Bloomberg Quotes Christian Davis on Possible Actions by United States to Limit China’s U.S. Investments

Christian Davis, a partner in the international trade practice at Akin Gump, has been quoted in the Bloomberg article “U.S. Weighs Use of Emergency Law to Curb Chinese Takeovers,” which reports that the Trump administration is considering a crackdown on Chinese investments in certain technologies that the United States considers sensitive. According to the article, it could be done by invoking a 40-year-old law reserved for national emergencies that would allow President Trump to block transactions and assets.

Treasury Department officials, the article reports, 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. Such a move, Davis said, has “never been used in connection with unfair trade practices, but it’s broad enough that you could put restrictions on a wide variety of transactions.”

Davis pointed out that enforcing sweeping bans on Chinese investment would mark a major departure from the existing process, whereby the Committee on Foreign Investment in the United States (CFIUS) reviews individual transactions to determine if it threatens U.S. national security. The administration, he said, could use CFIUS legislation to declare a policy that Chinese investment will not be allowed in entire industries deemed sensitive, such as microchips and telecommunications.

“The question,” Davis added, “is how different is that from what CFIUS is doing already with respect to Chinese investments in sensitive sectors. Depending on how these restrictions are implemented, the answer may be not much.”