US Treasury Proposes Expanding Investment Curbs on Chinese AI and Biotech Sectors

The United States Department of the Treasury announced a proposed rule on October 22 to broaden outbound investment restrictions targeting Chinese entities in artificial intelligence (AI), biotechnology, high-performance computing, and hypersonic systems, citing national security considerations, according to reports by LatestLY and ANI citing The Epoch Times.

The draft regulations would implement legislation enacted by the US Congress in December 2025, which expands upon an outbound investment security programme first initiated under a 2023 executive order that took effect in January 2025. In addition to expanding restrictions on Chinese technology firms, the proposed measures extend the outbound screening scope to include transactions involving Cuba, Iran, North Korea, and Russia.

Under the proposed rules, qualifying direct investments—including venture capital, private equity, and joint ventures in designated sensitive technologies—would be either banned outright or subject to mandatory notification to the Treasury Department within 30 days of transaction completion. Ordinary market purchases of publicly traded shares and conventional investment funds are proposed to remain largely exempt under specified criteria.

The Treasury Department has placed the proposed rule open for public comment through December 7, after which final regulations will be drafted. In response, China's Ministry of Commerce stated that it firmly opposes the proposed expansion of investment curbs, describing the measures as discriminatory and warning that they disrupt international trade and bilateral economic ties.