U.S. lawmakers want Biden order boosting oversight of outbound investments in China

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WASHINGTON, Sept 27 (Reuters) –

A bipartisan group of U.S. lawmakers on Tuesday called on President Joe Biden to issue an executive order to boost oversight of investments by U.S. companies and individuals in China and other countries.

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The lawmakers including House Speaker Nancy Pelosi, Senate Majority Leader Chuck Schumer and Republican Senator John Cornyn urged Biden to issue an order to “safeguard our national security and supply chain resiliency on outbound investments to foreign adversaries.”

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Congress has been considering legislation that would give the U.S. government sweeping new powers to block billions in U.S. outbound investments into China. The proposal was removed from bipartisan legislation to subsidize U.S. semiconductor chips manufacturing and research in a bill approved in August.

The lawmakers, including Democrats Bill Pascrell, House Appropriations chair Rosa DeLauro, Senator Bob Casey and Republicans Brian Fitzpatrick and Victoria Spartz, said in a letter to Biden that as negotiations continue, “our national security cannot afford to wait.” They urged the president “to safeguard our national security and supply chain resiliency on outbound investments to foreign adversaries.”

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The White House and Chinese Embassy did not immediately comment.

White House national security official Peter Harrell earlier this month said that the Biden administration has not yet made a final decision on a potential outbound investment mechanism regulating U.S. investments in China.

Harrell stressed that any measure targeting such investments should be narrowly tailored to address gaps in existing U.S. authorities and specific national security risks.

“When we cede our manufacturing power and technological know-how to foreign adversaries, we are hurting our economy, our global competitiveness, American workers, industry and national security. Government action on this front is long overdue to address the scope and magnitude of these serious risks we face as a country,” the lawmakers wrote.

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The Senate Banking Committee on Thursday will hold a hearing on outbound investment that will feature testimony from Cornyn, Casey and several former government officials among them Information Technology Industry Council Executive Vice President Robert Strayer.

The proposed legislation is intended to give the government greater visibility into U.S. investments. It would be mandatory to notify the government of investments that may fall under the new regulations, and the United States could use existing authorities to stop investments, or mitigate risk. If no action is taken, the investment can move forward. (Reporting by David Shepardson; Editing by Chizu Nomiyama, Mark Porter and David Gregorio)