The Biden administration is preparing to give a "sharper scalpel" to the government committee that reviews foreign investments into the U.S., administration officials tell Axios.

Why it matters: The potential influence of companies based outside the U.S. — like China's ByteDance, which owns TikTok — is one of the emerging themes in the presidential election. It's also a matter of bipartisan concern.

The big picture: The Committee on Foreign Investment in the United States (CFIUS) has broad leeway to approve — or reject — international investments in critical sectors in the U.S. economy. But some critics say it's not aggressive enough.

• Normally a quiet inter-agency board, CFIUS has recently been thrust into the spotlight.
• It is reviewing high-profile deals ranging from Nippon Steel's proposed purchase of U.S. Steel to Vista Outdoor's potential sale of its ammunitions unit to the Czechoslovakia Group (CSG).

Driving the news: The Treasury Department is issuing a proposal Thursday laying out the new authorities.

• "These updates to our enforcement toolkit provide CFIUS with a sharper scalpel to carefully and methodically address violations and protect U.S. national security," Paul Rosen, assistant secretary of the Treasury for investment security, told Axios.
• Among the potential changes: Increasing the maximum civil penalty for material misstatements or omissions in a filing with CFIUS from $250,000 to $5 million.

Flashback: In October of 2022, the Biden administration expanded CFIUS's authorities and signaled a more aggressive enforcement approach.

• Officials are making Thursday's changes after they realized they needed more enforcement mechanisms to achieve their goals.
• "These updates reflect lessons learned in the course of our monitoring, compliance, and enforcement work and build on the 2022 CFIUS Enforcement and Penalty Guidelines," Rosen said in a separate statement.

Zoom out: From the outset of his presidency, Biden has worked on strengthening supply chains and re-shoring manufacturing jobs in critical sectors. "Buy America" has been a concerted effort across the government.

• The CHIPS and Science Act is making more than $50 billion available to support the domestic semiconductor industry.
• And the Inflation Reduction Act makes similar investments — initially projected to cost $370 billion — in the green technology and manufacturing sectors.

Zoom in: At the same time, the White House imposed an entirely new set of outbound investment restrictions on U.S. companies that are looking to put money into Chinese companies.

• The so-called "reverse CFIUS" was mostly designed to prevent the leaching of American know-how by Chinese companies that could then give the People's Liberation Army an advantage over the U.S. military.
• Biden has also imposed new restrictions on the kind of semiconductor technology and equipment that can be exported to China.

The bottom line: This latest announcement isn't directed at China.

• But it does represent a broader effort by the Biden administration to ensure that critical industries are protected from foreign interference.