Treasury seeking public comment on Biden order to protect national security technologies

The U.S. Department of the Treasury is seeking public comment related to an executive order issued by President Joe Biden on investments in national security technologies and products by countries of concern.

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The order provides for the establishment of a new and targeted national security program to be implemented and administered by the U.S. Treasury in an effort to protect national security. It complements the existing export control and inbound investment screening tools. It identifies three categories of national security technologies and products to be covered by the program: semiconductors and microelectronics; quantum information technologies; and artificial intelligence.

In the order, Biden identified the People’s Republic of China, along with the Special Administrative Region of Hong Kong and the Special Administrative Region of Macau, as a country of concern.

The executive order also directs the Secretary of the Treasury to issue regulations that prohibit U.S. persons from engaging in certain transactions involving certain technologies and products that pose a particularly acute national security threat to the United States. It also requires U.S. persons to notify Treasury of certain other transactions involving certain technologies and products that may contribute to the threat to the national security of the United States.

The Treasury is seeking public comment and stakeholder participation in the rulemaking process. The public is invited to offer comments, including providing data and other information, that may be useful to inform the development of the program. Among other things, Treasury seeks input on the sub-sets of national security technologies and products related to semiconductors, quantum information technology, and artificial intelligence systems described in the proposal.

The leaders of the House Financial Services Committee were pleased with the action taken by the Biden administration.

“We’re glad to see the Biden Administration take a more thoughtful and targeted approach than initially reported. The White House listened to our concerns about the risks of undermining bedrock American principles, including the free flow of capital. This is confirmation that we can confront the Chinese Communist Party with a smart approach rather than harmful policy. Instead of emulating Xi Jinping, we should be working to export our rule of law and property rights,” U.S. Reps. Patrick McHenry (R-NC), chair of the committee, and Blaine Luetkemeyer (R-MO), chair of the Subcommittee on National Security, Illicit Finance, and International Financial Institutions, said.

The Treasury welcomes comments and views from a wide range of stakeholders on all aspects of how the secretary should implement this new program. The input will be taken into account as it develops draft regulations.