US TREASURY WILL ISSUE FINAL RULE TO RESTRICT TECH INVESTMENTS LINKED TO CHINA - OFFICIALS

MOSCOW, Oct 29 (Bernama-Sputnik) -- The US Treasury Department is issuing a final rule on the implementation of President Joe Biden's executive order to restrict certain investment transactions with China involving semiconductors, quantum, and artificial intelligence, senior administration officials said on Monday.

"So, today, the Treasury Department will issue a final rule to implement President Biden's Executive Order 14105 from August of 2023, which is entitled Addressing United States Investments in Certain National Security Technologies and Products in Countries of Concern," the officials said, reported Sputnik.

The final rule prohibits US persons from engaging in certain transactions involving a defined set of technologies and products that pose a "particularly acute national security threat to the United States." The rule also requires US persons to notify the Treasury of certain other transactions involving a defined set of technologies and products.

"The final rule focuses on specific categories of investment transactions where the target of the investment has a nexus to the PRC [People's Republic of China] and activities involving sensitive technologies and products. In terms of what transactions are covered, the final rule applies to, among other things, the US person's acquisition of an equity interest, or a contingent equity interest, certain debt financing, certain greenfield investments, or investments that could result in corporate expansion and joint ventures," the officials explained.

According to the officials, it would apply to a US investment firm taking an equity stake in an advanced semiconductor manufacturer in China, as well as a US company purchasing land in China to develop a quantum computing research facility.

"In addition to direct investments, indirect investments through a parent of a PRC company that is using AI models to improve targeting intelligence, reconnaissance and surveillance or autonomous weapons systems for military use would be prohibited, as with such indirect investments in a PRC company developing or scaling quantum computers or networks to undermine encryption systems," the officials said.

--BERNAMA-SPUTNIK