On May 5, 2023, the Department of the Treasury’s Office of Investment Security published in the Federal Register a Proposed Rule that would amend the regulations pertaining to certain transactions by foreign persons involving real estate in the United States pursuant to section 721 of the Defense Production Act of 1950, as amended, and implemented by the Committee on Foreign Investment in the United States (CFIUS).  The rule would amend a portion of the CFIUS covered real estate transaction regulations at 31 C.F.R. Part 802 regarding the term “military installations” and revise Appendix A (identifying specific bases, ranges and other installations that meet the CFIUS definition of military installations) to include the eight sites listed below:

  1. Air Force Plant 42, located in Palmdale, California
  2. Dyess Air Force Base, located in Abilene, Texas
  3. Ellsworth Air Force Base, located in Box Elder, South Dakota
  4. Grand Forks Air Force Base, located in Grand Forks, North Dakota
  5. Iowa National Guard Joint Force Headquarters, located in Des Moines, Iowa
  6. Lackland Air Force Base, located in San Antonio, Texas
  7. Laughlin Air Force Base, located in Del Rio, Texas
  8. Luke Air Force Base, located in Glendale, Arizona

These eight bases would be placed under Part 2 of Appendix A that applies to real estate that extends 99 miles outward from the boundaries of these military installations.  These locations are new designations and were not previously listed in Part 1 of Appendix A which applies only to real estate within close proximity (i.e., one mile) from certain military installations.  Once finalized, this rule would increase CFIUS’ jurisdiction and ability to review certain covered real estate transactions involving foreign investment within the “extended range” of these U.S. military installations.

Comments on the proposed rule must be received by June 5, 2023.  Comments may be submitted electronically via the Federal government eRulemaking portal at https://www.regulations.gov.  Electronic submission of comments citing “Provisions Pertaining to Certain Transactions by Foreign Persons Involving Real Estate in the United States.”  Comments may also be submitted via regular mail to U.S. Department of the Treasury, Attention: Meena Sharma, Deputy Director of Investment Security Policy and International Relations, 1500 Pennsylvania Avenue, N.W., Washington, DC 20220.

Photo of Scott E. Diamond** Scott E. Diamond**

Scott is a senior policy advisor with more than 25 years’ experience with the legislative and regulatory processes involved in international trade policy, remedies and enforcement. This includes working with clients on matters involving export controls, economic sanctions, human rights and forced labor…

Scott is a senior policy advisor with more than 25 years’ experience with the legislative and regulatory processes involved in international trade policy, remedies and enforcement. This includes working with clients on matters involving export controls, economic sanctions, human rights and forced labor compliance, corporate anti-boycott and antibribery compliance, national security investigations, and foreign direct investment in the United States.

**Not licensed to practice law.

Photo of Francesca M.S. Guerrero Francesca M.S. Guerrero

Francesca counsels clients on compliance with export controls, sanctions, import regulations, human rights and forced labor, and the FCPA and antibribery laws. She works closely with companies to develop tailored compliance programs that fit their specific needs, and routinely advises clients on some…

Francesca counsels clients on compliance with export controls, sanctions, import regulations, human rights and forced labor, and the FCPA and antibribery laws. She works closely with companies to develop tailored compliance programs that fit their specific needs, and routinely advises clients on some of their most challenging international transactions, involving dealings in high-risk jurisdictions or with high-risk counterparties. Francesca also counsels companies through all phases of internal investigations of potential trade and antibribery violations and represents companies across industries before related government agencies.

Photo of Samir D. Varma Samir D. Varma

Samir advises multinational corporations on export controls, economic sanctions and customs, and counsels individuals and corporations on the Foreign Corrupt Practices Act (FCPA) and other anti-corruption laws. He represents clients in enforcement actions before U.S. regulatory agencies and conducts corporate internal investigations.