United States of America: Closed consultation on Treasury rule implementing Executive Order addressing investments in certain national security technologies and products in countries of concern

On 4 August 2024, the US Department of the Treasury closes the public consultation on its proposed rulemaking (NPRM) in the matters of the Executive Order (EO) addressing United States Investments in Certain National Security Technologies and Products in Countries of Concern. The Executive Order (EO) empowers the US Treasury Secretary to reduce or forbid US investments in Chinese entities operating within three sectors, semiconductors and microelectronics, quantum information technologies, and artificial intelligence (AI) systems. The primary objective of this rule is to protect against the employment of American capital and expertise in advancing China's technologies that could potentially enhance its military capabilities, thereby jeopardising US national security. The order will entail proscribing certain transactions while also requiring that investors notify the government of their intentions regarding other transactions. Moreover, the rule would be a prerequisite for US investments in entities within the People's Republic of China (PRC) that engage in activities linked to AI-infused software designed for specific purposes that harbour the potential for military, intelligence, or national security ramifications.