By Andrea Shalal
WASHINGTON, Oct 22 (Reuters) – The US Treasury Department on Thursday announced proposed rules for screening outbound investment in China, Russia and other countries, a list that no longer includes Venezuela now that the country’s former president Nicolas Maduro is not in power.
Treasury will accept comments through December 7 on the proposed rules, which were mandated under the Comprehensive Outbound Investment National Security Act of 2025, or COINS Act, that passed Congress in December, but grew out of a bipartisan effort first begun under former President Joe Biden in 2023.
The COINS Act marked a significant expansion of US outbound investment controls, requiring US firms and individuals to notify Treasury about certain investment plans while banning them outright in other cases to prevent harm to US national security. It expanded the covered countries and added biotechnology as one of the restricted sectors, giving Treasury the authority to add additional sectors as needed.
The outbound program initially targeted China alone, but the COINS legislation expanded the list of countries “of concern” to include Cuba, Iran, North Korea, Russia and Venezuela “under the regime of Nicolas Maduro.”
But Treasury said it dropped Venezuela since Maduro’s government “no longer exists” following the capture of the former president by US forces in January, adding that the current government, led by Maduro’s deputy, Delcy Rodriguez, did not meet the definition. The proposed rule could still apply to certain investments in Venezuelan entities, Treasury said, without elaborating.
President Donald Trump hosted Chinese President Xi Jinping for a lavish state visit to Washington last month, and has pursued a less restrictive approach on Chinese technologies in his second term, but Thursday’s release of the proposed rules may signal a desire to keep some pressure on Beijing’s tech ambitions.
“The idea behind the outbound program is to ensure that we have the ability to monitor and potentially prohibit the types of investments” that pose risks to US national security, Treasury Assistant Secretary Chris Pilkerton, who oversees investment security issues, told Reuters.
“It’s not just about the investment itself; it’s not just about the money. It’s about the network, the supply chain, and things like that that come from that investment,” he said, adding that such a complex web of relationships would be hard to regulate otherwise through export controls or other measures.
Treasury said the proposed rules would not ban all investments in countries of concern. Instead, they would target specific investments in entities that engaged in dual-use technologies that benefited military programs, surveillance states and countries with human-rights abuses.
The proposed rules require notification about prospective investments in six sectors and five designated countries, while banning them outright in the case of artificial intelligence.
They allow certain exceptions, including investments in publicly traded companies and transactions valued at less than $50,000. The proposal would also allow investors to request exemptions for transactions deemed to be in the national interest of the United States, Treasury said.
Treasury also added an additional sector — biotechnology — to the five identified in the legislation: advanced semiconductors and microelectronics; artificial intelligence systems; quantum information technologies; high-performance computing and supercomputing; and hypersonic systems.
It said certain advanced biotechnologies could pose an acute risk to national security, citing the proliferation of biological weapons, the development of brain-computer interfaces and harm to US supply chain security.
The rules do not include potential licensing agreements made by US pharmaceutical companies with China, a Treasury official said, meeting a key demand of major drugmakers like Pfizer.
The proposed rules ban investments in artificial intelligence technologies in the target countries. Treasury said it decided on the ban given rapid advances over the past two years that raised questions about the efficacy of “regulating or even distinguishing the most advanced models.”
(Reporting by Andrea Shalal; editing by David Gaffen)
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