US weighs emergency powers to curb China tech investments

By: Saleha Mohsin
WASHINGTON: The US treasury department is considering using an emergency law to curb Chinese investments in sensitive technologies, as the Trump administration looks to punish China for what it sees as violations of American intellectual property rights.

The US government is reviewing the possible use of a law known as the International Emergency Economic Powers Act, said Heath Tarbert, an assistant secretary in the agency’s international affairs office. Under the 1977 IEEPA law, President Donald Trump could declare a national emergency in response to an “unusual and extraordinary threat”, allowing him to block transactions and seize assets.


Trump is pushing his administration to crack down on what he considers unfair trade practices by China. He has threatened tariffs on as much as $150 billion in Chinese imports in response to intellectual property theft and forced technology transfer.

Beijing has retaliated by proposing tariffs on $50 billion of American goods, and pledging further action if necessary.

The president asked treasury secretary Steven Mnuchin to consider investment restrictions on Chinese firms after the administration released the results of its probe into China’s IP practices last month.

Mnuchin has until around May 21 to propose executive action to address concerns about investments in the US “directed or facilitated by China in industries or technologies deemed important”, according to the March 22 presidential memo.

While investors have so far focused on Trump’s plan to impose tariffs on Chinese imports, new restrictions could deepen a slowdown in Chinese investments in the US since Trump took office, hurting the ability of American companies to raise capital and holding down valuations.

Treasury officials are working on plans to identify technology sectors in which Chinese companies would be banned from investing, such as semiconductors and so-called 5G wireless communications.