A bill introduced in the Senate in April (Strategic Competition Act of 2021, Section 138) seeks to subject US universities’ foreign grants, contracts and gifts to increased oversight by the Committee on Foreign Investment in the United States (CFIUS).
CFIUS is an interagency committee that reviews foreign investments in the United States. It has the authority to restrict foreign investments it deems pose a risk to US national security. Under the new legislation, CFIUS will have wide latitude to investigate certain foreign funding received by US higher education institutions.
The new bill is part of a recent government-wide effort to limit foreign influence on and access to US scientific research, particularly efforts on behalf of China, which remains the “biggest single source of overseas money to universities.” The Department of Justice has promoted these efforts as the “China initiative,” which has resulted in several high-profile criminal prosecutions, such as those of Harvard chemistry professor Charles Lieber and MIT engineering professor Gang Chen.
Section 117 of the Higher Education Act already requires many colleges and universities to disclose to the Department of Education if they receive at least $250,000 in total funding from a single foreign source. The proposed legislation will additionally require reporting of such funding to CFIUS and will permit CFIUS review of gifts or contracts that:
- are at least $1 million in value, and
- relate to research and development of “critical technologies” and provide the foreign person access to “material . . .technical information” that is restricted on the basis of national security and is not in the public domain, OR
- include a restriction or condition (such as an agreement to employ a faculty member or establish a research center) that would give the foreign entity the power to decide important matters affecting the recipient.
Recipients of the category of gifts or contracts pertaining to “critical technologies” will also be required to proactively submit information about the funding to CFIUS for review.
The proposed legislation has been criticized by many in the US higher education world. The American Council on Education has warned that the proposal could “severely hinder” international research collaborations.
See the full story at: https://www.arnoldporter.com/en/perspectives/blogs/enforcement-edge/2021/05/new-bill-continues-crackdown-on-foreign-influence?utm_source=Mondaq&utm_medium=syndication&utm_campaign=LinkedIn-integration