The Defense Production Act gives the Committee on Foreign Investment in the United States (CFIUS) the power to review any 'covered transaction' and to mitigate any national security risk that arises as a result of the transaction. The Act also empowers the President to suspend or prohibit any covered transaction if it is deemed to threaten United States national security. Historically, covered transactions would include mergers, acquisitions and takeovers by or with a foreign person that could result in foreign control of a United States business.

On 13 February 2020, regulations implementing reforms brought by the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) came into effect. FIRMMA expands the scope of CFIUS reviews to include certain foreign acquisitions of real property and related rights in the United States. In general, the new rules apply to real estate being or located in close proximity of airports, seaports or military installations.
"§4565. Authority to review certain mergers, acquisitions, and takeovers
(a) Definitions
In this section:
(1) Clarification
The term "national security" shall be construed so as to include those issues relating to "homeland security", including its application to critical infrastructure.
(2) Committee; chairperson
The terms "Committee" and "chairperson" mean the Committee on Foreign Investment in the United States and the chairperson thereof, respectively.
(3) Control
The term "control" means the power, direct or indirect, whether exercised or not exercised, to determine, direct, or decide important matters affecting an entity, subject to regulations prescribed by the Committee.
(4) Covered transaction
(A) In general
Except as otherwise provided, the term "covered transaction" means-
(i) any transaction described in subparagraph (B)(i); and
(ii) any transaction described in clauses (ii) through (v) of subparagraph (B) that is proposed, pending, or completed on or after the effective date set forth in section 1727 of the Foreign Investment Risk Review Modernization Act of 2018.
(B) Transactions described
A transaction described in this subparagraph is any of the following:
[...](ii) Subject to subparagraphs (C) and (E), the purchase or lease by, or a concession to, a foreign person of private or public real estate that-
(I) is located in the United States;
(II)(aa) is, is located within, or will function as part of, an air or maritime port; or
(bb)(AA) is in close proximity to a United States military installation or another facility or property of the United States Government that is sensitive for reasons relating to national security;
(BB) could reasonably provide the foreign person the ability to collect intelligence on activities being conducted at such an installation, facility, or property; or
(CC) could otherwise expose national security activities at such an installation, facility, or property to the risk of foreign surveillance; and
(III) meets such other criteria as the Committee prescribes by regulation, except that such criteria may not expand the categories of real estate to which this clause applies beyond the categories described in subclause (II). [...]
(E) Country specification
The Committee shall prescribe regulations that further define the term "foreign person" for purposes of clauses (ii) and (iii) of subparagraph (B). In prescribing such regulations, the Committee shall specify criteria to limit the application of such clauses to the investments of certain categories of foreign persons. Such criteria shall take into consideration how a foreign person is connected to a foreign country or foreign government, and whether the connection may affect the national security of the United States. [...]
(b) National security reviews and investigations
(1) National security reviews
(A) In general
Upon receiving written notification under subparagraph (C) of any covered transaction, or pursuant to a unilateral notification initiated under subparagraph (D) with respect to any covered transaction, the President, acting through the Committee-
(i) shall review the covered transaction to determine the effects of the transaction on the national security of the United States; and
(ii) shall consider the factors specified in subsection (f) for such purpose, as appropriate.[...]
(C) Written notice
(i) In general
(I) In general
Any party or parties to any covered transaction may initiate a review of the transaction under this paragraph by submitting a written notice of the transaction to the Chairperson of the Committee.
[...]
(D) Unilateral initiation of review
Subject to subparagraph (G), the President or the Committee may initiate a review under subparagraph (A) of-
(i) any covered transaction (other than a covered transaction described in subparagraph (E));[...]
(E) Covered transactions described
A covered transaction is described in this subparagraph if-
(i) the Committee has informed the parties to the transaction in writing that the Committee has completed all action under this section with respect to the transaction; or
(ii) the President has announced a decision not to exercise the President's authority under subsection (d) with respect to the transaction.[...]
(2) National security investigations
(A) In general
In each case described in subparagraph (B), the Committee shall immediately conduct an investigation of the effects of a covered transaction on the national security of the United States, and take any necessary actions in connection with the transaction to protect the national security of the United States.
(B) Applicability
Subparagraph (A) shall apply in each case in which-
(i) a review of a covered transaction under paragraph (1) results in a determination that-
(I) the transaction threatens to impair the national security of the United States and the risk has not been mitigated during or prior to the review of a covered transaction under paragraph (1);
(II) the transaction is a foreign government-controlled transaction; or
(III) the transaction would result in control of any critical infrastructure of or within the United States by or on behalf of any foreign person, if the Committee determines that the transaction could impair national security, and that such impairment to national security has not been mitigated by assurances provided or renewed with the approval of the Committee, as described in subsection (l), during the review period under paragraph (1); or
(ii) the lead agency recommends, and the Committee concurs, that an investigation be undertaken.[...]
(d) Action by the President
(1) In general
Subject to paragraph (4), the President may take such action for such time as the President considers appropriate to suspend or prohibit any covered transaction that threatens to impair the national security of the United States. [...]
(k) Committee on Foreign Investment in the United States
(1) Establishment
The Committee on Foreign Investment in the United States, established pursuant to Executive Order No. 11858, shall be a multi agency committee to carry out this section and such other assignments as the President may designate.[...]
(l) Actions by the Committee to address national security risks
(1) Suspension of transactions
The Committee, acting through the chairperson, may suspend a proposed or pending covered transaction that may pose a risk to the national security of the United States for such time as the covered transaction is under review or investigation under subsection (b).
(2) Referral to President
The Committee may, at any time during the review or investigation of a covered transaction under subsection (b), complete the action of the Committee with respect to the transaction and refer the transaction to the President for action pursuant to subsection (d).[...]" (Defense Production Act (50 U.S.C. current through Pub. L. 117-49), § 4565)
Defense Production Act (50 U.S.C. current through Pub. L. 117-49), § 4565
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