the rights that a foreign person
has with respect to that covered real estate, results in the foreign
person having at least three of the property rights under Sec.
802.233; or
(c) Any other transaction, transfer, agreement, or arrangement, the
structure of which is designed or intended to evade or circumvent the
application of section 721 as it relates to real estate transactions.
Note 1 to Sec. 802.212: Any transaction, transfer, agreement,
or arrangement described in this section that arises pursuant to a
bankruptcy proceeding or other form of default on debt is a covered
real estate transaction. See also Sec. 802.303 for the treatment of
certain lending transactions.
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Sec. 802.213 Entity.
The term entity means any branch, partnership, group or sub-group,
association, estate, trust, corporation or division of a corporation,
or organization (whether or not organized under the laws of any State
or foreign state); assets (whether or not organized as a separate legal
entity) operated by any one of the foregoing as a business undertaking
in a particular location or for particular products or services; and
any government (including a foreign national or subnational government,
the U.S. Government, a subnational government within the United States,
and any of their respective departments, agencies, or
instrumentalities).
Sec. 802.214 Excepted real estate foreign state.
The term excepted real estate foreign state means, until February
13, 2022, a foreign state that meets the criteria in paragraph (a) of
this section, and beginning on February 13, 2022, a foreign state that
meets both the criteria in paragraphs (a) and (b) of this section:
(a) Is identified by the Committee as an eligible foreign state and
(b) Is a foreign state for which the Committee has made a
determination under Sec. 802.1001(a).
Note 1 to Sec. 802.214: The name of each foreign state
identified by the Committee as an eligible foreign state will be
available at the Committee's section of the Department of the
Treasury website. See Sec. 802.1001(c) regarding the publication of
a notice in the Federal Register of a determination under Sec.
802.1001(a). The list of excepted real estate foreign states will
also be available at the Committee's section of the Department of
the Treasury website.
Sec. 802.215 Excepted real estate investor.
(a) The term excepted real estate investor means a foreign person
who is, as of the completion date of the transaction and subject to
paragraphs (c) and (d) of this section:
(1) A foreign national who is a national of one or more excepted
real estate foreign states and is not also a national of any foreign
state that is not an excepted real estate foreign state;
(2) A foreign government of an excepted real estate foreign state;
or
(3) A foreign entity that meets each of the following conditions
with respect to itself and each of its parents (if any):
(i) Such entity is organized under the laws of an excepted real
estate foreign state or in the United States;
(ii) Such entity has its principal place of business in an excepted
real estate foreign state or in the United States;
(iii) Seventy-five percent or more of the members and 75 percent or
more of the observers of the board of directors or equivalent governing
body of such entity are:
(A) U.S. nationals; or
(B) Nationals of one or more excepted real estate foreign states
who are not also nationals of any foreign state that is not an excepted
real estate foreign state;
(iv) Any foreign person that individually, and each foreign person
that is part of a group of foreign persons that in the aggregate, holds
10 percent or more of the outstanding voting interest of such entity;
holds the right to 10 percent or more of the profits of such entity;
holds the right in the event of dissolution to 10 percent or more of
the assets of such entity; or otherwise could exercise control over
such entity, is:
(A) A foreign national who is a national of one or more excepted
real estate foreign states and is not also a national of any foreign
state that is not an excepted real estate foreign state;
(B) A foreign government of an excepted real estate foreign state;
or
(C) A foreign entity that is organized under the laws of an
excepted real estate foreign state and has its principal place of
business in an excepted real estate foreign state or in the United
States; and
(v) The minimum excepted ownership of such entity is held,
individually or in the aggregate, by one or more persons each of whom
is:
(A) Not a foreign person;
(B) A foreign national who is a national of one or more excepted
real estate foreign states and is not also a national of any foreign
state that is not an excepted real estate foreign state;
(C) A foreign government of an excepted real estate foreign state;
or
(D) A foreign entity that is organized under the laws of an
excepted real estate foreign state and has its principal place of
business in an excepted real estate foreign state or in the United
States.
(b) For purposes of paragraph (a)(3)(iv) of this section, foreign
persons who are related, have formal or informal arrangements to act in
concert, or are agencies or instrumentalities of, or controlled by, the
national or subnational governments of a single foreign state are
considered part of a group of foreign persons and their individual
ownerships are aggregated.
(c) Notwithstanding paragraph (a) of this section, a foreign person
is not an excepted real estate investor with respect to a transaction
if:
(1) In the five years prior to the completion date of the
transaction the foreign person, any of its parents, or any entity of
which it is a parent:
(i) Has received written notice from the Committee that it has
submitted a material misstatement or omission in a notice or
declaration or made a false certification under this part or part 800
or 801 of this chapter;
(ii) Has received written notice from the Committee that it has
violated a material provision of a mitigation agreement entered into
with, material condition imposed by, or an order issued by, the
Committee or a lead agency under section 721(l);
(iii) Has been subject to action by the President under section
721(d);
(iv) Has:
(A) Received a written Finding of Violation or Penalty Notice
imposing a civil monetary penalty from the Department of the Treasury,
Office of Foreign Assets Control (OFAC); or
(B) Entered into a settlement agreement with OFAC with respect to
apparent violations of U.S. sanctions laws administered by OFAC,
including the International Emergency Economic Powers Act, the Trading
With the Enemy Act, the Foreign Narcotics Kingpin Designation Act, each
as amended, or of any executive order, regulation, order, directive, or
license issued pursuant thereto;
(v) Has received a written notice of debarment from the Department
of State, Directorate of Defense Trade Controls, as described in 22 CFR
parts 127 and 128;
(vi) Has been a respondent or party in a final order, including a
settlement order, issued by the Department of Commerce, Bureau of
Industry and Security (BIS) regarding violations of U.S. export control
laws administered by BIS, including the Export Control Reform Act of
2018 (50 U.S.C. 4801 et seq.), the Export Administration Regulations
(15 CFR parts 730-774), or of any executive order, regulation, order,
directive, or license issued pursuant thereto;
(vii) Has received a final decision from the Department of Energy,
National Nuclear Security Administration imposing a civil penalty with
respect to a violation of section 57 b. of the Atomic Energy Act of
1954, as implemented under 10 CFR part 810; or
(viii) Has been convicted of, or has entered into a deferred
prosecution agreement or non-prosecution agreement with the Department
of Justice with respect to, any felony in any jurisdiction within the
United States; or
(2) The foreign person, any of its parents, or any entity of which
it is a parent is, on the date on which the parties to the transaction
first execute a binding written agreement, or other binding document,
establishing the material terms of the transaction, listed
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on either the BIS Unverified List or Entity List in 15 CFR part 744.
(d) Irrespective of whether the foreign person satisfies the
criteria in paragraph (a)(1) or (2), (a)(3)(i) through (iii), or
(c)(1)(i) through (iii) of this section as of the completion date, if
at any time during the three-year period following the completion date
the foreign person no longer meets all the criteria set forth in
paragraph (a)(1) or (2), (a)(3)(i) through (iii), or (c)(1)(i) through
(iii) of this section, the foreign person is not an excepted real
estate investor with respect to the transaction from the completion
date onward. This paragraph does not apply when an excepted real estate
investor no longer meets any of the criteria solely due to a rescission
of a determination under Sec. 802.1001(b) or if the relevant foreign
state otherwise ceases to be an excepted real estate foreign state.
(e) A foreign person may waive its status as an excepted real
estate investor with respect to a transaction at any time by submitting
a declaration under Sec. 802.401 or filing a notice under Sec.
802.501 regarding the transaction in which it explicitly waives such
status. In such case, the foreign person will be deemed not to be an
excepted real estate investor with respect to the transaction, and the
relevant provisions of subpart D or E will apply.
Note 1 to Sec. 802.215: See Sec. 802.501(c)(2) regarding an
agency notice where a foreign person is not an excepted real estate
investor solely due to paragraph (d) of this section.
Sec. 802.216 Excepted real estate transaction.
The term excepted real estate transaction means the following:
(a) A purchase or lease by, or concession to, an excepted real
estate investor of covered real estate, or a change in rights of an
excepted real estate investor with respect to covered real estate.
(b) A covered transaction as defined in part 800 of this chapter
that includes the purchase, lease, or concession of covered real
estate.
(c) The purchase, lease, or concession of covered real estate that
is within an urbanized area or urban cluster, except for real estate
that is subject to paragraph (a) or (b)(1) of Sec. 802.211.
(d) The purchase, lease, or concession of covered real estate that
is a single housing unit, including fixtures and adjacent land to the
extent that such fixtures and land are incidental to the use of the
real estate as a single housing unit.
(e) The lease by or a concession to a foreign person of covered
real estate under paragraph (a) of Sec. 802.211 if:
(1) The foreign person is a foreign air carrier, as that term is
defined in 49 U.S.C. 40102(a)(21), for whom the Department of Homeland
Security, Transportation Security Administration has accepted a
security program under 49 CFR 1546.105, but only to the extent that the
lease or concession is in furtherance of its activities as a foreign
air carrier; or
(2) According to the terms of the lease or concession, the covered
real estate may be used only for the purpose of engaging in the retail
sale of consumer goods or services to the public.
(f) The purchase or lease by, or concession to, a foreign person of
commercial space in a multi-unit building that is covered real estate,
if, upon the completion of the transaction:
(1) The foreign person and its affiliates do not, in the aggregate,
hold, lease, or have a concession with respect to commercial space in
such building that exceeds 10 percent of the total square footage of
the commercial space of such building; and
(2) The foreign person and its affiliates (each counted separately)
do not represent more than 10 percent of the total number of tenants
based on the number of ownership, lease and concession arrangements for
commercial space in the building.
(g) The purchase or lease by, or a concession to, a foreign person
of covered real estate either:
(1) Owned by an Alaska ``Native village,'' ``Native group,'' or
``Native Corporation'' as those terms are defined in the Alaska Native
Claims Settlement Act at 43 U.S.C. 1602; or
(2) Held in trust by the United States for American Indians, Indian
tribes, Alaska Natives, or any of the entities set forth in paragraph
(g)(1) of this section.
(h) Examples:
(1) Example 1. Corporation A, a foreign person, proposes to
purchase all of the shares of Corporation X, a U.S. business.
Corporation X is in the business of owning and leasing real estate,
including real estate properties that are in close proximity to
military installations identified in part 1 and part 2 of appendix A
to this part. As the sole owner of Corporation X, Corporation A will
have control over Corporation X. The proposed transaction is not a
covered real estate transaction but is a covered transaction under
part 800 of this chapter.
(2) Example 2. Same facts as the example in paragraph (h)(1) of
this section. After the transaction contemplated in Example 1 of
this section is completed, Corporation X leases from another person
a tract of land that is in close proximity to a military
installation identified in part 1 of appendix A to this part.
Assuming no other relevant facts, the proposed transaction is a
covered real estate transaction but only with respect to the new
lease.
(3) Example 3. Corporation A, a foreign person, seeks to
purchase from Corporation X an empty warehouse located in close
proximity to a military installation identified in part 2 of
appendix A to this part. Assuming no other relevant facts, the
purchase of the covered real estate is not a covered transaction
subject to part 800 of this chapter because Corporation A has not
acquired a U.S. business, and the purchase is a covered real estate
transaction.
(4) Example 4. Same facts as the example in paragraph (h)(3) of
this section, except that, in addition to the proposed purchase of
Corporation X's empty warehouse, Corporation A would also acquire
from Corporation X the personnel, customer list, equipment, and
inventory management software used to operate the warehouse. Under
these facts, Corporation A is acquiring a U.S. business, and the
proposed transaction is a covered transaction subject to part 800 of
this chapter and therefore not a covered real estate transaction.
(5) Example 5. Corporation A, a foreign person, purchases
covered real estate that is undeveloped and in close proximity to a
military installation identified in part 1 of appendix A to this
part. Corporation A, through a newly incorporated U.S. subsidiary,
intends to use the covered real estate to set up a manufacturing
facility. Assuming no other relevant facts, Corporation A has not
acquired a U.S. business, the purchase of the covered real estate is
not a covered transaction subject to part 800 of this chapter, and
Corporation A's purchase of the covered real estate is a covered
real estate transaction.
(6) Example 6. A foreign person purchases real estate. The
nearest military installation is one that is identified in part 2 of
appendix A to this part and is 40 miles away (i.e., in the extended
range) from the real estate. The real estate is located in a
statistical geographic area with a population of 125,000
individuals. Assuming no other relevant facts, the transaction is
not a covered real estate transaction because the covered real
estate is located in an urbanized area.
(7) Example 7. Same facts as the example in paragraph (h)(6) of
this section, except that the covered real estate is not located in
an urbanized area or an urban cluster. Assuming no other relevant
facts, the real estate transaction is a covered real estate
transaction.
(8) Example 8. A foreign person purchases real estate that is
0.25 miles from a military installation identified in part 1 of
appendix A to this part. The real estate is located in an urbanized
area. Assuming no other relevant facts, the real estate transaction
is a covered real estate transaction because it is in close
proximity to a military installation listed in part 1 of appendix A
to this part.
(9) Example 9. A foreign person purchases a single housing unit,
including the one acre of land surrounding it, within 0.5 miles from
a military installation identified in part 1 of appendix A to this
part. Each home in the neighborhood sits on a separate lot, each of
which is approximately one acre in size. The acre of land
surrounding the housing unit is incidental to use of the land as a
single housing unit, and the real estate transaction
[[Page 3171]]
therefore is not a covered real estate transaction.
