I
119THCONGRESS
1
STSESSION H. R. 2246
To protect the national security of the United States by imposing sanctions
with respect to certain persons of the People’s Republic of China and
prohibiting and requiring notifications with respect to certain investments
by United States persons in the People’s Republic of China, and for
other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH21, 2025
Mr. B
ARR(for himself, Mr. MOOLENAAR, Mr. MCCAUL, Mr. GOLDENof
Maine, and Mr. S
UOZZI) introduced the following bill; which was referred
to the Committee on Foreign Affairs, and in addition to the Committee
on Financial Services, for a period to be subsequently determined by the
Speaker, in each case for consideration of such provisions as fall within
the jurisdiction of the committee concerned
A BILL
To protect the national security of the United States by
imposing sanctions with respect to certain persons of
the People’s Republic of China and prohibiting and re-
quiring notifications with respect to certain investments
by United States persons in the People’s Republic of
China, and for other purposes.
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled, 2
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SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 1
(a) S
HORTTITLE.—This title may be cited as the 2
‘‘Foreign Investment Guardrails to Help Thwart 3
(FIGHT) China Act’’. 4
(b) T
ABLE OFCONTENTS.—The table of contents for 5
this Act is as follows: 6
Sec. 1. Short title; table of contents.
Sec. 2. Secretary defined.
Sec. 3. Severability.
Sec. 4. Authorization of appropriations.
Sec. 5. Termination.
TITLE I—IMPOSITION OF SANCTIONS
Sec. 101. Imposition of sanctions.
Sec. 102. Definitions.
TITLE II—PROHIBITION AND NOTIFICATION ON INVESTMENTS
RELATING TO COVERED NATIONAL SECURITY TRANSACTIONS
Sec. 201. Prohibition and notification on investments relating to covered na-
tional security transactions.
TITLE III—SECURITIES AND RELATED MATTERS
Sec. 301. Requirements relating to the Non-SDN Chinese Military-Industrial
Complex Companies List.
SEC. 2. SECRETARY DEFINED.
7
Except as otherwise provided, in this Act, the term 8
‘‘Secretary’’ means the Secretary of the Treasury. 9
SEC. 3. SEVERABILITY. 10
If any provision of this Act, or the application there-11
of, is held invalid, the validity of the remainder of this 12
Act and the application of such provision to other persons 13
and circumstances shall not be affected thereby. 14
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SEC. 4. AUTHORIZATION OF APPROPRIATIONS. 1
(a) I
NGENERAL.—There is authorized to be appro-2
priated $150,000,000 to the Department of the Treasury, 3
out of which amounts may be transferred to the Depart-4
ment of Commerce to jointly conduct outreach to industry 5
and persons affected by this Act, for each of the first two 6
fiscal years beginning on or after the date of the enact-7
ment of this Act, to carry out this Act. 8
(b) H
IRINGAUTHORITY.— 9
(1) B
Y THE PRESIDENT.—The President may 10
appoint, without regard to the provisions of sections 11
3309 through 3318 of title 5, United States Code, 12
not more than 15 individuals directly to positions in 13
the competitive service (as defined in section 2102 of 14
that title) to carry out this Act. 15
(2) B
Y AGENCIES.—The Secretary and the Sec-16
retary of Commerce may appoint, without regard to 17
the provisions of sections 3309 through 3318 of title 18
5, United States Code, individuals directly to posi-19
tions in the competitive service (as defined in section 20
2102 of that title) of the Department of the Treas-21
ury and the Department of Commerce, respectively, 22
to carry out this Act. 23
SEC. 5. TERMINATION. 24
This Act shall cease to have any force or effect on 25
the date on which the Secretary of Commerce revises sec-26
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tion 791.4 of title 15, Code of Federal Regulations, to re-1
move the People’s Republic of China from the list of for-2
eign adversaries contained in such section. 3
TITLE I—IMPOSITION OF 4
SANCTIONS 5
SEC. 101. IMPOSITION OF SANCTIONS. 6
(a) I
NGENERAL.—The President may impose the 7
sanctions described in subsection (b) with respect to any 8
foreign person determined by the Secretary, in consulta-9
tion with the Secretary of State, to be a covered foreign 10
person. 11
(b) S
ANCTIONSDESCRIBED.—The President may ex-12
ercise all of the powers granted to the President under 13
the International Emergency Economic Powers Act (50 14
U.S.C. 1701 et seq.) to the extent necessary to block and 15
prohibit all transactions in property and interests in prop-16
erty of a foreign person that is determined to be a covered 17
foreign person pursuant to subsection (a) if such property 18
and interests in property are in the United States, come 19
within the United States, or are or come within the posses-20
sion or control of a United States person. 21
(c) P
ENALTIES.—The penalties provided for in sub-22
sections (b) and (c) of section 206 of the International 23
Emergency Economic Powers Act (50 U.S.C. 1705) shall 24
apply to any person who violates, attempts to violate, con-25
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spires to violate, or causes a violation of any prohibition 1
of this section, or an order or regulation prescribed under 2
this section, to the same extent that such penalties apply 3
to a person that commits an unlawful act described in sec-4
tion 206(a) of such Act (50 U.S.C. 1705(a)). 5
(d) E
XCEPTION FORINTELLIGENCE AND LAWEN-6
FORCEMENT ACTIVITIES.—Sanctions under this section 7
shall not apply with respect to any activity subject to the 8
reporting requirements under title V of the National Secu-9
rity Act of 1947 (50 U.S.C. 3091 et seq.) or any author-10
ized intelligence activities of the United States. 11
(e) E
XCEPTION FORUNITEDSTATESGOVERNMENT 12
A
CTIVITIES.—Nothing in this section shall prohibit trans-13
actions for the conduct of the official business of the Fed-14
eral Government by employees, grantees, or contractors 15
thereof. 16
(f) R
EPORT TOCONGRESS.—Not later than 365 days 17
after the date of the enactment of this Act, and annually 18
thereafter for 7 years, the Secretary shall submit to the 19
appropriate congressional committees a report that— 20
(1) states whether each foreign person on the 21
Non-SDN Chinese Military-Industrial Complex Com-22
panies List is a covered foreign person; and 23
(2) shall be submitted in unclassified form, but 24
may include a classified annex. 25
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(g) CONSIDERATION OF CERTAININFORMATION IN 1
I
MPOSINGSANCTIONS.—In determining whether a foreign 2
person is a covered foreign person, the President— 3
(1) may consider credible information obtained 4
by other countries, nongovernmental organizations, 5
or the appropriate congressional committees that re-6
lates to the foreign person; and 7
(2) may consider any other information that the 8
Secretary deems relevant. 9
(h) A
DMINISTRATIVEPROVISIONS.—The President 10
may exercise all authorities provided under sections 203 11
and 205 of the International Emergency Economic Powers 12
Act (50 U.S.C. 1702 and 1704) to carry out this section. 13
(i) D
ELEGATION.—The President shall delegate the 14
authorities granted by this section to the Secretary. 15
SEC. 102. DEFINITIONS. 16
In this title: 17
(1) A
PPROPRIATE CONGRESSIONAL COMMIT -18
TEES.—The term ‘‘appropriate congressional com-19
