On September 24, 2025, Covington’s tech industry experts explored what legal teams, government affairs professionals, and business leaders at tech companies need to know during this pivotal period and offered insights into anticipated challenges and emerging opportunities in the year ahead. Eight Covington attorneys shared their insights during a 60-minute session moderated by Covington partner Holly Fechner. Key takeaways from the Forum are outlined below.
Overview & Highlights of the Tech Policy in the Administration & Congress
Covington attorneys Bill Wichterman and Paul Ray addressed the reality that tech is both loved and hated—often at the same time—by policymakers on both ends of Pennsylvania Avenue and in both parties. This dynamic has produced mixed policy results, depending on the issue. When it comes to deregulation, AI, and taxes, many tech companies have been encouraged, but export controls and content moderation remain concerns. Areas like patent policy are received differently depending on individual companies’ business models. Tech is likely to remain near the center of this swirling vortex for the foreseeable future.
Artificial Intelligence
Covington attorney Matthew Shapanka addressed the federal and state legislative landscapes on artificial intelligence. While members of Congress have introduced more than 200 bills referencing AI, released several AI-related frameworks, and held many dozens of hearings on AI-related topics, Congress does not appear closer to enacting comprehensive AI governance rules. Matt also discussed the Trump Administration’s AI Action Plan, released in July, and the “light touch” regulatory framework released by Senate Commerce Committee Chair Ted Cruz (R-TX), which largely tracks the President’s AI Action Plan. Meanwhile, legislators in all 50 states introduced bills in 2025 on AI-related topics, with 38 states enacting more than 100 bills so far this year, including significant AI governance bills in California, New York, and Texas. Congress also failed to enact legislation earlier this year that would have “paused” state laws regulating AI while national rules are developed. Still, as the states continue to enact and implement all manner of AI legislation, Senator Cruz and other members of Congress, including House Energy & Commerce Committee Chair Brett Guthrie (R-KY) have pledged to continue pushing for a moratorium on state AI laws, with or without a federal alternative.
Privacy & Content Moderation
Covington attorney Nick Xenakis addressed the ongoing regulatory focus on privacy and content moderation, noting that these issues remain top priorities at both federal and state levels, with increasing attention on foreign regulation and its implications for U.S. companies. Under the Trump Administration, content moderation efforts focused on curbing perceived bias and promoting free speech, often intersecting with debates around the appropriate scope of Section 230 of the Communications Decency Act. Today, the rise of artificial intelligence adds new complexity, as regulators and Congress consider how automated systems influence moderation decisions and consumer protection. While comprehensive federal privacy legislation continues to be a perennial topic, its prospects remain uncertain given political dynamics and competing priorities—making proactive compliance and engagement with agencies such as the FTC and state attorneys general essential for businesses deploying new products or platforms.
Trade Controls
Covington attorney Stephen Bartenstein addressed the evolution of U.S. export controls and sanctions policy under the Trump Administration and what may be on the horizon. Steve discussed the Trump Administration’s announced plans to rescind and replace the AI diffusion export controls rule, as well as the potential expansion of Entity List export control restrictions to reach entities owned 50% or more by parties on the Entity List. (Several days after the Webinar, on September 29, the U.S. Commerce Department’s Bureau of Industry and Security issued a new rule expanding end-user export controls to reach non-U.S. entities owned 50% or more by parties on the Entity List and certain other restricted party lists, as discussed in our client alert here.) In addition, Steve described how the Trump Administration recently lifted comprehensive sanctions and eased export control restrictions on Syria, used sanctions authorities in recent months to target a number of additional parties for comprehensive property blocking sanctions, and designated narcotrafficking organizations as Foreign Terrorist Organizations.
National Security
Covington attorney Ingrid Price addressed the evolving national security regulatory landscape, emphasizing that recent rules—including the DOJ Data Security Program, the Treasury Department’s Outbound Investment Rule, and the Commerce Department’s Connected Vehicle Rule—reflect the U.S. government’s broader strategy to de-risk vis-à-vis China. These regulations impact cross-border investments, supply chain integrity, and data security, creating new compliance obligations for companies operating in sensitive sectors such as advanced technology, ICTS, and connected vehicles. While developed under the Biden Administration, these measures remain in effect and signal continued scrutiny of technology transactions involving U.S. and China. Companies should proactively assess vendor relationships, investment structures, and product design to ensure compliance, as regulatory expectations continue to evolve in this area.
Trade Policy & Tariffs
Covington attorney Kate McNulty addressed recent trade policy developments and related challenges for the tech sector, including the aggressive use by the Trump administration of tariffs and related-trade threats as tools for advancing policy objectives aimed at reshoring U.S. manufacturing and promoting increased U.S. investments in strategically significant sectors. Invoking national security rationales, the Trump administration has announced forthcoming sectoral tariffs on a range of critical technology products, including—among others—semiconductors, drones, and processed critical, while also threatening substantial tariffs on countries that regulate or tax U.S. digital technology companies. Recommendations for companies in this space include developing risk assessment and mitigation strategies around potential new tariffs, monitoring relevant developments, and considering possible opportunities for tariff relief.
Implications for China
Covington attorney Christopher Adams discussed the shifting dynamics of the U.S.-China relationship in 2025, noting that many recent U.S. policy and regulatory actions have been driven by strategic competition with China. In response, China has adopted a more assertive posture, seeking to counterbalance U.S. measures while signaling confidence in its economic resilience. Factors shaping the trajectory include evolving trade negotiations, technology restrictions, and geopolitical considerations, leaving the relationship in a holding pattern as the Trump Administration leans toward deal-making over traditional national security concerns. For multinational companies, these developments are influencing investment decisions, supply chain strategies, and risk assessments. Businesses with exposure to China should remain vigilant, adapt compliance frameworks, and anticipate potential shifts in trade policy or regulatory enforcement as both governments recalibrate their approaches.