(10) Example 10. Same facts as the example in paragraph (h)(9)
of this section, except that the foreign person also purchases an
adjacent five acres of undeveloped land a year later. Assuming no
other relevant facts, the purchase of the adjacent land is a covered
real estate transaction.
(11) Example 11. A foreign person leases five percent of the
total commercial space in a building located 0.5 miles from a
military installation identified in part 1 of appendix A to this
part. There are nine other tenants that have leases for commercial
space with the building owner. Assuming no other relevant facts, the
transaction is a not a covered real estate transaction.
Note 1 to Sec. 802.216: With respect to paragraph (d) of this
section, for purposes herein, fixtures and land may be considered
incidental if the size and nature of such is common for similar
single housing units in the locality in which the unit is located.
Sec. 802.217 Extended range.
The term extended range means, with respect to any military
installation identified in Sec. 802.227(h), (k), or (m), as listed in
part 2 of appendix A to this part, the area that extends 99 miles
outward from the outer boundary of close proximity to such military
installation, but, where applicable, not exceeding the outer limit of
the territorial sea of the United States.
Sec. 802.218 Foreign entity.
(a) The term foreign entity means any branch, partnership, group or
sub-group, association, estate, trust, corporation or division of a
corporation, or organization organized under the laws of a foreign
state if either its principal place of business is outside the United
States or its equity securities are primarily traded on one or more
foreign exchanges.
(b) Notwithstanding paragraph (a) of this section, any branch,
partnership, group or sub-group, association, estate, trust,
corporation or division of a corporation, or organization that can
demonstrate that a majority of the equity interest in such entity is
ultimately owned by U.S. nationals is not a foreign entity.
Sec. 802.219 Foreign government.
The term foreign government means any government or body exercising
governmental functions, other than the U.S. Government or a subnational
government of the United States. The term includes, but is not limited
to, national and subnational governments, including their respective
departments, agencies, and instrumentalities.
Sec. 802.220 Foreign national.
The term foreign national means any individual other than a U.S.
national.
Sec. 802.221 Foreign person.
(a) The term foreign person means:
(1) Any foreign national, foreign government, or foreign entity; or
(2) Any entity over which control is exercised or exercisable by a
foreign national, foreign government, or foreign entity.
(b) Any entity over which control is exercised or exercisable by a
foreign person is a foreign person.
(c) Examples:
(1) Example 1. Corporation A is organized under the laws of a
foreign state and is engaged in business only outside the United
States. All of its shares are held by Corporation X, which solely
controls Corporation A. Corporation X is organized in the United
States and is wholly owned and controlled by U.S. nationals.
Assuming no other relevant facts, Corporation A, although organized
and operating only outside the United States, is not a foreign
entity due to Sec. 802.218(b) and is not a foreign person.
(2) Example 2. Same facts as the first sentence of the example
in paragraph (c)(1) of this section. The government of the foreign
state under whose laws Corporation A is organized exercises control
over Corporation A because a law establishing Corporation A gives
the foreign state the right to appoint Corporation A's board
members. Corporation A is a foreign person.
(3) Example 3. Corporation A is organized in the United States,
is engaged in interstate commerce in the United States, and is
controlled by Corporation X. Corporation X is organized under the
laws of a foreign state, its principal place of business is located
outside the United States, and 50 percent of its shares are held by
foreign nationals and 50 percent of its shares are held by U.S.
nationals. Both Corporation A and Corporation X are foreign persons.
Corporation A is also a U.S. business.
(4) Example 4. Corporation A is organized under the laws of a
foreign state and is owned and controlled by a foreign national. A
branch of Corporation A engages in interstate commerce in the United
States. Corporation A (including its branch) is a foreign person.
The branch is also a U.S. business.
(5) Example 5. Corporation A is organized under the laws of a
foreign state and its principal place of business is located outside
the United States. Forty-five percent of the equity interest in
Corporation A is owned in equal shares by numerous unrelated foreign
investors, none of whom has control. The foreign investors have no
formal or informal arrangement with any other holder of equity
interest in Corporation A to act in concert regarding Corporation A.
Corporation A can demonstrate that the remainder of the equity
interest in Corporation A is ultimately held by U.S. nationals.
Assuming no other relevant facts, Corporation A is not a foreign
entity or foreign person.
(6) Example 6. Same facts as the example in paragraph (c)(5) of
this section, except that one of the foreign investors, a foreign
national, controls Corporation A. Assuming no other relevant facts,
Corporation A is not a foreign entity due to Sec. 802.218(b), but
it is a foreign person under paragraph (a)(2) of this section
because it is controlled by a foreign national.
Sec. 802.222 Hold.
The terms hold(s) and holding mean legal or beneficial ownership,
whether direct or indirect, whether through fiduciaries, agents, or
other means.
Sec. 802.223 Housing unit.
The term housing unit means a single family house, townhome, mobile
home or trailer, apartment, group of rooms, or single room that is
occupied as a separate living quarters, or, if vacant, is intended for
occupancy as a separate living quarters.
Sec. 802.224 Investment fund.
The term investment fund means any entity that is an ``investment
company,'' as defined in section 3(a) of the Investment Company Act of
1940 (15 U.S.C. 80a-1 et seq.), or would be an ``investment company''
but for one or more of the exemptions provided in section 3(b) or 3(c)
thereunder.
Sec. 802.225 Lead agency.
The term lead agency means the Department of the Treasury and any
other agency designated by the Chairperson of the Committee to have
primary responsibility, on behalf of the Committee, for the specific
activity for which the Chairperson designates it as a lead agency,
including all or a portion of an assessment, a review, an
investigation, or the negotiation or monitoring of a mitigation
agreement or condition.
Sec. 802.226 Lease.
(a) The term lease means an arrangement conveying a possessory
interest in real estate, short of ownership, to a person for a
specified time and in exchange for consideration. This term includes
subleases and assignments in whole or part.
(b) Examples:
(1) Example 1. Foreign person A enters into an arrangement with
a neighbor that allows the foreign person to use a private road
running across the neighbor's land. The road will remain owned by
the neighbor following the arrangement. The neighbor will also
retain physical possession of his land despite the foreign person
having permission to traverse the land while using the road. The
arrangement does not convey a possessory interest in real estate.
Assuming no other relevant facts, the foreign person has not entered
into a lease.
(2) Example 2. Same facts as the example in paragraph (b)(1) of
this section, except that
[[Page 3172]]
the foreign person's arrangement with the neighbor gives the foreign
person the exclusive right to occupy a portion of the neighbor's
land and attach fixtures to the surface, in exchange for a fee for a
specified period of time. The foreign person can unilaterally
adjust, remove, and make other changes to the fixtures. The foreign
person has entered into a lease.
Note 1 to Sec. 802.226: See Sec. 800.249(a)(5) for certain
long-term leases and concessions that could be subject to part 800
of this chapter.
Sec. 802.227 Military installation.
The term military installation means any site that meets the
following category descriptions, as identified in the list at appendix
A to this part:
(a) Active Air Force ballistic missile fields;
(b) Air Force bases administering active Air Force ballistic
missile fields;
(c) Air Force bases and major annexes thereof containing a unit
from the Air Force Air Combat Command;
(d) Air Force bases and major annexes thereof containing an Air
Force research laboratory or test unit and associated sites;
(e) Air Force bases and major annexes thereof containing a unit of
the North American Aerospace Defense Command and its regions;
(f) Air Force bases and Air Force stations and major annexes
thereof containing satellite, telemetry, tracking, or commanding
systems;
(g) Army bases, ammunition plants, centers of excellence and
research laboratories and major annexes thereof, excluding depots,
arsenals, and airfields that are not collocated with an Army
installation included in this section;
(h) Army combat training centers located in the continental United
States;
(i) Headquarters of the Office of the Secretary of Defense and
Defense Advanced Research Projects Agency and major offices and annexes
thereof;
(j) Long range radar sites and major annexes thereof in any of the
following states: Alaska, North Dakota, California, or Massachusetts;
(k) Major range and test facility base activities as defined in 10
U.S.C. 196;
(l) Marine Corps bases and air stations and major annexes thereof,
excluding detachments, installations, logistics battalions, recruit
depots, and support facilities;
(m) Military ranges as defined in 10 U.S.C. 101(e)(1) owned by the
Navy or Air Force, or joint forces training centers that are located in
any of the following states: Oregon, Nevada, Idaho, Wisconsin,
Mississippi, North Carolina, or Florida;
(n) Naval bases and air stations containing squadrons and
supporting commands of the Submarine Force Atlantic or Submarine Force
Pacific and major offices thereof;
(o) Naval surface, air, and undersea warfare centers and research
laboratories and major annexes thereof; and
(p) Navy off-shore range complexes and off-shore operating areas.
Sec. 802.228 Minimum excepted ownership.
The term minimum excepted ownership means:
(a) With respect to an entity whose equity securities are primarily
traded on an exchange in an excepted real estate foreign state or the
United States, a majority of its voting interest, the right to a
majority of its profits, and the right in the event of dissolution to a
majority of its assets; and
(b) With respect to an entity whose equity securities are not
primarily traded on an exchange in an excepted real estate foreign
state or the United States, 80 percent or more of its voting interest,
the right to 80 percent or more of its profits, and the right in the
event of dissolution to 80 percent or more of its assets.
Sec. 802.229 Parent.
(a) The term parent means, with respect to an entity:
(1) A person who or which directly or indirectly:
(i) Holds or will hold at least 50 percent of the outstanding
voting interest in the entity; or
(ii) Holds or will hold the right to at least 50 percent of the
profits of the entity, or has or will have the right in the event of
dissolution to at least 50 percent of the assets of the entity; or
(2) The general partner, managing member, or equivalent of the
entity.
(b) Any entity that meets the conditions of paragraph (a)(1) or (2)
of this section with respect to another entity (i.e., the intermediate
parent) is also a parent of any other entity of which the intermediate
parent is a parent.
(c) Examples:
(1) Example 1. Corporation P holds 50 percent of the voting
interest in Corporations R and S; Corporation R holds 40 percent of
the voting interest in Corporation X; and Corporation S holds 50
percent of the voting interest in Corporation Y, which in turn holds
50 percent of the voting interest in Corporation Z. Corporation P is
a parent of Corporations R, S, Y, and Z, but not of Corporation X.
Corporation S is a parent of Corporation Y and Z, and Corporation Y
is a parent of Corporation Z.
(2) Example 2. Corporation A holds warrants which when exercised
will entitle it to vote 50 percent of the outstanding shares of
Corporation B. Corporation A is a parent of Corporation B.
(3) Example 3. Investor A holds 60 percent of the outstanding
voting interest in Corporation B. Investor C holds the right to 80
percent of the profits of Corporation B. Each of Investor A and
Investor C is a parent of Corporation B.
Sec. 802.230 Party to a transaction.
(a) The term party to a transaction means:
(1) In the case of a purchase, the person acquiring the ownership
interest, the person from whom such ownership interest is acquired, and
the entity whose ownership interest is being acquired, without regard
to any person providing brokerage or underwriting services for the
transaction;
(2) In the case of a lease, the person acquiring the possessory
interest, and the person from whom such possessory interest is
acquired;
(3) In the case of a concession, the person receiving the right to
use the covered real estate, and the U.S. public entity;
(4) In the case of a change in rights that a person has with
respect to covered real estate as a result of a purchase, lease, or
concession, the person whose rights change as a result of the
transaction, and the person conveying those rights; and
(5) In the case of any other transaction, transfer, agreement, or
arrangement, the structure of which is designed or intended to evade or
circumvent the application of section 721, any person that participates
in such transaction, transfer, agreement, or arrangement.
(6) In all cases, each party that submitted a declaration or notice
to the Committee regarding a transaction.
(b) For purposes of section 721(l), the term party to a transaction
includes any affiliate of any party described in paragraph (a) of this
section that the Committee, or a lead agency acting on behalf of the
Committee, determines is relevant to mitigating a risk to the national
security of the United States.
Sec. 802.231 Person.
The term person means any individual or entity.
Sec. 802.232 Principal place of business.
(a) The term principal place of business means, subject to
paragraph (b) of this section, the primary location where an entity's
management directs, controls, or coordinates the entity's activities,
or, in the case of an investment fund, where the fund's activities and
investments are primarily directed, controlled, or coordinated by or on
behalf of the general partner, managing member, or equivalent.
[[Page 3173]]
(b) If the location determined under paragraph (a) of this section
is in the United States and the entity has represented to the U.S.
Government or a subnational government of the United States or any
foreign government, in the most recent submission or filing to such
government (other than a submission or filing to the Committee) in
which the entity has identified its principal place of business,
principal office and place of business, address of principal executive
offices, address of headquarters, or equivalent, that any of the
foregoing is outside the United States, then the location identified in
such submission or filing is deemed for purposes of this definition to
be the entity's principal place of business unless the entity can
demonstrate that such location has changed to the United States since
such submission or filing.
Sec. 802.233 Property right.
