Mr. Bush took the action under the Exon-Florio Act of 1988, which permits the Government to review purchases of American companies by foreign investors and, if it is judged that the purchase threatens national security, to bar the sale or subsequently nullify it.

Some senators noted that the Interstate Commerce Commission had the power to review purchases of railroads by other railroads and argued that this should logically be extended to purchases by non-railroad companies.

However, if overpricing is suspected, a verification of price reasonableness by perusing catalogues, telephone quotes, reviewing past purchases for the same item, etc. may be necessary before the micro-purchase is made.

The delays are taking place in the Security Council's sanctions committee on Iraq, where the United States has challenged contracts despite the recommendation of oil experts hired by the United Nations to review Iraqi purchases.

The list of so-called "dual use" items was not prohibitive; it called only for a right to review purchases of those goods.

The Committee on Foreign Investments in the United States, a multiagency group, reviews purchases of American businesses by overseas corporations for any impact on national security.

Mr. Neafsey's second major assignment is to review purchases under the open space preservation program, which has an annual allocation of $98 million.

Under the agreement today, a series of regional advisory groups would be set up to review prospective purchases, but no decision has been made on the extent of their power, officials said.

Most individuals who buy municipals don't have cadres of analysts reviewing prospective purchases and most municipal bonds that end in a default are too small to interest the funds so they are sold directly to individuals.

Investment Canada reviews corporate investments and purchases in the country by foreign entities and has the authority to prohibit deals deemed to be against Canada's national interest.