[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8361 Engrossed in House (EH)]

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118th CONGRESS
  2d Session
                                H. R. 8361

_______________________________________________________________________

                                 AN ACT


 
To impose sanctions with respect to economic or industrial espionage by 
         foreign adversarial companies, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Economic Espionage Prevention Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) On March 14, 2024, the Department of State notified 
        Congress of the following:
                    (A) People's Republic of China exports of 
                semiconductors to Russia have increased substantially 
                since Russia's full-scale invasion of Ukraine.
                    (B) In the second half of 2023, China exported 
                between $25,000,000 and $50,000,000 in additional 
                semiconductors to Russia every month relative to pre-
                invasion levels.
                    (C) During the same period, China also exported 
                between $50,000,000 and $100,000,000 in additional 
                exports to Russia every month to known transshipment 
                hubs.
                    (D) These exports include both Chinese and United 
                States-branded semiconductors (integrated circuits), 
                according to analysis of commercially available trade 
                data by the Bureau of Industry and Security of the 
                Department of Commerce, and are almost certainly 
                supporting Russia's military capabilities based on 
                Ukrainian analysis of recovered Russian weapons.
                    (E) Because of the prevalence of United States 
                manufacturing equipment in global semiconductor supply 
                chains, nearly all chips produced worldwide, including 
                in the People's Republic of China, are subject to 
                United States export controls if destined for Russia or 
                Belarus.
                    (F) All advanced semiconductors described on the 
                Commerce Control List have been subject to a license 
                requirement if destined to an entity in Russia since 
                its further invasion of Ukraine.
            (2) On April 3, 2024, Deputy Secretary of State, Kurt 
        Campbell, said ``I think we have assessed, over the course of 
        the last couple of months that Russia has almost completely 
        reconstituted militarily. And after the initial setbacks on the 
        battlefield delivered to them by a brave and hearty group in 
        Ukraine, with the support of China in particular, dual use 
        capabilities and a variety of other efforts, industrial and 
        commercial, Russia has retooled and now poses a threat to 
        Ukraine. . .But not just to Ukraine, its new found capabilities 
        pose a longer term challenge to stability in Europe and 
        threatens NATO allies.''.

SEC. 3. REPORT.

    (a) In General.--Not later than 90 days after the date of the 
enactment of this Act, the Secretary of State, in coordination with the 
heads of relevant Federal departments and agencies, as appropriate, 
shall submit to the appropriate congressional committees, a written 
report that contains the following:
            (1) An analysis and description of the extent to which any 
        foreign person who is a citizen of the People's Republic of 
        China or an entity organized under the laws of the People's 
        Republic of China, or any foreign person or entity controlled 
        by or operating at the direction of the Government of the 
        People's Republic of China--
                    (A) is knowingly a material source of critical 
                components necessary for the manufacture of weapons, 
                vehicles, and other military equipment by the defense 
                industrial base of the Russian Federation;
                    (B) has knowingly delivered critical components to 
                or entered into any agreement relating to the sale or 
                delivery of critical components with any entity 
                operating in the defense or intelligence sectors of the 
                Government of the Russian Federation;
                    (C) has knowingly delivered critical components to 
                or entered into any agreement relating to the sale or 
                delivery of critical components with any country or 
                entity with which the defense or intelligence sectors 
                of the Government of Russian Federation are cooperating 
                in support of Russia's war against Ukraine; or
                    (D) has knowingly delivered critical components to 
                or entered into any agreement relating to the sale or 
                delivery of critical components with a foreign person 
                that knowingly and directly provides these components 
                to the defense or intelligence sectors of the 
                Government of the Russian Federation.
            (2) The extent to which--
                    (A) any foreign person that is a citizen of the 
                People's Republic of China or an entity organized under 
                the laws of the People's Republic of China has 
                knowingly engaged, on or after the date of the 
                enactment of this Act, in transactions with a person 
                that is part of, or operates on behalf of, the defense 
                or intelligence sectors of the Government of the 
                Russian Federation;
                    (B) any foreign person identified pursuant to 
                subparagraph (A) has engaged in transactions which 
                would constitute a significant transaction with persons 
                that have been sanctioned for being part of, or 
                operating on behalf of, the defense or intelligence 
                sectors of the Government of the Russian Federation; or
                    (C) any foreign person identified pursuant to 
                subparagraph (A) has been subjected to sanctions 
                imposed pursuant to sections 231 and 235 of the 
                Countering America's Adversaries Through Sanctions Act 
                (22 U.S.C. 9525 and 9529).
    (b) Form and Availability.--
            (1) Form.--The report required by subsection (a) shall be 
        submitted in unclassified form, but may include a classified 
        annex.
            (2) Availability.--The unclassified portion of the report 
        required by subsection (a) may also be made available to the 
        public.

