A bipartisan group of lawmakers said on Monday they have agreed on legislation that would give the U.S. government sweeping new powers to block billions in U.S. investment into China.
The measure is part of a bill that would also grant $52 billion to chipmakers to expand operations, a boon to the industry.
"The refined proposal released today has bipartisan, bicameral support and addresses industry concerns, including the scope of prospective activities, industries covered, and the prevention of duplicative authorities," said U.S. Senators Bob Casey and John Cornyn, and Representatives Rosa DeLauro, Bill Pascrell, Jr., Michael McCaul, Brian Fitzpatrick and Victoria Spartz, in a statement.
The initial "outbound investment" proposal had run into opposition on the fear it could reduce companies' investments abroad, leading some chipmakers to oppose its inclusion in the chips bill being hammered out by Senate and House lawmakers.
The outbound investment measure was originally proposed as a standalone bill by Republican Senator John Cornyn and Democratic Senator Bob Casey, but was later added to the House version of a massive bill that includes the grants for chipmakers and is aimed at countering China's rise.
The concept behind the measure has support within the Biden administration. U.S. President Joe Biden's National Security Advisor Jake Sullivan said in July the government was working on new investment screening and considering outbound investment as it seeks to better position the United States for competition in technology.
A study by Rhodium said 43% of U.S. foreign direct investment transactions in China over the past two decades could have been subject to screening under the broad categories set out by the original proposal.
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