With the rapid development of the global economy and the complexity of international investment environments, the U.S. government has continuously adjusted its policies on foreign investment, especially in areas related to national security, technological innovation, and strategic industries. The “America First Investment Policy,” issued in 21 February, 2025, not only clarifies the U.S.’s strategic intentions regarding foreign investment but also imposes strict scrutiny and control measures on investments from foreign adversaries, particularly Chinese enterprises. The implementation of this policy will have a profound impact on foreign investors, especially Chinese capital in the U.S. market. This article provides a detailed interpretation of the policy and analyzes the potential legal challenges and responses.
I. Background and General Framework of the Policy
The “America First Investment Policy” was signed by the President of the United States and aims to safeguard the U.S.’s national and economic security, preventing foreign adversaries from infiltrating critical technologies, infrastructure, and other strategic sectors through investment. The policy particularly focuses on investment from countries such as China and other foreign adversaries, especially in sectors like technology, military, energy, and natural resources. According to this policy, the U.S. will adopt stricter review procedures and strengthen existing foreign investment review mechanisms (such as CFIUS—the Committee on Foreign Investment in the United States) to prevent such investments from threatening U.S. national security.
II. Main Content of the Policy
1. An Open Investment Environment and Investment from Allies
The policy clearly states that the U.S. will maintain an open investment environment and welcomes investments from allied countries and nations with sovereign wealth funds, as such investments help stimulate U.S. economic growth. The policy emphasizes that emerging technologies like artificial intelligence will be developed within the U.S., enhancing national competitiveness.2. Restrictions on Foreign Investment in Critical Technologies and Sensitive Areas
For foreign investments involving U.S. critical technologies, infrastructure, personal data, and other sensitive sectors, the U.S. will conduct case-by-case reviews based on the investor’s relationship with China and other foreign adversaries and the potential national security risks involved. Investments will be subject to relaxed approval conditions only if the investors can prove their capital is independent from China’s and other adversaries’ predatory investment practices.
3. Strengthening the Foreign Investment Review Mechanism (CFIUS)
The policy explicitly states that the U.S. will strengthen the role of CFIUS, particularly in reviewing investments in sensitive technological sectors such as artificial intelligence, semiconductors, and quantum technologies. CFIUS will review investments from China and other countries and may impose restrictions on those investments that pose a threat to national security, especially in critical infrastructure and emerging technologies.
4. Expedited Approval Process for Investments from Allies
For investments from U.S. allies and partners, particularly in advanced technology sectors, the U.S. will establish an expedited approval process. This process aims to streamline the review procedures and encourage investment from these countries into the U.S. market.
5. Expansion of Restrictions on Foreign Investments
The policy further stipulates that the U.S. will tighten restrictions on investments from Chinese-affiliated entities, particularly in technology, energy, agriculture, and other sectors. CFIUS will have the authority to limit Chinese firms from acquiring U.S. land, technologies, and other critical assets, especially in U.S. farmland, natural resources, and military-civil fusion sectors.
6. Tighter Scrutiny on “Mitigation Agreements”
The policy indicates that overly complex and long-term “mitigation agreements” will no longer be accepted. Foreign investments will require concrete, actionable steps within a specified timeframe, rather than perpetual and expensive compliance obligations. Furthermore, administrative resources will be allocated to facilitate investments from key partner countries.
III. Impact of the Policy on Chinese Investors
1. Stricter Scrutiny and Higher Thresholds
For Chinese enterprises and related investors, the main challenge of this policy is that the U.S. will conduct more stringent reviews of investments, particularly in technology, infrastructure, and sensitive data sectors. This means that any attempt by Chinese investors to acquire critical technologies, companies, or assets in the U.S. will face higher approval thresholds, and the review process is likely to become more complex and rigorous.
For example, investments in sectors like artificial intelligence, semiconductors, and quantum technologies will face stricter reviews, and if investors cannot prove their capital is independent of China’s government or military influence, they are likely to be rejected.
