Senate Pushes New China Tech Curbs In Defense Bill As House Takes Softer Stance

Defense Bill Becomes Battleground For China Tech Policy

Congress is using the annual National Defense Authorization Act to advance several technology restrictions targeting China, according to reports, though significant differences between House and Senate versions suggest a contentious negotiation ahead. The Senate passed its FY26 NDAA draft in October, while the House approved its version in September, with lawmakers now working to reconcile the two proposals amid an ongoing government shutdown.

Defense Bill Becomes Battleground For China Tech Policy
Senate’s Aggressive Semiconductor Controls
Expanded Investment Oversight And Biotech Restrictions
House Takes More Targeted Approach
White House Influence And Timeline

The NDAA has become a favored vehicle for non-defense policy measures due to its reliable passage each year since 1961, analysts suggest. This year, both chambers have included numerous China-focused technology provisions that could reshape trade relationships in semiconductors, artificial intelligence, and biotechnology.

Senate’s Aggressive Semiconductor Controls

The Senate’s draft includes the GAIN AI Act, which would establish a global licensing regime for semiconductor sales similar to what the Biden administration’s AI Diffusion Rule would have created, according to the analysis. The controversial measure would require semiconductor companies selling to countries of concern, including China, to offer American businesses first refusal on those orders.

Despite significant pushback from industry members including Nvidia and the White House, sources indicate the provision was included in the Senate’s draft. However, no similar measure appears in the House version, where lawmakers have been quieter on the issue. The Trump administration is reportedly crafting its own replacement for the AI Diffusion Rule, which could provide lawmakers with an alternative approach.

Expanded Investment Oversight And Biotech Restrictions

Two other notable Senate proposals would establish outbound investment regulations and prohibit collaboration with Chinese biotech companies on federally funded projects. The investment measure would grant the Treasury Department increased authority to block transactions involving “prohibited technologies” across semiconductors, AI models, quantum technology, and hypersonic missile systems.

The biotech amendment represents a revised version of the BIOSECURE Act, which generated constitutional concerns last year. The new draft removes specific company names, instead allowing the executive branch to determine which companies should face restrictions. According to reports, this version has yet to attract significant pushback but faces an uncertain path forward without corresponding House provisions.

House Takes More Targeted Approach

The House’s NDAA draft includes a less aggressive measure targeting Chinese drone manufacturers DJI and Autel, calling for security agency reviews that could lead to import restrictions. This provision was not included in the Senate’s draft but may appeal to China hawks in both chambers during conference negotiations., according to emerging trends

Historical patterns suggest the Senate’s more ambitious proposals face significant hurdles, analysts suggest. Both the BIOSECURE Act and outbound investment regulations have failed to survive previous conference processes, with the House resisting similar measures in the past. These dynamics appear unchanged this year, making them likely candidates for removal during final negotiations.

White House Influence And Timeline

The White House will likely play a decisive role in determining which provisions survive the conference process, according to sources. Administration opposition to the GAIN AI Act carries particular weight in the House, where the executive branch has demonstrated greater influence on these issues compared to the Senate.

Despite the government shutdown, the NDAA is expected to pass by year’s end or very early in 2026, maintaining its six-decade streak of annual passage. The conference process is anticipated to intensify in coming weeks, though shutdown-related delays may slow progress on resolving the significant differences between the two chambers’ approaches to China technology policy.