Joe Biden, Joe Biden, announced on Friday (3/1) his decision to block the $14.3 billion acquisition of US Steel, by Japan’s Nippon Steel.

“As I have stated repeatedly, steel production – and the workers who provide it – are the backbone of our country,” he said in a statement. “A strong steel industry, domestically owned and operated, is a key national security priority and is critical to resilient supply chains.”

The decision, first published in the Washington Post and New York Times, is not surprising, but it may affect future foreign investment in US companies. Biden had expressed his opposition to the deal, which was announced a year ago, from the beginning. Meanwhile, President-elect Donald Trump has said he also opposes the deal and intends to block it when he takes office.

The deal had sparked political controversy since its announcement in December 2023, with bipartisan opposition to foreign control of a historic landmark industry for US industrial power despite its decline in recent years. While Biden’s decision may prove popular domestically, it may discourage foreign investment in other US companies and deprive US Steel of the much-needed funding it claims it needs, according to CNN.

Last month, the Committee on Foreign Investment in the United States (CFIUS) reported to Biden that it had not reached a consensus on whether US Steel’s sale to Nippon Steel would pose a national security risk, leaving the final decision to the president. The United Steelworkers union strongly opposed the deal, arguing that Nippon did not provide sufficient guarantees to preserve jobs at the company’s older plants.

Although Biden’s decision poses obstacles, the two companies have pledged to seek approval of the deal through litigation, even if the Biden or Trump administrations try to block it.

US Steel and Nippon argue that the deal is necessary to secure investment in US Steel’s domestic steel operations, noting that without the planned $2.7 billion investment by Nippon, plants employing union members may close.