CFIUS Resuming Normal Operations

Key Takeaways

• CFIUS accepts new filings; clocks no longer tolled
• Shutdown backlog will extend review timelines
• Clearing backlog may take several months
• New filings face longer acceptance periods through fall
• Investigations likely to move to notice phase

Pulse Analysis

CFIUS serves as the United States' gatekeeper for foreign investments that could affect national security. Its mandate, codified in the 2018 Foreign Investment Risk Review Modernization Act, requires any transaction involving critical technology, infrastructure, or data to undergo a rigorous review. The agency’s ability to function hinges on funding across its constituent agencies, most notably the Department of Homeland Security, which provides the security expertise essential for assessing risk. When DHS funding lapsed during the recent 76‑day partial government shutdown, CFIUS was forced to halt new filings, creating a hidden backlog that now threatens to slow deal flow across multiple sectors.

Now that DHS funding is restored, CFIUS has announced that its statutory clocks are no longer tolled and that it will reopen the intake of new transaction notifications. Yet the agency’s staff spent the shutdown period catching up on substantive analysis of already‑accepted cases, leaving a queue of pending reviews. Industry observers estimate that clearing this backlog will require several months, pushing the timeline for new filings well beyond the pre‑shutdown norm. As a result, companies can expect longer waiting periods before their filings are accepted, and many investigations will likely transition directly into the notice phase, with outcomes ranging from no‑action letters to requests for detailed long‑form notices.

For corporations planning cross‑border acquisitions or capital infusions, the practical takeaway is to act early and engage CFIUS counsel before filing. Early strategic assessments can identify potential national‑security concerns and allow for mitigation measures—such as divestitures, data‑handling agreements, or restructuring of ownership—that smooth the review process. Additionally, firms should build flexibility into deal timelines and consider contingency plans if a CFIUS decision is delayed into the fall. By anticipating the extended review horizon and preparing robust compliance packages, companies can reduce uncertainty, protect valuation, and maintain momentum in an environment where national‑security scrutiny remains a decisive factor.