A potential sale of ETS’s TOEFL exam to overseas investors could face heightened and prolonged regulatory scrutiny, according to people familiar with the matter, due to the scale of sensitive personal data involved and the exam’s structural role in U.S. higher education admissions.

The TOEFL exam, used by millions of applicants globally each year, is a core credential for admission into U.S. universities, effectively influencing the volume, composition, and direction of international student flows into the United States.

People familiar with the discussions said ETS has explored interest from foreign private capital groups in acquiring the TOEFL business, though no transaction has been finalized. The sources declined to be identified because the talks are confidential.

Legal and regulatory experts say the transaction could fall squarely within the remit of the Committee on Foreign Investment in the United States, which in recent years has expanded its focus beyond traditional defense assets to include large-scale personal data sets and platforms with indirect national security implications.

“CFIUS has become far more sensitive to data concentration and control,” said a Washington-based national security lawyer. “Assets like TOEFL that map identity, mobility, and institutional access are no longer viewed as benign.”

The TOEFL platform is understood to hold extensive records, including identification documents, testing behavior data, geographic demand patterns, and applicant destination preferences — information that could provide detailed insight into global talent pipelines feeding U.S. institutions.

Deal advisers warn that regulatory exposure could materially affect valuation, financing terms, and deal certainty, particularly if a review is triggered late in the transaction process.

“In transactions involving assets like TOEFL, CFIUS risk introduces structural uncertainty,” said an investment banker advising on cross-border transactions. “Even without a formal block, extended reviews or mitigation requirements can significantly alter deal economics.”

The issue is also being closely watched by U.S. universities, many of which have grown increasingly dependent on international enrollment as domestic student numbers decline. Any perceived erosion of trust, governance stability, or data integrity associated with TOEFL could carry downstream financial and reputational consequences.

The U.S. Treasury Department, which chairs CFIUS, declined to comment.

ETS did not respond to requests for comment.

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