Dubai Ports World - UAE - Exon-Florio Provision - CFIUS

Department Of The Treasury ^ | US Dept of the Treasury

[deport]

The above is from the US Treasury and gives an overview of the process regarding Foreign Direct Investments in the US. In addition other info can be found at the following two links:

Code of Federal Regulations.. PART 800—REGULATIONS PERTAINING TO MERGERS, ACQUISITIONS, AND TAKEOVERS BY FOREIGN PERSONS

US CODE, TITLE 50, APPENDIX App. > DEFENSE > ACT > TITLE VII > § 2170 Prev | Next § 2170. Authority to review certain mergers, acquisitions, and takeovers

Code of Federal Regulations.. PART 800—REGULATIONS PERTAINING TO MERGERS, ACQUISITIONS, AND TAKEOVERS BY FOREIGN PERSONS

[kiriath_jearim]

Thanks for the post.

[Deagle]

This situation has become both a political problem and a possible terrorist threat problem.

Politically, it is a disaster...mainly due to catching the White House off-guard and responding incorrectly. The opening to the Democrats is certaintly not a good thing...

The possible terrorist threat is there and it should be interpretred differently. One, do we combine forces with the UAE (hopefully our friends against terrorists - at least in the last 3 years) and combat problems in the Middle East or do we assume that they may be complicit with the terrorists and prevent their control/ownership of our ports. Tough question...for both us and the administration.

What do you think?

[Howlin]

Bump.

[onyx]

BTTT

Good researched info here.

[BigSkyFreeper]

Thanks for the ping onyx! Good stuff here deport! BTTT!

[onyx]

Bookmark it. And that's an order.

:)

[BigSkyFreeper]

Roger Wilco Skypilot!

:)

[Owen]

>>(1) there is credible evidence that the foreign entity exercising control might take action that threatens national security, and

(2) the provisions of law, other than the International Emergency Economic Powers Act do not provide adequate and appropriate authority to protect the national security.
>>

This looks like the ball game.

Does anyone have any explicit and credible evidence that this particular company might take action to threaten the national security AND that other laws do not provide adequate authority to protect national security?

If not, then in the absence of evidence it would be illegal for the president to undo this selection, which seems to have been done according to a defined process that looks like a good one.

[p23185]

If not, then in the absence of evidence it would be illegal for the president to undo this selection, which seems to have been done according to a defined process that looks like a good one.

And I think GWB is taking such a hard stand with a threatened veto because behind the scenes he wants UAE to remain an ally especially in order to use the Al Dhafra Air Base should Iran require further persuasion to knock off their nuke ambitions.

[John Valentine]

NOW, here's a nugget of truth. And, don't forget Oman, right next door, also Muslim, also a friend, also just last month signing a Free Trade Agreement with the US, and also haveing a history of making key airfields available to the US in time of conflict.

Are friends in this part of the world are watching this to see if we really mean what we say. Right now, I think that we are making hypocrites of ourselves. I know Democrats don't care, but it has been eye-opening (not to say completely disgusting) to me to see how easily Republicans and conservatives have been stampeded by the Dems.

[calcowgirl]

Question. I read this Act a few times yesterday and couldn't figure out how it even applies to the DPW acquisition. DPW is acquiring P&O, a publicly traded British firm. How does Exon-Florio apply?

The Statute. Section 5021 of the Omnibus Trade and Competitiveness Act of 1988 amended Section 721 of the Defense Production Act of 1950 to provide authority to the President to suspend or prohibit any foreign acquisition, merger or takeover of a U.S. corporation that is determined to threaten the national security of the United States. The President can exercise this authority under section 721 (also known as the "Exon-Florio provision") to block a foreign acquisition of a U.S. corporation only if he finds:

[Milligan]

Don't you think this is profiling?

[Smartaleck]

If the law, which the WH followed is crap, the question remains, when will Congress accept responsibility for a crappy law?

Of note, there has been much ado about the President didn't know the implication being he's out of the loop or stupid yet -
"This order also provides for CFIUS to submit a report and recommendation to the President *****at the conclusion of an investigation."****

In other words, he didn't know by design!!!

[CharlesWayneCT]

P&O owns U.S. companies as subsidiaries. Some of these companies (U.S.) are the ones that actually RUN the port management operations now. They would still run the operations after the purchase. So the U.S. companies are in effect changing hands, and the law applies.

BTW, the P&O Stockholder report detailing the sale has a section which makes the deal dependent on making it through the Exon-Florio process. I reprint it At this post in another thread

You will see if you go there references to the time frames specified in the law above.

[deport]

How does Exon-Florio apply?

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As I read the following it seems that this gives Exon-Florio the authority....... [from the above posted article]

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Amendments. Section 837(a) of the National Defense Authorization Act for Fiscal Year 1993, called the "Byrd Amendment," amended Section 721 of the Defense Production Act (the "Exon-Florio provision"). It requires an investigation in cases where:

o the acquirer is controlled by or acting on behalf of a foreign government; and

o the acquisition "could result in control of a person engaged in interstate commerce in the U.S. that could affect the national security of the U.S."

[deport]

Also the section I posted in #18 covers the DPW more specifically I think.....

[deport]

when will Congress accept responsibility for a crappy law?

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Not in our lifetime would be my guess.... They may tinker with the provisions some but will do it under the need to curb abuses by some other entity is my speculation.