Commending the Passing of HR 556

COMMENDING THE PASSING OF H.R. 556

* Mr. ISSA. Madam Speaker, today, the U.S. House of Representatives unanimously passed H.R. 556, which reforms and modernizes the process by which the Committee on Foreign Investment in the United States reviews national security issues pertaining to foreign acquisitions.

* I commend the bipartisan House Financial Services Committee for putting together a strong bill that encourages and respects a general policy of openness toward foreign investment, but also protects our national security from new threats in a post 9-11 world.

* This legislation makes clear that in reviewing foreign government acquisitions of critical U.S. energy infrastructure, such as pipelines and Liquefied Natural Gas (LNG) facilities, the United States will not turn a blind eye to foreign governments that use energy assets as a political, economic or foreign policy weapon.

* As the Committee's report states, we expect ``..... that acquisitions of U.S. energy companies or assets by foreign governments or companies controlled by foreign governments--including any instance in which such foreign government has used energy assets to interfere with or influence policies or economic conditions in other countries in ways that threaten the national security of those countries--will be reviewed closely for their national security impact. If such acquisitions raise legitimate concerns about threats to U.S. national security, appropriate protections as set forth in the statute should be instituted including potentially the prohibition of the transaction.'

* Unfortunately, recent actions on the part of the government of Russia demonstrate why such protections are needed. One need only ask officials in the Ukraine, Lithuania, Belarus, Georgia and many countries throughout Europe whether the Russian government--through its state-owned oil monopoly, Rosneft, and gas monopoly, Gazprom--uses its energy assets to ``interfere with or influence policies or economic conditions' in their countries. If Gazprom or Rosneft tries to acquire critical energy infrastructure here in the United States, the CFIUS review process should carefully review the acquisition in order to determine the impact on our own national security, and I commend the bipartisan authors of this legislation for demanding nothing less.

* I commend the Financial Services Committee for recognizing that the reforms and procedures detailed in H.R. 556 ``stand in stark contrast to actions taken by some foreign governments, where expropriations of assets, often in the energy sector, have occurred arbitrarily, without justification, and without recompense for U.S. investors.'

* As many of my colleagues know, U.S. investors throughout the country lost approximately $6 billion when the Russian government effectively re-nationalized Russia's largest privately-owned energy company, Yukos, and expropriated its assets without compensation to its owners or shareholders.

* Now, for the first time since the Russian government's expropriation without compensation of Yukos, and President Vladimir Putin's ruthless strategy of using Russian energy assets to apply economic and political pressure on neighboring countries and the West--including the disruption of oil and gas supplies--the Congress has recognized that if the Russian Government or its subsidiary companies seek to acquire critical U.S. energy infrastructure, Russia's coercive energy policies and its potential threat to the energy security of the United States must be considered as part of the CFIUS review process.

* The National Security Foreign Investment Reform and Strengthened Transparency Act of 2007 strikes the right balance. It strongly encourages foreign investment in the United States without unnecessary and reasonable restrictions by companies that engage in responsible commercial activities and practices. However, H.R. 556 also makes it clear that energy-related infrastructure is critically important to our national security, and those companies that wish to acquire our infrastructure must adhere to internationally recognized standards of commercial conduct.

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