USA Tighten Security Checks for Real Estate Purchases: New Regulation Comes into Effect

The Biden administration has enacted a new regulation that expands its powers to review foreign real estate purchases near U.S. military bases. This measure is in response to growing concerns in the United States about national security risks posed by Chinese investments in properties near sensitive military sites. The rule proposed by the Treasury Department adds nearly 60 facilities in 30 states to the list of locations subject to review. This expansion increases the jurisdiction of the Committee on Foreign Investment in the United States (CFIUS) to approximately 227 military bases. Janet Yellen, the U.S. Treasury Secretary, emphasized that the new rule "will significantly enhance CFIUS's ability to thoroughly review real estate transactions near bases and enable us to deter foreign adversaries from threatening our armed forces." The CFIUS, led by the Treasury Department, examines foreign investments in the U.S. for national security risks. A proposal to apply the rule retroactively to a planned Gotion battery plant in Michigan was rejected. The German automaker Volkswagen is the largest single shareholder of Gotion High-Tech, the parent company of Gotion. Some Republican lawmakers argue that China retains "effective control" through diverse individual shareholders. The new regulation will take effect in December.