The US Treasury has proposed expanding its restrictions on outbound investment in sensitive technologies, targeting China, Russia, Cuba, Iran and North Korea. Officials say the measures are intended to prevent American capital from supporting capabilities that could enhance foreign military power and threaten US national security.
The draft covers semiconductors, artificial intelligence, quantum technology, supercomputing and hypersonic systems capable of travelling at least five times the speed of sound. Treasury has also added biotechnology. Certain transactions would require notification, while others would be prohibited; for covered AI investments, the proposal would remove the existing option of simply reporting a deal rather than facing a ban.
Only investments exceeding $50,000 would be covered, with many financial investments, including share purchases, excluded. The proposal builds on the programme initiated by President Joe Biden’s 2023 executive order restricting certain technology investments in China. It implements the Comprehensive Outbound Investment National Security Act, passed in the 2026 defence bill, which broadened the programme’s geographical and technological reach.
Breaches could attract civil penalties, and Treasury could require investors to sell their holdings. Investment lawyer Jason Chipman said the changes would require more substantial compliance programmes. China’s foreign ministry criticised the proposal as interference in normal commercial cooperation and said Beijing would monitor developments and safeguard its interests.
The draft is scheduled for publication in the Federal Register on 26 October, with written comments due by 7 December. Final regulations will follow and establish an implementation date, so the proposed expansion is not yet in force.
