ANS -- Obama Bars Chinese-Owned Company From Building Wind-Farm

Here's something different.  Obama has stopped a Chinese company from building a windfarm close to a Naval base. for security reasons. 
Find it here:  http://www.bloomberg.com/news/2012-09-28/obama-bars-chinese-owned-company-from-building-wind-farm.html  
--Kim

Obama Bars Chinese-Owned Company From Building Wind-Farm

By Sara Forden - Sep 28, 2012 11:28 AM PT

President Barack Obama barred a Chinese-owned company from building wind farms near a U.S. Navy installation in Oregon, the first time in 22 years a president has blocked a transaction on national security grounds.

�The president�s action demonstrates the administration�s commitment to protecting national security while maintaining the United States� longstanding policy on open investment,� the U.S. Treasury said in a statement today. The ruling �is specific to this transaction and is not a precedent with regard to any other foreign direct investment from China or any other country.�

Obama�s decision confirms an order handed down in July by the government�s Committee on Foreign Investment in the U.S., or CFIUS, which reviews acquisitions of domestic companies by non- U.S. entities. CFIUS referred the matter to the president after the Chinese-owned company, Ralls Corp., sued to overturn its ruling.

�I thought this case would have been ripe for some sort of mitigation agreement, which would have limited access by the parties but still allow them to obtain the benefit of their purchase,� Greg Jacobs, a lawyer with Reed Smith LLP in Washington, said in an interview before the announcement. �Some will view this as a closed-door to Chinese investment.�

Ralls, which is owned by executives of China-based Sany Group Co., is seeking to develop the wind farms in Oregon after purchasing land and other rights earlier this year. The assets consist of four locations, one of which is within restricted airspace the Navy uses for training, according to court documents. Three other properties are within five miles of the restricted airspace, according to the filings.

Sany Group

Closely held Sany Group is the owner of China�s biggest machinery maker. Dawei Duan, Sany�s chief financial officer and Jialiang Wu, a vice president of the group and general manager of Sany Electric Co., a group unit, are the owners of Delaware- based Ralls, according to court filings.

CFIUS rulings are rarely referred to the president for a decision before being resolved in some other way, according to a panel report to Congress covering the period from 2008 to 2010.

The last transaction blocked on CFIUS grounds was by then- president George H.W. Bush in 1990 in the proposed acquisition of MAMCO Manufacturing Inc., a maker of motors and generators based in Washington state, by China National Aero-Technology and Export Corp.

A status report in the court case, which is before U.S. District Judge Amy Berman Jackson, is due from both sides by Oct. 1

Jackson already said she can�t review the president�s decision because of the deference that she�s legally obliged to give the president on national security issues. She urged the government and Ralls to try to reach an agreement.

CFIUS Reporting

Ralls bought the wind-farm assets earlier this year without reporting the transaction to CFIUS, according to a U.S. filing in the case.

CFIUS is an interagency committee headed by Treasury Secretary Timothy Geithner that reviews the national security implications of transactions that could lead to a non-U.S. citizen controlling a U.S. business. The heads of the departments of Justice, Homeland Security, Commerce, Defense, State, and Energy, among others, sit on the committee. The panel�s recommendations can be enforced only by the president under the law.

The case is Ralls Corp. v. Committee on Foreign Investment in the U.S., 1:12-cv-01513, U.S. District Court, District of Columbia (Washington.)

To contact the reporter on this story: Sara Forden in Washington at sforden@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.