As global economic and geopolitical environments enter a new era, companies need to continuously develop and adjust their coherent global business strategies to secure and further expand business opportunities in all markets while minimizing political and legal risks by ensuring compliance. To assist you with that task, Mayer Brown’s US-China Trade Monthly provides news and insights related to the latest US developments impacting the US-China bilateral trade relationship. 

In this March 2024 issue, we will discuss: (1) the Biden Administration announcing investment in domestic manufacturing of ship-to-shore cargo cranes; (2) the House Select Committee on the Chinese Communist Party releasing its investigation findings surrounding five US venture capital firms; (3) Commerce considering ICTS-related rules to address connected vehicle risks; and (4) a Republican study committee introducing the Countering Communist China Act.

Biden Administration Announces Investment in Domestic Manufacturing of Ship-to-Shore Cargo Cranes

On February 21, 2024, the Biden Administration announced its plan to invest $20 billion, including through grants, into US port infrastructure over the next five years through President Biden’s Investing in America Agenda. The announcement was part of several actions the Administration announced to “bolster cybersecurity of U.S. ports.” As a result of this investment, PACECO Corp., a US-based subsidiary of Japanese company Mitsui E&S Co. Ltd., is planning to onshore US manufacturing capacity for ship-to-shore cargo crane production. This will be the first time in 30 years that cranes will be built domestically. Only two days later, the US Coast Guard issued Maritime Security (MARSEC) Directive 105-4, “which provides cyber risk management actions for owners or operators of ship-to-shore (STS) cranes manufactured by People’s Republic of China (PRC) companies.” However, because the directive contains “security-sensitive information,” it has not been made available to the general public. Instead, owners or operators of PRC-manufactured ship-to-shore cranes are instructed to “immediately contact their local Coast Guard Captain of the Port (COTP) or District Commander” to obtain a copy of the directive.

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House Select Committee on the Chinese Communist Party Releases Findings of Bipartisan Investigation into Five US Venture Capital Firms

Adding to the ongoing discussion on proper restrictions on outbound investments by US persons in China-related companies, on February 8, 2024, Chairman of the House Select Committee on the Strategic Competition between the United States and the Chinese Communist Party (“CCP”) (the “Select Committee”), Mike Gallagher (R-WI-8), and Ranking Member of the Select Committee, Raja Krishnamoorthi (D-IL-8), released the findings of their bipartisan investigation into certain US venture capital firms. The investigation set out to determine the relationship between these firms, the People’s Republic of China (“PRC”), and the “explosive growth in two advanced technology sectors: artificial intelligence (AI) and semiconductors.”

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Commerce Considers ICTS-related Rules to Address Connected Vehicle Risks

On March 1, 2024, the US Department of Commerce’s (“Commerce”) Bureau of Industry and Security (“BIS”) published an Advance Notice of Proposed Rulemaking1 (the “Notice”) seeking public comments on potential regulation of the information systems that are integral to “connected vehicles,” and that are designed, developed, manufactured, or supplied by persons owned, controlled by, or subject to the direction of jurisdictions and persons determined to be “foreign adversaries.” The Notice highlights ways in which the incorporation of foreign information technology into connected vehicles can raise US national security risks and is intended to inform BIS’s consideration of potential regulation of classes or categories of such transactions, although the Notice itself expresses willingness to consider rules that “narrowly address” those risks.

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Republican Study Committee Introduces the Countering Communist China Act

On February 29, 2024, Republican Study Committee (“RSC”) Chairman, Representative Kevin Hern (OK-01), and RSC National Security Task Force Chairman, Joe Wilson (SC-02), introduced H.R. 7476, the Countering Communist China Act (the “Act”). The RSC is the largest Member Caucus in Congress, consisting of self-described “conservative” Republicans in Congress. In its press release regarding the Act , RSC notes that the legislation is “the largest and most comprehensive legislation addressing the Chinese Communist Party (“CCP”) ever introduced in Congress.” The legislation also demonstrates how the positions of RSC Members have shifted to taking a much broader, and somewhat more confrontational, approach to US-China economic relations since the RSC’s last set of legislative recommendations in 2020.

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