China’s Ministry of Commerce opposes a U.S. proposal that would restrict certain investments involving specified biotechnology activities and covered foreign persons, with public comments due Dec. 7.
The U.S. Department of the Treasury (Treasury) announced the draft on Oct. 22. China’s Commerce Ministry said the proposal would widen restrictions on investment linked to China and could strain commercial ties and damage U.S. firms’ interests. It reserved the right to take corresponding measures but did not outline what they might be. EconoTimes previously covered the ministry’s earlier warning.
Under the draft, U.S. persons would have to report certain transactions involving covered foreign persons engaged in “notifiable technologies.” Certain transactions involving covered foreign persons and “prohibited technologies” would be barred. The proposal would classify specified biotechnology activities as prohibited technology; it would not apply to all U.S. investment in biotechnology.
The proposed biotechnology scope includes selected biological systems used with pharmaceutical compounds, such as vaccines, cell and gene therapies, and monoclonal antibodies. It also covers certain biomanufacturing equipment, brain-computer interfaces, sequencing technologies and automated laboratory systems. Treasury is seeking comment on whether to limit the pharmaceutical category to advanced or frontier technologies and how to define biofuels to exclude products such as ethanol, which it says may not pose acute national security risks.
The draft would also extend the program to high-performance computing and supercomputing, as well as hypersonic systems. The program took effect Jan. 2, 2025, and previously covered certain investments involving semiconductors and microelectronics, quantum information technologies and artificial intelligence. Treasury says the proposal implements the COINS Act, which Congress enacted Dec. 18, 2025.
For its proposed reporting and recordkeeping requirements, Treasury estimates 18,000 hours of work and associated costs of $2.31 million to $5.27 million. Its estimate assumes 150 entities per year and 200 responses annually. The department is also seeking public comment on possible effects on public health and U.S. businesses.
Treasury Secretary Scott Bessent said the proposal is intended to keep U.S. investment from supporting the development of sensitive technologies in countries of concern. Chinese Foreign Ministry spokesperson Mao Ning said Oct. 23, “It serves no one’s interest to take discriminatory measures targeting specific countries.” Written comments are due Dec. 7, 2026; Treasury says final regulations will set the effective date.
