The U.S. Treasury Department on Thursday proposed a new rule that would bar Americans from investing in artificial intelligence systems, supercomputing, hypersonic technology and biotechnology in China, Russia, North Korea and other “countries of concern” — the most significant expansion yet of Washington’s program for screening outbound investment in advanced technology.
The Notice of Proposed Rulemaking, issued October 22, implements the Comprehensive Outbound Investment National Security (COINS) Act, which Congress passed as part of the Fiscal Year 2026 National Defense Authorization Act in December 2025 and which codified and broadened the Outbound Investment Security Program Treasury has run since early 2025.
The proposed rule requires U.S. persons — including companies they control abroad — to notify Treasury about certain transactions involving covered foreign persons engaged in “notifiable technologies,” and prohibits them outright from deals involving “prohibited technologies.” Treasury used President Trump’s preferred term for AI throughout the release, calling it “superintelligence” or SI.
Which Technologies Are Covered
The COINS Act authorizes Treasury to set technical parameters for five technology sectors: semiconductor technologies and microelectronics; artificial intelligence systems; quantum information technologies; high-performance computing and supercomputing; and hypersonic systems. The Secretary has also added biotechnology to the proposed regulations, a sixth category permitted under the law’s authority to cover technologies that enable the military, intelligence, surveillance or cyber capabilities of a country of concern.
On the AI front, the rule’s technical specifications build on the existing program’s compute thresholds — including restrictions tied to AI systems trained above 10^25 computational operations — while the notification structure means many investments will need Treasury clearance even where they are not banned outright. The rule would apply to investments above $50,000 and excludes many purely financial positions such as stock purchases, according to the Associated Press’s reporting.
Why Russia’s Inclusion Matters
The proposal’s inclusion of Russia has drawn attention because it lands days after President Trump waived sanctions on Russia following a diesel deal with President Vladimir Putin. The AP notes the tension: one arm of Washington is easing economic pressure on Moscow while Treasury moves to wall off American capital from Russia’s military-relevant technology sectors.
Secretary Scott Bessent said in the announcement that the regulations “would strengthen the existing Outbound Investment Security Program to prevent our adversaries from using U.S. investment to develop critical technologies that threaten U.S. national security.” Craig Singleton, a senior fellow at the Foundation for Defense of Democracies, told the AP the proposal “sends an important signal to markets that Washington is tracking where U.S. capital is flowing and what capabilities it is helping build.”
Treasury is now taking public comments on the proposal — including on the scope of covered transactions, definitions, notification requirements and penalties — before issuing final implementing regulations with an effective date.
Why It Matters
For the AI industry, the rule hardens a trend that has been tightening for three years: capital, not just chips, is now treated as a national security asset. American investors in AI labs, semiconductor startups and compute infrastructure with exposure to China or the other named countries will need to map every transaction against the notifiable-versus-prohibited line — and the biotechnology addition shows Treasury is prepared to widen that line beyond the statute’s original five sectors.
The timing also matters for the industry’s current funding cycle. With Chinese labs like DeepSeek and MiniMax raising at record valuations and American giants committing hundreds of billions to compute, the rule’s notification regime effectively gives Treasury a window into where U.S. money is flowing in global AI — and a lever to stop it. Expect venture firms with cross-border portfolios to be the first to feel the compliance load when the final rule lands.
Background
Washington’s outbound-investment program began in 2023, when then-President Joe Biden signed an executive order restricting U.S. investments in semiconductors, quantum computing and AI going into China, and Treasury built the Outbound Investment Security Program around it. Congress then codified and expanded the program in December 2025 to cover more technologies and more countries, including Cuba, Iran, North Korea and Russia. This week’s proposal is the regulatory implementation of that law — and it follows a string of U.S. moves against Chinese AI this month, including the order removing DeepSeek from federal civilian agency systems and parallel regulatory action in Europe.
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