On July 25, the United States Senate displayed overwhelming support for a bipartisan legislation that will make it mandatory for U.S. companies to disclose any investments made in Chinese technologies.
The amendment, which garnered a remarkable vote of 91 to 6, is an addition to the National Defense Authorization Act (NDAA) and is expected to be put into effect later this year, presumably in 2023.
Under this amendment, U.S. companies will be required to inform federal agencies about their outbound investments in Chinese technologies, specifically targeting semiconductors used in artificial intelligence (AI) applications.
The amendment was jointly proposed by Democratic Senator Bob Casey and Republican Senator John Cornyn, based on a version of the Outbound Investment Transparency Act that seeks to address the risks associated with U.S. foreign investments in countries like China.
Senator Casey expressed his strong support for the amendment, emphasizing the necessity of having outbound investment notification to gain a clear understanding of the critical technology being transferred to potential adversaries through these capital flows.
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He further stated that such information would enable the United States to strategically “take control” of its economic future.
The current version of the bill is expected to pass through the Senate by the end of the week, after which it will be reconciled with a related bill that was previously passed in the House of Representatives. Eventually, the final version will be sent to President Joe Biden’s desk for approval.
This legislation comes amid an ongoing tit-for-tat relationship between the U.S. and China concerning emerging technologies.
Notably, on June 28, U.S. officials revealed plans to potentially restrict the computing power in semiconductor chips to limit the availability of AI chips in the Chinese market.
Responding to this, the Chinese government, on July 3, announced its own intentions to impose export controls on metals essential for semiconductor manufacturing.
Continuing this trajectory, on July 5, the U.S. reportedly considered placing controls on the level of access that Chinese companies would have to U.S.-based cloud computing services, impacting products offered by prominent providers such as Amazon Web Services and Microsoft.
These developments reflect the ongoing geopolitical tension surrounding technology and indicate how both nations are taking measures to safeguard their interests and maintain control over critical sectors in the ever-evolving landscape of global innovation.
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