WASHINGTONNEW YORK, Sept 27 Reuters U.S. financial firms are pushing for greater clarity on proposed new rules curbing U.S. investments in some China technology sectors which they say are too vague and put the onus of compliance on investors.

Aiming to protect national security and prevent U.S. capital from aiding China39;s military, President Joe Biden issued an executive order last month restricting new U.S. investments in sensitive Chinese technologies. The Treasury Department subsequently kicked off a rulemaking process to implement the order, and financial firms have been rushing to meet a Sept. 28 to provide input. The rules are expected to be implemented sometime next year.

The proposed rule applies to U.S. persons including U.S. citizens, residents, businesses and U.S. units of overseas businesses. They must notify the Treasury when making certain investments in China in the semiconductors and microelectronics, artificial intelligence and quantum information technologies sectors, and bans other such investments altogether.

In addition to venture capital and private equity firms, hedge funds, banks and potentially funds that track indexes are likely to be affected by the proposal, which financial industry executives and lawyers complain is broad and ambiguous.

Among their key concerns how the rules would apply to U.S. persons; which specific Chinese entities would be subject to the restrictions; and better defining a proposed exemption for publicly traded…