FACT SHEET: Executive Order Addressing the Threat from Securities Investments that Finance Certain Companies of the People’s Republic of China
JUNE 03, 2021
STATEMENTS AND RELEASES
Today, President Biden signed an Executive Order (E.O.) to further address the ongoing national emergency declared in E.O. 13959 of November 12, 2020 with respect to the threat posed by the military-industrial complex of the People’s Republic of China (PRC). President Biden also expanded the scope of this national emergency by finding that the use of Chinese surveillance technology outside the PRC, as well as the development or use of Chinese surveillance technology to facilitate repression or serious human rights abuses, constitute unusual and extraordinary threats. This E.O. allows the United States to prohibit – in a targeted and scoped manner – U.S. investments in Chinese companies that undermine the security or democratic values of the United States and our allies....
1) "Fact Sheets" of this sort are usually not helpful for the purposes of interpreting an OFAC-administered legal authority. But to the extent that the EO of June 3, 2021 looks as if it may subject non-Chinese entities to securities sanctions for arm’s length transactions involving the surveillance technology and/or defense sectors, one may look at this fact sheet, along with the preamble to EO 13959, as signaling an interpretation of the EO that limits designees to “Chinese companies” only. (“This E.O. allows the United States to prohibit – in a targeted and scoped manner – U.S. investments in Chinese companies that undermine the security or democratic values of the United States and our allies.”)
For discussion of this FAQ in the context of other designation-related issues, see section I(iii)-(v) of the Consolidated Comment on...