Negotiating Mitigation Agreements: Prenup-Agreements for a Future Ménage à Trois?

This piece gives an overview of agreements to mitigate national security concerns between the concerned state on the one hand and the acquiring company and the target company on the other hand. Through such mitigation arrangements, states seek to alleviate their national security concerns. The acquiring and target companies, in turn, are willing to make certain undertakings to obtain an—albeit conditional—clearance of the transaction. Mitigation actions have become increasingly popular with screening authorities, allowing them to preserve at the same time the security interests of the state and a general investor-friendly business environment, important to attract foreign capital. The article will look at typical types of security undertakings and at the different legal means to implement these undertakings.