SEC. 4. IMPOSITION OF SANCTIONS WITH RESPECT TO ECONOMIC OR INDUSTRIAL 
              ESPIONAGE BY FOREIGN ADVERSARY ENTITIES.

    (a) In General.--On and after the date that is 30 days after the 
date of the enactment of this Act, the President (a) may impose the 
sanctions described in subsection (c) against any of the foreign 
persons described in subsection (b).
    (b) Foreign Persons Described.--A foreign person is described in 
this subsection if the President determines on or after the date of the 
enactment of this Act that the person is a foreign adversary entity 
that knowingly engages in--
            (1) economic or industrial espionage with respect to trade 
        secrets or proprietary information owned by United States 
        persons;
            (2) the provision of material support or services to a 
        foreign adversaries' military, intelligence, or other national 
        security entities; or
            (3) the violation of United States export control laws.
    (c) Sanctions Described.--The sanctions that may be imposed with 
respect to a foreign person under subsection (b) are the following:
            (1) Property blocking.--The exercise of all powers granted 
        to the President by the International Emergency Economic Powers 
        Act (50 U.S.C. 1701 et seq.) to the extent necessary to block 
        and prohibit all transactions in property and interests in 
        property of the foreign person if such property and interests 
        in property are in the United States, come within the United 
        States, or are or come within the possession or control of a 
        United States person.
            (2) Ineligibility for visas, admission, or parole.--
                    (A) Visas, admission, or parole.--An alien 
                described in subsection (b) is--
                            (i) inadmissible to the United States;
                            (ii) ineligible to receive a visa or other 
                        documentation to enter the United States; and
                            (iii) otherwise ineligible to be admitted 
                        or paroled into the United States or to receive 
                        any other benefit under the Immigration and 
                        Nationality Act (8 U.S.C. 1101 et seq.).
                    (B) Current visas revoked.--
                            (i) In general.--An alien described in 
                        subsection (b) is subject to revocation of any 
                        visa or other entry documentation regardless of 
                        when the visa or other entry documentation is 
                        or was issued.
                            (ii) Immediate effect.--A revocation under 
                        clause (i) shall take effect immediately and 
                        automatically cancel any other valid visa or 
                        entry documentation that is in the alien's 
                        possession.
    (d) Exceptions.--
            (1) Exception for intelligence activities.--Sanctions under 
        this section shall not apply to any activity subject to the 
        reporting requirements under title V of the National Security 
        Act of 1947 (50 U.S.C. 3091 et seq.) or any authorized 
        intelligence activities of the United States.
            (2) Exception to comply with international obligations.--
        Sanctions under subsection (c)(2) shall not apply with respect 
        to the admission of an alien if admitting or paroling the alien 
        into the United States is necessary to permit the United States 
        to comply with--
                    (A) the Agreement regarding the Headquarters of the 
                United Nations, signed at Lake Success June 26, 1947, 
                and entered into force November 21, 1947, between the 
                United Nations and the United States; or
                    (B) other applicable international obligations.
            (3) Exception to carry out or assist law enforcement 
        activities.--Sanctions under subsection (c)(2) shall not apply 
        with respect to an alien if admitting or paroling the alien 
        into the United States is necessary to carry out or assist law 
        enforcement activity in the United States.
    (e) Waiver.--The President may waive the application of sanctions 
under this section with respect to a foreign person for renewable 
periods of not more than 180 days each if the President determines and 
submits to the appropriate congressional committees a report that 
contains a determination of the President that such a waiver is in the 
national security interests of the United States.
    (f) Implementation; Penalties.--
            (1) Implementation.--The President may exercise the 
        authorities provided to the President under sections 203 and 
        205 of the International Emergency Economic Powers Act (50 
        U.S.C. 1702 and 1704) to the extent necessary to carry out this 
        section.
            (2) Penalties.--A person that violates, attempts to 
        violate, conspires to violate, or causes a violation of 
        subsection (a) or any regulation, license, or order issued to 
        carry out that subsection shall be subject to the penalties set 
        forth in subsections (b) and (c) of section 206 of the 
        International Emergency Economic Powers Act (50 U.S.C. 1705) to 
        the same extent as a person that commits an unlawful act 
        described in subsection (a) of that section.
            (3) Procedures and guidelines for sanctions.--The President 
        shall establish procedures and guidelines for the 
        implementation and enforcement of sanctions imposed under this 
        section.
            (4) Annual report.--
                    (A) Unless the exception in subparagraph (B) 
                applies, not later than one year after the date of the 
                enactment of this Act, and for each of the 5 years 
                thereafter, the President shall submit to the 
                appropriate congressional committees a report on any 
                notable developments regarding economic or industrial 
                espionage activities by foreign persons.
                    (B) The President shall not be required to submit 
                the annual report described by subparagraph (A) if the 
                President has imposed sanctions as authorized under 
                this section within the previous calendar year.
    (g) Rule of Construction.--For purposes of this section, a 
transaction shall not be construed to include participation in an 
international standards-setting body or the activities of such a body.

