The US Department of the Treasury issued a Notice of Proposed Rulemaking on 22 October 2026 to implement the Comprehensive Outbound Investment National Security Act and to expand the Outbound Investment Security Program. The measure sits at the proposal stage. Treasury opened a public comment period that closes on 7 December 2026 and has stated that final implementing regulations will follow and will set the effective date for the programme.
The existing programme regulations sit at 31 C.F.R. Part 850 and continue to apply to activity undertaken before the new rule takes effect. Title VIII of the COINS Act was enacted on 18 December 2025 as part of the Fiscal Year 2026 National Defense Authorization Act. Subtitle C of that Act directs Treasury to require notification of transactions involving covered foreign persons engaged in notifiable technologies and to prohibit transactions involving covered foreign persons engaged in prohibited technologies. The proposal adopts the term super intelligence systems in place of AI systems, following Executive Order 14434, 91 FR 63129, Inaugurating the Era of Super Intelligence.
US persons investing in covered foreign persons lose the notification route for artificial intelligence work. The proposal extends the existing prohibition to entities in countries of concern developing any super intelligence system, so venture capital sponsors, private equity funds, limited partners and corporate investors face a bar on the transaction rather than a filing obligation. Biotechnology enters the programme as a prohibited sector for the first time. Semiconductor and microelectronics investors keep a split regime: electronic design automation software, fabrication and packaging equipment and advanced integrated circuits are prohibited, while any integrated circuit activity not otherwise prohibited is notifiable.
Quantum computers, quantum sensing platforms, quantum networks, supercomputers and hypersonic systems sit on the prohibited side. High-bandwidth, low-latency interconnects remain notifiable, as do hypersonic sensors, control equipment, software and certain dual-use materials. The Notice of Proposed Rulemaking fixes no effective date, which Treasury has reserved for the final rule. Comments are due by 7 December 2026.
Licentium advises fund sponsors, corporate investors and technology companies on cross-border investment screening and on artificial intelligence regulation. Work we undertake includes diligence on whether a target falls within notifiable or prohibited technology scope, fund structuring and side letter covenants for portfolios with country-of-concern exposure, and preparation of comment submissions on proposed rules.