Tech startups seeking U.S. funding could come under scrutiny

The Wall Street Journal (WSJ) reported on Sunday (May 8) that Congress could soon order government agencies to scrutinize tech startups seeking federal funding. have a nature.

According to the report, a Pentagon investigation found China is misusing a popular program to fund innovation in small businesses in the United States.

China is reportedly funded by the Department of Defense through the Small Business Innovation Research (SBIR) program, which seeks to promote innovation through competitive government awards, using “state-sponsored methods.” It targets companies that

According to the report, there are several cases of program participants who “dissolved American companies” and participated in the Chinese government’s human resource development programs instead of working in places supporting the Chinese Communist Party’s militant group, the People’s Liberation Army. did.

The WSJ writes that there are instances in which SBIR recipients have received venture capital funds from Chinese state-owned enterprises and have worked with Chinese organizations that “support the country’s defense industry.”

According to the report, the SBIR program needs a review to enable it to identify entities of concern that require a greater review.

Lawmakers are now reportedly considering a five-year reauthorization of SBIR and a related technology transfer program for small businesses. Both are part of a “drastic bipartisan” legislative package that will pass through the Capitol and seek to make the US more competitive with China and elsewhere.

In another piece of news about China’s interactions with other global powers, PYMNTS wrote that Chinese tech companies are quietly backing out of doing business with Russia as Russia continues its war in Ukraine. .

read more: Chinese tech firms quietly move operations out of Russia

China initially said it would drop sanctions against Russia, but a recent directive from the government said companies must not yield to pressure from the United States or from elsewhere. Several companies are “quietly reducing” shipments to Russia, which has the largest market share for several products.