How a Norwegian Government Report Shows the Limits of CFIUS Data Reviews
The U.S. Treasury Department building in Washington, D.C. (Eric Weaver, https://flic.kr/p/8fJ7Hv; CC BY-ND 2.0, https://creativecommons.org/licenses/by-nd/2.0/)
Amid growing attention to data and national security threats from China, a recent Norwegian government report sheds light on the limits of a U.S. government process for tackling them: the Committee on Foreign Investment in the United States (CFIUS).
In 2019, CFIUS, which reviews foreign investments in sensitive U.S. companies for national security risks, initiated a review of Chinese company Beijing Kunlun Tech’s 2016 and 2018 investments into dating app Grindr. Beijing Kunlun Tech had a more than 98 percent ownership stake in Grindr. The committee’s logic was that Grindr’s user data, including on sexual orientation, sexual behavior and health data, was too sensitive to risk ending up in the hands of the Chinese government via the Chinese owner. CFIUS went through its review process and, though the specifics of that review are classified, it reportedly asked Beijing Kunlun Tech to sell Grindr in March 2019, which the company then did in March 2020 to San Vicente Acquisition LLC, a U.S-incorporated group of tech investors and entrepreneurs.