[Congressional Record Volume 152, Number 100 (Wednesday, July 26, 2006)]
[Senate]
[Pages S8317-S8321]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          FOREIGN INVESTMENT AND NATIONAL SECURITY ACT OF 2006

  Mr. SHELBY. Mr. President, I ask unanimous consent that the Senate 
proceed to the immediate consideration of Calendar No. 474, S. 3549.
  The PRESIDING OFFICER. The clerk will report the bill by title.
  The bill clerk read as follows:

       A bill (S. 3549) to amend the Defense Production Act of 
     1950, to strengthen Government review and oversight of 
     foreign investment in the United States, to provide for 
     enhanced Congressional oversight with respect thereto, and 
     for other purposes.

  There being no objection, the Senate proceeded to consider the bill.
  Mr. McCAIN. Mr. President, today the Senate will pass S. 3549, the 
Foreign Investment and National Security Act of 2006. While I have 
reservations over the legislation as currently drafted, I have agreed 
to allow the bill to proceed to conference, given the assurances by the 
Chairman of the Senate Banking Committee, Senator Shelby, that he will 
work to address the concerns that I have raised.
  The Committee on Foreign Investment in the United States--known as 
CFIUS--was established 30 years ago to placate concerns in Congress 
over investments by Middle Eastern countries in American assets. Three 
decades later, it is once again concern over the Middle East that is 
driving Congress to overhaul the CFIUS process. This time, the outrage 
has revolved around the proposed acquisition of port terminal 
operations in the U.S. by Dubai Ports World, a corporation owned by the 
government of Dubai, one of the seven emirates that make up the United 
Arab Emirates.
  In the war on terror, the UAE has provided American and Coalition 
military forces unprecedented access to its ports and territory, 
overflight clearances, and other critical and important logistical 
assistance. The UAE has played host to over 700 U.S. Navy ships at its 
ports, including the Port of Jebel Ali--which is managed by Dubai Ports 
World--and to the Air Force at al Dhafra Air Base. The country also 
hosts the UAE Air Warfare Center, the leading fighter training center 
in the Middle East. The UAE has worked with us to stop terrorist 
financing and money laundering. Moreover, Dubai was the first Middle 
Eastern entity to join the Container Security Initiative and the 
Department of Energy's Megaports Initiative, a program aimed at 
stopping illicit shipments of nuclear and other radioactive material. 
But all of these details seem to have been lost in the rush to stop a 
corporate transaction with a key ally in the war on terror.
  Mr. President, there are at least two details in S. 3549 that cannot 
be ignored because they will not help protect our homeland. Instead, 
they will only harm America's economy, the strength of which is 
critical to our national security.
  One provision that I believe merits closer scrutiny would require 
CFIUS to notify several congressional committees, as well as individual 
members of Congress, of each and every transaction submitted to CFIUS's 
review. This notification would be required well before CFIUS made any 
determination about the national security implications, if any, of the 
proposed transaction.
  On its face, this provision would appear to be a reasonable effort to 
achieve transparency and accountability in the CFIUS process. However,

[[Page S8318]]

if this provision were enacted, a process that is meant to be a sober 
analysis of the national security implications of a transaction would 
become a politically charged debacle. What other goal would be 
accomplished by providing notice to the members of Congress whose 
States and districts are impacted by the transaction before any 
determination is made by CFIUS? The politicization of the CFIUS review 
process would discourage transactions that might be reviewed by CFIUS 
for fear of financial or reputational harm. This, in turn, could reduce 
foreign direct investment or impose a risk premium on such investment 
that would be detrimental to U.S. businesses seeking investment 
capital.
  A second provision that I believe needs further clarification would 
require CFIUS to investigate a proposed transaction whenever the matter 
involves ``any possible impairment to national security'' resulting 
from the acquisition of critical infrastructure or ``the possibility of 
an impairment to national security'' arising out of any transaction 
reviewed by CFIUS. Under these standards, many transactions that pose 
negligible or no risk to national security will nonetheless be forced 
into an extended 45-day investigation in addition to the initial 30-day 
review period. According to the Department of Treasury, these standards 
will lead to a significant increase in the number of investigations 
conducted by CFIUS. I strongly support a full and fair review of each 
transaction submitted to CFIUS, and I believe that a transaction that 
poses a risk to our national security should not be approved, but that 
is not what the mandatory 45-day investigation provisions would 
accomplish. In my view, it would be better to use CFIUS resources to 
investigate transactions that raise genuine national security concerns.
  I appreciate the interest of Senator Shelby and others to modify the 
CFIUS process, and I certainly do not doubt the sincerity of their 
desire to protect our Nation from threats abroad. That is why I am 
confident that my concerns with the legislation will be addressed in 
conference. If they are not, then I will be forced to object to the 
conference report.
  Mr. SHELBY. Mr. President, I ask unanimous consent that the amendment 
at the desk be agreed to, the bill, as amended, be read a third time 
and passed, the motion to reconsider be laid upon the table, and that 
any statements relating to the bill be printed in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment (No. 4703) was agreed to, as follows:

