US should tighten restrictions on China’s access to key technologies by closing loopholes, Congress told
- Export investment rules a ‘good start’, but Chinese firms are dodging controls with shell companies and subsidiaries, former Trump official testifies
- Banning investments in entire sectors said to be less resource-intensive for regulatory agencies and easier for American companies to understand
US export investment restrictions introduced in August to blunt China’s access to key technologies are promising but must be vastly tightened to close loopholes, including financial support for indigenous Chinese alternatives, Congress heard on Wednesday.
“Chinese firms commonly dodge US controls with shell companies and complex subsidiary arrays,” said Pottinger, now with the Foundation for Defence of Democracies, a Washington-based think tank. “And it would be better, simpler and less resource-intensive to apply new rules to entire sectors.”
Yet as witnesses called for broader, tougher and more comprehensive rules to deny fuel for Chinese tech development, the hearing underscored the limits of sanction regimes, the cat-and-mouse nature of enforcement and differing objectives of those involved.