Joe Biden orders tighter scrutiny on foreign investments in move seen to target China

US President Joe Biden has directed a government investment screening panel to sharpen its focus on foreign transactions that involve personal data and advanced technologies, a move that appears aimed at national security risks that the US sees in China.

Without changing the legal authority of the Committee on Foreign Investment in the United States, or CFIUS – which reviews US asset purchases by overseas entities for national security risks – the Biden administration wants it to put deals under closer scrutiny for several specific concerns, the White House said.

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What is CFIUS, anyway?

What is CFIUS, anyway?

These include “priority emerging and critical technologies, like semiconductors, quantum technologies, biotechnology and artificial intelligence, as well as supply chain considerations”, a senior administration official said in a briefing with reporters on Wednesday.

“By highlighting and sharpening the committees focus on these evolving and emerging risks, the executive order will help guide the committee and should also help businesses and investors better identify early on national security risks,” said another senior administration official on the call.

Biden’s executive order on Thursday also directs the committee to consider “aggregate industry investment trends”, which refers to the possibility of a foreign entity gaining control over a specific sector or technology through a series of transactions, under the radar of bureaucrats looking for potential threats.

The move was motivated by “what we’ve learned from the past few years and the administration’s related efforts to address the need for supply resilience of key supply chains, both inside and outside of the defence industrial base”, the first official said.