       On page 3, line 8, strike ``written notification'' and 
     insert the following: ``a written request for review by a 
     person involved in the transaction, or by one or more members 
     of CFIUS,''.
       On page 3, line 10, strike ``under this section'' and 
     insert ``in accordance with paragraph (1)(A)''.
       On page 3, line 24, strike ``entity'' and insert 
     ``person''.
       On page 4, beginning on line 19, strike ``additional 
     assurances'' and insert ``assurances provided or renewed with 
     the approval of CFIUS''.
       On page 4, line 22, strike ``and'' and insert ``or''.
       On page 5, line 2, insert before the period the following: 
     ``, and the issues that could result in an impairment to 
     national security are not resolved through negotiation of 
     assurances between one or more members of CFIUS and the 
     entities involved in the transaction''.
       On page 5, strike line 22 and all that follows through page 
     6, line 6 and insert the following:
       `` `(4) Monitoring of withdrawn transactions.--If the 
     notification or filing with respect to a proposed transaction 
     is withdrawn or rescinded, CFIUS shall continue to monitor 
     such transaction, unless the transaction is terminated by 
     agreement of the parties to the transaction. If CFIUS has 
     reason to believe that the proposed transaction has not been 
     so terminated, CFIUS shall initiate a review or investigation 
     under this section if the parties do not resubmit the 
     notification or filing within an appropriate period of 
     time.''.
       On page 6, strike lines 7 through 23 and insert the 
     following:
       `` `(5) Mandatory notification related to certain 
     transactions affecting national security.--The chairperson 
     and vice chairperson of CFIUS shall, not later than 90 days 
     after the date of enactment of the Foreign Investment and 
     National Security Act of 2006, issue rules, including the 
     imposition of appropriate penalties for failure to comply 
     with this paragraph, that require each person controlled by 
     or acting on behalf of a foreign government to notify the 
     chairperson of CFIUS in writing of any proposed transaction 
     involving such person and United States critical 
     infrastructure relating to United States national 
     security.''.
       On page 8, line 17, strike ``(or longer)''.
       On page 9, line 3, strike ``and classifications''.
       On page 9, line 15, strike ``and classifying''.
       On page 10, line 17, strike ``and classification''.
       On page 15, line 1, strike ``ranking'' and insert 
     ``assessments''.
       On page 16, line 5, strike ``Additional''.
       On page 17, line 6, insert ``of CFIUS'' after ``vice 
     chairperson''.
       On page 19, line 12, strike ``transaction'' and all that 
     follows through line 16 and insert ``transaction; and''.
       On page 20, line 3, insert ``does or'' before ``does not''.
       On page 23, strike lines 21 through 24.
       On page 24, line 1, strike ``(vi)'' and insert ``(v)''.
       On page 24, line 10, strike ``(vii)'' and insert ``(vi)''
       On page 24, line 17, strike ``(vii)'' and insert ``(vii)''.
       On page 27, line 4, strike ``the term'' and insert the 
     following: ``the term `assurances' means any term, 
     understanding, commitment, agreement, or limitation, however 
     described, that relates to ameliorating in any way the 
     potential effect of a transaction on the national security;
       ``(2) the term''.
       On page 27, line 12, strike ``(2)'' and insert ``(3)''.
       On page 27, line 19, strike ``(3)'' and insert ``(4)''.
       On page 27, line 22, strike ``(4)'' and insert ``(5)''.
       On page 27, line 25, strike the period and all that follows 
     through ``The term includes'' on page 28, line 1 and insert 
     ``, and includes''.
       On page 28, line 5, strike ``(5)'' and insert ``(6)''.
       On page 28, line 11, strike ``(6)'' and insert ``(7)''.
       On page 28, line 14, strike ``(7)'' and insert ``(8)''.
  The bill (S. 3549), as amended, was ordered to be engrossed for a 
third reading, was read the third time, and passed, as follows:

                                S. 3549

       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 ``Foreign Investment and 
     National Security Act of 2006''.

