Dod Special Security Agreement

December 7, 2020 1:24 am

(1) Board decision — If foreign investment in a company is sufficient to express national security concerns but is not sufficient to allow the foreign investor to appear on the board of directors, it is generally acceptable for the Board of Directors to adopt a resolution certifying that the foreign investor is prohibited from accessing classified information and is not authorized to influence the performance of the classified information company. , among other things. If foreign ownership is sufficient to elect a member to the board of directors, a board resolution may not be acceptable FOCI Minderung, even if the foreign owner is not represented on the board of directors. In accordance with U.S. policy, the NISPOM recognizes that foreign investment in the industrial defence base, if consistent with national security interests, is also, in the broadest sense, in the national interest of the United States. Part of the purpose of the National Industrial Security Program is to protect U.S. government contractors from inappropriate foreign influence or control. U.S. Government Facility Security Clearances (“FCLs”) shall not be issued to U.S. foreign ownership, control or influence companies (“FOCI” unless appropriate security measures are in place to protect U.S. national security.

The National Industrial Security Program (NISPOM) operating manual contains instructions on whether U.S. companies are on FOCI and implements the U.S. government`s policy of granting or prosecuting FCLs to U.S. companies operating under FOCI. Industrial security investigation procedures reviewed by the U.S. Foreign Investment Committee (CFIUS) of the U.S. government are mandated by the NISPOM. The Exon Florio provision of the Defense Production Act of 1950, as amended, defines the CFIUS Act and authorizes the president to investigate and – if the president discovers that the transaction threatens national security – to block mergers, acquisitions and acquisitions of U.S. companies by foreign interests. CFIUS and industrial safety controls move in parallel, but separately, tracks with different time constraints and considerations. The proposal for a satisfactory security agreement is certainly significant, but is only one factor that is taken into account in a Department of Defense (DoD) recommendation or another recommendation from the US authorities to CFIUS.

In cases where the Industrial Security Agreement is the remaining problem, DoD (or any other applicable agency) may recommend suspending or blocking the transaction if there is evidence that further negotiations are unlikely to result in a mutually acceptable plan. (2) Voting Trust Agreement und Proxy Agreement — Voting Trust Agreements and Proxy Agreements are applied in cases where a foreign investor is able to control a U.S. control.

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