The US is banning artificial intelligence investment in China in three areas: Starting January 2, investors will be banned from entering China.

Biden administration It announced Monday that it was finalizing rules that would restrict U.S. investments in China in artificial intelligence and other technology sectors that could pose a threat to the United States. national security. These rules, proposed by the US Treasury in June, stem from an executive order signed by the President, Reuters news agency reported. Joe Biden In August 2023.
The House China select committee has reportedly criticized major American index providers for channeling billions of dollars from US investors into stocks of Chinese companies that the US believes are helping the development of China’s military.

What are the prohibited sectors?

They target three key sectors: semiconductors and microelectronics; quantum information technologies; and certain artificial intelligence systems. The new regulations will come into force on January 2 and will be managed by the Treasury’s newly established Global Transactions Office.

Why the great Chinese ban

The Treasury emphasized that this “narrow technology stack” is vital for next-generation military, cybersecurity, surveillance and intelligence applications. Paul Rosen, a senior Treasury official, reportedly stated that the rule covers technologies such as “cutting-edge code-breaking computer systems or next-generation fighter jets.” He added that U.S. investments, including intangible benefits such as administrative assistance and access to investment and talent networks, should not help countries of concern develop their military, intelligence and cyber capabilities.
The rule is part of a broader effort to prevent U.S. expertise from helping China develop advanced technology and dominate global markets. Commerce Secretary Gina Raimondo stressed earlier this year that these rules are necessary to prevent China from developing its military technologies.
Starting Jan. 2, investors will be barred from injecting capital to help China and other “concerned countries” improve their military, intelligence and cybersecurity capabilities and from providing “intangible benefits,” such as administrative assistance and access to investment and talent networks.

What are the exceptions to the rule?

The new regulations include an exception for U.S. investments in publicly traded securities. But the U.S. already has powers under an earlier executive order banning the buying and selling of securities of certain Chinese companies, officials said.