U.S. Proposes Restrictions on Investments in Chinese Tech and AI

  • U.S. Treasury unveils draft rule to restrict American investments in China.
  • Focus areas include AI, computer chips, and quantum computing.
  • Rule follows Biden’s executive order targeting countries of concern like China.
  • Aims to prevent funding of technologies enhancing Chinese military capabilities.
  • Proposed rule open for public comment until August 4, expected to be finalized thereafter.

Main AI News:

The United States Department of the Treasury has unveiled a detailed draft regulation aimed at restricting and monitoring American investments in China, particularly focusing on artificial intelligence, computer chips, and quantum computing. This move follows President Joe Biden’s executive order from August, which addresses concerns over the flow of American funds to enhance technologies in countries deemed strategic rivals, such as China, Hong Kong, and Macau.

Biden’s administration aims to curb China’s advancement in critical technologies that could potentially bolster its military capabilities or lead to dominance in emerging sectors like electric vehicles (EVs). In addition to proposing stringent tariffs on Chinese EVs, the administration is pushing for rules that would compel US investors to disclose extensive information when engaging in transactions related to these technologies. Violations of these restrictions would be strictly prohibited under the proposed rule.

Specifically, the regulation seeks to prevent American investments from supporting AI systems in China that might have military applications, including weapons targeting, combat operations, and location tracking. A senior Treasury official, speaking anonymously to reporters, highlighted these measures, emphasizing the administration’s commitment to safeguarding national security interests.

The proposed rule is currently open for public comment until August 4, after which the Treasury Department is expected to finalize its implementation. Despite these measures, Biden’s administration has stated its intention to avoid a complete economic separation from China, underscoring the complex relationship between the two economic powers amid escalating tensions over national security issues.


This proposed regulation signifies a significant shift in U.S. policy towards China, aiming to curtail American investments in critical technologies that could bolster Chinese military and economic prowess. The stringent measures outlined underscore heightened geopolitical tensions and emphasize U.S. efforts to safeguard national security interests amidst a complex global economic landscape.


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