In this Note, Christopher M. Weimer examines the current state of foreign direct investment (FDI) review as it relates to national security.  As a backdrop for his analysis, Weimer presents statistical data to demonstrate the importance of FDI to the U.S. economy, and provides examples of the types of threats that foreign investment can pose to national security. 

He then analyzes the current regulatory framework—a framework that has developed through a combination of Congress's apprehension regarding particular transactions and its frustration with Executive inaction—as it currently exists after the passage of the Foreign Investment and National Security Act (FINSA) in 2007.  After identifying several significant shortcomings, Weimer concludes that the current regime, in which the Committee on Foreign Investment in the United States (CFIUS) is charged with reviewing foreign-investment transactions for potential security threats, does not adequately serve the interests of either the domestic economy or national security.  As an alternative to current the regulatory scheme, Weimer proposes the use of a modified form of the golden shares currently used in the United Kingdom to ensure protection in a limited number of security-sensitive firms.  The use of golden shares, Weimer argues, could offer increased certainty in national-security protections while limiting the threat of government interference in foreign investment in the majority of sectors, thus encouraging the inflow of much-needed foreign capital.  Finally, Weimer seeks to demonstrate the superiority of this approach through the hypothetical application of the golden shares concept to two recent FDI controversies: Magnequench and the rise of sovereign-wealth funds.