[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 4456 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
2d Session
S. 4456
To require the Under Secretary of Commerce for Industry and Security to
require a license for the export, reexport, or in-country transfer of
certain integrated circuits, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 30, 2026
Mr. Banks (for himself, Ms. Warren, Mr. Cotton, Mrs. Shaheen, Mr.
Ricketts, and Ms. Cortez Masto) introduced the following bill; which
was read twice and referred to the Committee on Banking, Housing, and
Urban Affairs
_______________________________________________________________________
A BILL
To require the Under Secretary of Commerce for Industry and Security to
require a license for the export, reexport, or in-country transfer of
certain integrated circuits, 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 ``Artificial Intelligence Oversight of
Verified Exports and Restrictions on Weaponizable Advanced Technology
to Covered High-Risk Actors Act'' or the ``AI OVERWATCH Act''.
SEC. 2. LICENSE REQUIREMENT FOR EXPORTS OF COVERED INTEGRATED CIRCUITS
TO COUNTRIES OF CONCERN.
Part I of the Export Control Reform Act of 2018 (50 U.S.C. 4811 et
seq.) is amended by inserting after section 1758 the following:
``SEC. 1758A. CONTROL OF EXPORTS OF COVERED INTEGRATED CIRCUITS.
``(a) Definitions.--In this section:
``(1) Allied country.--The term `allied country' means any
country listed in Country Group A under Supplement No. 1 to
part 740 of the Export Administration Regulations (as in effect
on January 1, 2026).
``(2) Appropriate congressional committees.--The term
`appropriate congressional committees' means the Committee on
Foreign Affairs of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the Senate.
``(3) Commerce control list.--The term `Commerce Control
List' means the list set forth in Supplement No. 1 to part 774
of the Export Administration Regulations.
``(4) Country of concern.--The term `country of concern'
means--
``(A) the People's Republic of China, including the
Hong Kong and Macau Special Administrative Regions;
``(B) the Republic of Cuba;
``(C) the Islamic Republic of Iran;
``(D) the Democratic People's Republic of Korea;
``(E) the Russian Federation; and
``(F) any other foreign country listed in Country
Group D:5 under Supplement No. 1 to part 740 of the
Export Administration Regulations, as published on
January 1, 2026, that is designated by the Secretary of
State as a country of concern for purposes of this
section and for which notice of such designation has
been published in the Federal Register.
``(5) Covered agency heads.--The term `covered agency
heads' means the Secretary of Defense, the Secretary of Energy,
the Secretary of State, and the Director of the White House
Office of Science and Technology Policy.
``(6) Covered integrated circuit.--
``(A) In general.--Subject to subparagraphs (B),
(C), and (D), the term `covered integrated circuit'
means--
``(i) an integrated circuit, computer, or
other product--
``(I) classified under Export
Control Classification Number 3A090 or
4A090 or related Export Control
Classification Numbers; or
``(II) that is functionally
equivalent or substantially similar to
a circuit, computer, or product
described in subclause (I), including
certain similar products listed under
Export Control Classification Number
5A002.z; or
``(ii) an integrated circuit that has 1 or
more digital processing units with--
``(I) a total processing
performance of 4,800 or more;
``(II) a total processing
performance of 2,400 or more and a
performance density of 1.6 or more;
``(III) a total processing
performance of 1,600 or more and a
performance density of 3.2 or more; or
``(IV) a total DRAM bandwidth of
1,400 gigabytes per second or more,
interconnect bandwidth of 1,100
gigabytes per second or more, or a sum
of DRAM bandwidth and interconnect
bandwidth of 1,700 gigabytes per second
or more.
