US plans limits on Chinese investment in its tech companies, says report | Tech News

The Treasury Department will reportedly limit China’s investment in US companies with “industrially significant technology,” an official said.

Firms with at least 25 percent Chinese ownership will be not be permitted to invest, Reuters reported, though that threshold could change before the restrictions are announced Friday.

It’s the latest move in escalating trade tensions between the US and China.

On Friday, the Office of the US Trade Representative said that $50 billion worth of Chinese goods with “industrially significant technologies” will be subject to 25 percent tariffs. However, the US government noted that it specifically excluded “goods commonly purchased by American consumers such as cellular telephones or televisions.”

President Donald Trump also reportedly assured Apple CEO Tim Cook that the government wouldn’t levy tariffs on iPhones either.

Much of the tension has been centered around ZTE. Last week, the US Senate voted to reinstate penalties against the Chinese telecom giant, rejecting Trump’s efforts to allow it to resume business with US suppliers.

The Commerce Department issued a denial order that prevents American businesses from selling hardware or services to ZTE in April. The seven-year ban, which forced the company to shut down its “major operating activities,” followed the government’s determination that ZTE violated terms of a 2017 settlement by failing to fire employees involved with illegally shipping US equipment to Iran and North Korea.

The ban crippled the company and left it unlikely to survive — until Trump tweeted that he wanted the Commerce Department to work on getting the ban lifted.

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