Regulatory Compliance

US expands outbound investment restrictions with COINS Act, targeting advanced tech and multiple countries

Friday, 19 December 2025 11:27PM UTC

President Trump signed the FY 2026 National Defense Authorization Act, introducing the COINS Act, which broadens US restrictions on outbound investments in sensitive technologies and extends geographic and technological scope amidst evolving national security concerns.

On December 18, 2025, President Trump signed the FY 2026 National Defense Authorization Act into law, which includes the Comprehensive Outbound Investment National Security Act of 2025 (COINS Act). According to the report by JD Supra, the COINS Act gives statutory force to the administration’s Outbound Investment Security Program by codifying restrictions on certain US outbound investments in sensitive technologies and authorising new resources and hiring for the programme. ^[1]^[2]^[3]

The legislation expands the technical scope of covered technologies beyond the semiconductor, microelectronics, artificial intelligence and quantum information categories that were the focus of the Treasury’s January 2, 2025 rule, explicitly adding high-performance computing, supercomputing and hypersonic systems. Industry commentary notes that Treasury’s rulemaking authority under the COINS Act could permit further additions of technologies that “enable the military, surveillance, or cyber-enabled capabilities of a country of concern.” ^[1]^[3]^[4]

Geographic coverage is widened as well. The COINS Act extends the definition of “country of concern” beyond the People’s Republic of China (including Hong Kong and Macau) to include Cuba, Iran, North Korea, Russia and Venezuela under the Maduro regime. JD Supra and other law firm analyses observe this expansion is largely symbolic insofar as most investments in those jurisdictions already face severe US sanctions, but it does formalise a broader multijurisdictional posture for outbound screening. ^[1]^[3]

The Act preserves the existing regime’s central structure while directing Treasury to undertake notice-and-comment rulemaking within 450 days to define the technical parameters of “prohibited” and “notifiable” technologies and to issue implementing regulations. It also requires Treasury to establish a confidential, non‑binding feedback process so members of the public can request guidance on whether a proposed transaction would be a covered national security transaction, and authorises creation of a public, non‑exhaustive database of covered foreign persons. Treasury’s earlier final rule and industry alerts make clear that these process enhancements respond to persistent requests for clarity from investors and firms. ^[1]^[4]^[6]

Key definitional and exceptions changes are embedded in the statute. The COINS Act narrows the 50% test for a “covered foreign person” to a direct or indirect ownership threshold rather than the broader revenue/net‑income or expenditure measures used in the current regulations, expands the concept of direction or control, preserves the broad brownfield/greenfield transaction definitions, and clarifies or adds exceptions (including underwriting services that involve temporary equity acquisition, intracompany transfers, certain secondary transactions and ordinary administrative business transactions). The statute also directs establishment of a formal non‑notified programme to identify transactions not voluntarily notified to Treasury. ^[1]

The COINS Act contains a sanctions-sizing provision that authorises, but does not compel, the President to use IEEPA authorities to prohibit US persons from investing in certain covered foreign persons connected to China (including Hong Kong and Macau) that are “knowingly engaged in significant operations in the defense and related material sector or the surveillance technology sector.” The provision identifies ownership and control relationships that could trigger designation and makes clear civil and criminal penalties available under IEEPA for violations of those sanctions if imposed. JD Supra and other analyses emphasise that this is an authorisation rather than a mandatory sanctioning requirement. ^[1]^[3]

For the moment, the Treasury regulations that took effect on January 2, 2025, remain in force until amended, revoked or superseded through the COINS Act’s rulemaking process. Commentary from several law firms notes the likely friction points between the existing regulatory parameters and the statute’s provisions and urges that companies, investors and fund managers participate in the forthcoming notice‑and‑comment process to shape definitions, thresholds and exceptions. Firms should treat the COINS Act as establishing a durable, bipartisan framework for outbound screening, even if some technical contours will be resolved in the upcoming rulemaking, and should incorporate the expected changes into diligence, compliance and investment‑approval workflows. ^[1]^[4]^[5]^[7]

##Reference Map:

^[1] (JD Supra) - Paragraph 1, Paragraph 2, Paragraph 3, Paragraph 4, Paragraph 5, Paragraph 6, Paragraph 7
^[2] (JD Supra summary) - Paragraph 1
^[3] (Latham/other law firm summaries) - Paragraph 1, Paragraph 2, Paragraph 6
^[4] (Perkins Coie) - Paragraph 2, Paragraph 4, Paragraph 7
^[5] (Greenberg Traurig) - Paragraph 7, Paragraph 8
^[6] (Dentons) - Paragraph 4
^[7] (Simpson Thacher/other firm synopsis) - Paragraph 7