``(B) Authority to update technical parameters.--
Beginning 24 months after the date of the submission to
Congress of the American Artificial Intelligence
Victory Strategy required in subsection (f), the Under
Secretary of Commerce for Industry and Security may add
or modify technical parameters for the definition of
`covered integrated circuit' for purposes of this
section though notice in the Federal Register, so long
as--
``(i) the addition or modification poses no
adverse impact on the national security of the
United States;
``(ii) not fewer than 30 days before the
addition or modification takes effect, the
Secretary of Commerce--
``(I) consults with the appropriate
congressional committees regarding such
addition or modification; and
``(II) in conjunction with each
agency that is part of the Operating
Committee for Export Policy and in
coordination with the Director of
National Intelligence, updates the
American Artificial Intelligence
Victory Strategy required in subsection
(f) and submits such update to the
appropriate congressional committees;
and
``(iii) the Operating Committee for Export
Policy has approved the addition or
modification by majority vote.
``(C) Products included.--Except as provided in
subparagraph (D), the term `covered integrated circuit'
includes a product containing such a covered integrated
circuit.
``(D) Exclusion.--The term `covered integrated
circuit' does not include--
``(i) covered integrated circuits or
products containing a covered integrated
circuit that are not designed or marketed for
use in a data center; or
``(ii) microprocessor microcircuits, such
as central processing units, that are not
graphics processing units or similar products.
``(7) Operating committee for export policy.--The term
`Operating Committee for Export Policy' means the Operating
Committee for Export Policy referred to in section 1763(c) of
the John S. McCain National Defense Authorization Act for
Fiscal Year 2019 (50 U.S.C. 4822(c)).
``(8) Performance density; total processing performance.--
The terms `performance density' and `total processing
performance' have the meanings given those terms in, and are
calculated as provided for under, Export Control Classification
Number 3A090 in the Commerce Control List (as in effect on
January 1, 2026).
``(9) Restricted integrated circuit.--
``(A) In general.--Subject to subparagraphs (B),
(C), and (D), the term `restricted integrated circuit'
means a covered integrated circuit that is--
``(i) an integrated circuit that has 1 or
more digital processing units--
``(I) with a total processing
performance of 21,000 or more; or
``(II) with a total processing
performance of 1,600 or more and a
performance density of 21 or more; or
``(ii) an integrated circuit that was first
marketed for sale after January 1, 2026, and
that has 1 or more digital processing units
with--
``(I) a total processing
performance of 4,800 or more;
``(II) a total processing
performance of 2,400 or more and a
performance density of 1.6 or more; or
``(III) a total processing
performance of 1,600 or more and a
performance density of 3.2 or more.
``(B) Authority to update technical parameters.--
The Under Secretary of Commerce for Industry and
Security may add or modify technical parameters for the
definition of `restricted integrated circuit' in the
same manner and subject to the same restrictions as the
authority described in paragraph (6)(B).
``(C) Products included.--Except as provided by
subparagraph (D), the term `restricted integrated
circuit' includes a product containing such a
restricted integrated circuit.
``(D) Exclusion.--The term `restricted integrated
circuit' does not include--
``(i) restricted integrated circuits or
products containing a restricted integrated
circuit that are not designed or marketed for
use in a data center; or
``(ii) microprocessor microcircuits, such
as central processing units, that are not
graphics processing units or similar products.
``(10) Trusted united states person.--The term `trusted
United States person' means any United States person designated
as a trusted United States person pursuant to subsection
(h)(2).
``(b) License Requirement.--
``(1) In general.--Beginning on the date of the enactment
of this section, the Under Secretary of Commerce for Industry
and Security, in coordination with each agency that is part of
the Operating Committee for Export Policy, shall require a
license for the export, reexport, or in-country transfer of a
covered integrated circuit or a restricted integrated circuit
to an entity that is located or headquartered in, or the
ultimate parent company of which is headquartered in, a country
of concern.
``(2) General license prohibited.--The Under Secretary of
Commerce for Industry and Security may not issue a general
license for the purpose of fulfilling the license requirement
in paragraph (1).
