US authorities will soon cut the flow of investment in Chinese AI

U.S. lawmakers have long toyed with the idea of ​​limiting the flow of capital from U.S. investors into Chinese industries critical to geopolitical competition, including artificial intelligence. According to Reuters, these restrictions will soon be approved and come into force.

Image source: IBM

US investors who wish to invest in Chinese assets related to a certain list of areas of activity will have to notify the Treasury Department in advance of such intentions. The US Office of Management and Budget, as the source notes, is already reviewing the relevant documents, and therefore the requirements may soon come into force. At least they will be made public in the next couple of weeks. The administration of current US President Biden is interested in publishing the requirements before the elections, which are scheduled for November 5. As a rule, at least 30 days pass before restrictions come into force in such cases.

The US Treasury Department published a working version of the document in June and provided the opportunity for interested parties to make proposals through public hearings. These restrictions may determine how much equity ownership of Chinese companies that require special U.S. attention may be controlled by American investors. In addition to artificial intelligence, the rules will apply to the production of semiconductors, quantum computing and the development of microelectronics. As part of public hearings, stock market participants proposed extending exceptions to these rules to certain types of investments in the capital of Chinese companies.