Treasury Proposes Sweeping Expansion of Outbound Investment Program

Treasury's notice of proposed rulemaking, issued October 22, 2026, would be the most far-reaching expansion of the Outbound Investment Security Program to date, implementing the COINS Act. It adds Cuba, Iran, North Korea, Russia and Venezuela to the "countries of concern" list, extends coverage to citizens and permanent residents of those states, including majority-owned or controlled entities, and replaces the tiered AI framework with a flat prohibition on covered "super intelligence" systems, including agentic harnesses, humanoid robots, autonomous vehicles and unmanned systems. Biotechnology becomes a prohibited sector covering vaccines, cell and gene therapies, monoclonal antibodies, brain-computer interfaces, sequencing, flow cytometers, mass spectrometry, lab automation and cloud-lab infrastructure. Photonics, hypersonics, high-performance computing, high-bandwidth memory and radiation-hardened chips also come into scope, alongside a $50,000 de minimis exception for notifications, new secondary-transaction and bank-lending safe harbors, an added diligence factor, and a nonbinding confidential feedback process. Why it matters: clients with US investors, foreign subsidiaries, joint ventures or supply ties to covered countries must test deal exposure now, because knowledge and control rules can reach non-US-domiciled businesses. Actions: map covered-person status across cap tables and joint ventures; assess the de minimis threshold and secondary exceptions; and file comments by December 7, 2026, especially on biotech scope, ahead of Treasury's March 13, 2027 finalization deadline.