115 HR 5902 IH: Disclose Getting Involved in Foreign Transactions Act
U.S. House of Representatives
2023-10-25
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I
118th CONGRESS
1st Session
H. R. 5902
IN THE HOUSE OF REPRESENTATIVES
October 6, 2023
Mr. James (for himself and Ms. Foxx) introduced the following bill
October 25, 2023
Referred to the Committee on Education and the Workforce
A BILL
To amend the Higher Education Act of 1965 to require staff and faculty to report foreign gifts and contracts.
1.

Short title
This Act may be cited as the “Disclose Getting Involved in Foreign Transactions Act” or the “Disclose GIFT Act”.
2.

Policy regarding conflicts of interest from foreign gifts and contracts
(a)

In general
Part B of title I of the Higher Education Act of 1965 (20 U.S.C. 1011 et seq.) is amended by inserting after section 117 the following:
“117A.

Institutional policy regarding foreign gifts and contracts to faculty and staff
(a)

Requirement To maintain policy and database
Beginning not later than 90 days after the date of the enactment of the Disclose GIFT Act, each institution described in subsection (b) shall maintain—
(1)
a policy requiring faculty, professional staff, and other staff engaged in research and development (as determined by the institution and measured by the Higher Education Research and Development Survey of the National Center for Science and Engineering Statistics) employed at the institution to disclose in a report to such institution on July 1 of each calendar year that begins after the year in which such enactment date occurs—
(A)
any gift received from a foreign source in the previous calendar year, the value of which is greater than the minimal value (as such term is defined in section 7342(a) of title 5, United States Code) or is of undetermined value, and including the date on which the gift was received;
(B)
any contract entered into with a foreign source in the previous calendar year, the value of which is $5,000 or more, considered alone or in combination with all other contracts with that foreign source within the calendar year, and including the date on which such contract commences and, as applicable, the date on which such contract terminates;
(C)
any contract with a foreign source in force during the previous calendar year that has an undetermined monetary value, and including the date on which such contract commences and, as applicable, the date on which such contract terminates; and
(D)
any contract entered into with a foreign country of concern or foreign entity of concern in the previous calendar year, the value of which is $0 or more, and including the beginning and ending dates of such contract and the full text of such contract and any addenda;
(2)
a publicly available and searchable database (in electronic and downloadable format), on a website of the institution, of the information required to be disclosed under paragraph (1), sortable and searchable by the date received (if a gift) or the date commenced (if a contract), the attributable country with respect to which information is being disclosed, and name of the individual making the disclosure, and until the latest of—
(A)
the date that is 4 years after the date on which—
(i)
a gift referred to in paragraph (1)(A) is received; or
(ii)
a contract referred to in subparagraph (B), (C) or (D) of paragraph (1) begins; or
(B)
the date on which a contract referred to in subparagraph (B), (C) or (D) of paragraph (1) terminates; and
(3)
a plan effectively to identify and manage potential information gathering by foreign sources through espionage targeting faculty, professional staff, and other staff engaged in research and development (as determined by the institution and measured by the Higher Education Research and Development Survey of the National Center for Science and Engineering Statistics) that may arise from gifts received from, or contracts entered into with, a foreign source, including through the use of—
(A)
periodic communications;
(B)
accurate reporting under paragraph (2) of the information required to be disclosed under paragraph (1); and
(C)
enforcement of the policy described in paragraph (1).
(b)

Institutions
An institution shall be subject to the requirements of this section if such institution—
(1)
is an eligible institution for the purposes of any program authorized under title IV; and
(2)
(A)
received more than $50,000,000 in Federal funds in any of the previous five calendar years to support (in whole or in part) research and development (as determined by the institution and measured by the Higher Education Research and Development Survey of the National Center for Science and Engineering Statistics); or
(B)
receives funds under title VI.
(c)

Enforcement
(1)

Investigation
The Secretary (acting through the General Counsel of the Department) may conduct investigations of possible violations of this section by institutions.
(2)

Civil action
Whenever it appears that an institution has knowingly or willfully failed to comply with a requirement of this section (including any rule or regulation promulgated under this section) based on such an investigation, a civil action may be brought by the Attorney General, at the request of the Secretary, in an appropriate district court of the United States, or the appropriate United States court of any territory or other place subject to the jurisdiction of the United States, to request such court to compel compliance with the requirement of this section that has been violated.
(3)

Costs and other fines
An institution that is compelled to comply with a requirement of this section pursuant to paragraph (2) shall—
(A)
pay to the Treasury of the United States the full costs to the United States of obtaining compliance with the requirement of this section, including all associated costs of investigation and enforcement; and
(B)
be subject to the applicable fines described in paragraph (4).
(4)

Fines for violations
The Secretary shall impose a fine on an institution that knowingly or willfully fails to comply with a requirement of this section as follows:
(A)

