US Firms in China: Keep PNTR, More Exclusions, Nix AI Diffusion Rule

The US-China Business Council (USCBC), representing 270 American companies operating in China, announced its policy priorities for US-China commercial relations. "With new US leadership, USCBC sees a fresh chance to address structural issues in China’s economy that disadvantage American businesses, workers, and farmers," the group states.

Phase I

Among its recommendations, USCBC urges fair treatment of US interests through negotiations aimed at boosting US exports and ensuring the enforcement of China’s “phase one” commitments.

"Recalibrate"

USCBC calls for "recalibrating national security restrictions" in coordination with allies, safeguarding America’s technological leadership without unnecessarily harming competitiveness. The group likewise emphasizes strengthening bilateral commercial mechanisms that deliver tangible results for US exports, along with fostering people-to-people exchanges.

Keep PNTR

Among its key recommendations, USCBC underscores the importance of retaining China’s permanent normal trade relations (PNTR) status, warning that revocation could severely disrupt supply chains, cost American jobs, and harm US economic competitiveness.

Target Tariffs

The council also calls for strategically targeted tariffs to address specific national security concerns and unfair Chinese trade practices, rather than blanket duties that raise consumer prices and reduce US exporters’ competitiveness. In this context, USCBC urges expanding tariff exclusions, particularly for manufacturing inputs, to mitigate inflationary effects and preserve jobs at home.

Roll Back Export Controls

Additionally, USCBC critiques new export control measures, including the AI Diffusion rule issued by the Bureau of Industry and Security (BIS). The organization argues the rule imposes sweeping worldwide licensing requirements on AI technologies with primarily civilian end uses and was drafted without sufficient input from industry. USCBC advocates nullifying the rule or, at minimum, adopting a narrower approach consistent with US allies and open trade principles.

China Reforms

USCBC also proposes measures to promote a level playing field for American companies operating in China, such as eliminating preferential procurement practices favoring domestic firms and strengthening intellectual property protections. It recommends leveraging existing bilateral working groups to address market barriers and regulatory issues directly with Beijing.

People to People

Beyond trade and investment policies, the council highlights the importance of people-to-people exchanges, suggesting simpler visa rules, increased flights, and easing cross-border data restrictions to foster engagement and growth for both countries.

The USCBC counts among its membership some of America's most prominent corporate citizens, including Apple, Boeing, Ford Motor, Coca Cola, Wal Mart and JP Morgan Chase.

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