The fourth-highest-ranking Republican in Congress said Wednesday that new legislation to strengthen foreign investment rules is vital to "protecting American interests," though she remains concerned about the Trump administration's trade policies.

Rep. Cathy McMorris Rodgers, R-Wash., the chair of the House Republican Conference, said it's important for the law to keep up with changes in the level of foreign investment.

"You're seeing more foreign investment in America. I think it's important the law is reflecting an updated version," Rodgers said on CNBC's "Squawk Box," "so that we are protecting American interests."

The bill gives the U.S. Committee on Foreign Investment in the United States, or CFIUS, an expanded role in reviewing the national security impacts of certain investments. It will also give the committee the authority to deal with concerns about foreign purchase of sensitive U.S. technologies, a senior administration official told CNBC.

The current proposal to change CFIUS arrived amid debate about how to balance China's allegedly unfair trade and intellectual property practices and national security concerns. It is less severe than other ideas recently floated by the White House. The administration reportedly dropped a plan to prohibit companies with at least 25 percent Chinese ownership from buying U.S. firms with critical technologies.

The bill passed the House of Representatives on Tuesday with overwhelming support from both parties.