WASHINGTON – U.S. Senators John Cornyn (R-TX), Catherine Cortez Masto (D-NV), Dan Sullivan (R-AK), Chuck Schumer (D-NY), Pete Ricketts (R-NE), Andy Kim (D-NJ), Dave McCormick (R-PA), and Michael Bennet (D-CO), along with Senate Banking, Housing, and Urban Affairs Committee Chairman Tim Scott (R-SC) and Ranking Member Elizabeth Warren (D-MA), released the following statements after their Foreign Investment Guardrails to Help Thwart (FIGHT) China Act, which would safeguard the United States’ national security against the growing threat posed by the People’s Republic of China (PRC) by prohibiting and requiring notification of U.S. investments in certain technologies in China, passed the Senate as part of the National Defense Authorization Act (NDAA):

“The need to address capital flowing from the U.S. to the People’s Republic of China was realized during the first Trump administration, and the FIGHT China Act presents a generational opportunity to confront the threat China poses to our national and economic security,” said Sen. Cornyn. “This landmark legislation would prohibit and require notification of U.S. investments in certain technologies in China, ensuring American ingenuity, innovation, and investment do not end up in the hands of the Chinese Communist Party to be weaponized against us. I’m proud the FIGHT China Act has received support in the Senate as part of our annual defense bill, and I look forward to it being included in the final version that heads to President Trump’s desk to become the law of the land.”

“The United States should not be lending a helping hand to our adversaries in Communist China by investing in their development of artificial intelligence, quantum computers, or military technologies,” said Sen. Cortez Masto. “I am proud of the work I have done with my colleagues on both sides of the aisle to get this critical national security bill passed by the Senate.”

“This amendment takes a strong step in providing the Trump administration with the tools it needs to protect our national economic security. As Americans, we benefit immensely from our free markets and open investment environment. But we must ensure that we are not fueling the Chinese Communist Party’s efforts to undermine our military strength and national security,” said Chairman Scott.

“We have a responsibility to ensure we are developing the most sensitive and cutting-edge technology here in the United States rather than funding its development in countries that do not share our values,” said Ranking Member Warren. “This bill is an important bipartisan step to address outbound investments that threaten our national security, and I look forward to working with my colleagues on this shared priority as the legislation moves forward in the process.”

“Our country’s investments in innovative technology give us an enormous advantage over the Chinese Communist Party,” said Sen. Sullivan. “But this advantage is threatened when American financial institutions invest in CCP-controlled companies that develop technology—like advanced semiconductors, artificial intelligence, quantum computing, and hypersonics—that could ultimately be used to kill Americans at home and Marines in the Taiwan Strait. I’m glad to once again join my Senate colleagues on legislation to put safeguards in place to ensure that American investments don’t go to support the nefarious ambitions of dictators around the world.”

“Yesterday, the Senate took an important step forward in stopping the Chinese Communist Party’s development of advanced technology that threatens America’s national security. We must take all necessary steps to protect against the harmful flow of U.S. investment into China for the development of technology like semiconductions, AI, and quantum computing,” said Leader Schumer. “The FIGHT China Act will help to protect our national security and ensure that the United States maintains a competitive edge in the critical technologies our military relies on.”

“American capital shouldn’t subsidize the growth of Communist China’s military and surveillance state,” said Sen. Ricketts. “The FIGHT China Act will address national security threats. It will protect American capital, intellectual property, and innovation from supporting Communist China’s malign ambitions.”

“This is a common-sense measure that strengthens our national security toolkit to address new challenges created by emerging technology,” said Sen. Kim. “With this legislation, we can have the visibility we need into American investments in strategic sectors to look out for our nation’s security, and strengthen our defense against evolving threats, including by competitors like China who use these investments against us.”

“China’s growing desire and influence in emerging technologies that can be used for both civilian industry and military purposes presents a significant threat to U.S. national and economic security,” said Sen. McCormick. “I am pleased to see the Foreign Investment Guardrails to Help Thwart (FIGHT) China Act legislation included in the NDAA as it will immediately help block U.S. investment from supporting the Chinese Community Party’s military modernization and advancement in certain critical technologies, artificial intelligence, and advanced manufacturing that can be used against us.”

“As China aids Russia’s war against Ukraine, hacks U.S. infrastructure, and threatens our partners across the Indo-Pacific, we must ensure American dollars do not support the Chinese government’s development of advanced technologies with potential military uses,” said Sen. Bennet. “This bill will bolster U.S. national security by creating a framework to screen and block these dangerous investments.”

The legislation is also cosponsored by Senators Jim Banks (R-IN), Elissa Slotkin (D-MI), Bill Hagerty (R-TN), and John Fetterman (D-PA).

Background:

Building on Sen. Cornyn’s previous efforts to increase transparency and prohibit investments by American entities in sensitive technologies in China, and in conjunction with the Trump administration’s America First Investment Policy, the Foreign Investment Guardrails to Help Thwart (FIGHT) China Act would permit the Secretary of the Treasury to prohibit U.S. investments in certain technologies in the People’s Republic of China (PRC), including certain Artificial Intelligence (AI) models, quantum computers, materials used in hypersonic systems, and other military technologies. It would also require U.S. entities to notify the U.S. Department of the Treasury of investments in certain AI models in the PRC. Lastly, the legislation would permit the Secretary of the Treasury to impose sanctions under the International Emergency Economic Powers Act (IEEPA) against PRC entities that engage with the PRC military and intelligence sectors.

Specifically, the Foreign Investment Guardrails to Help Thwart (FIGHT) China Act would cover the following investments:
• Acquisitions, including of limited partners, equity interest, property, or other assets;
• Loans and debt financing;
• Joint ventures;
• And equity interest or debt conversions.

The legislation would establish exemptions for:
• Transactions determined to be de minimis or in the national interest;
• Investments in securities, derivatives of securities, or made as a limited partner in a venture capital fund, private equity fund, fund of funds, or other pooled investment fund;
• Ancillary transactions undertaken by a financial institution;
• Acquisitions of entire assets or entities located outside the PRC;
• Certain transactions secondary to a covered national security transaction;
• And certain ordinary or administrative business transactions.

The legislation would prohibit covered investments in the PRC for development or production of:
• Certain advanced integrated circuits;
• Certain AI models capable of a high number of operations;
• Quantum computers and supercomputers;
• Materials or components for hypersonics; and
• Any of these technologies that are on the Munitions List, intended for use with nuclear equipment or facilities, or emerging technologies subject to export controls.

Lastly, the legislation would require U.S. persons to notify the U.S. Department of the Treasury within 14 days when making a covered investment in the PRC for the development or production of:
• Any non-prohibited integrated circuit;
• And any non-prohibited AI system which is used for military, surveillance, cybersecurity, penetration, forensics, or robotic system use or which meets a certain computing standard.