The U.S. Treasury Department has finalized a rule banning investments in Chinese semiconductors, artificial intelligence and quantum computing, citing national security concerns.

“The Biden-Harris Administration is committed to protecting America’s national security and keeping critical advanced technologies out of the hands of those who may use them to threaten our national security," said Assistant Treasury Secretary Paul Rosen in an October 28 statement. "Artificial intelligence, semiconductors, and quantum technologies are fundamental to the development of the next generation of military, surveillance, intelligence and certain cybersecurity applications."

China's leaders have been outspoken against the move, with Hong Kong chief executive John Lee claiming in an October 29 briefing that it will "harm the global supply chain." Chinese foreign ministry spokesperson Lin Jian echoed those sentiments in a separate briefing, saying that the country's government "strongly and firmly rejects" the new regulations.

The Treasury Department's so-called "Final Rule" approves the implementation of an executive order from President Biden issued in August of 2023, which will take effect on January 2, 2025. In practice, it will bar U.S. individuals and companies from investing in specific technology sectors in China, and require them to notify the U.S. government of investments in a handful of other technologies, such as older-generation electronic components.