mittees’’ means— 20
(A) the Committee on Financial Services 21
and the Committee on Foreign Affairs of the 22
House of Representatives; and 23
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(B) the Committee on Banking, Housing, 1
and Urban Affairs and the Committee on For-2
eign Relations of the Senate. 3
(2) C
OUNTRY OF CONCERN .—The term ‘‘coun-4
try of concern’’— 5
(A) means the People’s Republic of China; 6
and 7
(B) includes the Hong Kong Special Ad-8
ministrative Region and the Macau Special Ad-9
ministrative Region. 10
(3) C
OVERED FOREIGN PERSON .—The term 11
‘‘covered foreign person’’ means a foreign person— 12
(A)(i) that is incorporated in, has a prin-13
cipal place of business in, or is organized under 14
the laws of a country of concern; 15
(ii) the equity securities of which are pri-16
marily traded in the ordinary course of business 17
on one or more exchanges in a country of con-18
cern; 19
(iii) that is a member of the Central Com-20
mittee of the Chinese Communist Party; 21
(iv) that is the state or the government of 22
a country of concern, as well as any political 23
subdivision, agency, or instrumentality thereof; 24
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(v) that is subject to the direction or con-1
trol of any entity described in clause (i), (ii), 2
(iii), or (iv); or 3
(vi) that is owned in the aggregate, directly 4
or indirectly, 50 percent or more by an entity 5
or a group of entities described in clause (i), 6
(ii), (iii), or (iv); and 7
(B) that knowingly engaged in significant 8
operations in the defense and related materiel 9
sector or the surveillance technology sector of 10
the economy of a country of concern. 11
(4) F
OREIGN PERSON.—The term ‘‘foreign per-12
son’’ means a person, country, state, or government 13
(and any political subdivision, agency, or instrumen-14
tality thereof) that is not a United States person. 15
(5) N
ON-SDN CHINESE MILITARY-INDUSTRIAL 16
COMPLEX COMPANIES LIST .—The term ‘‘Non-SDN 17
Chinese Military-Industrial Complex Companies 18
List’’ means the list maintained by the Office of 19
Foreign Assets Control of the Department of the 20
Treasury under Executive Order 13959, as amended 21
by Executive Order 14032 (50 U.S.C. 1701 note; re-22
lating to addressing the threat from securities in-23
vestments that finance certain companies of the Peo-24
ple’s Republic of China), or any successor order. 25
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(6) UNITED STATES PERSON .—The term 1
‘‘United States person’’ means— 2
(A) any United States citizen or an alien 3
lawfully admitted for permanent residence to 4
the United States; 5
(B) an entity organized under the laws of 6
the United States or of any jurisdiction within 7
the United States (including any foreign branch 8
of such an entity); or 9
(C) any person in the United States. 10
TITLE II—PROHIBITION AND NO-11
TIFICATION ON INVEST-12
MENTS RELATING TO COV-13
ERED NATIONAL SECURITY 14
TRANSACTIONS 15
SEC. 201. PROHIBITION AND NOTIFICATION ON INVEST-16
MENTS RELATING TO COVERED NATIONAL 17
SECURITY TRANSACTIONS. 18
The Defense Production Act of 1950 (50 U.S.C. 19
4501 et seq.) is amended by adding at the end the fol-20
lowing: 21
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‘‘TITLE VIII—PROHIBITION AND 1
NOTIFICATION ON INVEST-2
MENTS RELATING TO COV-3
ERED NATIONAL SECURITY 4
TRANSACTIONS 5
‘‘SEC. 801. PROHIBITION ON INVESTMENTS. 6
‘‘(a) I
NGENERAL.—The Secretary may prohibit, in 7
accordance with regulations issued under subsection (e), 8
a United States person from knowingly engaging in a cov-9
ered national security transaction in a prohibited tech-10
nology. 11
‘‘(b) E
VASION.—Any transaction by a United States 12
person or within the United States that evades or avoids, 13
has the purpose of evading or avoiding, causes a violation 14
of, or attempts to violate the prohibition set forth in sub-15
section (a) is prohibited. 16
‘‘(c) W
AIVER.—Subject to subsection (d), the Sec-17
retary is authorized to exempt from the prohibition set 18
forth in subsection (a) any activity determined by the 19
President, in consultation with the Secretary, the Sec-20
retary of Commerce and, as appropriate, the heads of 21
other relevant Federal departments and agencies, to be in 22
the national interest of the United States. 23
‘‘(d) C
ONGRESSIONAL NOTIFICATION.—The Sec-24
retary shall— 25
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‘‘(1) notify the appropriate congressional com-1
mittees not later than 5 business days after issuing 2
a waiver under subsection (c); and 3
‘‘(2) include in such notification an identifica-4
tion of the national interest justifying the use of the 5
waiver. 6
‘‘(e) R
EGULATIONS.— 7
‘‘(1) I
N GENERAL.—The Secretary, in consulta-8
tion with the Secretary of Commerce and, as appro-9
priate, the heads of other relevant Federal depart-10
ments and agencies, may issue regulations to carry 11
out this section in accordance with subchapter II of 12
chapter 5 and chapter 7 of title 5, United States 13
Code (commonly known as ‘Administrative Proce-14
dure Act’). 15
‘‘(2) N
ON-BINDING FEEDBACK.— 16
‘‘(A) I
N GENERAL.—The regulations issued 17
under paragraph (1) shall include a process 18
under which a person can request non-binding 19
feedback on a confidential basis as to whether 20
a transaction would constitute a covered na-21
tional security transaction in a prohibited tech-22
nology. 23
‘‘(B) A
UTHORITY TO LIMIT FRIVOLOUS 24
FEEDBACK REQUESTS .—In establishing the 25
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process required by subparagraph (A), the Sec-1
retary may prescribe limitations on requests for 2
feedback identified as frivolous for purposes of 3
this subsection. 4
‘‘(3) N
OTICE AND OPPORTUNITY TO CURE .— 5
‘‘(A) I
N GENERAL.—The regulations issued 6
under paragraph (1) shall account for whether 7
a United States person has self-identified a vio-8
lation of the prohibition set forth in subsection 9
(a) in determining the legal consequences of 10
that violation. 11
‘‘(B) S
ELF-DISCLOSURE LETTERS .—The 12
regulations issued under paragraph (1) shall 13
dictate the form and content of a letter of self- 14
disclosure, which shall include relevant facts 15
about the violation, why the United States per-16
son believes its activity to have violated the pro-17
hibition set forth in subsection (a), and a pro-18
posal for mitigation of the harm of such action. 19
‘‘(4) P
UBLIC NOTICE AND COMMENT .—The reg-20
ulations issued under paragraph (1) shall be subject 21
to public notice and comment. 22
‘‘(5) L
OW-BURDEN REGULATIONS .—In issuing 23
regulations under paragraph (1), the Secretary shall 24
balance the priority of protecting the national secu-25
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rity interest of the United States while, to the extent 1
practicable— 2
‘‘(A) minimizing the cost and complexity of 3
compliance for affected parties, including the 4
duplication of reporting requirements under 5
current regulations; 6
‘‘(B) adopting the least burdensome alter-7
native that achieves regulatory objectives; and 8
‘‘(C) prioritizing transparency and stake-9
holder involvement in the process of issuing the 10
rules. 11
‘‘(6) P
ENALTIES.— 12
‘‘(A) I
N GENERAL.—The regulations issued 13
under paragraph (1) shall provide for the impo-14
sition of civil penalties described in subpara-15
graph (B) for violations of the prohibition set 16