SEC. 5. CLARIFYING AMENDMENTS.

    Section 203 of the International Emergency Economic Powers Act (50 
U.S.C. 1702) is amended--
            (1) in subsection (b)--
                    (A) in the matter preceding paragraph (1), by 
                striking ``, directly or indirectly'';
                    (B) in paragraph (3)--
                            (i) by striking ``including but not limited 
                        to'' and all that follows through ``news wire 
                        feeds.'' and inserting ``except to the extent 
                        that the President determines that such imports 
                        and exports would seriously impair his ability 
                        to deal with any national emergency declared 
                        under section 202.''; and
                            (ii) by striking ``under section 5 of the 
                        Export Administration Act of 1979, or under 
                        section 6 of such Act'' and inserting ``under 
                        other statutory or regulatory export control 
                        authorities''; and
                    (C) in paragraph (4), by inserting ``, except to 
                the extent that the President determines that such 
                imports and exports would seriously impair the ability 
                to deal with any national emergency declared under 
                section 202'' before the period at the end; and
            (2) by adding at the end the following:
    ``(d) Rules of Construction Relating to Sensitive and Personal 
Data.--The communication, the importation to a country, or the 
exportation from a country, directly or indirectly, whether commercial 
or otherwise, of bulk sensitive personal data or of source code used in 
a connected software application may not be construed to constitute--
            ``(1) a `postal, telegraphic, telephonic, or other personal 
        communication', for purposes of subsection (b)(1); or
            ``(2) an importation from a country, or an exportation to a 
        country, of `information or informational materials', for 
        purposes of subsection (b)(3).''.

SEC. 6. DEFINITIONS.

    In this Act:
            (1) Appropriate congressional committees.--The term 
        ``appropriate congressional committees'' means--
                    (A) the Committee on Foreign Affairs of the House 
                of Representatives; and
                    (B) the Committee on Foreign Relations of the 
                Senate.
            (2) Economic or industrial espionage.--The term ``economic 
        or industrial espionage'' has the meaning given that term in 
        section 1637(d) of the Carl Levin and Howard P. ``Buck'' McKeon 
        National Defense Authorization Act for Fiscal Year 2015.
            (3) Foreign person.--The term ``foreign person'' means any 
        person that is not a United States person.
            (4) Knowingly.--The term ``knowingly'', with respect to 
        conduct, a circumstance, or a result, means that a person has 
        actual knowledge, or should have known, of the conduct, the 
        circumstance, or the result.
            (5) Own, proprietary information, and trade secret.--The 
        terms ``own'', ``proprietary information'', and ``trade 
        secret'' have the meanings given those terms in section 1637(d) 
        of the Carl Levin and Howard P. ``Buck'' McKeon National 
        Defense Authorization Act for Fiscal Year 2015 (50 U.S.C. 
        1708(d)).
            (6) Person.--The term ``person'' means an individual or 
        entity.
            (7) United states person.--The term ``United States 
        person'' means--
                    (A) a United States citizen or an alien lawfully 
                admitted for permanent residence to the United States; 
                or
                    (B) an entity organized under the laws of the 
                United States or any jurisdiction within the United 
                States, including a foreign branch of such an entity.
            (8) Foreign adversary.--The term ``foreign adversary'' 
        means the countries listed in section 7.4 of title 15, Code of 
        Federal Regulations.

            Passed the House of Representatives September 9, 2024.

            Attest:

                                                                 Clerk.
118th CONGRESS

  2d Session

                               H. R. 8361

_______________________________________________________________________

                                 AN ACT

To impose sanctions with respect to economic or industrial espionage by 
         foreign adversarial companies, and for other purposes.