US Treasury drops Venezuela from countries facing outbound US investment restrictions
FXI•The Treasury Department proposed rules for screening outbound US investment in China, Russia and other countries, dropping Venezuela from the list after saying Nicolas Maduro’s government no longer exists. The proposal adds biotechnology as a regulated sector and would ban certain investments in artificial intelligence.
1. Venezuela removed from list
The Treasury Department announced proposed rules for screening outbound investment in China, Russia and other countries. Venezuela is no longer included because, Treasury said, Nicolas Maduro’s government “no longer exists” following his capture by US forces in January; the department said the rules could still apply to certain investments in Venezuelan entities.
2. Rules cover six sectors
The proposal requires notification for prospective investments in six sectors and five designated countries, and bans certain investments in artificial intelligence. It adds biotechnology to the five sectors identified in the legislation: advanced semiconductors and microelectronics, artificial intelligence systems, quantum information technologies, high-performance computing and supercomputing, and hypersonic systems.
3. Exceptions and comments
The rules would not ban all investments in countries of concern. Exceptions include investments in publicly traded companies and transactions valued below $50,000, and investors could request exemptions for transactions deemed in the US national interest. Treasury will accept comments through December 7; the proposal does not include potential licensing agreements between US pharmaceutical companies and China.
