Good morning. A bipartisan duo of China hawks drew attention when they introduced legislation taking aim at TikTok, but the social-media site isn’t their only target. The congressmen, leaders of a committee focused on China, have spent the past year making life difficult for businesses straddling the two countries, Risk & Compliance Journal's Richard Vanderford reports. 

• The bill: Introduced by Rep. Mike Gallagher (R., Wis.) and Rep. Raja Krishnamoorthi (D., Ill.)  and backed by the House Wednesday, it would block TikTok stateside unless it severs ties with its Chinese parent. Approval came just over a year after the anniversary of the first hearing of the House Select Committee on the Chinese Communist Party. Gallagher is the committee’s chair and Krishnamoorthi is its top Democrat.
   
• Who are they? The lawmakers are familiar to companies trying to do business in the U.S. and China amid their geopolitical sniping. Since its first hearing, the committee has set its sights on a range of targets, including Apple, Temu and Volkswagen, frequently leveling criticism at companies. The committee is arguably the most hawkish player in a Congress whose members have increasingly made common cause around criticizing China. Businesses have found its scrutiny can be tough.
   
• What does it mean for companies? “It increases the risk of [multinational corporations] being caught in the crossfire of geopolitical tensions,” said Alfredo Montufar-Helu, Beijing-based head of the China Center at the Conference Board, a business research firm with about 2,000 member companies. “It has just become a very big reputational risk.”

European lawmakers pass AI act, world’s first comprehensive AI law.

European lawmakers approved the world’s most comprehensive legislation yet on artificial intelligence, setting out sweeping rules for developers of AI systems and new restrictions on how the technology can be used.

The European Parliament on Wednesday voted to give final approval to the law after reaching a political agreement last December with European Union member states. The rules, which are set to take effect gradually over several years, ban certain AI uses, introduce new transparency rules and require risk assessments for AI systems that are deemed high-risk.

Biden’s 15% corporate minimum tax hits KKR, Blackstone, Whirlpool in first year.

President Biden’s 15% corporate alternative minimum tax hit the electric utility Duke Energy, the appliance maker Whirlpool and the investment firms KKR and Blackstone in its first year, and the president now wants to expand the levy.

Congress created the tax in the 2022 law known as the Inflation Reduction Act, trying to address situations in which companies reported billions in profits to investors while using legal credits and deductions to pay little or no corporate taxes. That was a political and policy problem partly of Congress’s own making and one that Biden and Democrats attempted to solve by layering on another tax.

• Bitcoin exchange-traded funds have drawn billions of dollars from investors since they launched in January, but their target market—financial advisers who oversee trillions in client assets—has remained largely out of reach.
   
• China’s biggest quant funds beat the market for years by applying complicated statistical models to stock picking. But they didn’t model a key factor—the government.
   
• An influential group of former military and political leaders are calling for the U.S. to ratify the United Nations Convention on the Law of the Sea, in an effort to spur the country’s interest in deep-sea mining amid competition with China for critical minerals.

Aid trucks trickle into northern Gaza as Israel opens new route. 

Israel opened a new land route for aid to enter northern Gaza as international pressure mounts to deliver food and other essentials to the besieged Palestinian enclave amid concerns of a looming famine.

Six trucks from the United Nations’ World Food Program containing enough food for 25,000 people entered northern Gaza through what Cogat, the Israeli military body responsible for facilitating aid in the strip, said was a pilot program to allow aid into the north while preventing Hamas from taking any. Israel says it ushers aid through corridors the military has secured, but doesn’t provide end-to-end security for convoys.

Meanwhile, the U.S. and its Arab and European allies began ramping up humanitarian airdrops this month, but the efforts are barely making a dent  n the starvation crisis triggered by the war Israel launched against Hamas in response to its deadly Oct. 7 attacks. Even the biggest airdrops rarely match the 16.5 tons of aid that just one typical truck carries into Gaza from Egypt at less than one-tenth of the cost. Before the war, Gaza relied on an average of 500 truck deliveries a day.

Also: Palestinians Describe Beatings, Stress Positions, Other Alleged Abuses in Israeli Detention

• China’s dealmaking slump has already hurt Wall Street banks. Now, lawyers are feeling the pain, with some of the world’s biggest law firms laying off staff in anticipation of a prolonged slowdown.
   
• Vladimir Putin warned publicly for the second time in less than two weeks of the possibility of nuclear confrontation with the West, a saber the Russian president is rattling with increasing frequency ahead of presidential elections this weekend.
   
• The European Central Bank unveiled a rare makeover to the inner workings of monetary policy, in a change that is technical but consequential for the economy and investors.

• The chief executive of Petco Health & Wellness has stepped down and is being replaced by the board’s lead independent director until a permanent successor is found.
   
• Under Armour said founder Kevin Plank will be heading the company again as chief executive with the upcoming exit of Stephanie Linnartz.
   
• How science sleuths track down bad research: Software such as Imagetwin and Proofig helps publishers, universities spot copied scientific images.
   
• The influx of retirees flooding into southern Appalachia is transforming the region from poor, serene and rustic to a bustling retirement haven. Many longtime Floridians are moving up also, as well as northerners moving directly into the area.

Follow us on X at @WSJRisk. Follow Risk & Compliance editor David Smagalla @DSmagalla_DJ and reporters Mengqi Sun @_MengqiSun, Dylan Tokar @dgtokar and Richard Vanderford @VanderfordRich.

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