Shocking new rules on AI investment: New rules to innovate

Technology: As a significant step to curb Chinese technological advancements, new rules have been put in place to reshape US investments in artificial intelligence and related technologies. Following an executive order issued by President Joe Biden in August 2023, these new guidelines will require US investors to notify the Treasury Department about certain investments in sensitive sectors, including AI, semiconductors, microelectronics, and quantum computing.

The upcoming rules are currently under review by the Office of Management and Budget. This suggests that they could be published within the next week, just ahead of the upcoming elections – a timing that has caught the attention of many observers. Former Treasury official Laura Black indicated the urgency behind these rules due to the political calendar.

Typically, the Treasury Department gives a 30-day period before such rules are activated, giving stakeholders time to adjust to the new landscape. The proposed rules also outline several exceptions, reflecting a nuanced approach aimed at balancing national security with economic interests.

While a Treasury spokesperson has yet to comment, Black anticipates that the final rules will delve deeper into AI coverage and set limits for affected partners. The overarching goal is clear: prevent American expertise from boosting Chinese military and technological capabilities. As we stand on the brink of this regulatory shift, the landscape of international tech investment is poised for a dramatic transformation.