(a) The term property right means, with respect to real estate, any
of the following rights or abilities, whether or not exercised, whether
or not shared concurrently with any other person, and whether or not
the underlying real estate is subject to an easement or other
encumbrance:
(1) To physically access the real estate;
(2) To exclude others from physically accessing the real estate;
(3) To improve or develop the real estate; or
(4) To attach fixed or immovable structures or objects to the real
estate.
(b) Examples:
(1) Example 1. Corporation A, a foreign person, enters into a
lease of real estate. Although at least one other person shares
concurrently with Corporation A the right to access the property,
Corporation A retains the right to physically exclude others from
access that would interfere with its rights under the lease. Under
the lease, Corporation A has the right to exclude others from
physically accessing the real estate, and therefore affords the
foreign person a property right.
(2) Example 2. Corporation A, a foreign person, enters into a
lease of real estate that allows Corporation A to develop the real
estate. The exercise of the right to develop the real estate is
subject to Corporation A obtaining the appropriate regulatory
permits. Notwithstanding the fact that Corporation A has not fully
exercised its lease right pending the issuance of the permits,
Corporation A is a party to lease that affords it a property right
for purposes of this part.
Sec. 802.234 Purchase.
(a) The term purchase means an arrangement conveying an ownership
interest in real estate to a person in exchange for consideration.
(b) Example: Person A, a foreign person, acquires covered real
estate from Person B, a U.S. national, in exchange for land and
services. Person A has purchased the covered real estate because the
arrangement was predicated on consideration in the form of land and
services.
Sec. 802.235 Real estate.
The term real estate means any land, including subsurface and
submerged, or structure attached to land, including any building or any
part thereof, that is located in the United States.
Sec. 802.236 Section 721.
The term section 721 means section 721 of title VII of the Defense
Production Act of 1950, as amended (50 U.S.C. 4565).
Sec. 802.237 Transaction.
The term transaction means any purchase or lease by, or concession
to, a person of real estate, whether proposed or completed.
Sec. 802.238 United States.
The term United States or U.S. means the United States of America,
the States of the United States, the District of Columbia, and any
commonwealth, territory, dependency, or possession of the United
States, or any subdivision of the foregoing, and includes the
territorial sea of the United States. For purposes of these regulations
and their examples in this part, an entity organized under the laws of
the United States of America, one of the States, the District of
Columbia, or a commonwealth, territory, dependency, or possession of
the United States is an entity organized ``in the United States.''
Sec. 802.239 Urban cluster.
The term urban cluster means a statistical geographic area as
identified in the most recent U.S. Census consisting of a densely
settled core created from census tracts or blocks and contiguous
qualifying territory that together have at least 2,500 individuals but
fewer than 50,000 individuals.
Sec. 802.240 Urbanized area.
The term urbanized area means a statistical geographic area as
identified in the most recent U.S. Census consisting of a densely
settled core created from census tracts or blocks and contiguous
qualifying territory that together have a minimum population of at
least 50,000 individuals.
Sec. 802.241 U.S. business.
The term U.S. business means any entity, irrespective of the
nationality of the persons that control it, engaged in interstate
commerce in the United States.
Note 1 to Sec. 802.241: See examples to definition in Sec.
800.252.
Sec. 802.242 U.S. national.
The term U.S. national means an individual who is a U.S. citizen or
an individual who, although not a U.S. citizen, owes permanent
allegiance to the United States.
Sec. 802.243 U.S. public entity.
The term U.S. public entity means the U.S. Government, a
subnational government of the United States, or any other body
exercising governmental functions of the United States, including air
and maritime port authorities. The term includes, but is not limited
to, the respective departments, agencies, and instrumentalities of the
U.S. Government and the subnational governments of the United States.
Sec. 802.244 Voting interest.
The term voting interest means any interest in an entity that
entitles the owner or holder of that interest to vote for the election
of directors of the entity (or, with respect to unincorporated
entities, individuals exercising similar functions) or to vote on other
matters affecting the entity.
Subpart C--Coverage
Sec. 802.301 Transactions that are covered real estate transactions.
Transactions that are covered real estate transactions include:
(a) A transaction that meets the criteria of Sec. 802.212,
including where a foreign person (other than an excepted real estate
investor) enters into a purchase or lease of, or obtains a concession
to, covered real estate either directly or indirectly. (See the
examples in paragraphs (h)(1) and (2) of this section.)
(b) A purchase by a foreign person (other than an excepted real
estate investor) of less than full ownership of covered real estate
that nevertheless affords the foreign person at least three property
rights with respect to the covered real estate. (See the example in
paragraph (h)(3) of this section.)
(c) A purchase or lease by, or concession to, a foreign person
(other than an excepted real estate investor) of real estate, a portion
of which is covered real estate with respect to which the foreign
person has at least three property rights. (See the example in
paragraph (h)(4) of this section.)
(d) A purchase or lease by, or concession to, a foreign person
(other than an excepted real estate investor) of a portion of covered
real estate with respect to which the foreign person has at least three
property rights. (See the
[[Page 3174]]
example in paragraph (h)(5) of this section.)
(e) A purchase, lease, or assignment of a concession, of covered
real estate that meets the criteria of Sec. 802.212 by one foreign
person (other than an excepted real estate investor) from another
foreign person. (See the example in paragraph (h)(6) of this section.)
(f) A purchase or lease by, or concession to, a foreign person
(other than an excepted real estate investor) of covered real estate,
that, through a subsequent change in the rights that a foreign person
has with respect to covered real estate, results in the foreign person
having at least three property rights. (See the example in paragraph
(h)(7) of this section.)
(g) A transaction the structure of which is designed or intended to
evade or circumvent the application of this part.
(h) Examples:
(1) Example 1. Corporation A, a foreign person, acquires
Corporation X, a U.S. business. As a result, Corporation X is a
foreign person. Subsequently, Corporation X purchases real estate
that is in close proximity to a military installation identified in
part 1 of appendix A to this part and obtains all of the property
rights with respect to such real estate. Assuming no other relevant
facts, the transaction is a covered real estate transaction.
(2) Example 2. Corporation A purchases covered real estate that
is undeveloped land. Corporation A's only asset in the United States
is the covered real estate, and Corporation A is not itself nor does
it own a U.S. business. In a subsequent transaction, Corporation B,
a foreign person, purchases 100 percent of the shares of Corporation
A. Assuming no other relevant facts, the subsequent transaction as
an indirect purchase of real estate is a covered real estate
transaction.
(3) Example 3. Corporation A, a foreign person, together with
Corporation B, a U.S. business, purchases real estate that is in
close proximity to a military installation identified in part 2 of
appendix A to this part. Neither party has full ownership; rather,
the title to the real estate is held by the two parties jointly.
Corporation A is afforded at least three property rights as a result
of the transaction. Assuming no other relevant facts, the
transaction is a covered real estate transaction.
(4) Example 4. Corporation A, a foreign person, purchases real
estate. Half of such real estate is located in close proximity to a
military installation identified in part 1 of appendix A to this
part of and is therefore covered real estate. The other half of the
real estate purchased by Corporation A is not located in close
proximity to any such military installation. Assuming no other
relevant facts, Corporation A's purchase is a covered real estate
transaction.
(5) Example 5. Corporation A, a U.S. business, purchases covered
real estate that is entirely located in close proximity to a
military installation identified in part 2 of appendix A to this
part. Corporation B, a foreign person, leases from Corporation A a
part of that real estate. Corporation B is entitled to at least
three property rights with respect to the real estate as a result of
the transaction. Assuming no other relevant facts, Corporation B's
lease is a covered real estate transaction.
(6) Example 6. Corporation A, a foreign person, purchases
covered real estate and is afforded three property rights with
respect to the covered real estate. In a subsequent transaction,
Corporation B, another foreign person, leases the covered real
estate from Corporation A, and is also afforded three property
rights. Assuming no other relevant facts, each transaction is a
covered real estate transaction.
(7) Example 7. Corporation A, a foreign person, leases from
Person B covered real estate, and is afforded two property rights.
Person B subsequently provides Corporation A an additional property
right in connection with the lease. Assuming no other relevant
facts, the lease is a covered real estate transaction because the
subsequent change in rights results in the foreign person having at
least three property rights.
Sec. 802.302 Transactions that are not covered real estate
transactions.
Transactions that are not covered real estate transactions include:
(a) A transaction that meets the definition of excepted real estate
transaction in Sec. 802.216.
(b) A purchase or lease by, or concession to, a foreign person of
covered real estate, or a subsequent change in rights, that does not
afford or result in the foreign person having at least three of the
property rights with respect to the covered real estate.
(c) An acquisition of securities by a person acting as a securities
underwriter, in the ordinary course of business and in the process of
underwriting.
(d) An acquisition pursuant to a condition in a contract of
insurance relating to fidelity, surety, or casualty obligations if the
contract was made by an insurer in the ordinary course of business.
Sec. 802.303 Lending transactions.
(a) The extension of a mortgage, loan, or similar financing
arrangement by a foreign person to another person for the purpose of
the purchase, lease, or concession of covered real estate, regardless
of whether accompanied by the creation in favor of the foreign person
of a secured interest in the covered real estate, shall not, by itself,
constitute a covered real estate transaction.
(1) The Committee will accept notices or declarations concerning a
mortgage, loan, or similar financing arrangement that does not, by
itself, constitute a covered real estate transaction only at the time
that, because of imminent or actual default or other condition, there
is a significant possibility that a purchase or lease by, concession
to, or a change in rights involving a foreign person may result from
the default or other condition and that would constitute a covered real
estate transaction.
(2) Where the Committee accepts a notice or declaration concerning
a mortgage, loan, or similar financing arrangement under paragraph
(a)(1) of this section, and a party to the transaction is a foreign
person that makes mortgages or loans in the ordinary course of
business, the Committee will take into account whether the foreign
person has made any arrangements to transfer the ownership and property
rights over the covered real estate to U.S. nationals or excepted real
estate investors for purposes of determining whether such mortgage,
loan, or financing arrangement constitutes a covered real estate
transaction.
(b) Notwithstanding paragraph (a) of this section, a mortgage,
loan, or similar financing arrangement through which a foreign person
acquires property rights over covered real estate may constitute a
covered real estate transaction to the extent that the arrangement
would constitute a purchase, lease, or concession under this part.
(c) Example: Corporation A, a foreign bank, makes a secured loan to
Corporation B in order for Corporation B to purchase a building that
constitutes covered real estate. The collateral for the loan is the
building that Corporation B is purchasing, and upon default,
Corporation A would obtain an ownership interest and be afforded at
least three property rights with respect to the building. Corporation B
defaults on the loan. Assuming no other relevant facts, the Committee
would accept a notice or declaration of the imminent default or default
transferring ownership of the building to Corporation A, which would
constitute a covered real estate transaction.
Sec. 802.304 Timing rule for a contingent equity interest.
(a) For purposes of determining whether to include the rights that
a holder of a contingent equity interest will acquire upon conversion
of, or exercise of a right provided by, that interest in the
Committee's analysis of whether a notified transaction is a covered
real estate transaction, the Committee will consider factors that
include:
[[Page 3175]]
(1) The imminence of conversion or satisfaction of contingent
conditions;
(2) Whether conversion or satisfaction of contingent conditions
depends on factors within the control of the acquiring party; and
(3) Whether the amount of interest and the rights that would be
acquired upon conversion or satisfaction of contingent conditions can
be reasonably determined at the time of acquisition.
(b) When the Committee, applying paragraph (a) of this section,
determines that the rights that the holder will acquire upon conversion
or satisfaction of contingent condition will not be included in the
Committee's analysis of whether a notified or submitted transaction is
a covered real estate transaction, the Committee will disregard the
contingent equity interest for purposes of that transaction except to
the extent that they convey immediate rights to the holder with respect
to the entity that issued the interest.
Subpart D--Declarations
Sec. 802.401 Procedures for declarations.
(a) A party or parties may submit a voluntary declaration of a
transaction by submitting electronically the information set out in
Sec. 802.402, including the certifications required thereunder, to the
Staff Chairperson in accordance with the submission instructions on the
Committee's section of the Department of the Treasury website.
(b) No communications other than those described in paragraph (a)
of this section shall constitute the submission of a declaration for
purposes of section 721.
(c) Information and other documentary material submitted to the
Committee under this section shall be considered to have been filed
with the President or the President's designee for purposes of section
721(c) and Sec. 802.802.
(d) Persons filing a declaration shall, during the time that the
matter is pending before the Committee, promptly advise the Staff
Chairperson of any material changes in plans, facts, or circumstances
regarding the transaction, and any material change in information
provided or required to be provided to the Committee under Sec.
802.402. Unless the Committee rejects the declaration on the basis of
such material changes in accordance with Sec. 802.404(a)(2)(i), such
changes shall become part of the declaration filed by such persons
under this section, and the certification required under Sec.
802.403(d) shall apply to such changes.
(e) Parties to a transaction that have filed with the Committee a
written notice regarding a transaction under Sec. 802.501 or Sec.
800.501 or a declaration under Sec. 800.403 may not submit to the
Committee a declaration regarding the same transaction or a
substantially similar transaction without the written approval of the
Staff Chairperson.
Sec. 802.402 Contents of declarations.
(a) The party or parties submitting a voluntary declaration of a
transaction under Sec. 802.401 shall provide the information set out
in this section, which must be accurate and complete with respect to
the party or parties filing the voluntary declaration and to the
transaction. (See also paragraphs (d), (e), and (f) of this section.)
