Trump signs sweeping defence bill restricting US investment in Chinese tech and military firms

President Trump signed the National Defence Authorisation Act on Thursday, cementing into law a series of restrictions on American money flowing into Chinese technology and military sectors. The bill, which Congress had debated for months before passing it with comfortable bipartisan margins—77 votes to 20 in the Senate, 312 to 112 in the House—represents the most significant legislative effort yet to wall off US capital from Chinese firms deemed strategically sensitive. It arrives at a moment of fragile truce between Washington and Beijing, after months of tit-for-tat tariffs and export controls had strained the relationship nearly to breaking.

The NDAA, enacted annually for more than six decades, is one of the few pieces of legislation Congress considers unmissable. This year's version, running over 3,000 pages, authorizes roughly $900 billion in Pentagon spending—$8 billion more than the White House requested—though Congress will need to pass separate funding legislation to actually disburse the money. Two provisions form the core of the China strategy. The Biosecure Act directs the executive branch to compile a list of Chinese biotechnology companies deemed problematic and bars them from federal contracts, grants, and loans. The Foreign Investment Guardrails to Help Thwart China Act, or FIGHT China Act, codifies Treasury Department restrictions on American investment in Chinese sectors with military applications, including quantum computing and semiconductors. Neither measure names specific companies; instead, they delegate the hard work of definition to the administration.

Both provisions had faced obstacles in previous years. The Biosecure Act was dropped from last year's bill after a Democratic lawmaker moved to protect jobs tied to a targeted Chinese company in his district. A predecessor to the FIGHT China Act drew opposition from a Republican who worried it would weaken Western firms' competitive position in China. This year, both cleared Congress, signaling a shift in the political calculus around China policy.

Beyond investment restrictions, the bill expands the State Department's capacity to monitor and counter Chinese influence globally. It creates at least 20 new foreign service officer positions, each with five-year tenures, focused on tracking Beijing's activities in economics, infrastructure, technology, and defence. The legislation establishes three new diplomatic offices: an Ambassador-at-Large for the Arctic, an Ambassador-at-Large for the Indian Ocean region, and a Countering the People's Republic of China Influence Fund Unit. It also mandates a new section within the US mission in China dedicated to monitoring Inner Mongolia, tracking developments in human rights, critical minerals extraction, and environmental degradation. Congress folded into the bill a requirement that the State Department report on China's diplomatic footprint worldwide and develop a strategy to counter foreign information manipulation.

John Moolenaar, the Republican chair of the House Select Committee on the Communist Party, framed the investment restrictions as essential. "American venture capitalists have provided billions of dollars to Chinese companies that work with the People's Liberation Army to develop the technologies of the future," he said. "They must stop funding our adversary." He also called the Biosecure Act a major victory for protecting American genetic data and securing pharmaceutical supply chains.

BGI Group, a Chinese genomics company that has drawn repeated scrutiny from US lawmakers, pushed back. In a statement, the company said the biosecurity provisions would likely drive up healthcare costs and reduce Americans' access to advanced life-science technologies. It denied serving US patients or holding access to American genetic data, and called the national security allegations against it "unfounded."

Two significant provisions did not make it into the final bill. The GAIN AI Act, which would have required American semiconductor makers to prioritize US customers for artificial intelligence chips before selling to China, was dropped after Nvidia objected. The company argued that no US customers faced chip shortages. The SAFE Research Act, which would have imposed funding restrictions and disclosure requirements on research collaborations with Chinese entities, also fell away. Scientists had warned the measure could damage valuable international partnerships, penalize honest mistakes, and undermine American scientific competitiveness. The bill does include a more modest research security provision: the intelligence community must now identify academic and scientific collaborations that might support Chinese military modernization or weapons testing.

What remains is a legislative framework that tightens the financial and contractual ties between the United States and China's technology and defence sectors, while expanding the diplomatic machinery to track and counter Beijing's global influence. The real work—defining which companies qualify as threats, which investments cross the line, which collaborations pose risks—now falls to the Trump administration.