"Covered real estate transactions would include two main categories: (1) real estate “described by its relation to airports and maritime ports”, and (2) real estate “described by its relation to U.S. military installations and other facilities or properties of the U.S. Government that are sensitive for national security reasons.” Real estate transactions are not subject to the mandatory declaration requirement but the proposed rules would allow the submission of voluntary short-form declarations for real estate transactions...

The proposed regulations create new country specifications for covered investments including a new term, “excepted foreign state.”

“Excepted foreign states” are countries “included in a defined group of eligible foreign states, which will be separately published on the Department of Treasury website” and which have been determined by a super-majority of CFIUS member agencies, based on “factors that will be made available on the Department of Treasury website,” to have established “a robust process to assess foreign investments for national security risks and to facilitate coordination with the United States on matters relating to investment security.” (Proposed rules to be codified at 31 CFR part 800 at p.25).

The proposed regulation also contains a definition of “excepted investor” that ties the exemption to ultimate beneficial ownership, looking at such factors as place of incorporation and corporate nationality, and requires substantial connections to the exempt location."