(b) Other than as provided under paragraph (f) of this section, if
fewer than all the parties to a transaction submit a declaration, the
Committee may, at its discretion, request that the parties to the
transaction file a written notice of the transaction under Sec.
802.501, if the Staff Chairperson determines that the information
provided by the submitting party or parties in the declaration is
insufficient for the Committee to assess the transaction.
(c) Subject to paragraph (e) of this section, a declaration
submitted under Sec. 802.401 shall describe or provide, as applicable:
(1) The name of the foreign person(s) and the current holder(s) of
interest in the real estate that are parties to, or, in applicable
cases, the subject of the transaction, as well as the name, telephone
number, and email address of the primary point of contact for each
party.
(2) The following information regarding the transaction in
question:
(i) A brief description of the rationale for and nature of the
transaction, including its structure (e.g., purchase, lease, or
concession) and term, whether the foreign person is acquiring a
collection of assets or interest in an entity, and whether it is part
of a larger project undertaken by the foreign person;
(ii) The total transaction value in U.S. dollars;
(iii) The status of the transaction, including the actual or
expected completion date of the transaction;
(iv) All sources of financing for the transaction and any real
estate agents/brokers involved; and
(v) A copy of the definitive documentation of the transaction, such
as a purchase, lease, or concession agreement, or if none exists, the
document establishing the material terms of the transaction, which in
the context of a transaction involving a covered port, must be signed
and dated.
(3) The following information regarding the real estate that is the
subject of the transaction:
(i) The location, by address and geographic coordinates in decimal
degrees to the fourth digit, of the real estate that is the subject of
the transaction;
(ii) The name(s) of and distance(s) to any covered port, military
installation, or any other facility or property of the U.S. Government
as identified in this part and that is relevant to CFIUS jurisdiction
given the location of the real estate.
(iii) A description of the real estate that is the subject of the
transaction including the approximate size (in acres, feet, or other
appropriate measurement); nature of the real estate (e.g., zoning type
and the major topographical or other features of the real estate); and
current use of the real estate including any physical security
measures.
(iv) A description of the plans of the foreign person with respect
to the real estate and structures that are or will be on the real
estate; and
(v) A description of any leases, licenses, permits, easements,
encumbrances, or other grants or approvals associated with the real
estate, including whether any involve the U.S. Government.
(4) A statement as to whether the foreign person will have any of
the following rights or abilities with respect to the real estate as a
result of the transaction:
(i) To physically access the real estate;
(ii) To exclude others from physically accessing the real estate;
(iii) To improve or develop the real estate; or
(iv) To attach fixed or immovable structures or objects to the real
estate.
(5) The name of the ultimate parent of the foreign person.
(6) The address and principal place of business of the foreign
person and its ultimate parent.
(7) A complete pre-transaction organizational chart (and post-
transaction, if different) including, information that identifies the
name, principal place of business, place of incorporation or other
legal organization (for entities); nationality (for individuals); and
ownership percentage (expressed in terms of both voting and economic
interest, if different) for each of the following:
(i) The immediate parent, the ultimate parent, and each
intermediate parent, if
[[Page 3176]]
any, of each foreign person that is a party to the transaction;
(ii) Where the ultimate parent is a private company, the ultimate
owner(s) of such parent; and
(iii) Where the ultimate parent is a public company, any
shareholder with an interest of greater than five percent in such
parent.
(8) Information regarding all foreign government ownership in the
foreign person's ownership structure, including nationality and
percentage of ownership, as well as any rights that a foreign
government holds, directly or indirectly, with respect to the foreign
person.
(9) With respect to the foreign person that is party to the
transaction and any of its parents, as applicable, a brief summary of
their respective business activities.
(10) A statement as to whether a party to the transaction is
stipulating that the transaction is a covered real estate transaction
and a description of the basis for the stipulation.
(11) A statement as to whether any party to the transaction has
been party to another transaction previously notified or submitted to
the Committee, and the case number assigned by the Committee regarding
such transaction(s).
(12) A statement (including relevant jurisdiction and criminal case
law number or legal citation) as to whether the holder of the real
estate, the foreign person, any parent of the foreign person, or any
person of which the foreign person is a parent, has been convicted in
the last 10 years of a crime in any jurisdiction.
(d) Each party submitting a declaration shall provide a
certification of the information contained in the declaration
consistent with Sec. 802.202. A sample certification may be found on
the Committee's section of the Department of the Treasury website.
(e) A party that offers a stipulation under paragraph (c)(10) of
this section acknowledges that the Committee and the President are
entitled to rely on such stipulation in determining whether the
transaction is a covered real estate transaction for the purposes of
section 721 and all authorities thereunder, and waives the right to
challenge any such determination. Neither the Committee nor the
President is bound by any such stipulation, nor does any such
stipulation limit the ability of the Committee or the President to act
on any authority provided under section 721 with respect to any covered
real estate transaction.
(f) In the case of a transaction where a U.S. public entity is a
party to the transaction and is not submitting a declaration, the other
party or parties to the transaction shall provide the information set
out in this section with respect to itself and, to the extent known or
reasonably available to it, with respect to the U.S. public entity.
Sec. 802.403 Beginning of 30-day assessment period.
(a) Upon receipt of a declaration submitted under Sec. 802.401,
the Staff Chairperson shall promptly inspect the declaration and shall
promptly notify in writing all parties to a transaction that have
submitted a declaration that:
(1) The Staff Chairperson has accepted the declaration and
circulated the declaration to the Committee, and the date on which the
assessment described in paragraph (b) of this section begins; or
(2) The Staff Chairperson has determined not to accept the
declaration and circulate the declaration to the Committee because the
declaration is incomplete, and an explanation of the material respects
in which the declaration is incomplete.
(b) A 30-day period for assessment of a transaction that is the
subject of a declaration shall commence on the date on which the
declaration is received by the Committee from the Staff Chairperson.
Such period shall end no later than the thirtieth day after it has
commenced, or if the thirtieth day is not a business day, no later than
the next business day after the thirtieth day.
(c) During the 30-day assessment period, the Staff Chairperson may
invite the parties to a covered real estate transaction to attend a
meeting with the Committee staff to discuss and clarify issues
pertaining to the transaction.
(d) If the Committee notifies the parties to a transaction that
have submitted a declaration under Sec. 802.401 that the Committee
intends to conclude all action under section 721 with respect to that
transaction, each party that has submitted additional information
subsequent to the original declaration shall file a certification as
described in Sec. 802.202. A sample certification may be found on the
Committee's section of the Department of the Treasury website.
(e) If a party fails to provide the certification required under
paragraph (d) of this section, the Committee may, at its discretion,
take any of the actions under Sec. 802.405.
Sec. 802.404 Rejection, disposition, or withdrawal of declarations.
(a) The Committee, acting through the Staff Chairperson, may:
(1) Reject any declaration that does not comply with Sec. 802.402
and so inform the parties promptly in writing;
(2) Reject any declaration at any time, and so inform the parties
promptly in writing, if, after the declaration has been submitted and
before the Committee has taken one of the actions specified in Sec.
802.405:
(i) There is a material change in the covered real estate
transaction as to which a declaration has been submitted; or
(ii) Information comes to light that contradicts material
information provided in the declaration by the party (or parties); or
(3) Reject any declaration at any time after the declaration has
been submitted, and so inform the parties promptly in writing, if the
party (or parties) that submitted the declaration does not provide
follow-up information requested by the Staff Chairperson within two
business days of the request, or within a longer time frame if the
party (or parties) so request in writing and the Staff Chairperson
grants that request in writing.
(b) The Staff Chairperson shall notify the party (or parties) that
submitted a declaration when the Committee has found that the
transaction that is the subject of a declaration is not a covered real
estate transaction.
(c) Parties to a transaction that have submitted a declaration
under Sec. 802.401 may request in writing, at any time prior to the
Committee taking action under Sec. 802.405, that such declaration be
withdrawn. Such request shall be directed to the Staff Chairperson and
shall state the reasons why the request is being made and state whether
the transaction that is the subject of the declaration is being fully
and permanently abandoned. An official of the Department of the
Treasury will promptly advise the parties to the transaction in writing
of the Committee's decision.
(d) The Committee may not request or recommend that a declaration
be withdrawn and refiled, except to permit parties to a covered real
estate transaction to correct material errors or omissions, or describe
material changes to the transaction, in the declaration submitted with
respect to that covered real estate transaction.
(e) A party (or parties) may not submit more than one declaration
for the same or a substantially similar transaction without approval
from the Staff Chairperson.
Note 1 to Sec. 802.404: See Sec. 802.401(e) regarding the
prohibition on submitting a declaration regarding the same
transaction or a substantially similar transaction for which
[[Page 3177]]
a written notice has been filed, or a declaration submitted under
part 800 of this chapter, without the approval of the Staff
Chairperson.
Sec. 802.405 Committee actions.
(a) Upon receiving a declaration submitted under Sec. 802.401 with
respect to a covered real estate transaction, the Committee may, at the
discretion of the Committee:
(1) If the Committee has reason to believe that the transaction may
raise national security considerations, request that the parties to the
transaction file a written notice under subpart E;
(2) Inform the parties to the transaction that the Committee is not
able to conclude action under section 721 with respect to the
transaction on the basis of the declaration and that the parties may
file a written notice under subpart E to seek written notification from
the Committee that the Committee has concluded all action under section
721 with respect to the transaction;
(3) Initiate a unilateral review of the transaction under Sec.
802.501(c); or
(4) Notify the parties in writing that the Committee has concluded
all action under section 721 with respect to the transaction.
(b) The Committee shall take action under paragraph (a) of this
section within the time period set forth in Sec. 802.403(b).
Subpart E--Notices
Sec. 802.501 Procedures for notices.
(a) Except as otherwise prohibited under paragraph (j) of this
section, a party or parties to a proposed or completed transaction may
file a voluntary notice of the transaction with the Committee.
Voluntary notice to the Committee is filed by sending an electronic
copy of the notice that includes, in English, the information set out
in Sec. 802.502, including the certification required under paragraph
(h) of that section. For electronic submission instructions, see the
Committee's section of the Department of the Treasury website.
(b) If the Committee determines that a transaction for which no
voluntary notice has been filed under this part, and with respect to
which the Committee has not informed the parties in writing that the
Committee has concluded all action under section 721, may be a covered
real estate transaction and may raise national security considerations,
the Staff Chairperson, acting on the recommendation of the Committee,
may request the parties to the transaction to provide to the Committee
the information necessary to determine whether the transaction is a
covered real estate transaction, and if the Committee determines that
the transaction is a covered real estate transaction, to file a notice
of such covered real estate transaction under paragraph (a) of this
section.
(c) With respect to any covered real estate transaction:
(1) Any member of the Committee, or his or her designee at or above
the Under Secretary or equivalent level, may, subject to paragraph
(c)(2) of this section, file an agency notice to the Committee through
the Staff Chairperson regarding a transaction if:
(i) That member has reason to believe that the transaction is a
covered real estate transaction and may raise national security
considerations and:
(A) The Committee has not informed the parties to such transaction
in writing that the Committee has concluded all action under section
721 with respect to such transaction; and
(B) The President has not announced a decision not to exercise the
President's authority under section 721(d) with respect to such
transaction; or
(ii) The transaction is a covered real estate transaction and:
(A) The Committee has informed the parties to such transaction in
writing that the Committee has concluded all action under section 721
with respect to such transaction or determined that such transaction is
not a covered real estate transaction, or the President has announced a
decision not to exercise the President's authority under section 721(d)
with respect to such transaction; and
(B) Either:
(1) A party to such transaction submitted false or misleading
material information to the Committee in connection with the
Committee's consideration of such transaction or omitted material
information, including material documents, from information submitted
to the Committee; or
(2) A party to such transaction breaches a mitigation agreement or
condition described in section 721(l)(3)(A), such breach is certified
to the Committee by the lead department or agency monitoring and
enforcing such agreement or condition as a material breach, and the
Committee determines that there are no other adequate and appropriate
remedies or enforcement tools available to address such breach.
(2)(i) That is a transaction where a foreign person is not an
excepted real estate investor due to the application of Sec.
802.215(d), any member of the Committee, or his or her designee at or
above the Under Secretary or equivalent level, may file an agency
notice to the Committee through the Staff Chairperson regarding such
transaction if:
(A) That member has reason to believe that the transaction is a
covered real estate transaction and may raise national security
considerations;
(B) The Committee has not informed the parties to such transaction
in writing that the Committee has concluded all action under section
721 with respect to such transaction; and
(C) The President has not announced a decision not to exercise the
President's authority under section 721(d) with respect to such
transaction.
(ii) No notice filed under this paragraph (c)(2) shall be made with
respect to a transaction more than one year after the completion date
of the transaction, unless the Chairperson of the Committee determines,
in consultation with other members of the Committee, that because the
foreign person no longer meets all the criteria set forth in Sec.
802.215(a)(1) or (2), (a)(3)(i) through (iii), or (c)(1)(i) through
(iii), the transaction may threaten to impair the national security of
the United States, and in no event shall an agency notice under this
paragraph be made with respect to such a transaction more than three
years after the completion date of the transaction.
