What's CFIUS, the US national security panel that can derail foreign deals?

Hindalco and AluChem jointly ended their acquisition deal last week, citing extended delays in closing the transaction that were 'beyond the control of either party'

Hindalco Industries announced last week that it was terminating its proposed $125-million acquisition of US specialty alumina maker AluChem after more than a year of regulatory delays involving the Committee on Foreign Investment in the United States (CFIUS).

 

CFIUS is an inter-agency US government committee that reviews certain foreign investments in the US for potential national security risks. When Hindalco announced the deal in June 2025, it expected the AluChem transaction to close within two to four months. The proposed acquisition went through several updates after US government shutdowns affected the CFIUS process and suspended statutory timelines.

 

Hindalco and AluChem jointly ended the agreement on October 1, with the company saying the “delays were beyond the control of either party”.

What does CFIUS review?

CFIUS reviews certain transactions involving foreign investment in the US to determine whether they could pose risks to US national security. Its jurisdiction covers certain investments involving critical technologies, critical infrastructure, sensitive personal data and real estate. CFIUS can also review certain transactions even when parties have not voluntarily filed a notice.

 

CFIUS is chaired by the US Treasury Secretary. Its members include the Secretaries of State, Defense, Commerce, Energy and Homeland Security, the Attorney General, the US Trade Representative and the director of the White House Office of Science and Technology Policy. The Director of National Intelligence and the Secretary of Labor also participate as non-voting, ex-officio members.

 

The committee assesses transactions individually. If it identifies national security concerns, it can work with the parties to put mitigation measures in place to address them

How does the CFIUS review process work?

Parties can submit a short-form declaration or a formal notice. A declaration is subject to a 30-day assessment period, while a formal notice has a 45-day review period.

 

If CFIUS requires further review, it can begin a 45-day investigation. The Treasury Secretary can extend the investigation by another 15 days in extraordinary circumstances. If CFIUS refers a transaction to the US president, the president has 15 days to make a decision.

 

Parties can also withdraw and refile a notice during the process. This can give CFIUS and the parties additional time to address outstanding national security concerns and discuss possible mitigation measures.

Why can a transaction take longer than expected?

The statutory review periods do not always determine the time taken to close a transaction. CFIUS may seek additional information, move a transaction from a declaration to a formal notice, conduct an investigation or negotiate mitigation measures.

 

Hindalco submitted a short-form declaration for its AluChem acquisition on August 6, 2025. CFIUS accepted it on August 12, starting a 30-day assessment period that ended on September 10. CFIUS then requested a long-form filing, which Hindalco submitted on September 30.

 

The US federal government shutdown that began on October 1, 2025, affected the statutory CFIUS timelines. Hindalco said the deadlines were temporarily suspended. In February 2026, the company said another partial US government shutdown had caused the statutory timelines to be tolled, temporarily halting the review.

What happens if CFIUS concerns remain unresolved?

CFIUS can work with transaction parties to address national security concerns through mitigation measures. If the concerns cannot be resolved, the transaction can be referred to the President of the United States for a decision. Parties can also withdraw their filing and refile it while discussions continue.

 

Past cases show that CFIUS reviews can lead to transactions being delayed, withdrawn, or even abandoned.

 

In 2017, HNA Group’s proposed $416-million investment in US in-flight services company Global Eagle Entertainment was abandoned after the transaction failed to clear CFIUS. Global Eagle said the deal was cancelled because CFIUS had not completed its national security review by the agreed “outside date”. Reuters reported that the protection of customer data transmitted through Global Eagle’s WiFi service was a concern.

 

Ant Financial’s proposed $1.2-billion acquisition of MoneyGram was also terminated the same year as HNA's after CFIUS concerns remained unresolved. The companies had gone through the CFIUS process three times, but security measures proposed to address concerns over the safety of data that could identify US citizens did not secure approval. MoneyGram CEO Alex Holmes said, “Despite our best efforts to work cooperatively with the U.S. government, it has now become clear that CFIUS will not approve this merger.”

 

In 2024, Nippon Steel’s proposed $14.9-billion acquisition of US Steel also faced major delays due to the same. In September, CFIUS allowed the companies to refile their application, starting a new 90-day review period. Reuters reported that the panel wanted more time to assess the deal’s national security implications and its impact on the US steel supply chain. The refiling pushed the decision beyond the November 2024 US presidential election. The deal was subsequently prohibited by then President Joe Biden in January 2025, before President Donald Trump allowed it to proceed in June 2025 subject to a national security agreement.

What do the latest CFIUS numbers show?

The CFIUS annual report in 2025 showed that withdrawals and refilings remain a major part of the review process.

 

According to the report, CFIUS received 207 notices for covered transactions. Of these, 114 proceeded to the investigation stage. Sixty-one notices were withdrawn. Fifty-one were subsequently refiled, while 10 underlying transactions were abandoned.

 

Of the 61 withdrawals, 58 took place after the investigation phase had begun. The annual data shows that parties often use withdrawal and refiling to allow additional time to address CFIUS concerns and consider mitigation measures.

 

Of the 10 transactions that were ultimately abandoned after withdrawal, seven involved cases where CFIUS could not identify mitigation measures that would resolve the national security risks or where the parties did not accept the proposed measures. Three were abandoned for commercial reasons.

 

The data also showed that eight notices received the 15-day extraordinary-circumstances extension in 2025.