Strengthening CFIUS to Counter Chinese Influence

China’s increasing economic influence and control over critical supply chains pose significant risks to U.S. national security. While CFIUS (Committee on Foreign Investment in the United States) is tasked with screening foreign investments, gaps in its jurisdiction allow Chinese investments in sensitive sectors to bypass review. This paper identifies three key vulnerabilities: greenfield investments, venture capital (VC) funding in emerging technologies, and offshore investment vehicles that obscure Chinese ownership. Ultimately, this paper proposes expanding CFIUS jurisdiction to address these workarounds and creating an investigative task force that would proactively track shell companies and fraudulent investment structures used to bypass regulations. Given the bipartisan support evidenced by initiatives like the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA), the CHIPS and Science Act, and advocacy from figures such as Senator John Cornyn, bolstering CFIUS’s authority is likely to pass Congress. This legislation is essential to prevent subversive foreign investments and safeguard critical U.S. industries.