forth in subsection (a). 17
‘‘(B) P
ENALTIES DESCRIBED.— 18
‘‘(i) U
NLAWFUL ACTS.—It shall be 19
unlawful for a person to violate, attempt to 20
violate, conspire to violate, or cause a vio-21
lation of any license, order, regulation, no-22
tification requirement, or prohibition 23
issued under this section. 24
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‘‘(ii) CIVIL PENALTY.—The Secretary 1
may impose a civil penalty on any person 2
who commits an unlawful act described in 3
clause (i) in an amount not to exceed the 4
greater of— 5
‘‘(I) $250,000; or 6
‘‘(II) an amount that is twice the 7
amount of the transaction that is the 8
basis of the violation with respect to 9
which the penalty is imposed. 10
‘‘(iii) D
IVESTMENT.—The Secretary 11
may compel the divestment of a covered 12
national security transaction in a prohib-13
ited technology determined to be in viola-14
tion of this title. 15
‘‘(iv) R
ELIEF.—The President may di-16
rect the Attorney General of the United 17
States to seek appropriate relief, including 18
divestment relief, in the district courts of 19
the United States, in order to implement 20
and enforce this title. 21
‘‘(7) B
URDEN OF PROOF .—In accordance with 22
section 556(d) of title 5, United States Code, in an 23
enforcement action for a violation of the prohibition 24
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set forth in subsection (a), the burden of proof shall 1
be upon the Secretary. 2
‘‘SEC. 802. NOTIFICATION ON INVESTMENTS. 3
‘‘(a) M
ANDATORYNOTIFICATION.—Not later than 4
450 days after the date of the enactment of this title, the 5
Secretary shall issue regulations prescribed in accordance 6
with subsection (b), to require a United States person that 7
engages in a covered national security transaction in a 8
prohibited technology (unless the Secretary has exercised 9
the authority provided by section 801(a) to prohibit know-10
ingly engaging in such covered national security trans-11
action) or a notifiable technology to submit to the Sec-12
retary a written notification of the transaction not later 13
than 30 days after the completion date of the transaction. 14
‘‘(b) R
EGULATIONS.— 15
‘‘(1) I
N GENERAL.—Not later than 450 days 16
after the date of the enactment of this title, the Sec-17
retary, in consultation with the Secretary of Com-18
merce and, as appropriate, the heads of other rel-19
evant Federal departments and agencies, shall issue 20
regulations to carry out this section in accordance 21
with subchapter II of chapter 5 and chapter 7 of 22
title 5, United States Code (commonly known as 23
‘Administrative Procedure Act’). 24
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‘‘(2) PUBLIC NOTICE AND COMMENT .—The reg-1
ulations issued under paragraph (1) shall be subject 2
to public notice and comment. 3
‘‘(3) L
OW-BURDEN REGULATIONS .—In issuing 4
regulations under paragraph (1), the Secretary shall 5
balance the priority of protecting the national secu-6
rity interest of the United States while, to the extent 7
practicable— 8
‘‘(A) minimizing the cost and complexity of 9
compliance for affected parties, including the 10
duplication of reporting requirements under 11
current regulation; 12
‘‘(B) adopting the least burdensome alter-13
native that achieves regulatory objectives; and 14
‘‘(C) prioritizing transparency and stake-15
holder involvement in the process of issuing the 16
rules. 17
‘‘(4) P
ENALTIES.— 18
‘‘(A) I
N GENERAL.—The regulations issued 19
under paragraph (1) shall provide for the impo-20
sition of civil penalties described in subpara-21
graph (B) for violations of the notification re-22
quirement set forth in subsection (a). 23
‘‘(B) P
ENALTIES DESCRIBED.— 24
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‘‘(i) UNLAWFUL ACTS.—It shall be 1
unlawful for a person to violate, attempt to 2
violate, conspire to violate, or cause a vio-3
lation of any license, order, regulation, no-4
tification requirement, or prohibition 5
issued under this section. 6
‘‘(ii) C
IVIL PENALTY.—A civil penalty 7
may be imposed on any person who com-8
mits an unlawful act described in clause (i) 9
in an amount not to exceed the greater 10
of— 11
‘‘(I) $250,000; or 12
‘‘(II) an amount that is twice the 13
amount of the transaction that is the 14
basis of the violation with respect to 15
which the penalty is imposed. 16
‘‘(5) B
URDEN OF PROOF .—In accordance with 17
section 556(d) of title 5, United States Code, in an 18
enforcement action for a violation of the prohibition 19
set forth in subsection (a), the burden of proof shall 20
be upon the Secretary. 21
‘‘(6) C
OMPLETENESS OF NOTIFICATION .— 22
‘‘(A) I
N GENERAL.—The Secretary shall, 23
upon receipt of a notification under subsection 24
(a), and in consultation with the Secretary of 25
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Commerce, promptly inspect the notification for 1
completeness. 2
‘‘(B) I
NCOMPLETE NOTIFICATIONS .—If a 3
notification submitted under subsection (a) is 4
incomplete, the Secretary shall promptly inform 5
the United States person that submits the noti-6
fication that the notification is not complete 7
and provide an explanation of relevant material 8
respects in which the notification is not com-9
plete. 10
‘‘(7) I
DENTIFICATION OF NON -NOTIFIED ACTIV-11
ITY.—The Secretary, in coordination with the Sec-12
retary of Commerce, shall establish a process to 13
identify covered national security transactions in a 14
prohibited technology or a notifiable technology for 15
which— 16
‘‘(A) a notification is not submitted to the 17
Secretary under subsection (a); and 18
‘‘(B) information is reasonably available. 19
‘‘(c) C
ONFIDENTIALITY OFINFORMATION.— 20
‘‘(1) I
N GENERAL.—Except as provided in para-21
graph (2), any information or documentary material 22
filed with the Secretary pursuant to this section 23
shall be exempt from disclosure under section 24
552(b)(3) of title 5, United States Code, and no 25
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such information or documentary material may be 1
made public by any government agency or Member 2
of Congress. 3
‘‘(2) E
XCEPTIONS.—The exemption from disclo-4
sure provided by paragraph (1) shall not prevent the 5
disclosure of the following: 6
‘‘(A) Information relevant to any adminis-7
trative or judicial action or proceeding. 8
‘‘(B) Information provided to Congress or 9
any of the appropriate congressional commit-10
tees. 11
‘‘(C) Information important to the national 12
security analysis or actions of the Secretary to 13
any domestic governmental entity, or to any 14
foreign governmental entity of an ally or part-15
ner of the United States, under the direction 16
and authorization of the Secretary, only to the 17
extent necessary for national security purposes, 18
and subject to appropriate confidentiality and 19
classification requirements. 20
‘‘(D) Information that the parties have 21
consented to be disclosed to third parties. 22
‘‘(E) Information where the disclosure of 23
such information is determined by the Secretary 24
to be in the national security interest. 25
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‘‘(d) INAPPLICABILITY.—If the Secretary prohibits a 1
covered national security transaction in a prohibited tech-2
nology under section 801, the requirements of this section 3
shall not apply with respect to the covered national secu-4
rity transaction. 5
‘‘SEC. 803. REPORT. 6
‘‘(a) I
NGENERAL.—Not later than one year after the 7
