US aims to curb investment in China over security concerns

Others say that China has access to many other sources of funding around the world and that cutting off access would prevent American companies from benefiting from Chinese innovations.

“Getting the exact details on outbound investment screening is easier said than done,” said Rory Murphy, vice president of government affairs at the US-China Business Council. “These are technical and complicated areas, and the details are critical.”

He added that his group wanted to “help policymakers achieve their national security goals without going overboard and without putting American companies at a disadvantage.”

Investment firms such as Blackstone, KKR, Sequoia, Carlyle Group, Bain Capital, Silver Lake, General Atlantic and Warburg Pincus all have notable exposure to China. According to tracking by Rhodium Group, a China-focused research firm, U.S. investors make about 3,000 deals a year in China, including foreign direct investment and venture capital deals, of which about 500 are valued at more than $1. million.

Bill Ford, the chief executive of General Atlantic, an investment firm, expressed his views on possible regulation directly with Commerce Secretary Gina Raimondo, a person familiar with the matter said.

General Atlantic says it has invested nearly $7 billion in China since 2000 with more than 34 holding companies in the country. One of its most high-profile investments there, ByteDance, the parent company of TikTok, has found itself in the crosshairs of the debate over how to handle US-China financial relations.

Depending on how it is implemented, this new tool could fundamentally change the country’s financial relationship with China, one of the United States’ main trading partners but also a main geopolitical rival.