     SEC. 2. AMENDMENTS TO THE DEFENSE PRODUCTION ACT OF 1950.

       Section 721 of the Defense Production Act of 1950 (50 
     U.S.C. App. 2170) is amended to read as follows:

     ``SEC. 721. REVIEW AND INVESTIGATION OF TRANSACTIONS 
                   INVOLVING FOREIGN PERSONS AND GOVERNMENTS.

       ``(a) Review of Transactions Involving Foreign Persons and 
     Governments.--
       ``(1)  Reviews required.--
       ``(A) In general.--CFIUS shall review any transaction 
     proposed or pending on or after the date of enactment of this 
     section by, with, or on behalf of a foreign person or foreign 
     government which could result in foreign control of a person 
     engaged in interstate commerce in the United States, for 
     which a review is requested, in the manner prescribed by 
     regulations promulgated under this section.
       ``(B) Purposes.--The purpose of such review shall be to 
     determine the effect on national security of such 
     transaction, whether an investigation of such transaction is 
     required under subsection (b), or both.
       ``(2) Timing of reviews.--
       ``(A) In general.--A review of a proposed or pending 
     transaction described in paragraph (1) shall be completed not 
     later than 30 days after the date of receipt by CFIUS of a 
     written request for review by a person involved in the 
     transaction, or by one or more members of CFIUS, of the 
     proposed or pending transaction, as prescribed by regulations 
     promulgated in accordance with paragraph (1)(A).
       ``(B) Extensions upon request.--Upon written request by the 
     Secretary, Deputy Secretary, or Under Secretary, or the 
     equivalent thereof, of one or more of the agencies that make 
     up CFIUS (including any agency described in subsection 
     (c)(4)(I)) for additional time to review a case, the 30-day 
     period described in subparagraph (A) shall be extended by not 
     longer than an additional 30 days, if the Secretary, Deputy 
     Secretary, or Under Secretary, or the equivalent thereof, 
     concludes that there is credible evidence to believe that if 
     permitted to proceed with the transaction, the foreign 
     acquiring person may take action that threatens to impair the 
     national security.
       ``(b) Investigations of Certain Transactions.--
       ``(1) In general.--CFIUS shall undertake an investigation 
     to determine the effects on national security of any 
     transaction described in subsection (a)(1) proposed or 
     pending on or after the date of enactment of this section--
       ``(A) which would--
       ``(i) result in control of any person engaged in interstate 
     commerce in the United States by a foreign government, or a 
     person acting by, with, or on behalf of a foreign government; 
     or
       ``(ii) result in control of any critical infrastructure of 
     or within the United States by,

[[Page S8319]]