``(c) Certification to Congress.--
``(1) Certification requirement.--Not fewer than 30 days
prior to approving any license for the export, reexport, or in-
country transfer of a covered integrated circuit to an entity
that is located or headquartered in, or the ultimate parent
company of which is headquartered in, a country of concern, the
Under Secretary of Commerce for Industry and Security, in
coordination with each agency that is part of the Operating
Committee for Export Policy, shall submit to the appropriate
congressional committees a copy of the license application and
proposed license, including--
``(A) the quantity of covered integrated circuit,
identified by an Export Control Classification Number,
as applicable, and by technical parameters of the
covered integrated circuit;
``(B) the ultimate consignee or end-user of the
covered integrated circuit;
``(C) any and all license conditions;
``(D) a certification that the export, reexport, or
in-country transfer of the covered integrated circuit
has verifiable and enforceable mechanisms for ensuring
the ultimate consignee or end-user has not, does not,
and will not support or enable, directly or indirectly,
the military, intelligence, surveillance, or cyber-
enabled capabilities of a country of concern,
including--
``(i) that the United States Government has
no information indicating that the ultimate
consignee or end-user has, does, or will
support or enable, directly or indirectly, the
military, intelligence, surveillance, or cyber-
enabled capabilities of a country of concern;
``(ii) an explanation of how the license
conditions support the certification; and
``(iii) in the case that the license
concerns a country of concern that engages in a
military-civil fusion policy or maintains a law
that requires persons to provide support and
assistance to national security bodies, public
security bodies, or relevant military bodies of
the country of concern, details on how the
license conditions address the specific threats
arising from such policy or law;
``(E) a certification that approving the license
will not adversely impact the defense industrial base
of the United States, including the availability of
covered integrated circuits for United States persons,
including all of the major subcomponents of the covered
integrated circuits, such as high-bandwidth memory;
``(F) a certification that approving the license
will not adversely impact the technology leadership and
advantage of the United States in total nationally
installed processing power capacity relative to the
country of concern related to the ultimate consignee or
end user of the covered integrated circuit;
``(G) a certification that approving the license
will not adversely impact the national security of the
United States;
``(H) the underlying analyses supporting the
certifications required in subparagraphs (D), (E), (F),
and (G); and
``(I) a technical assessment (including an
alternative assessment by the Director of National
Intelligence, if applicable) of how the export,
reexport, or in-country transfer of the covered
integrated circuit to an entity that is located or
headquartered in, or the ultimate parent company of
which is headquartered in, a country of concern affects
the artificial intelligence leadership of the United
States, including in terms of global market share, in
artificial intelligence models, artificial intelligence
cloud services, and covered integrated circuits,
respectively.
``(2) Extension of review period for certain submissions.--
In the case that a submission to Congress under paragraph (1)
is submitted on a date that is on or after July 10 and on or
before September 7 in any year, paragraph (1) shall apply by
substituting `60 days' for `30 days'.
``(3) Limitation.--The license described in subsection (b)
may not be issued until the date that is not fewer than 30 days
after the committees described in paragraph (1) received the
certification required in such paragraph.
``(d) Termination of Licenses.--Any license issued or approved
prior to the date of the enactment of this section for the export,
reexport, or in-country transfer of a covered integrated circuit to an
entity that is located or headquartered in, or the ultimate parent
company of which is headquartered in, a country of concern is
terminated.
``(e) Temporary Prohibition.--The Under Secretary of Commerce for
Industry and Security, in coordination with each agency that is part of
the Operating Committee for Export Policy, shall deny all licenses for
the export, reexport, or in-country transfer of a covered integrated
circuit to an entity that is located or headquartered in, or the
ultimate parent company of which is headquartered in, a country of
concern, within one business day of receiving any application for such
a license, until the date that is 14 days after the submission to
Congress of the American Artificial Intelligence Victory Strategy
required in subsection (f).