(d) Notices filed under paragraph (c) of this section are deemed
accepted upon their receipt by the Staff Chairperson. No agency notice
under paragraph (c)(1) of this section shall be made with respect to a
real estate transaction more than three years after the completion date
of the transaction, unless the Chairperson of the Committee, in
consultation with other members of the Committee, files such an agency
notice.
(e) No communications other than those described in paragraphs (a)
and (c) of this section shall constitute the filing or submitting of a
notice for purposes of section 721.
(f) Upon receipt of the electronic copy of a notice filed under
paragraph (a) of this section, including the certification required by
Sec. 802.502(h), the Staff Chairperson shall promptly inspect such
notice for completeness.
(g) Parties to a transaction are encouraged to consult with the
Committee in advance of filing a notice and, in appropriate cases, to
file with the Committee a draft notice or other appropriate documents
to aid the Committee's understanding of the transaction and to provide
an opportunity for the Committee to request additional information to
be included in the notice. Any such pre-
[[Page 3178]]
notice consultation should take place, or any draft notice should be
provided, at least five business days before the filing of a voluntary
notice. All information and documentary material made available to the
Committee under this paragraph shall be considered to have been filed
with the President or the President's designee for purposes of section
721(c) and Sec. 802.802.
(h) Information and other documentary material provided by any
party to the Committee after the filing of a voluntary notice under
this section shall be part of the notice, and shall be subject to the
final certification required under Sec. 802.502(l).
(i) For any voluntarily submitted draft or formal written notice
that includes a stipulation under section Sec. 802.502(j) that a
transaction is a covered real estate transaction, the Committee shall
provide comments on the draft or formal written notice or accept the
formal written notice of a covered real estate transaction not later
than the date that is 10 business days after the date of submission of
the draft or formal written notice.
(j) No party to a transaction may file a notice under paragraph (a)
of this section if the transaction has been the subject of a
declaration submitted under subpart D and the Committee has not yet
taken any action with respect to the transaction under Sec. 802.405.
Sec. 802.502 Contents of voluntary notices.
(a) If a party or the parties to a transaction file a voluntary
notice, they shall provide in detail the information set out in this
section, which must be accurate and complete with respect to the party
or parties filing the voluntary notice and to the transaction. (See
also paragraph (k) of this section regarding U.S. public entities and
paragraph (h) of this section and Sec. 802.202 regarding certification
requirements.)
(b) A voluntary notice filed under Sec. 802.501 shall describe or
provide, as applicable:
(1) The following information regarding the transaction in
question:
(i) A summary setting forth the essentials of the transaction,
including a statement of the purpose of the transaction, its scope,
both within and outside of the United States, as applicable, whether
the foreign person is acquiring a collection of assets or interest in
an entity, and the extent to which it is part of a larger project
undertaken by the foreign person;
(ii) The nature of the transaction, for example, whether the
transaction involves a purchase, lease, or concession of real estate
and the term, if any;
(iii) The name, United States address (if any), website address (if
any), nationality (for individuals) or place of incorporation or other
legal organization (for entities), and address of the principal place
of business of each foreign person that is a party to the transaction;
(iv) The name, address, website address (if any), principal place
of business, and place of incorporation or other legal organization of
the current holder of interest in the real estate that is the subject
of the transaction;
(v) In the case that a U.S. public entity is a party to the covered
real estate transaction, the name, telephone number, and email address
of the primary point of contact for the U.S. public entity;
(vi) The name, address, and nationality (for individuals) or place
of incorporation or other legal organization (for entities) of:
(A) The immediate parent, the ultimate parent, and each
intermediate parent, if any, of the foreign person that is a party to
the transaction;
(B) Where the ultimate parent is a private company, the ultimate
owner(s) of such parent; and
(C) Where the ultimate parent is a public company, any shareholder
with an interest of greater than five percent in such parent;
(vii) The name, address, website address (if any), and nationality
(for individuals) or place of incorporation or other legal organization
(for entities) of the foreign person or foreign persons that will be
afforded property rights with respect to the real estate that is the
subject of the covered real estate transaction;
(viii) The actual or expected completion date of the transaction;
(ix) A good faith approximation of the fair market value of the
interest acquired in the covered real estate in U.S. dollars, as of the
date of the notice;
(x) The name of any and all financial institutions and real estate
agents/brokers involved in the transaction, including as advisors,
underwriters, or sources of financing for the transaction;
(xi) A copy of the definitive documentation of the transaction,
such as a purchase, lease, or concession agreement, or if none exists,
the document establishing the material terms of the transaction, which
in the context of a transaction involving a covered port, must be
signed and dated;
(xii) Whether the foreign person will have any of the following
rights or abilities with respect to the real estate as a result of the
transaction and any additional information regarding such property
rights:
(A) To physically access the real estate;
(B) To exclude others from physically accessing the real estate;
(C) To improve or develop the real estate; or
(D) To attach fixed or immovable structures or objects to the real
estate.
(2) A detailed description of real estate that is the subject of
the transaction, including as applicable:
(i) The location, by address and geographic coordinates in decimal
degrees to the 4th digit, of the real estate that is the subject of the
covered real estate transaction;
(ii) A description of the real estate that is the subject of the
covered real estate transaction including the approximate size (in
acres, feet, or other appropriate measurement); nature of the real
estate (e.g., zoning type and the major topographical or other features
of the real estate); current use of the real estate; and structures
that are or will be on the real estate;
(iii) A description of any leases, licenses, permits, easements,
encumbrances, or other grants or approvals associated with the real
estate, including whether any involve the U.S. Government, as well as
any feasibility studies conducted with respect to the real estate; and
(iv) The name(s) of and distance(s) to any relevant covered port,
military installation, or any other facility or property of the U.S.
Government as identified in this part, and that is relevant to CFIUS
jurisdiction given the location of the real estate that is the subject
of the transaction.
(3) With respect to the foreign person engaged in the transaction
and its parents:
(i) A description of the business or businesses of the foreign
person and its ultimate parent, and the CAGE codes, NAICS codes, and
DUNS numbers, if any, for such businesses;
(ii) The plans of the foreign person for the real estate with
respect to:
(A) Use and development of the real estate;
(B) Changing the nature of the real estate including building new
structures or removing or altering current structures, including the
anticipated dimensions and any physical security measures employed at
the real estate; and
(C) Assigning, modifying, or terminating any leases, licenses,
permits, easements, encumbrances, or other grants or approvals referred
to in paragraph (b)(2)(iii) of this section;
(iii) Whether the foreign person is controlled by or acting on
behalf of a foreign government, including as an
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agent or representative, or in some similar capacity, and if so, the
identity of the foreign government;
(iv) Whether a foreign government or a person controlled by or
acting on behalf of a foreign government:
(A) Has or controls property rights or has or controls ownership
interests, including contingent equity interest, of the foreign person
that is a party to the transaction or any parent of the foreign person,
and if so, the nature and amount of any such interests, and with regard
to contingent equity interest, the terms and timing of conversion;
(B) Has the right or power to appoint any of the principal officers
or the members of the board of directors (including other persons who
perform the duties usually associated with such titles) of the foreign
person that is a party to the transaction or any parent of that foreign
person;
(C) Holds any other contingent interest (for example, such as might
arise from a lending transaction) in the foreign person that is a party
to the transaction and, if so, the rights that are covered by this
contingent interest, and the manner in which they would be enforced; or
(D) Has any other affirmative or negative rights or powers with
respect to control over the foreign person engaged in the transaction,
and if there are any such rights or powers, their source (for example,
a ``golden share,'' shareholders agreement, contract, statute, or
regulation) and the mechanics of their operation;
(v) Any formal or informal arrangements among foreign persons that
hold an ownership interest in any foreign person that is a party to the
transaction or between such foreign person and other foreign persons to
act in concert on particular matters affecting the real estate that is
the subject of the transaction, and provide a copy of any documents
that establish those rights or describe those arrangements;
(vi) For each member of the board of directors or equivalent
governing body (including external directors and other persons who
perform duties usually associated with such titles) and officers
(including president, senior vice president, executive vice president,
and other persons who perform duties normally associated with such
titles) of the foreign person engaged in the transaction and its
immediate, intermediate, and ultimate parents, and for any individual
having an ownership interest of five percent or more in the foreign
person engaged in the transaction and in the foreign person's ultimate
parent, the following information:
(A) A curriculum vitae or similar professional synopsis, provided
as part of the main notice, and
(B) The following ``personal identifier information,'' which, for
privacy reasons, and to ensure limited distribution, shall be set forth
in a separate document, not in the main notice:
(1) Full name (last, first, middle name);
(2) All other names and aliases used;
(3) Business address;
(4) Country and city of residence;
(5) Date of birth, in the format MM/DD/YYYY;
(6) Place of birth;
(7) U.S. Social Security number (where applicable);
(8) National identity number, including nationality, date and place
of issuance, and expiration date (where applicable);
(9) U.S. or foreign passport number (if more than one, all must be
fully disclosed), nationality, date and place of issuance, and
expiration date and, if a U.S. visa holder, the visa type and number,
date and place of issuance, and expiration date; and
(10) Dates and nature of foreign government and foreign military
service (where applicable), other than military service at a rank below
the top two non-commissioned ranks of the relevant foreign country; and
(vii) The following ``business identifier information'' for the
immediate, intermediate, and ultimate parents of the foreign person
engaged in the transaction, including their main offices and branches:
(A) Business name, including all names under which the business is
known to be or has been doing business;
(B) Business address;
(C) Business phone number, website address, and email address; and
(D) Employer identification number or other domestic tax or
corporate identification number.
(c) The voluntary notice shall list any filings with, or reports
to, agencies of the U.S. Government that have been or will be made with
respect to the transaction prior to its completion, indicating the
agencies concerned, the nature of the filing or report, the date on
which it was filed or the estimated date by which it will be filed, and
a relevant contact point and/or telephone number within the agency, if
known.
(d) In the case of the establishment of a joint venture in which
one or more of the parties is contributing covered real estate,
information for the voluntary notice shall be prepared on the
assumption that the foreign person that is party to the joint venture
has made a purchase or lease, or been granted a concession to, the
covered real estate that the other party to the joint venture is
contributing or transferring to the joint venture. The voluntary notice
shall describe the name and address of the joint venture and the
entities that established, or are establishing, the joint venture.
(e) Parties filing a voluntary notice shall, during the time that
the matter is pending before the Committee or the President, promptly
advise the Staff Chairperson of any material changes in plans, facts
and circumstances addressed in the notice, and information provided or
required to be provided to the Committee under this section, and shall
file amendments to the notice to reflect such material changes. Such
amendments shall become part of the notice filed by such persons under
Sec. 802.501, and the certifications required under paragraphs (h) and
(l) of this section shall apply to such amendments.
(f) Parties filing a voluntary notice shall include:
(1) A complete pre-transaction organizational chart (and post-
transaction, if different) including, information that identifies the
name, principal place of business, and place of incorporation or other
legal organization (for entities); nationality (for individuals); and
ownership percentage (expressed in terms of both voting and economic
interest, if different) for each of the following:
(i) The immediate parent, the ultimate parent, and each
intermediate parent, if any, of each foreign person that is a party to
the transaction;
(ii) Where the ultimate parent is a private company, the ultimate
owner(s) of such parent; and
(iii) Where the ultimate parent is a public company, any
shareholder with an interest of greater than five percent in such
parent.
(2) The opinion of the person regarding whether:
(i) It is a foreign person;
(ii) It is controlled by a foreign government; and
(iii) The transaction has resulted or could result in a foreign
person being afforded property rights with respect to covered real
estate, and the reasons for its view, focusing in particular on any
powers (for example, by virtue of an agreement, statute, or regulation)
that the foreign person will have with regard to the covered real
estate, and how those powers can or will be exercised.
(g) Parties filing a voluntary notice shall include information as
to whether:
[[Page 3180]]
(1) Any party to the transaction is, or has been, a party to a
mitigation agreement entered into or condition imposed under section
721, and if so, shall specify the date and purpose of such agreement or
condition and the U.S. Government signatories; and
(2) Any party to the transaction (including such party's parents,
subsidiaries, or entities under common control with the party) has been
a party to a transaction previously notified to the Committee.
(h) Each party filing a voluntary notice shall provide a
certification of the notice consistent with Sec. 802.202. A sample
certification may be found on the Committee's section of the Department
of the Treasury website.
(i) Parties filing a voluntary notice shall include with the notice
a list identifying each document provided as part of the notice,
including all documents provided as attachments or exhibits to the
narrative response.
(j) A party filing a voluntary notice may stipulate that the
transaction is a covered real estate transaction. A stipulation offered
by any party under this section must be accompanied by a detailed
description of the basis for the stipulation. A party that offers such
a stipulation acknowledges that the Committee and the President are
entitled to rely on such stipulation in determining whether the
transaction is a covered real estate transaction for the purposes of
section 721 and all authorities thereunder, and waives the right to
challenge any such determination. Neither the Committee nor the
President is bound by any such stipulation, nor does any such
stipulation limit the ability of the Committee or the President to act
on any authority provided under section 721 with respect to any covered
real estate transaction.
(k) In the case of a transaction where a U.S. public entity is a
party to the transaction, the notifying party or parties may be the
non-U.S. public entity. Each notifying party shall provide the
information set out in this section with respect to itself and, to the
extent known or reasonably available to it, with respect to the U.S.
public entity.
