2024 Reports

Passive financing in the crosshairs: CFIUS intensifies focus on limited partners in covered private equity transactions

Gerkin, Daniel J.; Weinbaum, Michelle A.

CFIUS is increasingly shifting focus from general partners that control investment funds to limited partners that pose minimal—if any—national security risk, leading to unintended consequences. This Perspective argues that CFIUS should prioritize higher-risk investment activity and mitigate the chilling effect on much-needed passive investment in U.S. businesses.