What happened
On ~22-23 October 2026, the Treasury Department issued a Notice of Proposed Rulemaking (NPRM) to implement the Comprehensive Outbound Investment Security (COINS) Act (passed in the FY2026 NDAA). The NPRM updates the existing Outbound Investment Security Program (OISP) by setting 'prohibited technology' and 'notifiable technology' parameters across five statutory sectors — semiconductor technologies and microelectronics; artificial intelligence systems (which Treasury labels 'super intelligence'/'superintelligence'); quantum information technologies; high-performance computing and supercomputing; and hypersonic systems — and additionally adds biotechnology. It would require US persons (including controlled foreign entities) to notify Treasury of transactions involving covered foreign persons engaged in notifiable technologies and be prohibited from certain transactions involving covered foreign persons engaged in prohibited technologies. It applies to transactions exceeding $50,000, excludes many financial investments such as stock purchases, sets a 'knowledge standard' and reasonable-and-diligent-inquiry expectation, and specifies violation/penalty processes. Treasury is accepting public comment before issuing a final rule.
Why it matters
This materially constrains how US capital flows into AI and adjacent strategic technology in countries of concern (China, Russia, Cuba, Iran, North Korea). It directly affects US investors, funds and AI companies with cross-border R&D, licensing, joint ventures or equity stakes — including via controlled foreign entities — and creates an outbound-investment analogue to export controls. It adds a new compliance obligation (screening, diligence, notification) and expanded penalty exposure for investments in foreign AI/superintelligence ventures that could advance an adversary's military, intelligence, surveillance or cyber capabilities.
Action needed
Assess current and pending outbound AI/quantum/supercomputing/biotech investments and participations against the proposed prohibited/notifiable definitions; build a reasonable-and-diligent-inquiry and knowledge-standard screening process; and submit comments before the NPRM comment deadline.