(l) At the conclusion of a review or investigation, each party that
has filed additional information subsequent to the original notice
shall file a final certification. (See Sec. 802.202.) A sample
certification may be found at the Committee's section of the Department
of the Treasury website.
Sec. 802.503 Beginning of 45-day review period.
(a) The Staff Chairperson shall accept a voluntary notice the next
business day after the Staff Chairperson has:
(1) Determined that the notice complies with Sec. 802.502; and
(2) Disseminated the notice to all members of the Committee.
(b) A 45-day period for review of a transaction shall commence on
the date on which the voluntary notice has been accepted, agency notice
has been received by the Staff Chairperson, or the Chairperson of the
Committee has requested a notice under Sec. 802.501(b). Such review
shall end no later than the forty-fifth day after it has commenced, or
if the forty-fifth day is not a business day, no later than the next
business day after the forty-fifth day.
(c) The Staff Chairperson shall promptly advise in writing all
parties to a transaction that have filed a voluntary notice of:
(1) The acceptance of the notice;
(2) The date on which the review begins; and
(3) The designation of any lead agency or agencies.
(d) Within two business days after receipt of an agency notice by
the Staff Chairperson, the Staff Chairperson shall send written advice
of such notice to the parties to the transaction that is subject to the
notice. Such written advice shall identify the date on which the review
began.
(e) The Staff Chairperson shall promptly circulate to all Committee
members any draft pre-filing notice, any agency notice, any complete
notice, and any subsequent information filed by the parties.
Sec. 802.504 Deferral, rejection, or disposition of certain voluntary
notices.
(a) The Committee, acting through the Staff Chairperson, may:
(1) Reject any voluntary notice that does not comply with Sec.
802.501 or Sec. 802.502 and so inform the parties promptly in writing;
(2) Reject any voluntary notice at any time, and so inform the
parties promptly in writing, if, after the notice has been submitted
and before action by the Committee or the President has been concluded:
(i) There is a material change in the transaction as to which
notification has been made; or
(ii) Information comes to light that contradicts material
information provided in the notice by the parties;
(3) Reject any voluntary notice at any time after the notice has
been accepted, and so inform the parties promptly in writing, if the
party or parties that have submitted the voluntary notice do not
provide follow-up information requested by the Staff Chairperson within
three business days of the request, or within a longer time frame if
the parties so request in writing and the Staff Chairperson grants that
request in writing; or
(4) Reject any voluntary notice before the conclusion of a review
or investigation, and so inform the parties promptly in writing, if one
of the parties submitting the voluntary notice has not submitted the
final certification required by Sec. 802.502(l).
(b) Notwithstanding the authority of the Staff Chairperson under
paragraph (a) of this section to reject an incomplete notice, the Staff
Chairperson may defer acceptance of the notice, and the beginning of
the review period specified by Sec. 802.503, to obtain any information
required under this section that has not been submitted by the
notifying party or parties or other parties to the transaction. Where
necessary to obtain such information, the Staff Chairperson may inform
any non-notifying party or parties that notice has been filed with
respect to a transaction involving the party, and request that certain
information required under this section, as specified by the Staff
Chairperson, be provided to the Committee within seven days after
receipt of the Staff Chairperson's request.
(c) The Staff Chairperson shall notify the parties when the
Committee has found that the transaction that is the subject of a
voluntary notice is not a covered real estate transaction.
(d) Example: The Staff Chairperson receives a joint notice from
Corporation A, a foreign person, and Corporation X, a company that is
selling covered real estate. The joint notice does not contain any
information described under Sec. 802.502 concerning the nature of the
real estate. The Staff Chairperson may reject the notice or defer the
start of the review period until the parties have supplied the omitted
information.
Sec. 802.505 Determination of whether to undertake an investigation.
(a) After a review of a notified transaction under Sec. 802.503,
the Committee shall undertake an investigation of any transaction that
it has determined to be a covered real estate transaction if:
(1) A member of the Committee (other than a member designated as ex
officio under section 721(k)) advises the Staff Chairperson that the
member believes that the transaction threatens to impair the national
security of the United States and that the threat has not been
mitigated; or
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(2) The lead agency recommends, and the Committee concurs, that an
investigation be undertaken.
(b) The Committee shall also undertake, after a review of a covered
real estate transaction under Sec. 802.503, an investigation to
determine the effects on national security of any covered real estate
transaction that would result in control by a foreign person of
critical infrastructure, as defined in Sec. 800.214 of this title, of
or within the United States, if the Committee determines that the
transaction could impair the national security and such impairment has
not been mitigated.
(c) The Committee shall undertake an investigation as described in
paragraph (b) of this section unless the Chairperson of the Committee
(or the Deputy Secretary of the Treasury) and the head of any lead
agency (or his or her delegee at the deputy level or equivalent)
designated by the Chairperson determine on the basis of the review that
the covered real estate transaction will not impair the national
security of the United States.
Sec. 802.506 Determination not to undertake an investigation.
If the Committee determines, during the review period described in
Sec. 802.503, not to undertake an investigation of a notified covered
real estate transaction, action under section 721 shall be concluded.
An official at the Department of the Treasury shall promptly inform the
parties to a covered real estate transaction in writing of a
determination of the Committee not to undertake an investigation and to
conclude action under section 721.
Sec. 802.507 Commencement of investigation.
(a) If it is determined that an investigation should be undertaken,
such investigation shall commence no later than the end of the review
period described in Sec. 802.503.
(b) An official of the Department of the Treasury shall promptly
inform the parties to a covered real estate transaction in writing of
the commencement of an investigation.
Sec. 802.508 Completion or termination of investigation and report to
the President.
(a) Subject to paragraph (e) of this section, the Committee shall
complete an investigation no later than the forty-fifth day after the
date the investigation commences, or, if the forty-fifth day is not a
business day, no later than the next business day after the forty-fifth
day.
(b) Upon completion or termination of any investigation, the
Committee shall send a report to the President requesting the
President's decision if:
(1) The Committee recommends that the President suspend or prohibit
the transaction;
(2) The Committee is unable to reach a decision on whether to
recommend that the President suspend or prohibit the transaction; or
(3) The Committee requests that the President make a determination
with regard to the transaction.
(c) In circumstances when the Committee sends a report to the
President requesting the President's decision with respect to a covered
real estate transaction, such report shall include information relevant
to sections 721(d)(4)(A) and (B), and shall present the Committee's
recommendation. If the Committee is unable to reach a decision to
present a single recommendation to the President, the Chairperson of
the Committee shall submit a report of the Committee to the President
setting forth the differing views and presenting the issues for
decision.
(d) Upon completion or termination of an investigation, if the
Committee determines to conclude all deliberative action under section
721 with regard to a notified covered real estate transaction without
sending a report to the President, action under section 721 shall be
concluded. An official at the Department of the Treasury shall promptly
advise the parties to such a transaction in writing of a determination
to conclude action.
(e) In extraordinary circumstances, the Chairperson may, upon a
written request signed by the head of a lead agency, extend an
investigation for one 15-day period. A request to extend an
investigation must describe, with particularity, the extraordinary
circumstances that warrant the Chairperson extending the investigation.
The authority of the head of a lead agency to request the extension of
an investigation may not be delegated to any person other than the
deputy head (or equivalent thereof) of the lead agency. If the
Chairperson extends an investigation under this paragraph with respect
to a covered real estate transaction, the Committee shall promptly
notify the parties to the transaction of the extension.
(f) For purposes of paragraph (e) of this section, the term
extraordinary circumstances means circumstances for which extending an
investigation is necessary and the appropriate course of action, in the
Chairperson's discretion, due to a force majeure event or to protect
the national security of the United States.
Sec. 802.509 Withdrawal of notices.
(a) A party (or parties) to a transaction that has filed notice
under Sec. 802.501(a) may request in writing, at any time prior to
conclusion of all action under section 721, that such notice be
withdrawn. Such request shall be directed to the Staff Chairperson and
shall state the reasons why the request is being made. Such requests
will ordinarily be granted, unless otherwise determined by the
Committee. An official of the Department of the Treasury will promptly
advise the parties to the transaction in writing of the Committee's
decision.
(b) Any request to withdraw an agency notice by the agency that
filed it shall be in writing and shall be effective only upon approval
by the Committee. An official of the Department of the Treasury shall
advise the parties to the transaction in writing of the Committee's
decision to approve the withdrawal request within two business days of
the Committee's decision.
(c) In any case where a request to withdraw a notice is granted
under paragraph (a) of this section:
(1) The Staff Chairperson, in consultation with the Committee,
shall establish, as appropriate:
(i) A process for tracking actions that may be taken by any party
to the covered real estate transaction before a notice is refiled under
Sec. 802.501; and
(ii) Interim protections to address specific national security
concerns with the covered real estate transaction identified during the
review or investigation of the covered real estate transaction.
(2) The Staff Chairperson shall specify a time frame, as
appropriate, for the parties to resubmit a notice and shall advise the
parties of that time frame in writing.
(d) A notice of a transaction that is submitted under paragraph
(c)(2) of this section shall be deemed a new notice for purposes of the
regulations in this part, including Sec. 802.701.
Subpart F--Committee Procedures
Sec. 802.601 General.
(a) In any assessment, review, or investigation of a covered real
estate transaction, the Committee should consider the factors specified
in section 721(f), as applicable, and, as appropriate, require the
parties to provide to the Committee the information necessary to
consider such factors. The Committee's assessment, review, or
investigation (if necessary) shall examine, as appropriate, whether:
(1) The transaction is a covered real estate transaction;
[[Page 3182]]
(2) There is credible evidence to support a belief that any foreign
person party to a covered real estate transaction might take action
that threatens to impair the national security of the United States;
and
(3) Provisions of law, other than section 721 and the International
Emergency Economic Powers Act, provide adequate and appropriate
authority to protect the national security of the United States.
(b) During an assessment, review, or investigation, the Staff
Chairperson may invite the parties to a notified transaction to attend
a meeting with the Committee staff to discuss and clarify issues
pertaining to the transaction. During an investigation, a party to the
transaction under investigation may request a meeting with the
Committee staff; such a request ordinarily will be granted.
(c) The Staff Chairperson shall be the point of contact for
receiving material filed with the Committee, including notices and
declarations.
(d) Where more than one lead agency is designated, communications
on material matters between a party to the transaction and a lead
agency shall include all lead agencies designated with regard to those
matters.
(e) The parties' description of a transaction in a declaration or
notice does not limit the ability of the Committee to, as appropriate,
assess, review, or investigate, or exercise any other authorities
available under section 721 with respect to any covered real estate
transaction that the Committee identifies as having been notified to
the Committee based upon the facts set forth in the declaration or
notice, any additional information provided to the Committee subsequent
to the original declaration or notice, or any other information
available to the Committee.
Sec. 802.602 Role of the Secretary of Labor.
In response to a request from the Chairperson of the Committee, the
Secretary of Labor shall identify for the Committee any risk mitigation
provisions proposed to or by the Committee that would violate U.S.
employment laws or require a party to violate U.S. employment laws. The
Secretary of Labor shall serve no policy role on the Committee.
Sec. 802.603 Materiality.
The Committee generally will not consider as material minor
inaccuracies, omissions, or changes relating to financial or commercial
factors not having a bearing on national security.
Sec. 802.604 Tolling of deadlines during lapse in appropriations.
Any deadline or time limitation under subparts D or E imposed on
the Committee shall be tolled during a lapse in appropriations.
Subpart G--Finality of Action
Sec. 802.701 Finality of actions under section 721.
All authority available to the President or the Committee under
section 721(d), including divestment authority, shall remain available
at the discretion of the President with respect to any covered real
estate transaction. Subject to Sec. 802.501(c)(1)(ii), such authority
shall not be exercised if:
(a) The Committee, through its Staff Chairperson, has advised a
party (or the parties) in writing that a particular transaction with
respect to which a voluntary notice or a declaration has been filed is
not a covered real estate transaction;
(b) The parties to the transaction have been advised in writing
under Sec. 802.405(a)(4), Sec. 802.506, or Sec. 802.508(d) that the
Committee has concluded all action under section 721 with respect to
the covered real estate transaction; or
(c) The President has previously announced, under section 721(d),
his or her decision not to exercise his or her authority under section
721 with respect to the covered real estate transaction.
Subpart H--Provision and Handling of Information
Sec. 802.801 Obligation of parties to provide information.
(a) Parties to a transaction that is notified or declared under
subpart D or E, or a transaction for which no notice or declaration has
been submitted and for which the Staff Chairperson has requested
information to assess whether the transaction is a covered real estate
transaction, shall provide information to the Staff Chairperson that
will enable the Committee to conduct a full assessment, review, and/or
investigation of the transaction. Parties to a transaction that have
filed information with the Committee shall promptly advise the Staff
Chairperson of any material changes to such information. If deemed
necessary by the Committee, information may be obtained from parties to
a transaction or other persons through subpoena or otherwise, under the
Defense Production Act Reauthorization of 2003, as amended (50 U.S.C.
4555(a)).
(b) Documentary materials or information required or requested to
be filed with the Committee under this part shall be submitted in
English. Supplementary materials written in a foreign language shall be
submitted in certified English translation.