2. Stronger National Security Review
Under the “America First Investment Policy,” CFIUS will review all foreign investments in sensitive technologies and infrastructure, especially those from China. Chinese companies may face additional legal challenges and obstacles, particularly in projects involving military or dual-use technologies. Companies that are state-owned or have close ties to the Chinese government will need to be especially cautious when making such investments.
3. Sector-Specific Investment Restrictions
Chinese investors should pay close attention to investments in sectors related to the U.S. military-civil fusion. The Chinese government’s use of private enterprises to advance military technologies will lead to further restrictions by the U.S. on Chinese-affiliated companies entering critical industries. Whether acquiring U.S. farmland, mineral resources, or entering crucial technological sectors, Chinese enterprises may face stricter regulation.
4. Opportunities for Green Investments and Capital Flows
Despite the restrictions on foreign investments, investments from U.S. allies and strategic partners will still benefit from more relaxed policies. Chinese enterprises may explore cooperating with these countries and, through multinational investments and joint ventures, enter the U.S. market while circumventing direct investment restrictions.
IV. Response Strategies and Recommendations
1. Enhance Compliance and Risk Assessment
Chinese enterprises should strengthen their compliance checks when investing in the U.S. and ensure that their investments do not involve sensitive areas or critical technologies. Especially in the case of acquisitions in technology and infrastructure sectors, it is advisable to engage professional legal counsel for early-stage risk assessment to ensure compliance with CFIUS and other regulatory requirements.
2. Choose Appropriate Investment Channels
Chinese investors should strategically choose investment routes based on the scope outlined in the “America First Investment Policy.” Avoid direct investments in restricted sectors such as military, energy, and farmland, and seek greenfield investments that align with U.S. regulations to reduce the difficulty of approval.
3. Stay Updated on Policy Changes
The “America First Investment Policy” is not static and may be adjusted in response to changing international and economic conditions. Chinese enterprises should closely monitor policy developments and adjust their investment strategies accordingly.
[Comment]
The “America First Investment Policy” reflects the U.S.’s effort to safeguard national security in the global investment environment and imposes higher requirements and challenges on Chinese enterprises and foreign investors. When considering investments in the U.S., Chinese enterprises need to carefully analyze the legal risks associated with the policy and work closely with U.S. legal advisors to ensure their investment activities comply with the new regulatory framework, thus avoiding potential legal risks and financial losses.
I. Background and General Framework of the Policy
The “America First Investment Policy” was signed by the President of the United States and aims to safeguard the U.S.’s national and economic security, preventing foreign adversaries from infiltrating critical technologies, infrastructure, and other strategic sectors through investment. The policy particularly focuses on investment from countries such as China and other foreign adversaries, especially in sectors like technology, military, energy, and natural resources. According to this policy, the U.S. will adopt stricter review procedures and strengthen existing foreign investment review mechanisms (such as CFIUS—the Committee on Foreign Investment in the United States) to prevent such investments from threatening U.S. national security.
II. Main Content of the Policy
1. An Open Investment Environment and Investment from Allies
The policy clearly states that the U.S. will maintain an open investment environment and welcomes investments from allied countries and nations with sovereign wealth funds, as such investments help stimulate U.S. economic growth. The policy emphasizes that emerging technologies like artificial intelligence will be developed within the U.S., enhancing national competitiveness.2. Restrictions on Foreign Investment in Critical Technologies and Sensitive Areas
For foreign investments involving U.S. critical technologies, infrastructure, personal data, and other sensitive sectors, the U.S. will conduct case-by-case reviews based on the investor’s relationship with China and other foreign adversaries and the potential national security risks involved. Investments will be subject to relaxed approval conditions only if the investors can prove their capital is independent from China’s and other adversaries’ predatory investment practices.
3. Strengthening the Foreign Investment Review Mechanism (CFIUS)
The policy explicitly states that the U.S. will strengthen the role of CFIUS, particularly in reviewing investments in sensitive technological sectors such as artificial intelligence, semiconductors, and quantum technologies. CFIUS will review investments from China and other countries and may impose restrictions on those investments that pose a threat to national security, especially in critical infrastructure and emerging technologies.
