Industry committee  I don't have much to add to what the other panellists shared. I would say that, for example, when CFIUS conducts its review, although it would look to see if companies follow prescribed standards, in part to determine if they're trustworthy, it can look at issues beyond standards that may be set for different reasons.

Industry committee  That's correct. In the United States, Treasury chairs CFIUS. There are nine voting members, which are most of the cabinet agencies, including the Department of Defense. For each transaction, Treasury chooses a co-chair who helps lead the review. It operates by consensus of all the member agencies.

Industry committee  Being on the outside now, I always say that as much transparency as possible is preferable. CFIUS's annual report does include information on the types of risks it reviews and the mitigation measures that have been taken. I know that the relatively new assistant secretary has been doing more public engagement to try to educate businesses on what CFIUS sees as the risk.

Industry committee  In the United States, we do have the excepted foreign state concept, where certain investors with very tight ties to Five Eyes countries aren't subject to the non-controlling jurisdiction. All countries are still subject to the controlling jurisdiction. When you have mandatory filings, to the extent that you can focus on higher-risk transactions, I think that's the right approach.

Industry committee  I will say one thing. CFIUS is not covering our research contracts with universities that can provide parties of concern access to technology that's being developed. That was a decision in the United States not to subject that to CFIUS, but some other countries, like Denmark and I believe the U.K., are considering that.

Industry committee  Yes, I would.

Industry committee  Yes, it's very similar, although CFIUS uses it quite sparingly and also ensures that if it shares information, it will be protected. However, yes, it's very much in line with the CFIUS provision.

Industry committee  I think this is a judgment call in the U.S. Originally, we had a pilot program for mandatory filings for critical technology, and it was based on export control but on sectors. CFIUS was seeing a significant number of lower-risk transactions from countries that wouldn't cause concern, so there was a decision to focus it on when an authorization would be required for a specific country, to align it more with risk.

Industry committee  Based on my interactions, the Five Eyes have generally seen risks similarly. I also worked quite a bit with European allies. I'd say that, if you look at five years ago, the U.S., Canada and a handful of other countries were the ones that had broader review mechanisms. In recent years, there has been a recognition that certain foreign investment does raise national security risks.

Industry committee  As I mentioned before, Canada does have rather broad authority after the fact to review transactions—in Canada, more blocking than mitigation, for reasons that have been discussed today. Canada, I think, was one of the earlier countries to actually take action. I do think, looking at the U.S. experience, that we closed what we thought was a loophole, particularly with respect to high-risk technology, to be able to review those preclosing.

Industry committee  As part of the amendments in 2018, which came into effect in 2020, CFIUS was able to close a jurisdictional gap. Previously, CFIUS had jurisdiction over transactions that could result in control over U.S. business. CFIUS was given authority to cover minority non-controlling investments in companies with critical technologies, such as artificial intelligence.

Industry committee  I'm sorry. Do I think what would have repercussions?

Industry committee  Do you mean if CFIUS were to revise its—

Industry committee  It would depend on how the transaction is structured. Again, I think that Canada has broader jurisdiction with certain assets, sales or greenfield transactions. If there were an investment into an operating company, which is a pretty low standard, if it had permits or if it had undertaken any development, then it could be covered.

Industry committee  I think the approach, as I said, that CFIUS takes is to review functioning businesses, as opposed to start-ups, where a foreign investor has come in. I take the point that it doesn't cover everything. It's one tool. Maybe I'll just leave it at that.