US Treasury Restricts Investments in China Technology

The U.S. Treasury Department has announced a new rule to restrict American investments in China, specifically targeting sectors like artificial intelligence, computer chips, and quantum computing, aimed at preventing China's military from advancing in these technologies. This rule, effective January 2, follows an executive order from President Biden issued in August 2023, which limits access for 'countries of concern' to U.S. capital for potentially military-related technologies. Assistant Treasury Secretary Paul Rosen emphasized that these investments could provide strategic advantages beyond financial resources, including management expertise and talent acquisition. The bipartisan initiative to block China's high-tech ambitions has seen previous efforts, such as tariffs on Chinese electric vehicles and export controls on advanced computer chips. In response, China has formally protested the U.S. actions, asserting strong disapproval. The rule also mandates that U.S. investors notify the government of certain transactions involving sensitive technologies, with penalties for violations reaching up to $368,136 or double the transaction value.