US Senate Approves Bill Mandating Disclosure of Investments in Chinese Tech
In a significant move, the US Senate has overwhelmingly supported legislation requiring US companies to inform federal agencies about their investments in Chinese technologies, such as artificial intelligence (AI) and semiconductors. The amendment to the National Defense Authorization Act (NDAA) received strong backing from 91 senators, with only six dissenting. The NDAA, which sets policy for the Department of Defense, is expected to become law later this year.
The bipartisan support for a stringent stance on China is notable in the currently divided US Congress. Lawmakers have introduced numerous bills aimed at addressing competition with China’s communist government and industries. The amendment adopted by the Senate mirrors the Outbound Investment Transparency Act proposed by Democratic Senator Bob Casey and Republican Senator John Cornyn. Its purpose is to mitigate the risks associated with American investment flowing into foreign adversaries like China.
Senator Casey emphasized the importance of outbound investment notification, stating that it allows lawmakers to gauge the extent of critical technology being transferred to adversaries through capital flows. Armed with such information, legislators can then take necessary steps to safeguard the nation’s economic future. Unlike a previous version of the legislation that failed to pass, the latest measure requires disclosure of certain outbound investments rather than the review or prohibition of specific deals. Additionally, it focuses on a narrower range of industries.
In another development, the Senate voted 91 to 7 in favor of an amendment to the NDAA that strengthens federal reviews of foreign purchases of US farmland. Under certain circumstances, the amendment also prohibits Chinese, Russian, Iranian, or North Korean acquisitions of US farmland.
The final version of the NDAA, which authorizes $886 billion in defense spending, will be determined later this year. The Senate is expected to pass its version, including the approved amendments, this week. Subsequently, the Senate bill will be reconciled with a bill previously passed in the House of Representatives.
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