Governments that once measured their quantum ambitions in research budgets now also decide who may buy, sell, invest in, and supply quantum technology. Since September 2024, the United States has required licenses to export specified quantum computers and components. It has also restricted U.S. investment in Chinese quantum firms and taken equity in several of the quantum hardware makers it funds.
China’s commerce ministry has suspended, until January 10, 2027, its export controls on five rare earths that include ytterbium, an element used in trapped-ion quantum computers. China is also choosing new public-key and hash algorithms, citing the quantum threat, through a standards program that excludes algorithms standardized elsewhere. In the European Union, a draft Quantum Act would generally limit strategic projects to EU-controlled companies and place a similar restriction on public procurement, according to The Quantum Insider.
Since 2024, the United States, China, and the European Union have added export controls, investment rules, and ownership terms to the research grants that defined quantum policy, while 90% of responding companies in a 2026 industry survey reported at least one foreign supplier. China sets its export controls alone. Washington coordinated its quantum export controls with partners but sets the terms of its license exception, its investment rules, and its equity stakes alone. Europe has mostly matched control lists agreed with allies and is only now drafting preferences for its own suppliers.
Quantum companies buy across borders, so the United States and the EU have each paired their export controls with license exemptions for a few partners. Allies now use those exemptions to bargain over how far restriction should go.
Export controls
The Commerce Department’s Bureau of Industry and Security (BIS) placed export controls on “quantum computers, related equipment, components, materials, software, and technology” on September 5, 2024. BIS also created License Exception Implemented Export Controls (IEC), under which countries that adopt equivalent controls can receive those items without a license. In its IEC table, BIS listed Germany, Italy, and the United Kingdom as eligible to receive the largest dilution refrigerators in September 2024 and added Finland, Norway, and the Netherlands by that December, according to Quantum Observer’s map of the quantum supply chain by input. Dilution refrigerators are the cryogenic coolers that superconducting and silicon spin-qubit machines need.
The UK government brought new controls on quantum and cryogenic technologies into force on April 1, 2024. The UK, “along with a number of like-minded countries, has committed to implement” the controls, the government wrote in its notice to exporters.
The European Union made quantum computers subject to EU-wide controls from November 15, 2025. The Commission added cryogenic cooling systems, parametric signal amplifiers, cryogenic wafer probers, and electronic components designed for cryogenic temperatures in the same update. Several of the new EU entries match U.S. ones, from large dilution refrigerators to silicon enriched past the same purity threshold.
On November 9, 2026, China’s Ministry of Commerce extended a suspension of some of its rare-earth export controls to January 10, 2027, Reuters reported. According to S&P Global, the suspended controls are those on holmium, erbium, thulium, europium, and ytterbium. The U.S. Energy Department lists ytterbium-171 as an isotope used for trapped-ion quantum computing. Controls that China imposed in April 2025 on seven other rare earths remain in force, according to S&P Global.
Washington wrote its quantum controls with partners and rewards countries that copy them. Brussels adopted many of the same entries. Beijing sets its rare-earth controls, and their suspensions, through its own commerce ministry.
Investment rules
The Treasury Department’s Outbound Investment Security Program, in effect since January 2, 2025, covers U.S. investments in quantum information technologies, semiconductors, and artificial intelligence in China, including Hong Kong and Macau. Congress put outbound investment rules into statute on December 18, 2025, when it enacted the Comprehensive Outbound Investment National Security (COINS) Act as part of the annual defense authorization. Treasury proposed rules to implement the act on October 22, 2026, with public comments due December 7.
The European Commission asked member states in January 2025 to review outbound investments by EU investors in semiconductors, artificial intelligence, and quantum technologies, including transactions completed since January 1, 2021. A Commission recommendation is not legally binding on member states. Member states were due to send the Commission a comprehensive report by June 30, 2026. Quantum Observer found no published findings from those reports as of November 13, 2026.
Ownership, fabrication, and procurement
In 2026 the U.S. Commerce Department turned research grants into shareholdings. On May 21, it announced letters of intent worth $2.013 billion with nine companies under the CHIPS and Science Act and said it would receive “a minority, non-controlling equity stake in each company.” By September, D-Wave, Rigetti, Quantinuum, and GlobalFoundries had issued shares to the department or agreed to issue them as their awards became final, as Quantum Observer reported.
Commerce also attached production terms to Quantinuum’s award. Inventions from the project must be “predominantly produced or licensed for production in the United States” during the project and for 10 years after it, with limited exceptions, Quantinuum reported in a September 8 filing. Quantum Observer compares the equity and milestone terms of each award in a companion analysis of federal quantum funding.
On September 16, Commerce announced a final award of up to $1 billion for Anderon, a newly formed IBM subsidiary, to help it establish a “quantum semiconductor foundry.” Neither Commerce nor IBM mentioned equity in their September announcements. IBM disclosed the department’s stake in its October 22 quarterly report, writing that “Anderon issued a minority equity interest to the Department.” PsiQuantum, a private company that also received a final award, did not mention equity when it announced the award on September 8.
