Treasury proposes COINS Act outbound investment rules and adds biotechnology to covered technologies

The U.S. Department of the Treasury on 22 October 2026 issued a notice of proposed rulemaking (NPRM) to update its Outbound Investment Security Program (OISP) under the Comprehensive Outbound Investment Security (COINS) Act, which Congress passed as part of the Fiscal Year 2026 National Defense Authorization Act. The Act codifies the Government's approach to regulating certain outbound investments by US persons and builds on the existing OISP. It directs the Treasury Secretary to issue regulations with two tracks. The first requires US persons to notify Treasury of certain transactions involving covered foreign persons engaged in "notifiable technology". The second prohibits US persons from other transactions involving covered foreign persons engaged in "prohibited technology".

The obligations would attach to the US person, "including any controlled foreign entities". The NPRM also sets a knowledge standard and expectations for a US person to conduct "a reasonable and diligent inquiry" before undertaking a transaction. It defines the conduct that would be treated as a violation and the penalties that would apply. In Atlas's view, investors with stakes in foreign technology companies, including through entities they control abroad, should treat the diligence standard as the provision that will shape their deal processes.

Six sectors, one added by Treasury

The Act authorises technical parameters for prohibited and notifiable technology in five sectors:

- semiconductor technologies and microelectronics;
- artificial intelligence systems;
- quantum information technologies;
- high-performance computing and supercomputing;
- hypersonic systems.

It also lets the Secretary add and define other technologies that enable the military, intelligence, surveillance or cyber-enabled capabilities of a country of concern. That power can be used only in consultation with the appropriate congressional committees and subject to notice and comment rulemaking. Using it, the Secretary has added biotechnology to the proposed regulations.

Treasury's summary of the NPRM's technical specifications refers to "super intelligence systems", where the Act's list of sectors says "artificial intelligence systems". AI developers and their investors will need the technical parameters in the NPRM itself to see where the notification and prohibition lines fall.

Secretary Scott Bessent said the proposal would strengthen the programme "to prevent our adversaries from using U.S. investment to develop critical technologies that threaten U.S. national security". Christopher Pilkerton, Assistant Secretary for Investment Security, said the rules address risks "when foreign adversaries try to benefit from U.S. investment in key technology sectors".

What the proposal covers

According to Treasury, the NPRM sets out:

- requirements on US persons and their controlled foreign entities;
- categories of covered national security transactions;
- definitions;
- the scope of covered foreign persons;
- excepted transactions;
- the information a notification must contain;
- a process for requesting non-binding feedback and submitting confidential information;
- the knowledge standard and diligence expectations;
- violations and penalties.

Treasury invites comments on all aspects of the proposal. It names in particular the scope of a covered national security transaction, definitions of key terms, the notification requirements, and the penalty and enforcement processes. Written comments go through regulations.gov by the deadline set in the NPRM. The NPRM, a fact sheet and other material are on Treasury's outbound investment programme page.

Final implementing regulations will follow at a later date and will set the programme's effective date.