(c) Any information filed with the Committee in connection with any
action for which a report is required under section 721(l)(6)(B) with
respect to the implementation of a mitigation agreement or condition
described in section 721(l)(3)(A) shall be accompanied by a
certification that complies with the requirements of section 721(n) and
Sec. 802.202. A sample certification may be found at the Committee's
section of the Department of the Treasury website.
Sec. 802.802 Confidentiality.
(a) Except as provided in paragraph (b) of this section, any
information or documentary material submitted or filed with the
Committee under this part, including information or documentary
material filed under Sec. 802.501(g), shall be exempt from disclosure
under the Freedom of Information Act, as amended (5 U.S.C. 552 et
seq.), and no such information or documentary material may be made
public.
(b) Paragraph (a) of this section shall not prohibit disclosure of
the following:
(1) Information relevant to any administrative or judicial action
or proceeding;
(2) Information to Congress or to any duly authorized committee or
subcommittee of Congress;
(3) Information important to the national security analysis or
actions of the Committee to any domestic governmental entity, or to any
foreign governmental entity of a United States ally or partner, under
the exclusive direction and authorization of the Chairperson, only to
the extent necessary for national security purposes, and subject to
appropriate confidentiality and classification requirements; or
(4) Information that the parties have consented to be disclosed to
third parties;
(c) This section shall continue to apply with respect to
information and documentary material submitted or filed with the
Committee in any case where:
(1) Action has concluded under section 721 concerning a notified
transaction;
(2) A request to withdraw a notice or a declaration is granted
under Sec. 802.509 or Sec. 802.404(c), respectively, or where a
notice or a declaration has been rejected under Sec. 802.504(a) or
Sec. 802.404(a), respectively;
(3) The Committee determines that a notified or declared
transaction is not a covered real estate transaction; or
[[Page 3183]]
(4) Such information or documentary material was filed under
subpart D and the parties do not subsequently file a notice under
subpart E.
(d) Nothing in paragraph (a) of this section shall be interpreted
to prohibit the public disclosure by a party of documentary material or
information that it has submitted or filed with the Committee. Any such
documentary material or information so disclosed may subsequently be
reflected in the public statements of the Chairperson, who is
authorized to communicate with the public and the Congress on behalf of
the Committee, or of the Chairperson's designee.
(e) The provisions of the Defense Production Act Reauthorization of
2003, as amended (50 U.S.C. 4555(d)) relating to fines and imprisonment
shall apply with respect to the disclosure of information or
documentary material filed with the Committee under these regulations.
Subpart I--Penalties and Damages
Sec. 802.901 Penalties and damages.
(a) Any person who submits a declaration or notice with a material
misstatement or omission or makes a false certification under Sec.
802.402, Sec. 802.403, or Sec. 802.502 may be liable to the United
States for a civil penalty not to exceed $250,000 per violation. The
amount of the penalty imposed for a violation shall be based on the
nature of the violation.
(b) Any person who violates a material provision of a mitigation
agreement with, a material condition imposed by, or an order issued by,
the United States under section 721(l) may be liable to the United
States for a civil penalty not to exceed $250,000 per violation or the
value of the transaction, whichever is greater. For clarification,
under the previous sentence, whichever penalty amount is greater may be
imposed per violation, and the amount of the penalty imposed for a
violation shall be based on the nature of the violation.
(c) A mitigation agreement entered into or amended under section
721(l) may include a provision providing for liquidated or actual
damages for breaches of the agreement. The mitigation agreement shall
specify the amount of any liquidated damages that are a reasonable
assessment of the harm to the national security that could result from
a breach of the agreement. Any mitigation agreement containing a
liquidated damages provision shall include a provision specifying that
the Committee may consider the severity of the breach in deciding
whether to seek a lesser amount than that stipulated in the agreement.
(d) A determination to impose penalties under paragraph (a) or (b)
of this section must be made by the Committee. Notice of the penalty,
including a written explanation of the conduct to be penalized and the
amount of the penalty, shall be sent to the subject person
electronically and by U.S. mail or courier service. Notice shall be
deemed to have been effected by the earlier of the date of electronic
transmission and the date of receipt of U.S. mail or courier service.
For the purposes of this section, the term subject person means the
person or persons who may be liable to the United States for a civil
penalty.
(e) Upon receiving notice of a penalty to be imposed under
paragraphs (a) through (c) of this section, the subject person may,
within 15 business days of receipt of such notice, submit a petition
for reconsideration to the Staff Chairperson, including a defense,
justification, or explanation for the conduct to be penalized. The
Committee will review the petition and issue any final penalty
determination within 15 business days of receipt of the petition. The
Staff Chairperson and the subject person may extend either such period
through written agreement. The Committee and the subject person may
reach an agreement on an appropriate remedy at any time before the
Committee issues any final penalty determination.
(f) The penalties and damages authorized in paragraphs (a) through
(c) of this section may be recovered in a civil action brought by the
United States in federal district court.
(g) Section 2 of the False Statements Accountability Act of 1996,
as amended (18 U.S.C. 1001), shall apply to all information provided to
the Committee under section 721, including by any party to a covered
real estate transaction.
(h) The penalties and damages available under this section are
without prejudice to other penalties, civil or criminal, available
under law.
(i) The imposition of a civil monetary penalty or damages under
these regulations creates a debt due to the U.S. Government. The
Department of the Treasury may take action to collect the penalty or
damages assessed if not paid within the time prescribed by the
Committee and notified to the applicable party or parties. In addition
or instead, the matter may be referred to the Department of Justice for
appropriate action to recover the penalty or damages.
Sec. 802.902 Effect of lack of compliance.
If, at any time after a mitigation agreement or condition is
entered into or imposed under section 721(l), the Committee or a lead
agency in coordination with the Staff Chairperson, as the case may be,
determines that a party or parties to the agreement or condition are
not in compliance with the terms of the agreement or condition, the
Committee or a lead agency in coordination with the Staff Chairperson
may, in addition to the authority of the Committee to impose penalties
under section 721(h) and to unilaterally initiate a review of any
covered real estate transaction under section 721(b)(1)(D)(iii):
(a) Negotiate a plan of action for the party or parties to
remediate the lack of compliance, with failure to abide by the plan or
otherwise remediate the lack of compliance serving as the basis for the
Committee to find a material breach of the agreement or condition;
(b) Require that the party or parties submit a written notice or
declaration under clause (i) of section 721(b)(1)(C) with respect to a
covered real estate transaction initiated after the date of the
determination of noncompliance and before the date that is five years
after the date of the determination to the Committee to initiate a
review of the transaction under section 721(b); or
(c) Seek injunctive relief.
Subpart J--Foreign National Security Investment Review Regimes
Sec. 802.1001 Determinations.
(a) The Committee may determine at any time that a foreign state
has made significant progress toward establishing and effectively
utilizing a robust process to analyze foreign investments for national
security risks and to facilitate coordination with the United States on
matters relating to investment security.
(b) The Committee may rescind a determination under paragraph (a)
of this section if the Committee determines that such a rescission is
appropriate.
(c) The Chairperson of the Committee shall publish a notice of any
determination or rescission of a determination under paragraph (a) or
(b) of this section, respectively, in the Federal Register.
Sec. 802.1002 Effect of determinations.
(a) A determination under Sec. 802.1001(a) shall take effect
immediately upon publication of a notice of such determination under
Sec. 802.1001(c) and remain in effect unless rescinded under Sec.
802.1001(b).
(b) A rescission of a determination under Sec. 802.1001(b) shall
take effect on
[[Page 3184]]
the date specified in the notice published under Sec. 802.1001(c).
(c) A determination under Sec. 802.1001(a) does not apply to any
transaction for which a declaration or notice has been accepted by the
Staff Chairperson under Sec. 802.403(a)(1) or Sec. 802.503(a),
respectively.
(d) A rescission of a determination under Sec. 802.1001(b) does
not apply to any transaction for which:
(1) The completion date is prior to the date upon which the
rescission of a determination under paragraph (b) of this section
becomes effective; or
(2) Before publication of the rescission of determination under
Sec. 802.1001(c), the parties to the transaction have executed a
binding written agreement, or other binding document, establishing the
material terms of the transaction that is ultimately consummated.
Appendix A to Part 802--List of Military Installations and Other U.S.
Government Sites
----------------------------------------------------------------------------------------------------------------
Site name Location
----------------------------------------------------------------------------------------------------------------
Part 1
----------------------------------------------------------------------------------------------------------------
Adelphi Laboratory Center.................... Adelphi, MD.
Air Force Maui Optical and Supercomputing Maui, HI.
Site.
Air Force Office of Scientific Research...... Arlington, VA.
Andersen Air Force Base...................... Yigo, Guam.
Army Futures Command......................... Austin, TX.
Army Research Lab--Orlando Simulations and Orlando, FL.
Training Technology Center.
Army Research Lab--Raleigh Durham............ Raleigh Durham, NC.
Arnold Air Force Base........................ Coffee County and Franklin County, TN.
Beale Air Force Base......................... Yuba City, CA.
Biometric Technology Center (Biometrics Clarksburg, WV.
Identity Management Activity).
Buckley Air Force Base....................... Aurora, CO.
Camp MacKall................................. Pinebluff, NC.
Cape Cod Air Force Station................... Sandwich, MA.
Cape Newenham Long Range Radar Site.......... Cape Newenham, AK.
Cavalier Air Force Station................... Cavalier, ND.
Cheyenne Mountain Air Force Station.......... Colorado Springs, CO.
Clear Air Force Station...................... Anderson, AK.
Creech Air Force Base........................ Indian Springs, NV.
Davis-Monthan Air Force Base................. Tucson, AZ.
Defense Advanced Research Projects Agency.... Arlington, VA.
Eareckson Air Force Station.................. Shemya, AK.
Eielson Air Force Base....................... Fairbanks, AK.
Ellington Field Joint Reserve Base........... Houston, TX.
Fairchild Air Force Base..................... Spokane, WA.
Fort Benning................................. Columbus, GA.
Fort Belvoir................................. Fairfax County, VA.
Fort Bliss................................... El Paso, TX.
Fort Campbell................................ Hopkinsville, KY.
Fort Carson.................................. Colorado Springs, CO.
Fort Detrick................................. Frederick, MD.
Fort Drum.................................... Watertown, NY.
Fort Gordon.................................. Augusta, GA.
Fort Hood.................................... Killeen, TX.
Fort Knox.................................... Fort Knox, KY.
Fort Leavenworth............................. Leavenworth, KS.
Fort Lee..................................... Petersburg, VA.
Fort Leonard Wood............................ Pulaski County, MO.
Fort Meade................................... Anne Arundel County, MD.
Fort Riley................................... Junction City, KS.
Fort Shafter................................. Honolulu, HI.
Fort Sill.................................... Lawton, OK.
Fort Stewart................................. Hinesville, GA.
Fort Yukon Long Range Radar Site............. Fort Yukon, AK.
Francis E. Warren Air Force Base............. Cheyenne, WY.
Guam Tracking Station........................ Inarajan, Guam.
Hanscom Air Force Base....................... Lexington, MA.
Holloman Air Force Base...................... Alamogordo, NM.
Holston Army Ammunition Plant................ Kingsport, TN.
Joint Base Anacostia-Bolling................. Washington, DC.
Joint Base Andrews........................... Camp Springs, MD.
Joint Base Elmendorf-Richardson.............. Anchorage, AK.
Joint Base Langley-Eustis.................... Hampton, VA and Newport News, VA.
Joint Base Lewis-McChord..................... Tacoma, WA.
Joint Base McGuire-Dix-Lakehurst............. Lakehurst, NJ.
Joint Base Pearl Harbor-Hickam............... Honolulu, HI.
Joint Base San Antonio....................... San Antonio, TX.
Joint Expeditionary Base Little Creek-Fort Virginia Beach, VA.
Story.
Kaena Point Satellite Tracking Station....... Waianae, HI.
King Salmon Air Force Station................ King Salmon, AK.
Kirtland Air Force Base...................... Albuquerque, NM.
Kodiak Tracking Stations..................... Kodiak Island, AK.
[[Page 3185]]
Los Angeles Air Force Base................... El Segundo, CA.
MacDill Air Force Base....................... Tampa, FL.
Malmstrom Air Force Base..................... Great Falls, MT.
Marine Corps Air Ground Combat Center Twentynine Palms, CA.
Twentynine Palms.
Marine Corps Air Station Beaufort............ Beaufort, SC.
Marine Corps Air Station Cherry Point........ Cherry Point, NC.
Marine Corps Air Station Miramar............. San Diego, CA.
Marine Corps Air Station New River........... Jacksonville, NC.
Marine Corps Air Station Yuma................ Yuma, AZ.
Marine Corps Base Camp Lejeune............... Jacksonville, NC.
Marine Corps Base Camp Pendleton............. Oceanside, CA.
Marine Corps Base Hawaii..................... Kaneohe Bay, HI.
Marine Corps Base Hawaii, Camp H.M. Smith.... Halawa, HI.
Marine Corps Base Quantico................... Quantico, VA.
Mark Center.................................. Alexandria, VA.
Minot Air Force Base......................... Minot, ND.
Moody Air Force Base......................... Valdosta, GA.
Naval Air Station Joint Reserve Base New Belle Chasse, LA.
Orleans.
Naval Air Station Oceana..................... Virginia Beach, VA.
Naval Air Station Oceana Dam Neck Annex...... Virginia Beach, VA.
