The US will ban outbound investments in China’s semiconductors, quantum technologies and artificial intelligence from January 2 if they are deemed to threaten American national security, a key move in the Biden administration’s efforts to address concerns about the mainland’s progress in advanced technologies.
The US Treasury released final rules on Monday to prohibit engagement in certain transactions with mainland China, Hong Kong and Macau involving “a defined set of technologies and products” that pose a national-security risk, according to the department, requiring them to notify Treasury of such transactions.
In a statement, Treasury said the transactions would cover technologies in semiconductors and microelectronics, quantum-information technologies as well as AI, which it described as “fundamental to the development of the next generation of military, surveillance, intelligence and certain cybersecurity applications” such as next-generation fighter jets.
Senior officials in the Joe Biden administration said the rules would ensure that US investments were not “exploited” in developing advanced technologies that would fuel modernisation of China’s military.
The investment ban would target direct or indirect investments that have a “nexus” to China and activities involving sensitive technologies and products, the official added.
Transactions such as the acquisition of equity interest, certain debt financing and greenfield investments or investments that could result in corporate expansion and joint ventures would also be targeted.