date on which the regulations issued under section 801(e) 8
take effect, and not less frequently than annually there-9
after for 7 years, the Secretary, in consultation with the 10
Secretary of Commerce, shall submit to the appropriate 11
congressional committees a report that— 12
‘‘(1) lists all enforcement actions taken subject 13
to the regulations during the year preceding submis-14
sion of the report, which includes, with respect to 15
each such action, a description of— 16
‘‘(A) the prohibited technology or notifiable 17
technology; 18
‘‘(B) the covered national security trans-19
action; and 20
‘‘(C) the covered foreign person; 21
‘‘(2) provides an assessment of whether Con-22
gress should amend the definition of the term ‘pro-23
hibited technology’ by— 24
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‘‘(A) identifying additional technologies, 1
not currently listed as a prohibited technology, 2
that the Secretary, in consultation with the Sec-3
retary of Commerce and, as applicable, the Sec-4
retary of Defense, the Secretary of State, the 5
Secretary of Energy, the Director of National 6
Intelligence, and the heads of any other rel-7
evant Federal agencies, determines may pose an 8
acute threat to the national security of the 9
United States if developed or acquired by a 10
country of concern; 11
‘‘(B) explaining why each technology iden-12
tified in subparagraph (A) may pose an acute 13
threat to the national security of the United 14
States if developed or acquired by a country of 15
concern; and 16
‘‘(C) recommending the repeal of tech-17
nologies from the category of prohibited tech-18
nology to the extent that the technologies no 19
longer pose an acute threat to the national se-20
curity of the United States if developed or ac-21
quired by a country of concern; 22
‘‘(3) lists all notifications submitted under sec-23
tion 802 during the year preceding submission of the 24
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•HR 2246 IH
report and includes, with respect to each such notifi-1
cation— 2
‘‘(A) basic information on each party to 3
the covered national security transaction with 4
respect to which the notification was submitted; 5
and 6
‘‘(B) the nature of the covered national se-7
curity transaction that was the subject to the 8
notification, including the elements of the cov-9
ered national security transaction that neces-10
sitated a notification; 11
‘‘(4) includes a summary of those notifications, 12
disaggregated by prohibited technology, notifiable 13
technology, by covered national security transaction, 14
and by country of concern; 15
‘‘(5) provides additional context and informa-16
tion regarding trends in the prohibited technology, 17
notifiable technology, the types of covered national 18
security transaction, and the countries involved in 19
those notifications; and 20
‘‘(6) assesses the overall impact of those notifi-21
cations, including recommendations for— 22
‘‘(A) expanding existing Federal programs 23
to support the production or supply of prohib-24
ited technologies or notifiable technologies in 25
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•HR 2246 IH
the United States, including the potential of ex-1
isting authorities to address any related na-2
tional security concerns; 3
‘‘(B) investments needed to enhance pro-4
hibited technologies or notifiable technologies 5
and reduce dependence on countries of concern 6
regarding those technologies; and 7
‘‘(C) the continuation, expansion, or modi-8
fication of the implementation and administra-9
tion of this title, including recommendations 10
with respect to whether the definition of the 11
term ‘country of concern’ under section 807(2) 12
should be amended to add or remove countries. 13
‘‘(b) C
ONSIDERATION OF CERTAININFORMATION.— 14
In preparing the report pursuant to subsection (a), the 15
Secretary— 16
‘‘(1) shall consider information provided jointly 17
by the chairperson and ranking member of any of 18
the appropriate congressional committees; 19
‘‘(2) may consider credible information obtained 20
by other countries and nongovernmental organiza-21
tions that monitor the military, surveillance, intel-22
ligence, or technology capabilities of a country of 23
concern; and 24
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•HR 2246 IH
‘‘(3) may consider any other information that 1
the Secretary deems relevant. 2
‘‘(c) F
ORM OFREPORT.—Each report required by 3
this section shall be submitted in unclassified form, but 4
may include a classified annex. 5
‘‘(d) T
ESTIMONYREQUIRED.—Not later than one 6
year after the date of the enactment of this title, and an-7
nually thereafter for five years, the Secretary and the Sec-8
retary of Commerce shall each provide to the Committee 9
on Banking, Housing, and Urban Affairs of the Senate 10
and the Committee on Financial Services of the House of 11
Representatives testimony with respect to the national se-12
curity threats relating to investments by United States 13
persons in countries of concern and broader international 14
capital flows. 15
‘‘(e) R
EQUESTS BYAPPROPRIATECONGRESSIONAL 16
C
OMMITTEES.— 17
‘‘(1) I
N GENERAL.—After receiving a request 18
that meets the requirements of paragraph (2) with 19
respect to whether a technology should be included 20
in the amendments as described in subsection (a)(2), 21
the Secretary shall, in preparing the report pursuant 22
to subsection (a)— 23
‘‘(A) determine if that technology may 24
pose an acute threat to the national security of 25
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the United States if developed or acquired by a 1
country of concern; and 2
‘‘(B) include in the report pursuant to sub-3
section (a) an explanation with respect to that 4
determination that includes— 5
‘‘(i) a statement of whether or not the 6
technology, as determined by the Sec-7
retary, may pose an acute threat to the na-8
tional security of the United States if de-9
veloped or acquired by a country of con-10
cern; and 11
‘‘(ii) if the Secretary determines 12
that— 13
‘‘(I) the technology may pose an 14
acute threat to the national security 15
of the United States if developed or 16
acquired by a country of concern, an 17
explanation for such determination 18
and a recommendation whether that 19
technology should be named a prohib-20
ited technology or a notifiable tech-21
nology; and 22
‘‘(II) the technology would not 23
pose an acute threat to the national 24
security of the United States if devel-25
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•HR 2246 IH
oped or acquired by a country of con-1
cern, an explanation for such deter-2
mination. 3
‘‘(2) R
EQUIREMENTS.—A request under para-4
graph (1) with respect to whether a technology may 5
pose an acute threat to the national security of the 6
United States if developed or acquired by a country 7
of concern shall be submitted to the Secretary in 8
writing jointly by the chairperson and ranking mem-9
ber of one or more of the appropriate congressional 10
committees. 11
‘‘SEC. 804. MULTILATERAL ENGAGEMENT AND COORDINA-12
TION. 13
‘‘(a) A
UTHORITIES.—The Secretary, in coordination 14
with the Secretary of State, the Secretary of Commerce, 15
and the heads of other relevant Federal agencies, should— 16
‘‘(1) conduct bilateral and multilateral engage-17
ment with the governments of countries that are al-18
lies and partners of the United States to promote 19
and increase coordination of protocols and proce-20
