WASHINGTON — The U.S. Treasury Department, seeking to prevent China’s military from gaining an edge in cutting-edge technologies, issued a rule Monday aimed at restricting and monitoring U.S. investments in China in areas of artificial intelligence , computer chips and quantum computing.

The finalized rule stems from an executive order issued in August 2023 by President Joe Biden. The order aimed to limit the access of “countries of concern” – particularly China, Hong Kong and Macau – to US dollars to finance technologies that could be used, for example, to crack codes or develop fighter jets new generation. It will come into force on January 2.

“US investments … should not be used to help countries of concern develop their military, intelligence and cybersecurity capabilities,” said Paul Rosen, assistant secretary of the Treasury for investment security. He emphasized that investments can mean more than money; they can provide “intangible benefits,” including management help and assistance in finding top talent and tapping other sources of funding.

Blocking China’s high-tech ambitions is one of the few issues that enjoys broad support in Washington, from both Republicans and Democrats.

In May, Biden imposed tough tariffs on electric vehicles from China. He also imposed export controls to prevent the Chinese from acquiring advanced computer chips and the equipment needed to produce them. Former President Donald Trump pledged to significantly raise taxes on all imports from China if voters returned him to the White House.

The Biden administration solicited feedback from businesses and U.S. allies before releasing the final version.

In addition to blocking investments, the rule requires Americans and businesses in the United States to notify the U.S. government of transactions involving “technologies and products that may contribute to a threat to the national security of the United States.”

Violators can be hit with fines of up to $368,136 or twice the value of the prohibited transaction, whichever is greater. Treasury is establishing an Office of Global Transactions to oversee the new rule.