June 8, 2021

President Joe Biden’s new order, which bans U.S. investment in companies that operate in China has been classified as broader than a similar company signed by Donald Trump, and it also has a lower bar that makes it more convenient to add companies later.

According to Bill Reinsch of CSIS, Joe Biden’s order could impact more companies depending on “how aggressive the U.S. administration wants to be”.

President Biden’s revised order thus eliminates the need for a direct link with the Chinese state, using the vague phrase that a company must “operate in” the defense or surveillance sectors.

Adopting the new order, Hong Kong-based lawyer Wendy Wysong said Biden’s list, unlike Trump’s, appeared to be on a sounder footing, noting, “It may be harder to challenge the designation because the underlying rationale presumably won’t be so weak, and the designation criteria is not as narrowly worded.”

For more information, read the original story in Reuters.