US Treasury Proposes New Investment Restrictions Targeting AI, Biotech, and Advanced Chip Funding to China

What happened

The Treasury Department announced a proposed rule under the Comprehensive Outbound Investment National Security Act that broadens the Outbound Investment Security Program. The rule adds advanced semiconductors, AI systems, quantum computing, high‑performance computing, hypersonic systems, and biotechnology (including gene‑editing, immunotherapies, and brain‑computer interfaces) to the list of technologies subject to stricter U.S. investment scrutiny. A reporting requirement will apply to qualifying transactions, and certain investments will be prohibited. The proposal is open for public comment before final regulations are issued.

Why it matters for trust and compliance

• The rule tests an organization’s supply‑chain risk‑management and investment‑oversight controls; mapping these controls to the new requirements provides defensible evidence for audit readiness.
• Demonstrate continuous monitoring of outbound‑investment exposures to high‑risk technology sectors.
• Collect and retain evidence of due‑diligence, board approvals, and reporting to satisfy future Treasury audits.

Who is affected

Recommended actions

1. Create an inventory of all outbound investments tied to AI, biotech, or advanced chips.
2. Align existing due‑diligence and reporting processes with the proposed thresholds.
3. Begin gathering contractual and governance artifacts to evidence compliance.