The Senate attached a measure to the annual defense policy bill that would subject some US investments in China to new requirements, complementing restrictions being weighed by the Biden administration amid increased concern in Washington over China’s development of advanced technology.
The measure, approved 91 to 6 on Tuesday, would require firms to notify the government about certain investments in China and other countries of concern, although they wouldn’t be subject to review or possible prohibition.
Similar to a planned executive order from the administration, it would focus on investment in high-tech sectors, including semiconductors, artificial intelligence and quantum computing, as well as hypersonics and satellite-based communications.
The legislation, which was introduced by Senators Bob Casey, a Democrat from Pennsylvania, and John Cornyn, a Texas Republican, is an update of a measure they introduced last Congress, and could place additional pressure on the administration to enact the order it’s been working on since last year.
The White House is aiming to propose the order by the end of August, which puts it on track for 2024 implementation after it winds its way through a review and comment period. Unlike the proposed legislation, the executive order potentially would prohibit some new investments.
Read more: US Plans Narrow China Tech Investment Limits, Likely by 2024
Both senators have pushed the administration to issue the executive order, with Casey advocating for congressional action to bolster the White House efforts, according to a person familiar with the matter.
Cornyn and Casey have circulated a copy of the bill to the administration, industry and Senate colleagues, the person said.
Asked about the executive order last week, White House Press Secretary Karine Jean-Pierre said last week that she didn’t have a timeline for its introduction.
“It’s a complicated process,” she said. “We want to make sure that we get this right, and it takes some time.”
Senate Majority Leader Chuck Schumer has said he aims for the chamber to pass the defense bill, officially known as the National Defense Authorization Act, before leaving for August recess next week. The House will take up the amended version when it returns in September.
The proposed legislation would require firms to notify the Treasury Department 14 days in advance of investments and 14 days after secured transactions. It would cover investments including acquisitions, debt, subsidiaries and joint-ventures, as well as technology transfers.