In its Chips Act 2.0 proposal of June 3, 2026, the European Commission kept support for six quantum chip pilot lines but named no quantum area among its six priorities for strategic projects. Europe’s quantum industry consortium, QuIC, asked in September for quantum chip manufacturing to be added.
With its planned Quantum Act, the Commission would go further, according to a draft that The Quantum Insider obtained and reported on November 10. Under the draft, as The Quantum Insider put it, participation in strategic projects “would generally be limited to EU-controlled companies.” Public procurement of quantum products, systems, and services “would face a similar restriction,” the outlet reported. MLex, a regulatory news service, reported on October 28 that under a leaked draft, suppliers “controlled from outside the EU” could be excluded from public contracts.
The Commission could open specified projects to companies from countries in reciprocal strategic partnerships. It would treat quantum foundries, chip fabrication and packaging, control electronics, cryogenics, lasers, and detectors as priority areas and keep a list of critical components.
The Quantum Insider reported that the Commission sets no overall spending allocation in the draft and leaves funding to the successor to Horizon Europe, to a proposed European Competitiveness Fund, and to national and private money. Strategic-project status “would not itself create an entitlement to funding,” according to the report.
In a planning document dated November 10, the Commission provisionally listed the act for adoption as a proposal on November 24, six days later than in an earlier list. The Commission has not published the draft. A proposal becomes law only after Parliament and the Council agree on a text.
Washington attached ownership and production terms to new money. In its draft, the Commission would attach supplier rules to strategic projects and public purchasing and leave the money to other EU and national programs. Washington already uses public spending to decide who supplies quantum technology, and the Commission plans to do the same. China is building domestic sources for some of the same inputs, among them dilution refrigerators and silicon-28, according to Chinese state media reports collected in Quantum Observer’s supply-chain map.
Programs and funds
Research money has continued alongside the new controls. In its July 2025 Quantum Europe Strategy, the Commission wrote that the EU and its member states had invested more than €11 billion in quantum technologies over the previous five years. It also wrote that Europe attracts only 5% of global private quantum funding, against more than 50% for the United States.
In the same strategy, the Commission named “strategic autonomy in quantum technologies” as an aim. It said Europe should ensure that quantum developments are “free from third country export regulations.”
Governments that published national strategies in 2026 put protection beside research. Sweden’s government listed protection of strategic quantum technology among five goals to 2036 in an August strategy without any sums of money. The Dutch minister of economic affairs and climate and the state secretary for digital economy and sovereignty sent the Netherlands’ quantum strategy to parliament in October. The government cited €614.9 million already made available to Quantum Delta NL, its national quantum program.
Britain’s government set five national quantum missions in 2023, among them “accessible, UK-based quantum computers capable of running 1 trillion operations” by 2035. Israel’s Innovation Authority and C4IR Israel recommended “selective technological sovereignty” over full self-sufficiency in an October 2026 case study of the first phase of the country’s national quantum program, from 2019 to 2025. India’s cabinet approved Rs 6,003.65 crore for a National Quantum Mission in 2023, running through fiscal 2030–31.
In the United States, the Department of War announced about $350 million in quantum computing initiatives on October 8, 2026. The department paired about $200 million in new funding for the Defense Advanced Research Projects Agency’s Quantum Benchmarking Initiative with a conditional loan commitment of up to $150 million from its Office of Strategic Capital to PsiQuantum, Quantum Computing Report reported. The outlet described the package as meant to accelerate national security applications and to “secure domestic manufacturing for fault-tolerant quantum computing.” Fault-tolerant machines correct their own errors during long calculations.
Standards
The U.S. National Institute of Standards and Technology (NIST) published its first three post-quantum cryptography standards on August 13, 2024, for ML-KEM, ML-DSA, and SLH-DSA, the algorithms formerly called CRYSTALS-Kyber, CRYSTALS-Dilithium, and SPHINCS+. Post-quantum algorithms are public-key methods designed to resist attacks by quantum computers.
China chose its own route when its Institute of Commercial Cryptography Standards launched the Next-generation Commercial Cryptographic Algorithms Program on February 5, 2025, and excluded algorithms already standardized elsewhere. NIST’s algorithms are therefore absent from the 119 first-round candidates China published in September 2026, as Quantum Observer reported. Under China’s 2019 Cryptography Law, commercial cryptography is used to protect information that does not involve state secrets.
If China standardizes its own commercial algorithms, companies selling into China and into markets that follow NIST would need to support both sets. Governments divide over quantum key distribution along a different line, between security agencies and the programs that fund it, as Quantum Observer explains in a companion analysis.
Alliances and their limits
Allies have built channels to share quantum work and to ease their controls on one another. Pillar II of AUKUS, the security partnership of Australia, Britain, and the United States, covers advanced capabilities. Under Pillar II, the partners tested four Australian-developed quantum clocks in Washington over six weeks, Australia’s defense ministry said in November 2025. The ministry said such clocks can provide “reliable position, navigation and timing in contested environments.”