4. Expedited Approval Process for Investments from Allies
For investments from U.S. allies and partners, particularly in advanced technology sectors, the U.S. will establish an expedited approval process. This process aims to streamline the review procedures and encourage investment from these countries into the U.S. market.
5. Expansion of Restrictions on Foreign Investments
The policy further stipulates that the U.S. will tighten restrictions on investments from Chinese-affiliated entities, particularly in technology, energy, agriculture, and other sectors. CFIUS will have the authority to limit Chinese firms from acquiring U.S. land, technologies, and other critical assets, especially in U.S. farmland, natural resources, and military-civil fusion sectors.
6. Tighter Scrutiny on “Mitigation Agreements”
The policy indicates that overly complex and long-term “mitigation agreements” will no longer be accepted. Foreign investments will require concrete, actionable steps within a specified timeframe, rather than perpetual and expensive compliance obligations. Furthermore, administrative resources will be allocated to facilitate investments from key partner countries.
III. Impact of the Policy on Chinese Investors
1. Stricter Scrutiny and Higher Thresholds
For Chinese enterprises and related investors, the main challenge of this policy is that the U.S. will conduct more stringent reviews of investments, particularly in technology, infrastructure, and sensitive data sectors. This means that any attempt by Chinese investors to acquire critical technologies, companies, or assets in the U.S. will face higher approval thresholds, and the review process is likely to become more complex and rigorous.
For example, investments in sectors like artificial intelligence, semiconductors, and quantum technologies will face stricter reviews, and if investors cannot prove their capital is independent of China’s government or military influence, they are likely to be rejected.
2. Stronger National Security Review
Under the “America First Investment Policy,” CFIUS will review all foreign investments in sensitive technologies and infrastructure, especially those from China. Chinese companies may face additional legal challenges and obstacles, particularly in projects involving military or dual-use technologies. Companies that are state-owned or have close ties to the Chinese government will need to be especially cautious when making such investments.
3. Sector-Specific Investment Restrictions
Chinese investors should pay close attention to investments in sectors related to the U.S. military-civil fusion. The Chinese government’s use of private enterprises to advance military technologies will lead to further restrictions by the U.S. on Chinese-affiliated companies entering critical industries. Whether acquiring U.S. farmland, mineral resources, or entering crucial technological sectors, Chinese enterprises may face stricter regulation.
4. Opportunities for Green Investments and Capital Flows
Despite the restrictions on foreign investments, investments from U.S. allies and strategic partners will still benefit from more relaxed policies. Chinese enterprises may explore cooperating with these countries and, through multinational investments and joint ventures, enter the U.S. market while circumventing direct investment restrictions.
IV. Response Strategies and Recommendations
1. Enhance Compliance and Risk Assessment
Chinese enterprises should strengthen their compliance checks when investing in the U.S. and ensure that their investments do not involve sensitive areas or critical technologies. Especially in the case of acquisitions in technology and infrastructure sectors, it is advisable to engage professional legal counsel for early-stage risk assessment to ensure compliance with CFIUS and other regulatory requirements.
2. Choose Appropriate Investment Channels
Chinese investors should strategically choose investment routes based on the scope outlined in the “America First Investment Policy.” Avoid direct investments in restricted sectors such as military, energy, and farmland, and seek greenfield investments that align with U.S. regulations to reduce the difficulty of approval.
3. Stay Updated on Policy Changes
The “America First Investment Policy” is not static and may be adjusted in response to changing international and economic conditions. Chinese enterprises should closely monitor policy developments and adjust their investment strategies accordingly.
[Comment]
The “America First Investment Policy” reflects the U.S.’s effort to safeguard national security in the global investment environment and imposes higher requirements and challenges on Chinese enterprises and foreign investors. When considering investments in the U.S., Chinese enterprises need to carefully analyze the legal risks associated with the policy and work closely with U.S. legal advisors to ensure their investment activities comply with the new regulatory framework, thus avoiding potential legal risks and financial losses.