WASHINGTON — The U.S. Commerce Department is expected to propose banning the use of Chinese software in autonomous and connected vehicles in the coming weeks, according to people familiar with the matter.
The Biden administration plans to issue a proposed rule that would ban Chinese software in U.S. vehicles with Level 3 automation and higher, which would have the effect of also banning U.S. road tests of autonomous vehicles produced by Chinese companies.
The administration, in plans first reported by Reuters, will also propose banning vehicles with advanced wireless communications modules developed by China from U.S. roads, the sources added.
Under the proposal, automakers and suppliers would need to verify that none of their connected vehicle or advanced autonomous vehicle software was developed in a “foreign entity of interest” such as China, the sources said.
The Commerce Department said last month it planned to issue proposed rules on connected vehicles in August and expected to impose limits on some software made in China and other countries considered adversaries.
Asked for comment, a Commerce Department spokesman said Sunday that the department “is concerned about the national security risks associated with connected technologies in connected vehicles.”
The department’s Bureau of Industry and Security will issue a proposed rule that “will focus on specific systems of concern within the vehicle. Industry will also have the opportunity to review the proposed rule and submit comments.”
A spokesman for the Chinese Embassy in Washington said electric vehicles are a globalized industry.
“Only division of labor and cooperation can bring mutual benefits, and only fair competition can bring technological progress,” the spokesperson said, adding: “China urges the US to earnestly respect market principles and international trade rules, and create a level playing field for enterprises from all countries. China will firmly defend its legitimate rights and interests.”
On Wednesday, the White House and State Department hosted a meeting with allies and industry leaders to “jointly address national security risks associated with connected vehicles,” the department said. The sources said officials revealed details of the administration’s planned rule at that meeting.
The meeting included officials from the United States, Australia, Canada, the European Union, Germany, India, Japan, South Korea, Spain and the United Kingdom who “exchanged views on the data and cybersecurity risks associated with connected vehicles and certain components.”
Also known as conditional driving automation, Level 3 involves technology that allows drivers to engage in behind-the-wheel activities, such as watching movies or using smartphones, but only under limited conditions.
In November, a group of US lawmakers raised concerns about Chinese companies collecting and handling sensitive data while testing self-driving vehicles in the US and asked questions of 10 major companies, including Baidu, Nio, WeRide, Didi, Xpeng, Inceptio, Pony.ai, AutoX, Deeproute.ai and Qcraft.
In letters, the group said that in the 12 months ending in November 2022, Chinese autonomous vehicle (AV) companies tested more than 450,000 miles in California. In July 2023, Transportation Secretary Pete Buttigieg said his department had national security concerns about Chinese AV companies in the U.S.
The administration is concerned about connected vehicles that use the driver monitoring system to listen to or record occupant conversations or take control of the vehicle itself.
“The national security risks are quite significant,” Commerce Secretary Gina Raimondo said in May. “We decided to act because this is really serious.”