First-time violations
In the case of an institution that knowingly or willfully fails to comply with a requirement of this section with respect to a calendar year, and that has not previously knowingly or willfully failed to comply with such a requirement, the Secretary shall impose a fine on the institution of not less than $250,000, but not more than the total amount of gifts or contracts reported by such institution in the database required under subsection (a)(2).
(B)

Subsequent violations
In the case of an institution that has been fined pursuant to clause (i) with respect to a calendar year, and that knowingly or willfully fails to comply with a requirement of this section with respect to any additional calendar year, the Secretary shall impose a fine on the institution with respect to any such additional calendar year in an amount that is not less than $500,000, but not more than twice the total amount of gifts or contracts reported by such institution in the database required under subsection (a)(2).
(d)

Definitions
In this section:
(1)

Contract
the term contract—
(A)
means any—
(i)
agreement for the acquisition, by purchase, lease, or barter, of property or services by a foreign source for the direct benefit or use of any of the parties to the agreement;
(ii)
affiliation, agreement, or similar transaction with a foreign source based on the use or exchange of the name, likeness, time, services, or resources of faculty, professional staff, or other staff engaged in research and development (as determined by the institution and measured by the Higher Education Research and Development Survey of the National Center for Science and Engineering Statistics) employed at an institution described in subsection (b); or
(iii)
purchase, lease, or barter of property or services from a foreign source that is a foreign country of concern or a foreign entity of concern; and
(B)
does not include any fair-market, arms-length agreement made by faculty, professional staff, and other staff engaged in research and development (as determined by the institution and measured by the Higher Education Research and Development Survey of the National Center for Science and Engineering Statistics) for the acquisition, by purchase, lease, or barter of property or services from a foreign source other than such a foreign source that is a foreign country of concern or a foreign entity of concern; and
(2)

Foreign country of concern
The term foreign country of concern includes the following:
(A)
A country that is a covered nation (as defined in section 4872(d) of title 10, United States Code).
(B)
Any country that the Secretary, in consultation with the Secretary of Defense, the Secretary of State, and the Director of National Intelligence, determines to be engaged in conduct that is detrimental to the national security or foreign policy of the United States.
(3)

Foreign entity of concern
The term foreign entity of concern has the meaning given such term in section 10612(a) of the Research and Development, Competition, and Innovation Act (42 U.S.C. 19221(a)) and includes a foreign entity that is identified on the list published under section 1286(c)(8)(A) of the John S. McCain National Defense Authorization Act for Fiscal Year 2019 (10 U.S.C. 22 4001 note; Public Law 115–232).
(4)

Foreign source
The term foreign source means—
(A)
a foreign government, including an agency of a foreign government;
(B)
a legal entity, governmental or otherwise, created under the laws of a foreign state or states;
(C)
a natural person who is not a citizen or a national of the United States or a trust territory or protectorate thereof; and
(D)
an agent, including—
(i)
a subsidiary or affiliate of a foreign legal entity, acting on behalf of a foreign source; and
(ii)
an entity or organization that operates primarily for the benefit of, or under the auspices of, a foreign legal entity, including a foundation or a related entity (such as any educational, cultural, or language entity).
(5)

Gift
The term gift—
(A)
means any gift of money, property, resources, staff, or services; and
(B)
does not include—
(i)
any payment of one or more elements of a student’s cost of attendance (as such term is defined in section 472) to an institution by, or scholarship from, a foreign source who is a natural person, acting in their individual capacity and not as an agent for, at the request or direction of, or on behalf of, any person or entity (except the student), made for not more than 15 students, and that is not made under a restricted or conditional contract with such foreign source; or
(ii)
assignment or license of registered industrial and intellectual property rights, such as patents, utility models, trademarks, or copyrights, or technical assistance, that are not identified as being associated with a national security risk or concern by the Federal Research Security Council as described under section 7902 of title 31, United States Code; or
(iii)
decorations (as such term is defined in section 7342(a) of title 5, United States Code).
(6)

Institution
The term institution means an institution of higher education (as such term is defined in section 102, other than an institution described in subsection (a)(1)(c) of such section).
(7)

Professional staff
the term professional staff means professional employees, as defined in section 3 of the Fair Labor Standards Act of 1938 (29 U.S.C. 203).”.
(b)

Program participation agreement
Section 487(a) of the Higher Education Act of 1965 (20 U.S.C. 1094) is amended by adding at the end the following:
“(30)
(A)
An institution will comply with the requirements of section 117A.
(B)
An institution that, for 3 consecutive institutional fiscal years, violates any requirement of section 117A shall—
(i)
be ineligible to participate in the programs authorized by this title for a period of not less than 2 institutional fiscal years; and
(ii)
in order to regain eligibility to participate in such programs, demonstrate compliance with all requirements of such section for not less than 2 institutional fiscal years after the institutional fiscal year in which such institution became ineligible.” .