CFIUS’s New Tools to Review: Foreign Investments in US Businesses and Real Estate

Paul Giordano, Principal, Enfinite Capital LLC, USA

While US policymakers continue to recognize the many economic benefits of foreign investment in the United States, their growing concerns over foreign control of or access to sensitive US technologies, infrastructure and personal data led to a significant expansion of the US Government’s powers to review inbound foreign acquisitions and investments from a national security perspective. The Foreign Investment Risk Review Modernization Act (“FIRRMA”) was enacted into law in August 2018 to better equip the Committee on Foreign Investment in the United States (“CFIUS”) to meet increased potential threats posed by foreign direct investments in US businesses and real estate. FIRRMA also updated CFIUS’s statutory authority to align it more closely with the evolution of CFIUS statutory interpretations and practices in certain respects since the last major overhaul of CFIUS’s authority in 2007. In February 2020, two sets of final regulations implementing FIRRMA became effective: (1) those generally applicable to covered transactions, including non-controlling investments (the “Final Investment Regulation”) and (2) those applicable to covered real estate transactions (the “Final Real Estate Regulation”) .

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USA International Banking & Finance September 2020 Vol.13, No. 52, Summer 2020

Paul Giordano

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Mr. Giordano currently is a Principal of Enfinite Capital LLC and also acts as an advisor, lawyer and director to leading insurance, technology and engineering firms. From 2009 through 2017, Mr. Giordano was Executive Vice President, General Counsel and Secretary of Ironshore Inc., a global specialty insurance company. While at Ironshore, he also was Chairman for Political Risk, Special Risk and Surety and CEO of Ironshore Surety Holdings Inc. Prior to joining Ironshore, Mr. Giordano was President and CEO of Syncora Holdings Ltd., a publicly traded financial guaranty insurance and reinsurance company, from 2006 to 2008. Mr. Giordano served in a variety of legal and business roles at XL Capital Ltd. from 1997 through 2006, including Executive Vice President and General Counsel, President of XL Financial Solutions and CEO for XL’s Financial Products and Services division. Mr. Giordano began his career in private practice with the law firms of Cleary, Gottlieb, Steen & Hamilton and Clifford Chance in New York and London from 1990 to 1997 where his practice focused primarily on banking law, securities law, M&A and international financial transactions. Mr. Giordano has held a variety of board positions in the insurance industry, including serving as an outside director of Primus Guaranty, Ltd., a NYSE-listed credit default swap company. He also was a senior advisor to the Committee on Capital Markets Regulation, an independent non-partisan 501(c)(3) research organization focused on regulation of the U.S. capital markets, and Co-Chair of the Financial Services Policy Committee of the New England Council, a cross-industry business advocacy group. Mr. Giordano holds a JD from Harvard Law School, an MA from Oxford University and a BA in Political Science from the University of Missouri-Columbia.

Enfinite Capital LLC

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Enfinite Capital LL is an investment firm specializing in technology and utility-scale renewable energy and other specialized commercial real estate assets.

USA International Banking & Finance September 2020 Vol.13, No. 52, Summer 2020
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