Mergers & Acquisitions 2022 Annual Review

2022 M&A ANNUAL REVIEW Global Foreign Investment Review. The trend toward greater regulatory scrutiny of foreign direct investment continues globally as well. ■ The European Union adopted an FDI screening mechanism to ensure cooperation and information sharing across its member states. ■ The United Kingdom’s new National Security and Investment Act allows the UK government to scrutinize a wide range of deals for national security concerns; previously, UK regulators could only review such transactions on public interest grounds. Outbound Investment Review. The concept of an outbound investment review mechanism continues to gain traction in Washington. 11 Requirements likely will come in the form of executive action requiring prior notification and review of outbound transactions in certain sectors (such as semiconductor development) to certain destinations. The mechanism may also include required notices of certain outbound capital investments. Export Controls. 2022 also featured significant updates to U.S. export controls. ■ Most notably, the U.S. Department of Commerce significantly expanded U.S. export controls on semiconductors to limit China’s access to sensitive technologies with potential military capabilities. The controls include restrictions on U.S. persons who “support” semiconductor manufacturing and related activities in China. ■ The United States, European Union, United Kingdom, and other allies responded to Russia’s invasion of Ukraine with expansive export controls; for example, the Department of Commerce imposed a license requirement on exporting all items subject to the Commerce Control List to Russia as well as all luxury goods to Russia, and added well over 300 entities to its Entity List (thereby effectively cutting them off from any U.S. exports) for their involvement in Russia’s invasion of Ukraine. The concept of an outbound investment review mechanism continues to gain traction in Washington. 10 For further discussion of the Guidelines, please see our client alert, New CFIUS Enforcement Guidelines Signal Expanded Compliance Focus. 11 For a discussion of potential legislation, please see our client alert, Lawmakers Continue Push for Review of Outbound Investments. Read more about national security including the following recent client alerts: New CFIUS Enforcement Guidelines Signal Expanded Compliance Focus and Lawmakers Continue Push for Review of Outbound Investments .