A group of US rules aimed at restricting investments in artificial intelligence in China are undergoing final review, indicating that these restrictions are likely to be implemented soon. This step is part of an executive order signed by President Joe Biden in August 2023, aimed at preventing American investors from supporting China’s military capabilities in areas such as artificial intelligence and other advanced technologies.
These rules not only involve bans but also require American investors to report some of their investments in artificial intelligence and sensitive technologies to the Treasury Department. The primary goal of these actions is to maintain US technological superiority and prevent the leakage of knowledge that could enhance Chinese military capabilities, according to Reuters.
The new rules specifically focus on artificial intelligence, semiconductors, microelectronics, and quantum computing technologies, which are currently under final review at the Office of Management and Budget. This usually indicates that the rules will be issued within about a week.
Expectations are that these rules will be announced before the US presidential elections scheduled for November, according to Laura Black, a former official at the US Treasury Department. Black explained that these regulations usually require a period of up to 30 days before they come into effect.
In June, the Treasury Department published proposed rules that included some exemptions and allowed the public the opportunity to comment on them. It emphasized that it is the responsibility of individuals and US companies to identify transactions subject to restrictions. Despite the official spokesperson for the Treasury Department not commenting on this issue, it is expected that the final rules will provide greater clarification on the impact on the artificial intelligence sector and specific thresholds for investments.
The proposed rules had imposed restrictions on transactions related to certain uses of artificial intelligence, especially those relying on high computational capabilities, in addition to requiring notification of some transactions related to the development of artificial intelligence or semiconductor systems that have not been fully banned.
The proposed exemptions include publicly traded securities, such as mutual funds and index funds, as well as some investments in limited partnerships and collective debt financing in some cases.
