Thursday, September 14, 2017
Trump Prohibits Sale of Lattice Semiconductor Corporation to China Venture Capital Fund under the Defense Production Act of 1950
one small voice
Washington DC, President Donald J. Trump issued an order prohibiting the acquisition of Lattice Semiconductor Corporation (Lattice) by, among others, China Venture Capital Fund Corporation Limited (CVCF). CVCF is a Chinese corporation owned by Chinese state-owned entities that manages industrial investments and venture capital.
The President made the decision to issue this order under section 721 of the Defense Production Act of 1950, as amended by the Foreign Investment and National Security Act of 2007. Under the Defense Production Act, the President is authorized to suspend or prohibit certain acquisitions that result in foreign control of a United States business if he concludes, among other things, that there is credible evidence that the foreign interest exercising control might take action that threatens to impair the national security of the United States. The President reached this decision upon consideration of the appropriate factors set forth in section 721 of the Defense Production Act and a review of a recommendation from the Committee on Foreign Investment in the United States. The national-security risk posed by the transaction relates to, among other things, the potential transfer of intellectual property to the foreign acquirer, the Chinese government’s role in supporting this transaction, the importance of semiconductor supply chain integrity to the United States Government, and the use of Lattice products by the United States Government.