On August 9, 2023, President Biden issued an executive order prohibiting Americans from investing in some Chinese industries beginning next year. The targeted industries include "semiconductors and microelectronics, quantum information technologies, and artificial intelligence sectors that are critical for the military, intelligence, surveillance, or cyber-enabled capabilities."  The move is expressly intended to slow the growth of these industries in China in order to protect U.S. national security. China, not surprisingly, was not pleased with the development.

From my perspective, of particular concern would be any retaliatory actions that China could take in connection with the U.S. capital markets.  For example, the China Securities Regulatory Commission (CSRC), which recently adopted rules that require Chinese companies listing overseas (whether by way of IPO or merger), and underwriters acting for them in connection with such listings, to seek approval from the CSRC in connection with the listing. While I have not seen any indication that it will do so, it would not be difficult for the CSRC to decide to delay, or to not approve, offerings or transactions in the U.S. that had been long planned. Such actions could be particularly significant for a SPAC, since a SPAC has only a limited time to complete a business combination.  

China based companies attempting to list in the U.S. and those engaging in transactions with China based companies should keep an eye out for any indication on the posture of the CSRC.