     with, or on behalf of any foreign person, if CFIUS determines 
     that any possible impairment to national security has not 
     been mitigated by assurances provided or renewed with the 
     approval of CFIUS, as described in subsection (i), during the 
     review period under subsection (a); or
       ``(B) if the review by CFIUS under subsection (a) produces 
     sufficient information to indicate the possibility of an 
     impairment to national security, after consideration of the 
     factors listed in subsection (g), and the issues that could 
     result in an impairment to national security are not resolved 
     through negotiation of assurances between one or more members 
     of CFIUS and the entities involved in the transaction.
       ``(2) Timing of investigations.--An investigation required 
     to be undertaken under this subsection--
       ``(A) shall commence at such time as CFIUS determines under 
     subsection (a) that such investigation is required, as 
     prescribed by regulations promulgated pursuant to this 
     section; and
       ``(B) shall be completed not later than 45 days after the 
     date of its commencement.
       ``(3) Resubmitted filings.--An investigation of a 
     transaction under this subsection which is interrupted 
     because the notification or filing is withdrawn by the 
     applicant, and which is subsequently resubmitted, shall 
     require up to a 45-day investigation from the date on which 
     CFIUS receives the new submission. The investigation shall 
     include a review of the rationale for the withdrawal and 
     resubmission of the proposed transaction to CFIUS.
       ``(4) Monitoring of withdrawn transactions.--If the 
     notification or filing with respect to a proposed transaction 
     is withdrawn or rescinded, CFIUS shall continue to monitor 
     such transaction, unless the transaction is terminated by 
     agreement of the parties to the transaction. If CFIUS has 
     reason to believe that the proposed transaction has not been 
     so terminated, CFIUS shall initiate a review or investigation 
     under this section if the parties do not resubmit the 
     notification or filing within an appropriate period of 
     time.''
       ``(5) Mandatary notification related to certain 
     transactions affecting national security.--The chairperson 
     and vice chairperson of CFIUS shall, not later than 90 days 
     after the date of enactment of the Foreign Investment and 
     National Security Act of 2006, issue rules, including the 
     imposition of appropriate penalties for failure to comply 
     with this paragraph, that require each person controlled by 
     or acting on behalf of a foreign government to notify the 
     chairperson of CFIUS in writing of any proposed transaction 
     involving such person and United States critical 
     infrastructure relating to United States national security.''
       ``(c) Committee on Foreign Investment in the United 
     States.--
       ``(1) Establishment.--There is established the Committee on 
     Foreign Investment in the United States, which shall serve as 
     the President's designee for all purposes under this section.
       ``(2) Chairperson.--The Secretary of the Treasury shall 
     serve as the chairperson of CFIUS.
       ``(3) Vice chairperson.--The Secretary of Defense shall 
     serve as the vice chairperson of CFIUS.
       ``(4) Membership.--The members of CFIUS shall include--
       ``(A) the Secretary of the Treasury;
       ``(B) the Secretary of State;
       ``(C) the Secretary of Defense;
       ``(D) the Secretary of Commerce;
       ``(E) the Secretary of Homeland Security;
       ``(F) the Attorney General of the United States;
       ``(G) the Director of the Office of Management and Budget;
       ``(H) the Director of National Intelligence; and
       ``(I) the heads of those other executive departments or 
     agencies as the President determines appropriate, on a case-
     by-case basis.
       ``(5) Referral to appropriate members of cfius.--Upon 
     receipt of notification of a proposed or pending transaction 
     under this section, the chairperson of CFIUS shall assign the 
     appropriate member of CFIUS to lead the review and 
     investigation of such proposed or pending transaction under 
     this section.
       ``(6) Intelligence reviews.--The Director of National 
     Intelligence shall--
       ``(A) direct the intelligence community, to collect and 
     analyze information related to any proposed or pending 
     transaction pursuant to this section, and to prepare a report 
     of its findings, which the Director shall make available to 
     members of CFIUS not later than 15 days after the date of the 
     commencement by CFIUS of a 30-day review of any such 
     transaction under subsection (a), and before the commencement 
     of any investigation under subsection (b); and
       ``(B) ensure that the intelligence community remains 
     engaged in the collection, analysis, and dissemination to 
     CFIUS of any additional relevant information that may become 
     available during the course of any investigation conducted 
     under subsection (b) with respect to a transaction.
       ``(7) Assessments of foreign countries for use in reviews 
     and investigations.--
       ``(A) In general.--Not later than 120 days after the date 
     of enactment of the Foreign Investment and National Security 
     Act of 2006, the chairperson and vice chairperson of CFIUS, 
     in consultation with the Secretary of State, the Secretary of 
     Commerce, the Secretary of Energy, the Chairman of the 
     Nuclear Regulatory Commission, and the Director of National 
     Intelligence, shall develop and implement a system for 
     assessing individual countries, including--
       ``(i) an assessment of the adherence of the country to 
     nonproliferation control regimes, including treaties and 
     multilateral supply guidelines, which shall draw on, but not 
     be limited to, the annual report on Adherence to and 
     Compliance with Arms Control, Nonproliferation and 
     Disarmament Agreements and Commitments required by section 
     403 of the Arms Control and Disarmament Act;
       ``(ii) an assessment of the relationship of such country 
     with the United States, specifically on its record on 
     cooperating in counter-terrorism efforts, which shall draw 
     on, but not be limited to, the report of the President to 
     Congress under section 7120 of the Intelligence Reform and 
     Terrorism Prevention Act of 2004; and
       ``(iii) an assessment of the potential for transshipment or 
     diversion of technologies with military applications, 
     including an analysis of national export control laws and 
     regulations.
       ``(B) Confidentiality.--The assessment system required by 
     subparagraph (A) and any information or documentary material 
     maintained or developed thereunder--
       ``(i) shall be used solely by those agencies involved in 
     reviewing and investigating acquisitions, mergers, and 
     takeovers pursuant to this section;
       ``(ii) may not be made available to the public; and
       ``(iii) shall be exempt from disclosure under section 552 
     of title 5, United States Code.
       ``(8) Staff of cfius.--Employees of the Department of the 
     Treasury who serve as staff for CFIUS shall report directly 
     to the Deputy Secretary of the Treasury, and shall perform no 
     official functions other than as CFIUS staff.
       ``(d) Action by the President.--
       ``(1) In general.--Subject to subsection (e), the President 
     may take such action for such time as the President considers 
     appropriate to suspend or prohibit any transaction which 
     would result in control of any critical infrastructure or 
     person engaged in interstate commerce in the United States, 
     proposed or pending on or after the date of enactment of this 
     section, by or with a foreign person or government, so that 
     such control will not threaten to impair the national 
     security.
       ``(2) Announcement by the president.--The President shall 
     announce the decision on whether or not to take action 
     pursuant to this subsection not later than 15 days after an 
     investigation described in subsection (b) is completed.
       ``(3) Enforcement.--The President may direct the Attorney 
     General to seek appropriate relief, including divestment 
     relief, in the district courts of the United States in order 
     to implement and enforce this subsection.
       ``(e) Findings of the President.--The President may 
     exercise the authority conferred by subsection (d) only if 
     the President finds that--
       ``(1) there is credible evidence that leads the President 
     to believe that the foreign interest exercising control might 
     take action that threatens to impair the national security; 
     and
       ``(2) provisions of law, other than this section and the 
     International Emergency Economic Powers Act, do not, in the 
     judgment of the President, provide adequate and appropriate 
     authority for the President to protect the national security 
     in the matter before the President.
       ``(f) Actions and Findings Nonreviewable.--The actions of 
     the President under subsection (d) and the findings of the 
     President under subsection (e) shall not be subject to 
     judicial review.
       ``(g) Factors To Be Considered.--For purposes of 
     determining whether to take action under subsection (d) and 
     for purposes of reviews and investigations under this 
     section, the President and CFIUS, respectively, shall 
     consider, among other factors--
       ``(1) potential effects on United States critical 
     infrastructure, including major energy assets;
       ``(2) potential effects on United States critical 
     technologies;
       ``(3) domestic production needed for projected national 
     defense requirements;
       ``(4) the capability and capacity of domestic industries to 
     meet national defense requirements, including the 
     availability of human resources, products, technology, 
     materials, and other supplies and services;
       ``(5) the control of domestic industries and commercial 
     activity by foreign citizens as it affects the capability and 
     capacity of the United States to meet the requirements of 
     national security;
       ``(6) the potential effects of the proposed or pending 
     transaction on sales of military goods, equipment, or 
     technology to any country--
       ``(A) identified by the Secretary of State--
       ``(i) under section 6(j) of the Export Administration Act 
     of 1979, as a country that supports terrorism;
       ``(ii) under section 6(l) of the Export Administration Act 
     of 1979, as a country of concern regarding missile 
     proliferation; or
       ``(iii) under section 6(m) of the Export Administration Act 
     of 1979, as a country of concern regarding the proliferation 
     of chemical and biological weapons;
       ``(B) identified by the Secretary of Defense as posing a 
     potential regional military

