[Federal Register Volume 67, Number 225 (Thursday, November 21, 2002)]
[Proposed Rules]
[Pages 70194-70195]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-29622]


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DEPARTMENT OF THE TREASURY

Office of International Investment

31 CFR Part 800


Regulations Pertaining to Mergers, Acquisitions, and Takeovers by 
Foreign Persons

AGENCY: Office of International Investment, Department of the Treasury.

ACTION: Proposed rule.

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SUMMARY: This proposed rule amends regulations in part 800 of 31 CFR 
that implement section 721 of Title VII of the Defense Production Act 
of 1950 (the ``DPA''), as added by section 5021 of the Omnibus Trade 
and Competitiveness Act of 1988. The proposed regulation amends only 
those provisions relating to the filing of voluntary notice with the 
Committee on Foreign Investment in the United States (CFIUS).

DATES: Written comments on the proposed rule may be submitted on or 
before December 23, 2002.

ADDRESSES: Because paper mail in the Washington area may be subject to 
delay, commenters are encouraged to e-mail comments. Comments should be 
sent by one method only. Comments may be mailed to Gay Sills, Director, 
Office of International Investment, Room 4201 NY, Department of the 
Treasury, Washington, DC 20220, or sent electronically to 
[email protected].

FOR FURTHER INFORMATION CONTACT: Gay Sills, Director, Office of 
International Investment, Department of the Treasury, 15th Street and 
Pennsylvania Ave., NW., Washington, DC 20220, (202) 622-1860.

SUPPLEMENTARY INFORMATION: Section 136 of the Defense Production Act 
Amendments of 1992 (Pub. L. 102-558) amended section 709 of the DPA by 
requiring that any regulation issued under the DPA be published in the 
Federal Register and that opportunity for public comment be provided 
for not less than thirty days. Due to the relatively routine nature of 
these regulations, the comment period will be 30 days.
    This proposed regulation provides parties that file a notice with 
CFIUS under section 721 with the option of filing electronically, 
providing just a single paper copy to CFIUS, or the option of 
continuing the current practice of providing CFIUS 13 paper copies. By 
filing electronically, companies could substantially decrease the 
paperwork burden of providing CFIUS notice under section 721.

Executive Order 12866

    These regulations are not subject to the requirements of Executive 
Order 12866 because they relate to a foreign and military affairs 
function of the United States.

Paperwork Reduction Act

    The collections of information provided for in this rule have been 
previously reviewed and approved by the Office of Management and Budget 
in accordance with the Paperwork Reduction Act of 1980 (44 U.S.C. 
3504(h)) under OMB control number 1505-0121. The proposed rule does not 
change the information collection other than to permit an alternative 
means of submitting notice to the Committee on Foreign Investment in 
the United States.

Regulatory Flexibility Act

    This regulation implements section 721 of the Defense Production 
Act of 1950 (``Section 721'') (50 U.S.C. App. 2170)(''DPA''). Section 
709 of the DPA (50 U.S.C. App. 2159) provides that the regulations 
issued under it are not subject to the rulemaking requirements of the 
Administrative Procedure Act (5 U.S.C. 553). Notwithstanding this 
exemption, section 709 of the DPA was amended by section 136 of the 
Defense Production Act Amendments of 1992 (Pub. L. 102-558) to require 
any regulation issued under the DPA to be published in the Federal 
Register for at least thirty days to provide for public comment. This 
requirement subjects this proposed rule to the Regulatory Flexibility 
Act (5 U.S.C. 601 et seq.). It is hereby certified that this proposed 
rule will not impose a significant economic impact on a substantial 
number of small businesses. Currently, the Treasury Department 
estimates that an average filing requires about 60 hours of preparation 
time. This proposed rule will permit parties to file notifications 
electronically, which is expected to reduce the preparation time 
somewhat because it will no longer be necessary to provide 13 paper 
copies of a filing. Instead, a filer can provide a single paper copy to 
the Treasury Department along with the electronic filing. Therefore, 
the impact of the proposed rule on small companies that file 
notifications with CFIUS is expected to be marginally beneficial.

List of Subjects in 31 CFR Part 800

    Foreign investments in United States, Investigations, National 
defense, Reporting and recordkeeping requirements.

[[Page 70195]]

Authority and Issuance

    For the reasons set out in the preamble, Title 31, chapter VIII, 
part 800 of the Code of Federal Regulations is proposed to be amended 
as set forth below.

PART 800--[AMENDED]

    1. Section 800.401 is revised to read as follows:


Sec.  800.401  Procedures for notice.

    (a) A party or parties to an acquisition subject to section 721 may 
submit a voluntary notice to the Committee of the proposed or completed 
acquisition by:
    (1) Sending thirteen copies of the information set out in Sec.  
800.402 to the Staff Chairman of the Committee on Foreign Investment in 
the United States (``Staff Chairman''), Office of International 
Investment, Department of the Treasury, 15th Street and Pennsylvania 
Avenue, NW., Washington, DC 20220; or
    (2) Sending--
    (i) One signed paper copy of the information set out in Sec.  
800.402 to the Staff Chairman of the Committee on Foreign Investment in 
the United States (``Staff Chairman''), Office of International 
Investment, Department of the Treasury, 15th Street and Pennsylvania 
Avenue, NW., Washington, DC 20220; and
    (ii) One electronic copy of this same information in Adobe Acrobat 
(PDF) or Microsoft Word format to the following e-mail address: 
[email protected]. Electronic filings that exceed 5 Megabytes (MB) 
will need to be divided into smaller transmissions of no more than 5 MB 
each, which should be sent individually as attachments to separate e-
mails.
    (b) Any member of the Committee may submit an agency notice of a 
proposed or completed acquisition to the Committee through its Staff 
Chairman if that member has reason to believe, based on facts then 
available, that the acquisition is subject to section 721 and may have 
adverse impacts on the national security. In the event of agency 
notice, the Committee will promptly furnish the parties to the 
acquisition with written advice of such notice.
    (c) No agency notice, or review or investigation by the Committee, 
shall be made with respect to a transaction more than three years after 
the date of conclusion of the transaction, unless the Chairman of the 
Committee, in consultation with other members of the Committee, 
requests an investigation.
    (d) No communications other than those described in paragraphs (a), 
(b) and (c) of this section shall constitute notice for purposes of 
section 721. In any case where a party or parties file(s) 
electronically under paragraph (a) of this section, the signed paper 
copy shall constitute the original copy, and CFIUS will not notify the 
parties of its acceptance of a filing until the original copy has been 
received by the Office of International Investment.

    Dated: October 28, 2002.
John B. Taylor,
Under Secretary for International Affairs.
[FR Doc. 02-29622 Filed 11-20-02; 8:45 am]
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