When the three defense ministers met on May 30, 2026, they backed “expanding the breadth of the AUKUS licence-free environment” by narrowing the list of technologies excluded from it, according to their joint statement. They named payloads for uncrewed undersea vehicles as Pillar II’s first signature project. The ministers did not mention quantum in the statement.
The Quantum Development Group, a forum of 13 governments, met in London from March 30 to April 1, 2026. Its members agreed on three priority areas for cooperation, the first covering research security, investment security, and supply-chain resilience. The United States also signs Technology Prosperity Deals, non-binding memorandums with quantum among the areas of cooperation, including one with Sweden in May 2026.
The exemptions remain narrow. EU001, the general authorization in the EU’s dual-use regulation that lets EU exporters ship most controlled items to nine allied destinations without an individual license, does not cover South Korea. QuIC asked the Commission in October to add it and wrote that some members had lost customers to shipment delays under the EU’s licensing system.
Ninety percent of responding companies in a September 2026 survey by six quantum industry associations said they had at least one supplier abroad, as Quantum Observer reported. China ranked sixth among supplier locations, even with Chinese companies left out of the survey. The associations counted the countries that companies named and did not measure trade volumes. U.S. makers depend on allied suppliers at several points, as Quantum Observer found when it traced the allied parts and inventions in U.S. quantum computers.
Restrictors and builders
| Tool | Who uses it | When | Source |
|---|---|---|---|
| Export controls on quantum and related technologies | United States, United Kingdom, European Union | September 2024, April 2024, November 2025 | BIS, UK notice, EU regulation |
| Export controls on inputs | United States and European Union (dilution refrigerators, enriched silicon, cryogenic electronics) | September 2024, November 2025 | BIS, EU regulation, Quantum Observer |
| Export controls on inputs | China (seven rare earths since April 2025, and five more, including ytterbium, suspended to January 10, 2027) | April 2025, extension of November 9, 2026 | S&P Global, Reuters |
| Outbound investment rules covering quantum | United States (binding), European Union (recommendation) | January 2025 | Treasury, Commission recommendation |
| Equity stakes and domestic-production terms in funding | United States | May–September 2026 | Commerce, Quantum Observer, IBM 10-Q |
| Strategic projects and procurement limited to EU-controlled suppliers | European Union (unpublished draft) | Draft reported October–November 2026 | The Quantum Insider, MLex |
| National algorithm program excluding foreign standards | China | February 2025 onward | Quantum Observer |
| License exemptions for partners | United States (IEC), European Union (EU001), AUKUS (licence-free environment) | IEC since September 2024, EU001 under the 2021 dual-use regulation, AUKUS expansion backed in May 2026 | BIS, EU regulation, QuIC, AUKUS ministers |
On this evidence, the EU and the UK restrict as well as build. The United States builds capacity through Commerce awards and Department of War funding alongside its restrictions. The clearer division is between Beijing and Washington, which each set some of their tools alone, and European governments, which have mostly adopted lists agreed with partners.
The strongest objection to this reading can be made with the Commission’s own figures. If Europe attracts 5% of global private quantum funding against more than 50% for the United States, as the Commission wrote in its strategy, Europe’s binding constraint is capital. European companies would not gain capital from rules on who may supply.
The six associations behind the 2026 survey made a related case, writing that controls on trade “should protect flow of critical technologies” without hampering innovation and growth. Israel’s Innovation Authority and C4IR Israel argued in their case study for selective sovereignty instead of self-sufficiency.
Although the Commission identified a shortage of private money in its own strategy, it would add supplier rules and leave funding to other programs under the draft Quantum Act, as The Quantum Insider described it.
What would confirm or overturn this reading
Four dated events between November 2026 and September 2028, along with Commerce’s remaining quantum awards, will test this reading.
- November 24, 2026, provisionally. The Commission may adopt its Quantum Act proposal that day. If it drops the limit on EU-controlled suppliers from the proposal, Europe’s move toward its own preferences would be smaller than under the draft.
- December 7, 2026. Comments close on Treasury’s proposed rules under the COINS Act. In the final rule, Treasury will set how the statute applies to investments in Chinese quantum companies.
- January 10, 2027. China’s suspension of its controls on five rare earths, including ytterbium, ends unless Beijing extends it again.
- Commerce’s remaining awards. Atom Computing, Infleqtion, and Diraq had no final award by November 12, as Quantum Observer found. If their awards carry equity, Washington will have shown that it treats ownership as a standing tool. An announcement without equity would not settle the question, because IBM disclosed Anderon’s stake in a quarterly report five weeks after Commerce announced the award.
- September 10, 2028. Under the EU’s dual-use export regulation, the Commission must evaluate the regulation between September 10, 2026, and September 10, 2028. Whether EU001 then covers South Korea will be a test of how far Europe extends its partner exemptions.
The reading would be narrowed if the Quantum Act emerged without supplier limits and company filings showed no equity in Commerce’s remaining quantum awards. The controls and stakes already in place would stand, and the trend would have stopped growing. If the six associations repeated their 2026 survey and found a falling share of foreign suppliers, the result would be evidence that sovereignty policy is changing where companies buy.