dures to facilitate the effective implementation of 21
and appropriate compliance with the prohibitions 22
pursuant to this title; 23
‘‘(2) upon adoption of protocols and procedures 24
described in paragraph (1), work with those govern-25
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•HR 2246 IH
ments to establish mechanisms for sharing informa-1
tion, including trends, with respect to such activities; 2
and 3
‘‘(3) work with and encourage the governments 4
of countries that are allies and partners of the 5
United States to develop similar mechanisms of their 6
own, for the exclusive purpose of preventing the de-7
velopment or acquisition of prohibited technologies 8
by a country of concern. 9
‘‘(b) S
TRATEGY FORMULTILATERALENGAGEMENT 10
ANDCOORDINATION.—Not later than 180 days after the 11
date of the enactment of this title, the Secretary, in con-12
sultation with the Secretary of State, the Secretary of 13
Commerce, and the heads of other relevant Federal agen-14
cies, should— 15
‘‘(1) develop a strategy to work with the gov-16
ernments of countries that are allies and partners of 17
the United States to develop mechanisms that are 18
comparable to the prohibitions pursuant to this title, 19
for the exclusive purpose of preventing the develop-20
ment and acquisition of prohibited technologies by a 21
country of concern; and 22
‘‘(2) assess opportunities to provide technical 23
assistance to those countries with respect to the de-24
velopment of those mechanisms. 25
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‘‘(c) REPORT.—Not later than one year after the date 1
of the enactment of this title, and annually thereafter for 2
four years, the Secretary shall submit to the appropriate 3
congressional committees a report that includes— 4
‘‘(1) a discussion of any strategy developed pur-5
suant to subsection (b)(1), including key tools and 6
objectives for the development of comparable mecha-7
nisms by the governments of allies and partners of 8
the United States; 9
‘‘(2) a list of partner and allied countries to 10
target for cooperation in developing their own prohi-11
bitions; 12
‘‘(3) the status of the strategy’s implementation 13
and outcomes; and 14
‘‘(4) a description of impediments to the estab-15
lishment of comparable mechanisms by governments 16
of allies and partners of the United States. 17
‘‘(d) A
PPROPRIATECONGRESSIONAL COMMITTEES 18
D
EFINED.—In this section, the term ‘appropriate congres-19
sional committees’ means— 20
‘‘(1) the Committee on Foreign Relations and 21
the Committee on Banking, Housing, and Urban Af-22
fairs of the Senate; and 23
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•HR 2246 IH
‘‘(2) the Committee on Foreign Affairs and the 1
Committee on Financial Services of the House of 2
Representatives. 3
‘‘SEC. 805. PUBLIC DATABASE OF COVERED FOREIGN PER-4
SONS. 5
‘‘(a) I
NGENERAL.—The Secretary, in consultation 6
with the Secretary of Commerce, may establish a publicly 7
accessible, non-exhaustive database that identifies covered 8
foreign persons in a prohibited technology pursuant to this 9
title. 10
‘‘(b) C
ONFIDENTIALITY OF EVIDENCE.—The Sec-11
retary shall establish a mechanism for the public, includ-12
ing Congress, stakeholders, investors, and nongovern-13
mental organizations, to submit evidence on a confidential 14
basis regarding whether a foreign person is a covered for-15
eign person in a prohibited technology and should be in-16
cluded in the database described in subsection (a), if any. 17
‘‘(c) E
XEMPTIONFROMDISCLOSURE.— 18
‘‘(1) I
N GENERAL.—Except as provided in para-19
graph (2), any information or documentary material 20
filed with the Secretary pursuant to this section 21
shall be exempt from disclosure under section 22
552(b)(3) of title 5, United States Code, and no 23
such information or documentary material may be 24
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•HR 2246 IH
made public (other than the identity of a covered 1
foreign person in accordance with subsection (b)). 2
‘‘(2) E
XCEPTIONS.—Paragraph (1) shall not 3
prohibit the disclosure of the following: 4
‘‘(A) Information relevant to any adminis-5
trative or judicial action or proceeding. 6
‘‘(B) Information to Congress or any duly 7
authorized committee or subcommittee of Con-8
gress. 9
‘‘(C) Information important to the national 10
security analysis or actions of the Secretary to 11
any domestic governmental entity, or to any 12
foreign governmental entity of a United States 13
ally or partner, under the exclusive direction 14
and authorization of the Secretary, only to the 15
extent necessary for national security purposes, 16
and subject to appropriate confidentiality and 17
classification requirements. 18
‘‘(D) Information that the parties have 19
consented to be disclosed to third parties. 20
‘‘(d) R
ULE OFCONSTRUCTION.—The database de-21
scribed in subsection (a), if any, shall not be considered 22
to be an exhaustive or comprehensive list of covered for-23
eign persons for the purposes of this title. 24
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•HR 2246 IH
‘‘SEC. 806. RULE OF CONSTRUCTION. 1
‘‘Nothing in this title may be construed to negate the 2
authority of the President under any authority, process, 3
regulation, investigation, enforcement measure, or review 4
provided by or established under any other provision of 5
Federal law, or any other authority of the President or 6
the Congress under the Constitution of the United States. 7
‘‘SEC. 807. DEFINITIONS. 8
‘‘In this title: 9
‘‘(1) A
PPROPRIATE CONGRESSIONAL COMMIT -10
TEES.—Except as provided by section 804(d), the 11
term ‘appropriate congressional committees’ 12
means— 13
‘‘(A) the Committee on Financial Services, 14
the Committee on Foreign Affairs, the Com-15
mittee on Energy and Commerce, and the Com-16
mittee on Appropriations of the House of Rep-17
resentatives; and 18
‘‘(B) the Committee on Banking, Housing, 19
and Urban Affairs and the Committee on Ap-20
propriations of the Senate. 21
‘‘(2) C
OUNTRY OF CONCERN .—The term ‘coun-22
try of concern’— 23
‘‘(A) means the People’s Republic of 24
China; and 25
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•HR 2246 IH
‘‘(B) includes the Hong Kong Special Ad-1
ministrative Region and the Macau Special Ad-2
ministrative Region. 3
‘‘(3) C
OVERED FOREIGN PERSON .—Subject to 4
regulations prescribed in accordance with this title, 5
the term ‘covered foreign person’ means a foreign 6
person that— 7
‘‘(A) is incorporated in, has a principal 8
place of business in, or is organized under the 9
laws of a country of concern; 10
‘‘(B) is a member of the Central Com-11
mittee of the Chinese Communist Party; 12
‘‘(C) is subject to the direction or control 13
of a country of concern, an entity described in 14
subparagraph (A) or (B), or the state or the 15
government of a country of concern (including 16
any political subdivision, agency, or instrumen-17
tality thereof); or 18
‘‘(D) is owned in the aggregate, directly or 19
indirectly, 50 percent or more by a country of 20
concern, an entity described in subparagraph 21
(A) or (B), or the state or the government of 22
a country of concern (including any political 23
subdivision, agency, or instrumentality thereof). 24
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‘‘(4) COVERED NATIONAL SECURITY TRANS -1
ACTION.— 2
‘‘(A) I
N GENERAL.—Subject to such regu-3
lations as may be issued in accordance with this 4
