The order directed the Treasury Department to issue the rule, and the department issued an advance notice of proposed rule-making the same day as the Aug. 9 executive order.
In an Oct. 30 letter to Yellen, Reps. Mike Gallagher, R-Wis., and Raja Krishnamoorthi, D-Ill. — who serve as chairman and ranking member respectively of the House panel — call on the Treasury to "issue rules and technical guidance as soon as possible to begin curtailing the flow of U.S. capital to these sectors and to ensure that American investors and businesses have clarity on which investments will be subject to restrictions going forward."
Since the Treasury issued its advance notice of proposed rule-making, many industry groups and lawyers asked for more clarity on how to apply the rule and how to determine what investments it covers.
In a comment letter to the Treasury, the U.S. Chamber of Commerce wrote: "It is imperative that the implementing regulations are narrowly tailored to target specific national security concerns in a transparent, efficient, and predictable manner."
However, Reps. Gallagher and Krishnamoorthi in their letter to Yellen ask that the Treasury "(adopt) a broad definition of covered technology sectors."
"While avoiding unnecessary restrictions on investment is important in principle, we should be under no illusion that a narrowly scoped (executive order) will adequately protect our national security interests," the lawmakers wrote.
The lawmakers also ask the Treasury to maintain coordination with global allies and partners while moving forward with implementation of the executive order.
The lawmakers also signaled that Congress should enact legislation to take investment restrictions even further to include "passive flows of capital" like mutual funds, exchange-traded funds and index funds.
"The (executive order) lays the foundation for Congress to build additional restrictions that protect our national security and uphold our values," Gallagher and Krishnamoorthi wrote.