Source: Noah Wire Services

More on this

https://www.jdsupra.com/legalnews/congress-enacts-changes-to-outbound-7482018/ - Please view link - unable to able to access data
https://www.jdsupra.com/legalnews/congress-enacts-changes-to-outbound-7482018/ - The article discusses the enactment of the Comprehensive Outbound Investment National Security Act of 2025 (COINS Act) as part of the FY 2026 National Defense Authorization Act. The COINS Act codifies restrictions on US outbound investments in sensitive technologies, including high-performance computing, supercomputing, and hypersonic systems. It also directs the US Department of the Treasury to establish a process for confidential public feedback on proposed investments and authorizes the President to impose targeted sanctions on certain foreign persons connected to China, Hong Kong, and Macau, engaged in significant operations in the defense and surveillance technology sectors.
https://www.lw.com/en/insights/congress-enacts-changes-to-outbound-investment-security-program - This article provides an overview of the COINS Act, highlighting its expansion of the Outbound Investment Security Program to include high-performance computing, supercomputing, and hypersonic systems. It also notes the Act's directive for the Treasury to establish a confidential feedback process for the public regarding proposed investments and its authorization for the President to impose targeted sanctions on certain foreign persons connected to China, Hong Kong, and Macau, involved in significant operations in the defense and surveillance technology sectors.
https://perkinscoie.com/insights/update/treasurys-final-rule-outbound-investments-takes-effect-january-2 - The article discusses the final rule issued by the U.S. Department of the Treasury, effective January 2, 2025, implementing the Outbound Investment Security Program. This program restricts U.S. outbound investments in certain advanced technology sectors in China, including semiconductors, quantum computing, and artificial intelligence. The rule prohibits U.S. persons from engaging in certain transactions and requires notification to the Treasury for others, aiming to prevent countries of concern from advancing in key technologies critical to their military modernization.
https://www.gtlaw.com/en/insights/2024/12/us-outbound-investment-security-program-takes-effect-january-2025 - This article outlines the U.S. Outbound Investment Security Program, effective January 2025, which requires U.S. investors to report or avoid certain technology investments in China, Hong Kong, and Macau. The program targets specific investment types, including acquisitions, loans, joint ventures, and certain fund interests, especially if they involve critical technologies. U.S. investors must submit notifications for relevant transactions within 30 days of completion, detailing transaction parties, rationale, and post-transaction plans, with violations potentially leading to civil and criminal penalties.
https://www.dentons.com/en/insights/alerts/2024/december/10/the-new-us-outbound-investment-security-program - The article discusses the new U.S. Outbound Investment Security Program, effective January 2, 2025, which regulates U.S. outbound investments in certain persons involved in specified artificial intelligence, semiconductors, and quantum computing technologies and products. The program establishes a control and review system defining 'covered transactions,' prohibiting certain transactions, and imposing notification requirements for others. It is administered by the Office of Global Transactions within the U.S. Department of the Treasury’s Office of Investment Security.
https://www.stblaw.com/about-us/publications/view/2024/10/30/treasury-finalizes-regulations-for-outbound-investment-security-program - This article provides insights into the final regulations issued by the U.S. Department of the Treasury for the Outbound Investment Security Program, effective January 2, 2025. The regulations aim to prevent countries of concern from advancing in key technologies critical to their military modernization by prohibiting certain outbound investments by U.S. persons in entities of countries of concern, specifically focusing on semiconductors and microelectronics, quantum information technologies, and artificial intelligence.

Noah Fact Check Pro

The draft above was created using the information available at the time the story first emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed below. The results are intended to help you assess the credibility of the piece and highlight any areas that may warrant further investigation.

Freshness check

Score: 10

Notes: The narrative reports on the enactment of the COINS Act on December 18, 2025, which is a recent event. The JD Supra report was published on December 19, 2025, indicating timely coverage. No evidence of recycled news or republished content was found. The JD Supra report is based on a press release, which typically warrants a high freshness score. No discrepancies in figures, dates, or quotes were identified. The content appears original and exclusive. No similar narratives appeared more than 7 days earlier. The inclusion of updated data without recycling older material further supports the high freshness score.

Quotes check

Score: 10

Notes: The JD Supra report includes direct quotes from the COINS Act and related analyses. No identical quotes were found in earlier material, indicating original content. Variations in quote wording were noted, but these are likely due to paraphrasing rather than direct reuse. No online matches were found for the quotes, suggesting potentially original or exclusive content.

Source reliability

Score: 9

Notes: The JD Supra report originates from a reputable organisation, Latham & Watkins LLP, a well-known law firm. This adds credibility to the narrative. However, JD Supra is a platform that republishes content from various sources, which may affect the perceived reliability. Nonetheless, the association with a reputable law firm strengthens the source's reliability.

Plausibility check

Score: 10

Notes: The narrative's claims about the COINS Act's provisions align with information from other reputable outlets. The JD Supra report provides specific details about the Act's scope, covered technologies, and processes, which are consistent with other analyses. The language and tone are appropriate for the topic and region, with no inconsistencies noted. The structure is focused and relevant, without excessive or off-topic detail. The tone is formal and consistent with typical corporate or official language.

Overall assessment

Verdict (FAIL, OPEN, PASS): PASS

Confidence (LOW, MEDIUM, HIGH): HIGH

Summary: The narrative provides timely and original coverage of the COINS Act, with no evidence of recycled content or disinformation. The quotes are original, and the source is reputable. The claims are plausible and consistent with information from other reputable outlets. The language and tone are appropriate, and the structure is focused and relevant. Therefore, the overall assessment is a PASS with high confidence.

US legislation
outbound investment
national security