title, the term ‘covered national security trans-5
action’ means any activity engaged in by a 6
United States person that involves— 7
‘‘(i) the acquisition of an equity inter-8
est or contingent equity interest in a cov-9
ered foreign person; 10
‘‘(ii) the provision of a loan or similar 11
debt financing arrangement to a covered 12
foreign person, where such debt financ-13
ing— 14
‘‘(I) is convertible to an equity 15
interest; or 16
‘‘(II) affords or will afford the 17
United States person the right to 18
make management decisions with re-19
spect to or on behalf of a covered for-20
eign person or the right to appoint 21
members of the board of directors (or 22
equivalent) of the covered foreign per-23
son; 24
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•HR 2246 IH
‘‘(iii) the entrance by such United 1
States person into a joint venture with a 2
covered foreign person; 3
‘‘(iv) the conversion of a contingent 4
equity interest (or interest equivalent to a 5
contingent equity interest) or conversion of 6
debt to an equity interest in a covered for-7
eign person; 8
‘‘(v) the acquisition, leasing, or other 9
development of operations, land, property, 10
or other assets in a country of concern 11
that will result in, or that the United 12
States person intends to result in— 13
‘‘(I) the establishment of a cov-14
ered foreign person; or 15
‘‘(II) the engagement of a person 16
of a country of concern in a prohib-17
ited technology where it was not pre-18
viously engaged in such prohibited 19
technology; 20
‘‘(vi) knowingly directing transactions 21
by foreign persons that the United States 22
person has knowledge at the time of the 23
transaction would constitute an activity de-24
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•HR 2246 IH
scribed in clause (i), (ii), (iii), (iv), or (v), 1
if engaged in by a United States person; or 2
‘‘(vii) the acquisition of a limited part-3
ner or equivalent interest in a venture cap-4
ital fund, private equity fund, fund of 5
funds, or other pooled investment fund 6
that the United States person has knowl-7
edge at the time of the acquisition, intends 8
to engage in an activity described in clause 9
(i), (ii), (iii), (iv), (v), or (vi). 10
‘‘(B) E
XCEPTIONS.—Subject to notice and 11
comment regulations prescribed in consultation 12
with Congress and in accordance with this title, 13
the term ‘covered national security transaction’ 14
does not include— 15
‘‘(i) any transaction the value of 16
which the Secretary determines is de mini-17
mis; 18
‘‘(ii) any category of transactions that 19
the Secretary determines is in the national 20
interest of the United States; 21
‘‘(iii) an investment— 22
‘‘(I) in a security (as defined in 23
section 3(a) of the Securities Ex-24
change Act of 1934 (15 U.S.C. 25
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•HR 2246 IH
78c(a))) that is traded on an ex-1
change or the over-the-counter market 2
in any jurisdiction; 3
‘‘(II) in a security issued by an 4
investment company (as defined in 5
section 3 of the Investment Company 6
Act of 1940 (15 U.S.C. 80a–3)) that 7
is registered with the Securities and 8
Exchange Commission; 9
‘‘(III) made as a limited partner 10
or equivalent in a venture capital 11
fund, private equity fund, fund of 12
funds, or other pooled investment 13
fund (other than as described in sub-14
clause (II)) where— 15
‘‘(aa) the limited partner or 16
equivalent’s committed capital is 17
not more than $2,000,000, ag-18
gregated across any investment 19
and co-investment vehicles of the 20
fund; or 21
‘‘(bb) the limited partner or 22
equivalent has secured a binding 23
contractual assurance that its 24
capital in the fund will not be 25
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•HR 2246 IH
used to engage in a transaction 1
that would be a covered national 2
security transaction if engaged in 3
by a United States person; or 4
‘‘(IV) in a derivative of a security 5
described under subclause (I), (II), or 6
(III); 7
‘‘(iv) any ancillary transaction under-8
taken by a financial institution (as defined 9
in section 5312 of title 31, United States 10
Code); 11
‘‘(v) the acquisition by a United 12
States person of the equity or other inter-13
est owned or held by a covered foreign per-14
son in an entity or assets located outside 15
of a country of concern in which the 16
United States person is acquiring the to-17
tality of the interest in the entity held by 18
the covered foreign person; 19
‘‘(vi) an intracompany transfer of 20
funds, as defined in regulations prescribed 21
in accordance with this title, from a United 22
States parent company to a subsidiary lo-23
cated in a country of concern or a trans-24
action that, but for this clause, would be a 25
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•HR 2246 IH
covered national security transaction be-1
tween a United States person and its con-2
trolled foreign person that supports oper-3
ations that are not covered national secu-4
rity transactions or that maintains covered 5
national security transactions that the con-6
trolled foreign person was engaged in prior 7
to January 2, 2025; 8
‘‘(vii) a transaction secondary to a 9
covered national security transaction, in-10
cluding— 11
‘‘(I) contractual arrangements or 12
the procurement of material inputs 13
for any covered national security 14
transaction (such as raw materials); 15
‘‘(II) bank lending; 16
‘‘(III) the processing, clearing, or 17
sending of payments by a bank; 18
‘‘(IV) underwriting services; 19
‘‘(V) debt rating services; 20
‘‘(VI) prime brokerage; 21
‘‘(VII) global custody; 22
‘‘(VIII) equity research or anal-23
ysis; or 24
‘‘(IX) other similar services; 25
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•HR 2246 IH
‘‘(viii) any ordinary or administrative 1
business transaction as may be defined in 2
such regulations; or 3
‘‘(ix) any transaction completed before 4
the date of the enactment of this title. 5
‘‘(C) A
NCILLARY TRANSACTION DE -6
FINED.—In this paragraph, the term ‘ancillary 7
transaction’ means— 8
‘‘(i) the processing, settling, clearing, 9
or sending of payments and cash trans-10
actions; 11
‘‘(ii) underwriting services; 12
‘‘(iii) credit rating services; and 13
‘‘(iv) other services ordinarily incident 14
to and part of the provision of financial 15
services, such as opening deposit accounts, 16
direct custody services, foreign exchange 17
services, remittances services, and safe de-18
posit services. 19
‘‘(5) F
OREIGN PERSON.—The term ‘foreign per-20
son’ means a person that is not a United States per-21
son. 22
‘‘(6) N
OTIFIABLE TECHNOLOGY .— 23
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•HR 2246 IH
‘‘(A) IN GENERAL.—The term ‘notifiable 1
technology’ means a technology with respect to 2
which a covered foreign person— 3
‘‘(i) designs any advanced integrated 4
circuit that is not covered under paragraph 5
(8)(A)(iii); 6
‘‘(ii) fabricates any integrated circuit 7
that is not covered under paragraph 8
(8)(A)(iv); 9
‘‘(iii) packages any integrated circuit 10
that is not covered under paragraph 11
(8)(A)(v); or 12
‘‘(iv) develops any artificial intel-13
ligence system that is not covered under 14
clause (vii), (viii), (ix), or (xvi) of para-15
graph (8)(A), and that is— 16
‘‘(I) designed to be used for— 17
‘‘(aa) any military end use 18
(such as for weapons targeting, 19
target identification, combat sim-20
ulation, military vehicle or weap-21
ons control, military decision- 22
