misterbull,Taylor Investments
"Joseph Taylor, vice president of Panasonic Corp. of North America, is among executives from more than a dozen other U.S. units of foreign companies that are descending on Capitol Hill to warn against erecting new hurdles to investment from abroad after the Dubai Ports World controversy".
Reuters
Foreign subsidiaries to caution U.S. lawmakers
By Susan Cornwell
April 25, 2006
WASHINGTON, April 25 (Reuters) - Born in Atlantic City and raised in Pennsylvania, a senior Panasonic executive will show Congress the American face of foreign investment this week and urge lawmakers not to scare away foreign bids for U.S. assets.
Joseph Taylor, vice president of Panasonic Corp. of North America, is among executives from more than a dozen other U.S. units of foreign companies that are descending on Capitol Hill to warn against erecting new hurdles to investment from abroad after the Dubai Ports World controversy.
Panasonic, based in Secaucus, New Jersey, is a wholly owned subsidiary of Japan's Matsushita Electric Industrial Co. Ltd. <6752.T>. But, Taylor declared: "We're not foreign."
"We have American faces, an American employee base, we pay U.S. taxes," he told Reuters in a telephone interview. "We have roughly 10,000 employees in the United States. All but maybe 200 or 300 are Americans."
The executives are worried about a new atmosphere on Capitol Hill after the Dubai ports saga, in which a state-owned Arab company agreed to unwind its purchase of major U.S. port operations after an uproar from U.S. lawmakers who said they were worried about national security.
Now legislation is emerging to tighten rules on government reviews of foreign purchases of U.S. assets.
Executives visiting Congress on Thursday will caution lawmakers not to overreact and restrict foreign takeovers. The lobbying was organized by the Organization for International Investment, a Washington-based business association.
"It's an election year, and nothing feels better than keeping America safe and secure," said Georg Budenbender, president of E.ON North America Inc. The unit of the large German power and gas company E.ON AG <EONG.DE> owns utilities in Kentucky.
"But what is really happening?" Budenbender said he would ask U.S. lawmakers. "Are you keeping investment dollars out of your district? Keeping job growth down?"
This year, E.ON invested nearly $1 billion in new U.S. power generation equipment, said Budenbender, a U.S. citizen who was born in Germany.
PENDING LEGISLATION
A bill requiring the government to be stricter in vetting foreign deals has passed the Senate Banking Committee.
House lawmakers such as Missouri Republican Rep. Roy Blunt are working on a similar bill. On Thursday, a House subcommittee will hold a hearing on how the interagency Committee on Foreign Investments in the United States reviews proposed foreign takeovers.
A major concern is that U.S. government reviews of foreign acquisitions, now mostly limited to 30 days, will be extended for too long, the business executives say. Under the Senate legislation, reviews could be stretched beyond three months.
"Time is costly," Taylor said. "With the investment process more complicated for foreign companies, they may decide to invest their money elsewhere."
The rate of spending by foreign companies had slowed before the Dubai ports deal. The U.S. Commerce Department says U.S. capital spending by affiliates of nonbank foreign companies fell to $108 billion in 2004 from $122 billion in 2001.
The details of the pending legislation are crucial, the U.S. subsidiaries of foreign firms say. They worry, for example, how broadly the U.S. government will define "critical infrastructure." The Senate bill would mandate longer reviews of takeovers involving critical infrastructure if there is a demonstrated national security concern.
A more drastic bill already introduced in the House and awaiting a hearing would force foreign companies to sell holdings in any U.S. infrastructure the government deems critical to the economy or national security.
"You have to ask yourself, what will be considered critical infrastructure?" Budenbender said. "What will be added to that list in the future? We are in the energy business. What does that entail if we are contemplating another investment here?"
Even Panasonic, which makes a variety of electronic products, worries about the definition of critical infrastructure, Taylor said. "We supply storage devices in your laptop ... We produce components that go onto a circuit board ... At some point, something (we make) would have to be included."
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