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本期CFIUS 60秒速读的启示是交易方应在涉及自愿申报的交易中尽早考虑如何计算交易金额。


60-Second CFIUS
CFIUS Filing Fees Are Here, But Calculation Can Be Complicated

As of May 1, 2020, parties making a voluntary notice filing with CFIUS will have to pay a filing fee. There is no fee for declarations under the mandatory filing regime.

The Treasury Department’s April 29, 2020 interim rulemaking establishes a step-function fee schedule based on the “value” of the transaction. There is no fee where the value is less than $500,000. The maximum fee is $300,000 for transaction values of $750,000,000 or more. In between the fees go from 0.15% in smaller deals, to 0.04% for larger deals.

There is more complexity than you might think. For example, in most cases the “value” of a transaction is determined by the amount paid by the foreign party, not the value of what is acquired—unless the consideration is contingent on milestones, in which case the parties look at the value of the target assets or equity. If there are multiple foreign parties, each may have a different transaction “value”. A filing may be made by the lead investor but not by smaller investors, so the value of the transaction for purposes of setting the filing fee may be less than the total deal size. If there are foreign and US buyers/investors, you would look only to the foreign parties.

If the target is a multinational with US operations, the “value” for purposes of setting the fee is the overall consideration paid, not the portion attributed to the US business. In a large multinational acquisition including a modest US component, the filing fee could max out at $300,000 even if the US business represented less than 1% of the deal.

If the consideration includes public securities, the value is the closing price on the day before filing, not the volume-weighted (VWAP) or trailing average price. Deals that include warrants, options or other contingent equity interests include the exercise or conversion price if the conversion is “imminent,” but not otherwise. In-kind contributions, services, intangibles such as intellectual property or knowhow, or services are valued at “fair market value,” but this is often difficult to determine, as is the value of a “US business” contributed to a joint venture. If CFIUS disagrees with the calculation of the fee, it can reject the filing.

The 60-second takeaway is that parties should start thinking early about how to set a value on a transaction involving a voluntary filing with CFIUS.