making, weapons design (includ-23
ing chemical, biological, radio-24
logical, or nuclear weapons), or 25
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•HR 2246 IH
combat system logistics and 1
maintenance); or 2
‘‘(bb) any government intel-3
ligence or mass-surveillance end 4
use (such as through incorpora-5
tion of features such as mining 6
text, audio, or video, image rec-7
ognition, location tracking, or 8
surreptitious listening devices); 9
‘‘(II) intended by the covered for-10
eign person or joint venture to be 11
used for— 12
‘‘(aa) cybersecurity applica-13
tions; 14
‘‘(bb) digital forensics tools; 15
‘‘(cc) penetration testing 16
tools; or 17
‘‘(dd) control of robotic sys-18
tems; or 19
‘‘(III) trained using a quantity of 20
computing power greater than 10
23 21
computational operations (such as in-22
teger or floating-point operations). 23
‘‘(B) U
PDATES.—The Secretary, in con-24
sultation with Congress, may prescribe regula-25
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•HR 2246 IH
tions in accordance with this title to refine the 1
technical parameters of technologies described 2
in subparagraph (A) as reasonably needed for 3
national security purposes or to add or remove 4
categories to or from the list in subparagraph 5
(A). 6
‘‘(7) P
ARTY.—The term ‘party’, with respect to 7
a covered national security transaction, has the 8
meaning given that term in regulations prescribed in 9
accordance with this title. 10
‘‘(8) P
ROHIBITED TECHNOLOGY .— 11
‘‘(A) I
N GENERAL.—The term ‘prohibited 12
technology’ means a technology with respect to 13
which a covered foreign person— 14
‘‘(i) develops or produces any design 15
automation software for the design of inte-16
grated circuits or advanced packaging; 17
‘‘(ii) develops or produces any— 18
‘‘(I) electronic design automation 19
software for the design of integrated 20
circuits or advanced packaging; 21
‘‘(II) front-end semiconductor 22
fabrication equipment designed for the 23
volume fabrication of integrated cir-24
cuits, including equipment used in the 25
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production stages from a blank wafer 1
or substrate to a completed wafer or 2
substrate; or 3
‘‘(III) equipment for performing 4
volume advanced packaging; 5
‘‘(iii) designs any integrated circuit 6
designs that meet or exceed the specifica-7
tions set in Export Control Classification 8
Number (ECCN) 3A090 in Supplement 9
No. 1 to the Export Administration Regu-10
lations, or integrated circuits designed for 11
operation at or below 4.5 Kelvin; 12
‘‘(iv) fabricates integrated circuits 13
that are— 14
‘‘(I) logic integrated circuits 15
using a non-planar transistor architec-16
ture or with a technology node of 16/ 17
14 nanometers or less, including fully 18
depleted silicon-on-insulator (FDSOI) 19
integrated circuits; 20
‘‘(II) NOT–AND (NAND) mem-21
ory integrated circuits with 128 layers 22
or more; 23
‘‘(III) dynamic random-access 24
memory (DRAM) integrated circuits 25
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using a technology node of 18 1
nanometer half-pitch or less; 2
‘‘(IV) integrated circuits manu-3
factured from a gallium-based com-4
pound semiconductor; 5
‘‘(V) integrated circuits using 6
graphene transistors or carbon 7
nanotubes; or 8
‘‘(VI) integrated circuits designed 9
for operation at or below 4.5 Kelvin; 10
‘‘(v) packages any integrated circuit 11
using advanced packaging techniques; 12
‘‘(vi) develops, designs, or produces 13
any commodity, material, software, or 14
technology designed exclusively for use in 15
or with extreme ultraviolet lithography fab-16
rication equipment; 17
‘‘(vii) develops, designs, or produces 18
any artificial intelligence models trained 19
with at least 10
25floating point oper-20
ations; 21
‘‘(viii) develops, designs, or produces 22
any artificial intelligence models that rely 23
upon or utilize advanced integrated circuits 24
that meet or exceed the specifications set 25
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in Export Control Classification Number 1
(ECCN) 3A090 in Supplement No. 1 to 2
the Export Administration Regulations; 3
‘‘(ix) develops, designs, or produces 4
any artificial intelligence models designed 5
for use by the Government of the People’s 6
Republic of China, its special administra-7
tive regions, or its agencies and instrumen-8
talities; 9
‘‘(x) develops a quantum computer or 10
produces any critical components required 11
to produce a quantum computer such as a 12
dilution refrigerator or two-stage pulse 13
tube cryocooler; 14
‘‘(xi) develops or produces any quan-15
tum sensing platform designed for, or 16
which the relevant covered foreign person 17
intends to be used for, any military, gov-18
ernment intelligence, or mass-surveillance 19
end use; 20
‘‘(xii) develops or produces quantum 21
networks or quantum communication sys-22
tems designed for or intended to be used 23
for— 24
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‘‘(I) networking to scale up the 1
capabilities of quantum computers, 2
such as for the purposes of breaking 3
or compromising encryption; 4
‘‘(II) secure communications, 5
such as quantum key distribution; or 6
‘‘(III) any other application that 7
has any military, government intel-8
ligence, or mass-surveillance end use; 9
‘‘(xiii) develops, designs, or produces 10
materials, components, avionics, flight con-11
trol, propulsion, Global Positioning System 12
(GPS), data relay, and target detection 13
systems designed for use in hypersonic sys-14
tems or capable of sustainable operations 15
above 1,000 degrees Celsius; 16
‘‘(xiv) develops, installs, sells, or pro-17
duces any supercomputer enabled by ad-18
vanced integrated circuits that can provide 19
theoretical compute capacity of 100 or 20
more double-precision (64-bit) petaflops or 21
200 or more single-precision (32-bit) 22
petaflops of processing power within a 23
41,600 cubic foot or smaller envelope; 24
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‘‘(xv) develops, designs, or produces 1
any other technologies in the advanced 2
semiconductors and microelectronics sec-3
tor, the artificial intelligence sector, the 4
high-performance computing and super-5
computing sector, the hypersonic missiles 6
sector, or the quantum information science 7
and technology sector that are— 8
‘‘(I) defense articles or defense 9
services included on the United States 10
Munitions List set forth in the Inter-11
national Traffic in Arms Regulations 12
under subchapter M of chapter I of 13
title 22, Code of Federal Regulations; 14
‘‘(II) specially designed and pre-15
pared nuclear equipment, parts or 16
components, materials, software, or 17
technologies covered by part 810 of 18
title 10, Code of Federal Regulations 19
(relating to assistance to foreign 20
atomic energy activities); 21
‘‘(III) nuclear facilities, equip-22
ment, or materials covered by part 23
110 of title 10, Code of Federal Regu-24
lations (relating to export and import 25
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•HR 2246 IH
of nuclear equipment and material); 1
or 2
‘‘(IV) emerging or foundational 3
technologies controlled pursuant to 4
section 1758 of the Export Control 5
Reform Act of 2018 (50 U.S.C. 6
4817); or 7
‘‘(xvi) develops any artificial intel-8
ligence system that is designed to be exclu-9
sively used for, or which the relevant cov-10
ered foreign person intends to be used for, 11
any— 12
