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Published by Chris Nash

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Published by: Chris Nash on Jul 26, 2008
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Foreign Eligibility for U.S. TechnologyFunding
September 1995
he presence of foreign-based multinational firms in the UnitedStates has transformed many sectors of the U.S. economy—auto-mobiles and chemicals come readily to mind. In the past decade,foreign direct investment in the United States increased by 280percent to reach $445 billion in 1993. Foreign-based multinational firmsbring technology and capital to a range of industries, and employhundreds of thousands of workers in the United States. For these rea-sons, the United States welcomes foreign investors, affording them thesame rights and protections as U.S.-based companies.But in some foreign countries, U.S. firms have not received compara-ble treatment. U.S. companies have faced considerable barriers to directinvestment, their intellectual property rights have not been adequatelyprotected, and they have not enjoyed comparable access to technologydevelopment programs funded by foreign governments.These concerns prompted U.S. Congress to pass legislation govern-ing the eligibility of foreign-based firms to participate in U.S. govern-ment technology programs, for example, the Advanced Technology Pro-gram and several technology programs funded under the Energy PolicyAct of 1992. This paper addresses the question: What eligibility condi-tions should affiliates of foreign firms be required to meet before receiv-ing financial assistance from the U.S. government?This is a follow-on product to OTA’s assessment of MultinationalFirms and the U.S. Technology Base. That assessment was requested bythe Senate Committee on Commerce, Science, and Transportation andthe Senate Committee on Banking, Housing, and Urban Affairs.
utside Reviewers
Jay Chai
Chairman and CEOItochu International
Kathleen N. Kingscott
Program DirectorScience and Technology PolicyIBM Corporation
Douglas Selin
Director, International InvestmentUnited States TradeRepresentative
Mary L. Good
Under Secretary for TechnologyPolicyU.S. Department of Commerce
Anthony F. Rock
Deputy Office DirectorU.S. Department of State.
Richard Thayer
Director, Government AffairsAT&T
Robert J. Hermann
Senior Vice PresidentScience and TechnologyUnited Technologies
Robert C. Marlay
Director, Office of Science PolicyU.S. Department of Energy
Steven Schlossstein
PresidentSBS Associates, Inc.
Raymond Vernon
John F. Kennedy School of GovernmentHarvard University
Patrick Windham
Professional Staff MemberSenate Commerce Committee
OTA appreciates and is grateful for the valuable assistance and thoughtful critiques provided by the outside reviewers. Thereviewers do not, however, necessarily approve, disapprove, or endorse this report. OTA assumes full responsibility for the report andthe accuracy of its contents.

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