On February 21, 2025, President Trump issued the America First Investment Policy Memorandum (“Memorandum”). The Memorandum aims to promote foreign direct investment (FDI) from “allies and partners” while restricting inbound investment from and outbound investment to “foreign adversaries,” such as China (including Hong Kong and Macau), Cuba, Iran, North Korea, Russia, and the Nicolás Maduro regime in Venezuela.
To achieve its FDI aims, the Memorandum requests a review of various Committee on Foreign Investment into the United States (CFIUS) procedures, limits the environmental assessment of large scale investments into the United States, and directs various agencies such as the Securities and Exchange Commission (SEC), the Federal Bureau of Investigation (FBI), and the Department of Labor to review, “based on the auditability, corporate oversight, and evidence of criminal or civil fraudulent behavior, all foreign adversary companies currently listed on domestic exchanges while requiring the Secretary of Labor to publish updated fiduciary standards under the Employee Retirement Income Security Act of 1974 for investments in public market securities of foreign adversary companies.” The president also orders these agencies “[t]o protect the savings of United States investors and channel them into American growth and prosperity,” prompting his administration to:
- “determine if adequate financial auditing standards are upheld for companies covered by the Holding Foreign Companies Accountable Act;
- review the variable interest entity and subsidiary structures used by foreign-adversary companies to trade on United States exchanges, which limit the ownership rights and protections for United States investors, as well as allegations of fraudulent behavior by these companies; and
- restore the highest fiduciary standards as required by the Employee Retirement Security Act of 1974, seeking to ensure that foreign adversary companies are ineligible for pension plan contributions.”
To balance promoting investment with maintaining national security, the Memorandum also adopts the following:
- Fast-Track Investment Process: It creates a “fast-track” process to encourage investment from allied and partner sources in U.S. businesses involved in advanced technology, with security measures to ensure foreign investors avoid U.S. adversaries.
- Environmental & CFIUS Reviews: It proposes mechanisms to potentially eliminate Environmental Protection Agency (EPA) and related agency reviews for large investments (over $1 billion) and CFIUS mitigation agreements, while expanding CFIUS jurisdiction to include new greenfield, start-up technology, and farmland investments.
- Reporting & Restrictions on Investments: It aims to reduce reporting burdens on “passive investments” (as defined in the Memorandum) but may impose new restrictions on U.S. pension funds, endowments (particularly universities), and publicly traded securities for outbound investments in sectors like biotech, hypersonics, aerospace, advanced manufacturing, and directed energy in adversary countries.
The Memorandum also expressly incorporates the America First Trade Policy Memorandum issued on the first day of the Trump administration (see Thompson Hine Update of January 22, 2025). As with the trade policy memorandum, the present Memorandum invokes the authority of the International Emergency Economic Powers Act (IEEPA), which the President relied upon to impose tariffs on China, Canada, and Mexico (see Thompson Hine Update of February 3, 2025). However, in contrast to the America First Trade Policy Memorandum, which required a series of reports to be completed by April 1, 2025, the present Memorandum does not have any procedural requirements to satisfy before implementation.