‘‘(I) military end use (such as for 13
weapons targeting, target identifica-14
tion, combat simulation, military vehi-15
cle or weapon control, military deci-16
sion-making, weapons design (includ-17
ing chemical, biological, radiological, 18
or nuclear weapons), or combat sys-19
tem logistics and maintenance); or 20
‘‘(II) government intelligence or 21
mass-surveillance end (such as 22
through incorporation of features such 23
as mining text, audio, or video, image 24
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recognition, location tracking, or sur-1
reptitious listening devices). 2
‘‘(B) U
PDATES.—The Secretary, in con-3
sultation with Congress, may prescribe regula-4
tions in accordance with this title to make up-5
dates to the technical parameters of tech-6
nologies described in subparagraph (A) as rea-7
sonably needed for national security purposes. 8
‘‘(9) S
ECRETARY.—Except as otherwise pro-9
vided, the term ‘Secretary’ means the Secretary of 10
the Treasury. 11
‘‘(10) U
NITED STATES PERSON .—The term 12
‘United States person’ means— 13
‘‘(A) any United States citizen or an alien 14
lawfully admitted for permanent residence to 15
the United States; 16
‘‘(B) an entity organized under the laws of 17
the United States or of any jurisdiction within 18
the United States (including any foreign branch 19
of such an entity); or 20
‘‘(C) any person in the United States.’’. 21
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•HR 2246 IH
TITLE III—SECURITIES AND 1
RELATED MATTERS 2
SEC. 301. REQUIREMENTS RELATING TO THE NON-SDN CHI-3
NESE MILITARY-INDUSTRIAL COMPLEX COM-4
PANIES LIST. 5
(a) R
EPORT.— 6
(1) I
N GENERAL.—Not later than 365 days 7
after the date of the enactment of this Act, and bi-8
ennially thereafter for 6 years, the Secretary shall 9
submit to the appropriate congressional committees 10
a report that states whether any of the following for-11
eign persons qualifies for inclusion on the Non-SDN 12
Chinese Military-Industrial Complex Companies 13
List: 14
(A) Any PRC person listed on the Military 15
End-User List (Supplement No. 7 to part 744 16
of the Export Administration Regulations). 17
(B) Any PRC person listed pursuant to 18
section 1260H of the William M. (Mac) Thorn-19
berry National Defense Authorization Act for 20
Fiscal Year 2021 (10 U.S.C. 113 note). 21
(C) Any PRC person listed on the Depart-22
ment of Commerce’s Entity List (Supplement 23
No. 4 to part 744 of the Export Administration 24
Regulations). 25
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•HR 2246 IH
(2) PROCESS REQUIRED.—To prepare the re-1
ports under paragraph (1), the President shall es-2
tablish a process under which the Federal agencies 3
responsible for administering the lists described in 4
subparagraphs (A), (B), and (C) of paragraph (1) 5
shall share with each other all relevant information 6
that led to the identification of the entities described 7
in such lists. 8
(3) R
ISK-BASED PRIORITIZATION FRAME -9
WORK.—In making the initial determinations under 10
paragraph (1), the Secretary may establish a risk- 11
based prioritization framework factoring in 12
prioritization of entity review submitted to the Sec-13
retary by the Federal agencies administering the 14
lists described in subparagraphs (A), (B), and (C) of 15
paragraph (1). 16
(4) A
NNUAL REPORTS TO THE APPROPRIATE 17
CONGRESSIONAL COMMITTEES .—The report under 18
paragraph (1) may summarize findings concerning 19
entities previously reviewed pursuant to this section 20
and do not necessitate additional review by the Sec-21
retary. 22
(5) M
ATTERS TO BE INCLUDED .—The Sec-23
retary shall include in the report required by para-24
graph (1) an overview of the criteria required for 25
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listing on Non-SDN Chinese Military-Industrial 1
Complex Companies List. The heads of the Federal 2
agencies administering the lists described in sub-3
paragraphs (A), (B), and (C) of paragraph (1) shall 4
provide an overview of the criteria for entity identi-5
fication or listing on each respective list. 6
(b) R
EQUIREMENT FOR DIVESTMENT.— 7
(1) I
N GENERAL.—The President shall promul-8
gate rules that prohibit a United States person from 9
knowingly holding securities of entities on the Non- 10
SDN Chinese Military-Industrial Complex Compa-11
nies List, after the date that is 365 days after the 12
date of enactment of this Act. 13
(2) A
UTHORIZATION.—The prohibitions on in-14
vestment imposed under paragraph (1) shall not 15
apply to a transaction in a security that is entered 16
into on or before the date that is 365 days after the 17
date of enactment of this Act by a United States 18
person, if such transaction is entered into solely to 19
divest of the security. 20
(c) W
AIVER.— 21
(1) I
N GENERAL.—The President may establish 22
a process under which the requirements of sub-23
section (b) shall not apply if the President deter-24
mines to do so is necessary to protect the national 25
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security or foreign policy objectives of the United 1
States. 2
(2) C
ASE-BY-CASE REQUIREMENT .—Determina-3
tions under paragraph (1) shall be issued on a case- 4
by-case basis for each entity on the Non-SDN Chi-5
nese Military-Industrial Complex Companies List. 6
(3) N
OTICE AND BRIEFING .—The President 7
shall notify the appropriate congressional committees 8
in writing in advance of issuing a determination 9
under paragraph (1) and shall provide a substantive 10
briefing on the determination to the appropriate con-11
gressional committees within 30 days of issuing a 12
determination. 13
(d) D
EFINITIONS.—In this section: 14
(1) A
PPROPRIATE CONGRESSIONAL COMMIT -15
TEES.—The term ‘‘appropriate congressional com-16
mittees’’ means— 17
(A) the Committee on Financial Services 18
and the Committee on Foreign Affairs of the 19
House of Representatives; and 20
(B) the Committee on Banking, Housing, 21
and Urban Affairs of the Senate. 22
(2) C
OUNTRY OF CONCERN .—The term ‘‘coun-23
try of concern’’— 24
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•HR 2246 IH
(A) means the People’s Republic of China; 1
and 2
(B) includes the Hong Kong Special Ad-3
ministrative Region and the Macau Special Ad-4
ministrative Region. 5
(3) N
ON-SDN CHINESE MILITARY-INDUSTRIAL 6
COMPLEX COMPANIES LIST .—The term ‘‘Non-SDN 7
Chinese Military-Industrial Complex Companies 8
List’’ means the list maintained by the Office of 9
Foreign Assets Control of the Department of the 10
Treasury under Executive Order 13959, as amended 11
by Executive Order 14032 (50 U.S.C. 1701 note; re-12
lating to addressing the threat from securities in-13
vestments that finance certain companies of the Peo-14
ple’s Republic of China), and any successor order. 15
(4) PRC
PERSON.—The term ‘‘PRC person’’ 16
means a foreign person that— 17
(A) is incorporated in a principal place of 18
business in, or is organized under the laws of, 19
a country of concern; 20
(B) is a member of the Central Committee 21
of the Chinese Communist Party; 22
(C) is the state or the government of a 23
country of concern, as well as any political sub-24
division, agency, or instrumentality thereof; or 25
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•HR 2246 IH
(D) is owned in the aggregate, directly or 1
indirectly, 50 percent or more by an entity or 2
a group of entities described in subparagraph 3
(A), (B), or (C). 4
Æ
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