{"id":9606,"date":"2026-03-29T16:23:03","date_gmt":"2026-03-29T20:23:03","guid":{"rendered":"https:\/\/diaztradelaw.com\/?p=9606"},"modified":"2026-03-30T20:08:05","modified_gmt":"2026-03-31T00:08:05","slug":"non-notified-transactions-raising-red-flags-for-cfius","status":"publish","type":"post","link":"https:\/\/diaztradelaw.com\/non-notified-transactions-raising-red-flags-for-cfius\/","title":{"rendered":"Non-notified Transactions Raising Red Flags for CFIUS\u00a0"},"content":{"rendered":"

Authors:
\n<\/strong>Jennifer Diaz, President, Diaz Trade Law<\/em>
\nAmber Pirson, Attorney, Diaz Trade Law<\/em><\/p>\n

Even when a transaction does not trigger a mandatory filing, <\/span>Committee on Foreign Investment in the United States<\/span> (CFIUS) risk does not disappear. While the regime remains technically \u201cvoluntary\u201d in many cases, Treasury\u2019s increasingly active non-notified program means that deals can still be reviewed, and potentially unwound, long after closing. As a result, parties must weigh the benefits of filing against the risk of future scrutiny, particularly in sensitive sectors or with higher-risk investors.\u00a0<\/span>\u00a0<\/span><\/p>\n

What counts as \u201cvoluntary\u201d <\/span><\/b>\u00a0<\/span><\/h4>\n

Given the breadth of CFIUS\u2019 jurisdiction to review transactions between US and non-US entities where the latter\u2019s investment implicates U.S. national security, if a deal is not a \u201ccovered transaction\u201d (no foreign\u2011government substantial interest in a TID U.S. business; no critical technology), the filing decision is voluntary, but not risk\u2011free. CFIUS runs a vigorous non\u2011notified program that screens thousands of transactions annually and can request (or require) a filing post\u2011closing.<\/span>\u00a0<\/span><\/p>\n

Why file voluntarily anyway?<\/span><\/b><\/h4>\n

A voluntary filing can deliver \u201csafe harbor\u201d (limiting CFIUS\u2019 ability to initiate a review of the transaction in the future), reduce the risk of a disruptive post\u2011closing inquiry, and preserve options if a customer or government counterparties expect CFIUS clearance in sensitive sectors (e.g., defense supply chain, advanced computing and AI, biosecurity, or large\u2011scale personal\u2011data platforms).<\/span>\u00a0<\/span><\/p>\n

A practical playbook to reduce CFIUS risk and avoid being flagged<\/span><\/b>\u00a0<\/span><\/h4>\n

1) Review the risks of your investor profile and structure.\u00a0<\/strong><\/p>\n

Confirm \u201cexcepted investor\/state\u201d status where applicable, and consider governance that removes control and covered\u2011investment rights where such restrictions can truly be enforced by both parties (no board\/observer, no material non\u2011public technical info, no substantive decision\u2011making).\u00a0<\/span>\u00a0<\/span><\/p>\n

Be prepared for full upstream ownership transparency (including limited partners [LPs]); CFIUS expects disclosure and may ask for LP info and governance rights\u2014even where fund documents restrict it.\u00a0<\/span>\u00a0<\/span><\/p>\n

2) Minimize data, access, and proximity risks.\u00a0<\/strong><\/p>\n

In line with other trade compliance measures, implement U.S.\u2011person\u2011only access, data localization, encryption, and segregation measures ex ante; for higher\u2011risk cases, evaluate a U.S. proxy\/Special Security Agreement (SSA) or ring\u2011fencing sensitive assets.\u00a0<\/span>\u00a0<\/span><\/p>\n

For real estate adjacency exposure, re\u2011check the Part 802 installation lists and updated US Census Bureau data: Treasury expanded covered sites and radii, increasing the odds that a real estate component surfaces on CFIUS radar.<\/span>\u00a0<\/span><\/p>\n

3) Choose the right filing lane.\u00a0<\/strong><\/p>\n

Declarations (30 days) work best for low\u2011risk fact patterns from trusted investors; outcomes include clearance or a request to file a notice.<\/span>\u00a0<\/span><\/p>\n

Full notices are advisable for complex facts, sensitive buyers\/sectors, or where customers and regulators require the certainty of a formal clearance letter; use pre\u2011notice Committee engagement and draft submissions to tighten timelines.\u00a0<\/span>\u00a0<\/span><\/p>\n

4) Anticipate the non\u2011notified program.\u00a0<\/strong><\/p>\n

Treasury coordinates tips, media, databases, and classified reporting to identify non\u2011notified deals; outreach may arrive months or years post\u2011close. Have a response plan and contemporaneous memos showing why no filing was mandatory and why the risk profile was low.\u00a0<\/span>\u00a0<\/span><\/p>\n

5) Track the enforcement environment. <\/strong><\/p>\n

Treasury has finalized rules increasing penalty ceilings and speeding mitigation talks; more penalties have been publicly announced (including eight\u2011figure cases). Treat certifications seriously, build compliance programs, and monitor post\u2011clearance obligations.<\/span>\u00a0<\/span><\/p>\n

Conclusion<\/span><\/b>\u00a0<\/span><\/h4>\n

TID U.S. businesses in sensitive sub\u2011sectors (AI\/semiconductors\/quantum, critical infrastructure operational technology [OT], bulk sensitive personal data) may draw CFIUS interest, even where there is no mandatory trigger. Given the Committee\u2019s growing interest in non-notified transactions, political momentum to continue trade wars with countries of concern, and that the Committee\u2019s jurisdiction to review transactions is not subject to a statute of limitations, companies should be wary of the Committee\u2019s investigation long after closing \u2013 especially where the deal has a nexus to the U.S. government or sectors known as important to U.S. national interests.\u00a0<\/span>\u00a0<\/span><\/p>\n

Diaz Trade Law can help you navigate CFIUS requirements, reduce risk, and avoid costly post\u2011closing surprises. Contact us at <\/span>info@diaztradelaw.com<\/span><\/a> or 305-456-3830.<\/span>\u00a0<\/span><\/p>\n

Learn more:<\/span>\u00a0<\/span><\/p>\n