``(f) American Artificial Intelligence Victory Strategy.--The
Secretary of Commerce, in conjunction with the covered agency heads and
in coordination with the Director of National Intelligence, shall
submit to the appropriate congressional committees an American
Artificial Intelligence Victory Strategy that details--
``(1) a whole-of-government framework to win the artificial
intelligence race;
``(2) the national security and economic implications of
the People's Republic of China winning the artificial
intelligence race;
``(3) the effect that access by countries of concern to
covered integrated circuits, semiconductor manufacturing
equipment, and related subcomponents that are from the United
States or allied countries would have on the artificial
intelligence race, the capabilities of the People's Republic of
China, and United States national security;
``(4) recommendations for policy changes the United States
Government should make to best position the United States in
the artificial intelligence race against the People's Republic
of China;
``(5) an assessment of the implications of the export,
reexport, or in-country transfer of covered integrated circuits
to countries of concern for the military, intelligence,
surveillance, or cyber-enabled capabilities of such countries;
and
``(6) an assessment of the covered integrated circuit
production numbers and capabilities of the People's Republic of
China for fiscal years 2026 and 2027, including--
``(A) a determination of whether the People's
Republic of China would cease or reduce its efforts to
pursue indigenous production and use of Chinese-
designed and manufactured covered integrated circuits
if entities located or headquartered in, or the
ultimate parent company of which is headquartered in,
the People's Republic of China are provided access to
covered integrated circuits designed in the United
States;
``(B) a comparison of the covered integrated
circuit production numbers and capabilities of the
People's Republic of China to the covered integrated
circuit production numbers and capabilities of the
United States and allies of the United States; and
``(C) a quantitative analysis, to the extent
feasible, examining the artificial intelligence
capabilities of countries of concern if such countries
relied solely on indigenous production of covered
integrated circuits using indigenously produced
manufacturing equipment and related subcomponents.
``(g) License Prohibition for Restricted Integrated Circuits.--The
Under Secretary of Commerce for Industry and Security, in coordination
with each agency that is part of the Operating Committee for Export
Policy, shall deny all licenses for the export, reexport, or in-country
transfer of a restricted integrated circuit to an entity that is
located or headquartered in, or the ultimate parent company of which is
headquartered in, a country of concern.
``(h) Exemption From Certain License Requirements for Trusted
United States Persons.--
``(1) In general.--The requirement for a license under
sections 742.6 and 744.23 of the Export Administration
Regulations shall not apply to the export, reexport, or in-
country transfer of a covered integrated circuit if the covered
integrated circuit--
``(A) is not destined for Macau, Hong Kong, or a
country listed in Country Group D:5 under Supplement
No. 1 to part 740 of the Export Administration
Regulations; and
``(B) will remain under the ownership and control
of a trusted United States person or a subsidiary of a
trusted United States person once the covered
integrated circuit is in operation.
``(2) Implementation.--Not later than 90 days after the
date of the enactment of this section, the Under Secretary of
Commerce for Industry and Security, in coordination with each
agency that is part of the Operating Committee for Export
Policy, shall--
``(A) seek input from the public regarding the
standards and requirements a United States person
should be required to meet to obtain a designation as a
trusted United States person;
``(B) based on such input, prescribe regulations
establishing such standards and requirements, which
shall include--
``(i) establishment by the United States
person of reasonable security standards,
including physical security, cybersecurity,
remote access, secure covered integrated
circuit repair and disposal procedures, and
other measures designed to prevent the illicit
transfer, diversion, or access to covered
integrated circuits;
``(ii) a requirement that the United States
person may not transfer or install a majority
of its aggregate total processing performance
of covered integrated circuits outside the
United States;
``(iii) a requirement that not more than an
aggregate 10 percent of the ultimate beneficial
ownership of the United States person may be
held, directly or indirectly, by any entity
that primarily resides, is domiciled, or
conducts the majority of its business in a
country of concern;
``(iv) robust know-your-customer standards;
``(v) a preference for sourcing advanced
integrated circuits and subcomponents from
production facilities that support the revival
of semiconductor manufacturing in the United
States; and
``(vi) annual audit or attestation
requirements to ensure compliance with clauses
(i), (ii), (iii), and (iv); and
``(C) prescribe regulations establishing the
process by which the Under Secretary of Commerce for
Industry and Security, in coordination with each agency
that is part of the Operating Committee for Export
Policy, shall approve such a designation.
``(3) Expansion to allied countries.--The Under Secretary
of Commerce for Industry and Security, in coordination with
each agency that is part of the Operating Committee for Export
Policy, shall consider options for securely expanding the
license exemption program described in this subsection to
certain allied countries.''.
<all>