US tech companies win changes in bill to limit China access to technology

Lawmakers pushing legislation aimed at preventing China from acquiring sensitive US technology have proposed relaxing elements of the measure after lobbying by high-tech firms but will tighten another portion, according to a draft revision seen by Reuters.

The bill in the Senate and a companion measure in the US House of Representatives would broaden the reach of the inter-agency Committee on Foreign Investment in the United States (CFIUS) in hopes of halting Chinese efforts to acquire sophisticated US technology. The bipartisan legislation has the support of President Donald Trump’s administration.

Tech companies criticised the original legislation amid concerns it could limit or slow their exports, which in 2016 totalled $153 billion, according to World Bank data. Among the companies lobbying for the changes were Google parent Alphabet, Facebook, IBM Corp, Intel Corp, Qualcomm and a long list of other hardware and software companies.

CFIUS has gone from virtually unknown several years ago to the front-page news this month as one of its probes resulted in Trump forbidding chipmaker Broadcom, which is in the process of moving back to the United States, from buying rival Qualcomm.

A technology industry group said the original bill broadened CFIUS’ reach so much that companies that sell sensitive technology could potentially be forced to go before the panel to have any sale reviewed, even the most uncontroversial.

They also argued that some technology transfers were already reviewed by other US agencies. Josh Kallmer, senior vice president for global policy for the Information Technology Industry Council, said the changes were positive.

“We see this as a huge step in the right direction both atmospherically and substantively,” he said.