Naval Air Station Whidbey Island............. Oak Harbor, WA.
Naval Base Guam.............................. Apra Harbor, Guam.
Naval Base Kitsap Bangor..................... Silverdale, WA.
Naval Base Point Loma........................ San Diego, CA.
Naval Base San Diego......................... San Diego, CA.
Naval Base Ventura County--Port Hueneme Port Hueneme, CA.
Operating Facility.
Naval Research Laboratory.................... Washington, DC.
Naval Research Laboratory--Blossom Point..... Welcome, MD.
Naval Research Laboratory--Stennis Space Hancock County, MS.
Center.
Naval Research Laboratory--Tilghman.......... Tilghman, MD.
Naval Station Newport........................ Newport, RI.
Naval Station Norfolk........................ Norfolk, VA.
Naval Submarine Base Kings Bay............... Kings Bay, GA.
Naval Submarine Base New London.............. Groton, CT.
Naval Surface Warfare Center Carderock Bayview, ID.
Division--Acoustic Research Detachment.
Naval Support Activity Crane................. Crane, IN.
Naval Support Activity Orlando............... Orlando, FL.
Naval Support Activity Panama City........... Panama City, FL.
Naval Support Activity Philadelphia.......... Philadelphia, PA.
Naval Support Facility Carderock............. Bethesda, MD.
Naval Support Facility Dahlgren.............. Dahlgren, VA.
Naval Support Facility Indian Head........... Indian Head, MD.
Naval Weapons Station Seal Beach Detachment Norco, CA.
Norco.
New Boston Air Station....................... New Boston, NH.
Offutt Air Force Base........................ Bellevue, NE.
Oliktok Long Range Radar Site................ Oliktok, AK.
Orchard Combat Training Center............... Boise, ID.
Peason Ridge Training Area................... Leesville, LA.
Pentagon..................................... Arlington, VA.
Peterson Air Force Base...................... Colorado Springs, CO.
Picatinny Arsenal............................ Morris County, NJ.
Pi[ntilde]on Canyon Maneuver Site............ Tyrone, CO.
Pohakuloa Training Area...................... Hilo, HI.
Point Barrow Long Range Radar Site........... Point Barrow, AK.
Portsmouth Naval Shipyard.................... Kittery, ME.
Radford Army Ammunition Plant................ Radford, VA.
Redstone Arsenal............................. Huntsville, AL.
Rock Island Arsenal.......................... Rock Island, IL.
Rome Research Laboratory..................... Rome, NY.
Schriever Air Force Base..................... Colorado Springs, CO.
Seymour Johnson Air Force Base............... Goldsboro, NC.
Shaw Air Force Base.......................... Sumter, SC.
Southeast Alaska Acoustic Measurement Ketchikan, AK.
Facility.
Tin City Long Range Radar Site............... Tin City, AK.
Tinker Air Force Base........................ Midwest City, OK.
Travis Air Force Base........................ Fairfield, CA.
Tyndall Air Force Base....................... Bay County, FL.
U.S. Army Natick Soldier Systems Center...... Natick, MA.
Watervliet Arsenal........................... Watervliet, NY.
Wright-Patterson Air Force Base.............. Dayton, OH.
----------------------------------------------------------------------------------------------------------------
[[Page 3186]]
----------------------------------------------------------------------------------------------------------------
Part 2
----------------------------------------------------------------------------------------------------------------
Aberdeen Proving Ground...................... Aberdeen, MD.
Camp Shelby.................................. Hattiesburg, MS.
Cape Canaveral Air Force Station............. Cape Canaveral, FL.
Dare County Range............................ Manns Harbor, NC.
Edwards Air Force Base....................... Edwards, CA.
Eglin Air Force Base......................... Valparaiso, FL.
Fallon Range Complex......................... Fallon, NV.
Fort Bragg................................... Fayetteville, NC.
Fort Greely.................................. Delta Junction, AK.
Fort Huachuca................................ Sierra Vista, AZ.
Fort Irwin................................... San Bernardino County, CA.
Fort Polk.................................... Leesville, LA.
Fort Wainwright.............................. Fairbanks, AK.
Hardwood Range............................... Necehuenemedah, WI.
Hill Air Force Base.......................... Ogden, UT.
Mountain Home Air Force Base................. Mountain Home, ID.
Naval Air Station Meridian................... Meridian, MS.
Naval Air Station Patuxent River............. Lexington Park, MD.
Naval Air Weapons Station China Lake......... Ridgecrest, CA.
Naval Base Kitsap--Keyport................... Keyport, WA.
Naval Base Ventura County--Point Mugu Point Mugu, CA.
Operating Facility.
Naval Weapons Systems Training Facility Boardman, OR.
Boardman.
Nellis Air Force Base........................ Las Vegas, NV.
Nevada Test and Training Range............... Tonopah, NV.
Pacific Missile Range Facility............... Kekaha, HI.
Patrick Air Force Base....................... Cocoa Beach, FL.
Tropic Regions Test Center................... Wahiawa, HI.
Utah Test and Training Range................. Barro, UT.
Vandenberg Air Force Base.................... Lompoc, CA.
West Desert Test Center...................... Dugway, UT.
White Sands Missile Range.................... White Sands Missile Range, NM.
Yuma Proving Ground.......................... Yuma, AZ.
----------------------------------------------------------------------------------------------------------------
Site name County Township/range
----------------------------------------------------------------------------------------------------------------
Part 3
----------------------------------------------------------------------------------------------------------------
90th Missile Wing, Francis E. Warren Logan, CO................................. All lands except those
Air Force Base Missile Field located south of Township 8
(Colorado, Nebraska, and Wyoming). North and east of Range 51
West using the Bureau of
Land Management's Public
Lands Survey System.
Morgan, CO................................ All lands located north of
Township 3 North using the
Bureau of Land Management's
Public Lands Survey System.
Sedgwick, CO.............................. All lands except those
located east of Range 46
West using the Bureau of
Land Management's Public
Lands Survey System.
Washington, CO............................ All lands located north of
Township 4 North, and west
of Range 52 West using the
Bureau of Land Management's
Public Lands Survey System.
Weld, CO.................................. All lands located north of
Township 4 North, and east
of Range 64 West using the
Bureau of Land Management's
Public Lands Survey System.
Banner, NE................................ All.
Cheyenne, NE.............................. All.
Deuel, NE................................. All lands located south of
Township 15 North, and west
of Range 43 West using the
Bureau of Land Management's
Public Lands Survey System.
Garden, NE................................ All lands located south of
Township 19 North, and west
Range 43 West using the
Bureau of Land Management's
Public Lands Survey System.
Kimball, NE............................... All.
Morrill, NE............................... All lands except those
located north of Township 21
North using the Bureau of
Land Management's Public
Lands Survey System.
Scotts Bluff, NE.......................... All.
Sioux, NE................................. All lands except those
located north of Township 26
North, and east of Range 57
West using the Bureau of
Land Management's Public
Lands Survey System.
Goshen, WY................................ All lands except those
located north of Township 27
North using the Bureau of
Land Management's Public
Lands Survey System.
Laramie, WY............................... All lands except those
located south of Township 14
North, and west of Range 64
West using the Bureau of
Land Management's Public
Lands Survey System.
[[Page 3187]]
Platte, WY................................ All lands except those
located north of Township 27
North using the Bureau of
Land Management's Public
Lands Survey System.
341st Missile Wing, Malmstrom Air Blaine, MT................................ All lands except those
Force Base Missile Field (Montana). located north of Township 24
North using the Bureau of
Land Management's Public
Lands Survey System.
Cascade, MT............................... All.
Chouteau, MT.............................. All lands except those
located north of Township 24
North, and east of Range 8
East using the Bureau of
Land Management's Public
Lands Survey System.
Fergus, MT................................ All lands except those
located east of Range 26
East using the Bureau of
Land Management's Public
Lands Survey System.
Glacier, MT............................... All lands located south of
Township 35 North, and east
of Range 7 West, using the
Bureau of Land Management's
Public Lands Survey System.
Golden Valley, MT......................... All lands except those
located south of Township 11
North, and east of Range 20
East using the Bureau of
Land Management's Public
Lands Survey System.
Judith Basin, MT.......................... All.
Lewis and Clark, MT....................... All lands except those
located south of Township 14
North using the Bureau of
Land Management's Public
Lands Survey System.
Liberty, MT............................... All lands except those
located north of Township 31
North, and east of Range 5
East using the Bureau of
Land Management's Public
Lands Survey System.
Meagher, MT............................... All lands except those
located south of Township 12
North, and west of Range 9
East using the Bureau of
Land Management's Public
Lands Survey System.
Musselshell, MT........................... All lands located north of
Township 10 North, and west
of Range 23 East using the
Bureau of Land Management's
Public Lands Survey System.
Petroleum, MT............................. All lands located west of
Range 27 East using the
Bureau of Land Management's
Public Lands Survey System.
Phillips, MT.............................. All lands located south of
Township 23 North, and west
of Range 25 East using the
Bureau of Land Management's
Public Lands Survey System.
Pondera, MT............................... All lands except those
located west of Range 9
West, using the Bureau of
Land Management's Public
Lands Survey System.
Stillwater, MT............................ All lands located north of
Township 3 North, and west
of Range 20 East using the
Bureau of Land Management's
Public Lands Survey System.
Sweet Grass, MT........................... All lands located north of
Township 3 North, and east
of Range 12 East using the
Bureau of Land Management's
Public Lands Survey System.
Teton, MT................................. All lands except those
located west of Range 10
West using the Bureau of
Land Management's Public
Lands Survey System.
Toole, MT................................. All lands except those
located north of Township 34
North using the Bureau of
Land Management's Public
Lands Survey System.
Wheatland, MT............................. All.
91st Missile Wing, Minot Air Force Bottineau, ND............................. All lands except those
Base Missile Field (North Dakota). located east of Range 77
West using the Bureau of
Land Management's Public
Lands Survey System.
Burke, ND................................. All lands except those
located west of Range 93
West using the Bureau of
Land Management's Public
Lands Survey System.
Dunn, ND.................................. All lands located north of
Township 148 North, using
the Bureau of Land
Management's Public Lands
Survey System.
McHenry, ND............................... All lands except those
located north of Township
156 North, and east of Range
80 West using the Bureau of
Land Management's Public
Lands Survey System.
McKenzie, ND.............................. All lands located east of
Range 95 West, using the
Bureau of Land Management's
Public Lands Survey System.
McLean, ND................................ All lands except those
located south of Township
145 North using the Bureau
of Land Management's Public
Lands Survey System.
[[Page 3188]]
Mercer, ND................................ All lands located north of
Township 145 North, east of
Range 90 West, using the
Bureau of Land Management's
Public Lands Survey System.
Mountrail, ND............................. All.
Pierce, ND................................ All lands located south of
Township 155 North, west of
Range 72 West using the
Bureau of Land Management's
Public Lands Survey System.
Renville, ND.............................. All.
Sheridan, ND.............................. All lands except those
located south of Township
148 North, and east of Range
78 West using the Bureau of
Land Management's Public
Lands Survey System.
Ward, ND.................................. All lands except those
located north of Township
155 North, and east of Range
83 West using the Bureau of
Land Management's Public
Lands Survey System.
Williams, ND.............................. All lands located south of
Township 158 North, and east
of Range 96 West using the
Bureau of Land Management's
Public Lands Survey System.
----------------------------------------------------------------------------------------------------------------
Site name Location
------------------------------------------------------------------------
Part 4
------------------------------------------------------------------------
Boston Range Complex............ Offshore Massachusetts, New Hampshire,
Maine.
Boston Operating Area........... Offshore Massachusetts, New Hampshire,
Maine.
Charleston Operating Area....... Offshore North Carolina, South
Carolina.
Cherry Point Operating Area..... Offshore North Carolina, South
Carolina.
Corpus Christi Operating Area... Offshore Texas.
Eglin Gulf Test and Training Offshore Florida.
Range.
Gulf of Mexico Range Complex.... Offshore Mississippi, Alabama,
Florida.
Hawaii Range Complex............ Offshore Hawaii.
Jacksonville Operating Area..... Offshore Florida, Georgia.
Jacksonville Range Complex...... Offshore Florida.
Key West Operating Area......... Offshore Florida.
Key West Range Complex.......... Offshore Florida.
Narragansett Bay Range Complex.. Offshore Connecticut, Massachusetts,
New York, Rhode Island.
Narragansett Bay Operating Area. Offshore Connecticut, Massachusetts,
New York, Rhode Island.
New Orleans Operating Area...... Offshore Louisiana.
Northern California Range Offshore California.
Complex.
Northwest Training Range Complex Offshore Oregon, Washington.
Panama City Operating Area...... Offshore Florida.
Pensacola Operating Area........ Offshore Alabama, Florida.
Point Mugu Sea Range............ Offshore California.
Southern California Range Offshore California.
Complex.
Virginia Capes Operating Area... Offshore Delaware, Maryland, North
Carolina, Virginia.
Virginia Capes Range Complex.... Offshore Delaware, Maryland, North
Carolina, Virginia.
------------------------------------------------------------------------
Dated: January 6, 2020.
Thomas Feddo,
Assistant Secretary for Investment Security.
[FR Doc. 2020-00187 Filed 1-13-20; 4:15 pm]
BILLING CODE 4810-25-P