By: Campbell, Hall S.B. No. 2116
(In the Senate - Filed March 12, 2021; April 1, 2021, read
first time and referred to Committee on Business & Commerce;
April 20, 2021, reported adversely, with favorable Committee
Substitute by the following vote: Yeas 9, Nays 0; April 20, 2021,
sent to printer.)
Click here to see the committee vote
COMMITTEE SUBSTITUTE FOR S.B. No. 2116 By: Hancock
A BILL TO BE ENTITLED
AN ACT
relating to prohibiting contracts or other agreements with certain
foreign-owned companies in connection with critical infrastructure
in this state.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. This Act may be cited as the Lone Star
Infrastructure Protection Act.
SECTION 2. Subtitle C, Title 5, Business & Commerce Code, is
amended by adding Chapter 113 to read as follows:
CHAPTER 113. PROHIBITION ON AGREEMENTS WITH CERTAIN FOREIGN-OWNED
COMPANIES IN CONNECTION WITH CRITICAL INFRASTRUCTURE
Sec. 113.001. DEFINITIONS. In this chapter:
(1) "Company" means a sole proprietorship,
organization, association, corporation, partnership, joint
venture, limited partnership, limited liability partnership, or
limited liability company, including a wholly owned subsidiary,
majority-owned subsidiary, parent company, or affiliate of those
entities or business associations, that exists to make a profit.
(2) "Critical infrastructure" means a communication
infrastructure system, cybersecurity system, electric grid,
hazardous waste treatment system, or water treatment facility.
(3) "Cybersecurity" means the measures taken to
protect a computer, computer network, computer system, or other
technology infrastructure against unauthorized use or access.
(4) "Designated country" means a country designated by
the governor as a threat to critical infrastructure under Section
113.003.
Sec. 113.002. PROHIBITED ACCESS TO CRITICAL
INFRASTRUCTURE. (a) A business entity may not enter into an
agreement relating to critical infrastructure in this state with a
company:
(1) if, under the agreement, the company would be able
to directly or remotely access or control critical infrastructure
in this state; and
(2) if the company is:
(A) owned by or the majority of stock or other
ownership interest of the company is held or controlled by:
(i) individuals who are citizens of China,
Iran, North Korea, Russia, or a designated country; or
(ii) a company or other entity, including a
governmental entity, that is owned or controlled by citizens of or
is directly controlled by the government of China, Iran, North
Korea, Russia, or a designated country; or
(B) headquartered in China, Iran, North Korea,
Russia, or a designated country.
(b) The prohibition described by Subsection (a) applies
regardless of whether:
(1) the company's or its parent company's securities
are publicly traded; or
(2) the company or its parent company is listed on a
public stock exchange as:
(A) a Chinese, Iranian, North Korean, or Russian
company; or
(B) a company of a designated country.
Sec. 113.003. DESIGNATION OF COUNTRY AS THREAT TO CRITICAL
INFRASTRUCTURE. (a) The governor, after consultation with the
public safety director of the Department of Public Safety, may
designate a country as a threat to critical infrastructure for
purposes of this chapter.
(b) The governor may consult the Homeland Security Council,
established under Subchapter B, Chapter 421, Government Code, to
assess a threat to critical infrastructure for purposes of making a
designation under this section.
SECTION 3. Subtitle F, Title 10, Government Code, is
amended by adding Chapter 2274 to read as follows:
CHAPTER 2274. PROHIBITION ON CONTRACTS WITH CERTAIN FOREIGN-OWNED
COMPANIES IN CONNECTION WITH CRITICAL INFRASTRUCTURE
Sec. 2274.0101. DEFINITIONS. In this chapter:
(1) "Company" means a sole proprietorship,
organization, association, corporation, partnership, joint
venture, limited partnership, limited liability partnership, or
limited liability company, including a wholly owned subsidiary,
majority-owned subsidiary, parent company, or affiliate of those
entities or business associations, that exists to make a profit.
(2) "Critical infrastructure" means a communication
infrastructure system, cybersecurity system, electric grid,
hazardous waste treatment system, or water treatment facility.
(3) "Cybersecurity" means the measures taken to
protect a computer, computer network, computer system, or other
technology infrastructure against unauthorized use or access.
(4) "Designated country" means a country designated by
the governor as a threat to critical infrastructure under Section
2274.0103.
(5) "Governmental entity" means a state agency or
political subdivision of this state.
Sec. 2274.0102. PROHIBITED CONTRACTS. (a) A governmental
entity may not enter into a contract or other agreement relating to
critical infrastructure in this state with a company that is:
(1) owned by or the majority of stock or other
ownership interest of the company is held or controlled by:
(A) individuals who are citizens of China, Iran,
North Korea, Russia, or a designated country; or
(B) a company or other entity, including a
governmental entity, that is owned or controlled by citizens of or
is directly controlled by the government of China, Iran, North
Korea, Russia, or a designated country; or
(2) headquartered in China, Iran, North Korea, Russia,
or a designated country.
(b) The prohibition described by Subsection (a) applies
regardless of whether:
(1) the company's or its parent company's securities
are publicly traded; or
(2) the company or its parent company is listed on a
public stock exchange as:
(A) a Chinese, Iranian, North Korean, or Russian
company; or
(B) a company of a designated country.
Sec. 2274.0103. DESIGNATION OF COUNTRY AS THREAT TO
CRITICAL INFRASTRUCTURE. (a) The governor, after consultation
with the public safety director of the Department of Public Safety,
may designate a country as a threat to critical infrastructure for
purposes of this chapter.
(b) The governor may consult the Homeland Security Council,
established under Subchapter B, Chapter 421, to assess a threat to
critical infrastructure for purposes of making a designation under
this section.
SECTION 4. Chapter 113, Business & Commerce Code, as added
by this Act, and Chapter 2274, Government Code, as added by this
Act, apply to a contract or agreement entered into on or after the
effective date of this Act.
SECTION 5. This Act takes effect September 1, 2021.
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