Treasury Department to limit investments in Chinese technology that pose potential risk to national security

The Treasury Department will implement a new rule aimed at limiting U.S. investments in Chinese companies that develop advanced technologies and are considered a potential risk to national security. The regulation will take effect on Jan. 2, 2025.

The White House stated that this measure is an effort based on "keeping America safe by preventing countries of concern—namely the People’s Republic of China—from advancing in key technologies that are critical to their military modernization."

Senior officials said the new rule targets sensitive technology sectors where the Chinese Communist Party (CCP) has shown advances, such as semiconductors, quantum computing and artificial intelligence.

Americans to be banned from investing in certain Chinese companies

The regulation establishes specific restrictions: U.S. citizens will be prohibited from investing in Chinese companies that develop advanced semiconductors or artificial intelligence systems intended for military use. In addition, it will require mandatory notification to the Treasury Department in the case of investments in legacy Chinese semiconductor companies.

The rule also covers technologies that could be used to compromise computer networks, breach encryption systems or break codes, thus limiting the potential use of these innovations for military benefit. The new provisions, designed after consultations with lawmakers, industry leaders and international partners, seek to complement existing export controls.