Statement on Signing the Foreign Investment Study Act of 1974.

IT GIVES me great pleasure to have signed S. 2840, the Foreign Investment Study Act of 1974.

A recent study by the executive branch concluded that the available information on the activities of foreign investors in the United States is inadequate. The bill I sign into law today will go a long way toward remedying that deficiency.

This bill provides for the Departments of Commerce and the Treasury to undertake comprehensive studies of foreign direct and portfolio investment in the United States. Under the authority provided by the bill they will (1) conduct "benchmark" surveys of all existing foreign direct and portfolio investment in the United States; (2) analyze the effects of foreign investment on the U.S. economy; (3) review our existing reporting requirements that apply to foreign investors; and (4) make recommendations on means for us to keep our information and statistics on foreign investment current. These surveys will be conducted early next year and cover data for 1974; an interim report of the results will be submitted to the Congress 12 months after the date of enactment of this act and a full and complete report, together with appropriate recommendations, within 18 months of the date of enactment.

When this study is completed, we will be in a position to know better how to conduct ongoing monitoring of foreign investment activity in the United States. Earlier, this Administration had opposed new reporting systems which would have lacked the benefits of the information which will be generated by the actions under S. 2840. We are not opposed to keeping a watch on foreign investment, but we do want to do it in the most efficient and helpful way, with the aid of the greatest possible amount of data.

As I sign this act, I reaffirm that it is intended to gather information only. It is not in any sense a sign of a change in America's traditional open door policy towards foreign investment. We continue to believe that the operation of free market forces will direct worldwide investment flows in the most productive way. Therefore, my Administration will oppose any new restriction on foreign investment in the United States except where absolutely necessary on national security grounds or to protect an essential national interest.