(Reuters) - A bipartisan group of U.S. lawmakers said on Monday they had agreed on a proposal that would give the U.S. government broader powers to limit U.S. billions in China dollar investment. The proposal is part of a broader future bill that is closely related to U.S. semiconductor investment in China.

The clause is aimed at improving U.S. competitiveness against China and provides chipmakers with $52 billion in funding to expand their U.S. operations.

U.S. Senators Bob Casey, John Cornyn, and Representatives Rosa DeLauro, Bill Pascrell, Jr., Michael McCaul, Brian Fitzpatrick and Victoria Spartz said in a statement: "The refined proposal released today has been approved by both parties and in both the House and the Senate," said in a statement. support, and addresses industry concerns, including the scope of anticipated activities, the sectors covered, and the prevention of duplication of authorisations.”

The original "outbound investment" proposal was opposed by many chip companies, fearing it could reduce companies' overseas investment, and some semiconductor makers opposed its inclusion in chip bills being finalized by members of the Senate and House of Representatives.

Democratic Senator Mark Warner told Reuters on Monday that the timetable was extremely tight when a bill covering the broader chip would finally be introduced, and said lawmakers were closely negotiating a bill that would only focus on subsidizing chipmakers. This is intended to help the United States compete with China in science, commerce and technology, though it could lead to a decline in U.S.-China trade.

The proposal was originally proposed by Cornyn and Casey as a stand-alone bill, but has since been added to the House version of the chip bill.

Compared to the original version, the draft legislation would limit overseas investment by many chipmakers, prompting objections from critics who say it would hurt U.S. competitiveness. "If the government were to impose such controls unilaterally, it would only damage the flexibility and resilience of American companies," the US-China Business Council said of the new draft.

The new draft stipulates that the investment committee will cooperate more, coordinate and share information with U.S. allies.

President Joe Biden's national security adviser, Jake Sullivan, said in July that the administration is conducting new investment screenings and considering outbound investments as it seeks to better position the United States in the technology race.

A survey by research firm Rhodium found that over the past 20 years, 43 percent of U.S. direct investment deals in China could be screened in the categories specified in the original proposal.