Donald Trump on Friday issued an executive order prohibiting HieFo Corporation, a firm controlled by a citizen of the People’s Republic of China, from retaining ownership of certain semiconductor-related assets acquired from EMCORE Corporation, citing national security concerns.
The order, issued under Section 721 of the Defense Production Act of 1950, finds “credible evidence” that HieFo’s acquisition of EMCORE’s digital chip and wafer design, fabrication, and processing businesses could threaten to impair U.S. national security. The transaction was completed on April 30, 2024.
Under the order, the acquisition is formally prohibited, and HieFo is required to divest all interests and rights in the EMCORE assets within 180 days unless an extension is granted by the Committee on Foreign Investment in the United States (CFIUS).
Until divestment is completed and verified, HieFo is barred from granting access to the EMCORE assets or any non-public technical information, systems, facilities, or intellectual property to unauthorized individuals. The order also restricts HieFo from reorganizing, transferring assets, or altering its legal structure in ways that could impede compliance.
The executive order authorizes CFIUS to impose monitoring conditions, conduct audits at HieFo’s expense, and require weekly compliance certifications until divestment is complete. Any attempt to evade or circumvent the order is explicitly prohibited.
CFIUS must approve any proposed sale or transfer of the assets, with authority to block transactions it determines could threaten national security or undermine the purpose of the order. Once divestment is completed, HieFo must certify that all required interests have been transferred and that associated intellectual property has been destroyed or transferred as directed.
The Attorney General is authorized to take enforcement action if necessary. The order directs publication in the Federal Register and transmission to the affected parties by the Department of the Treasury.
Trump reserved the right to issue additional orders related to the transaction if further action is deemed necessary to protect U.S. national security.