On August 13, 2018, President Trump signed the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA). The law's intent is to stop China's acquisition of critical technologies -- the'crown jewels' of U.S. global power. FIRRMA expands the powers of the Committee on Foreign Investment in the United States (CFIUS) to review the national security implications of foreign investments. The CFIUS reform bill subjects more transactions to review and mandates that foreign investments in critical technologies are reported to the committee. Championed initially as a strong response to China's technology transfer strategy, FIRRMA's passage, coupled with ongoing trade and IP tensions, caused Chinese investments into U.S. technology firms to decline by 79% in 2018.

President Trump's time in office has been punctuated by rising tension with China on a host of economic issues. He's received bipartisan criticism for the impact of tariffs on Chinese goods and the resulting retaliation against American exports. Democrats and Republicans have also unified over concerns about how Chinese state-associated actors are using minority investments in critical technology companies to gain sensitive information -- like IP and know-how -- about startups, many of them VC-backed. Policymakers are worried this technology is being used to propel Chinese advancement in emerging technology like artificial intelligence and robotics. These concerns led to passage of the Foreign Investment Risk Review Modernization Act (FIRRMA), which was signed into law by the president on August 13. NVCA has been at the table during FIRRMA's consideration because it stands to have a significant impact on the venture and startup ecosystem.