The U.S.-China tech battle continues with 2 important developments
What is the U.S. Innovation and Competition Act? What’s happening to TikTok? Everything you need to know about the tech battle between the U.S. and China.
U.S. lawmakers have taken a strong stance on curbing Chinese technological influence with two significant legislative developments this week, reports CNBC.
- Tuesday, the Senate passed a new bill promoting American technological and industrial competitiveness against China, according to CNN.
- Wednesday, President Joe Biden revoked executive orders from then-President Donald Trump that sought to ban TikTok and issued broader executive orders to investigate foreign-controlled software, reported CNBC.
Here’s everything you need to know about the recent developments.
What is the new bill promoting competition with China?
The U.S. Innovation and Competition Act is a sweeping bill that allocates $250 billion over the next five years to promoting American technological development. The 2,400-page bill includes measures for researching and manufacturing of emerging technologies, reported The New York Times.
- The bill allocates an emergency $52 billion for researching and developing semiconductor chips. Current worldwide chip shortages have exposed vulnerabilities in the U.S. supply chain and dependence on international manufacturing, said NPR.
- Provisions to overhaul the National Science Foundation by adding a directorate for tech and innovations are also included in the bill, said CNBC.
- The bill would require all “federally funded infrastructure projects” to use materials produced in the U.S., said CNN.
- More specific provisions in the bill aim to counter Chinese technological ambitions by strengthening U.S. supply chains and foster U.S. innovation, reported CNBC.
This bill is one of the largest industrial bills in U.S. history and the most significant in decades, according to CNN.
What are Biden’s new executive orders? What does it mean for TikTok?
Wednesday, Biden revoked three of Trump’s executive orders that sought to ban transactions with TikTok and WeChat as well as the apps themselves.
Biden issued a broader executive order calling for the development of criteria that evaluates the risk of software owned or run by foreign governments, said The New York Times.
- The executive order aims for a clearer evaluation of the security risks to American consumers and their data.
- The Commerce Department will begin reviewing apps tied to foreign adversaries and make recommendations on evaluation criteria and any further legislative action, said CNBC.
No apps are specifically named in the executive orders, but the order has implications for TikTok, WeChat and Alipay, which all over ownership ties in China.
What happens now?
Neither of the recent legislative developments has immediate legal implications for Chinese apps or industries.
- The U.S. Innovation and Competition Act must be approved by the House then signed by the president before becoming law, according to BBC. Biden has already voiced support for the bill.
- Biden’s executive orders do not specify the consequences for apps found to be threats to national security, said The New York Times.
China has strongly criticized the recent bill, reported BBC.
TikTok and WeChat have not responded to the executive orders, said The New York Times.