The Trump administration reportedly is contemplating using an existing law related to national emergencies to restrict Chinese investment in sensitive technologies.
The news comes on the heels of President Donald Trump's decision to impose tariffs on up to $60 billion in imports of Chinese goods in retaliation for what the administration said is China's theft of American intellectual property.
Bloomberg News, citing four people with knowledge of the matter, said the Treasury Department is developing plans to identify the technology sectors that Chinese companies would be barred from investing in. Those sectors could include semiconductors and 5G wireless communications.
The Treasury Department had no immediate comment when contacted by CNBC.
Trump had said last week that the tariffs he was imposing were "the first of many" trade actions. On Tuesday, the White House said he talked to both German Chancellor Angela Merkel and French President Emmanuel Macron about addressing China's "unfair" economic and trade practices, including intellectual-property theft.
Bloomberg reported that the White House is considering using the International Emergency Economic Powers Act to ban Chinese investment in some tech sectors.
The 41-year-old law allows the president to declare a national emergency in the face of an "unusual and extraordinary threat."
Trump has previously taken action, without invoking that law, to block takeovers of American companies involved in semiconductors and 5G wireless on national security grounds related to China.
Both cases were very unusual, as American presidents in the past three decades have blocked the sale of U.S. companies just a handful of times.
In September, Trump blocked the sale of Lattice Semiconductor Corp. after citing national security concerns. The prospective buyer was Canyon Bridge Capital Partners, which is backed by China Venture Capital Fund Corporation Limited. The White House had said the venture capital fund is "owned by Chinese state-owned entities."
On March 12, Trump blocked the buyout of chip maker Qualcomm by Singapore-based Broadcom for the same reasons. Factoring into that decision was concern that the United States would lose a competitive edge to China's Huawei in the development of 5G wireless technology.