Regarding the Proposed Acquisition of United States Steel Corporation by Nippon Steel Corporation

President Biden issued an order under the Defense Production Act blocking Nippon Steel Corporation's proposed acquisition of U.S. Steel Corporation, finding credible evidence that the transaction threatened U.S. national security. The order prohibits the transaction and requires the parties to fully abandon it within 30 days, with weekly compliance certifications to CFIUS until abandonment is complete.

Federal Register Open PDF 90 FR 2605

Impact dates

Feb 2, 2025
Full and permanent abandonment of Proposed Transaction
Jan 10, 2025
Weekly compliance certifications to CFIUS

Key directives

Prohibit proposed acquisition of U.S. Steel by Nippon Steel
Prohibit substantially similar transactions
Require full and permanent abandonment within 30 days
Require weekly compliance certifications to CFIUS
Require written certification of abandonment upon completion
Authorize CFIUS to implement protective measures
Authorize Attorney General to enforce order
Direct Secretary of Treasury to transmit order to parties

Who is ordered

Timeline

Immediate

Proposed acquisition prohibited
Weekly compliance certifications to CFIUS begin

Near term (90d)

Parties must fully and permanently abandon transaction by 30 days (extendable by CFIUS)
Written certification of abandonment due to CFIUS upon completion

Long term

Potential precedent for CFIUS review of foreign acquisitions in critical industries
Possible further presidential orders under reserved authority

Risks & tensions

U.S.-Japan trade relations strain given Japan is key ally
Potential legal challenge to CFIUS authority or presidential power
Uncertainty around 'substantially similar transaction' scope
Economic impact on U.S. Steel without foreign investment alternative