[[Page S8320]]

     threat to the interests of the United States; or
       ``(C) listed under section 309(c) of the Nuclear Non-
     Proliferation Act of 1978, on the `Nuclear Non-Proliferation-
     Special Country List' (15 C.F.R. Part 778, Supplement No. 4) 
     or any successor list;
       ``(7) the potential effects of the proposed or pending 
     transaction on United States international technological 
     leadership in areas affecting United States national 
     security;
       ``(8) the long term projection of United States 
     requirements for sources of energy and other critical 
     resources and materials; and
       ``(9) the assessments developed under subsection (c)(7) of 
     the country in which the foreign persons acquiring United 
     States entities are based.
       ``(h) Confidentiality of Information.--
       ``(1) In general.--Any information or documentary material 
     filed with CFIUS pursuant to this section shall be exempt 
     from disclosure under section 552 of title 5, United States 
     Code, and no such information or documentary material may be 
     made public, except as may be relevant to any administrative 
     or judicial action or proceeding.
       ``(2) Notification to governor.--Notwithstanding paragraph 
     (1), CFIUS shall notify the Governor of any State regarding a 
     transaction involving critical infrastructure in that State 
     for the purpose of discussing any security concerns that 
     arise or may arise from that transaction. Information or 
     documentary material made available to a Governor under this 
     paragraph may not be made public, including under any law of 
     a State pertaining to freedom of information or otherwise, 
     but the exception in paragraph (3) for disclosures to either 
     House of Congress or Congressional Committees shall not apply 
     to Governors who receive information under this paragraph.
       ``(3) Disclosure.--Nothing in this subsection shall be 
     construed to prevent disclosure to either House of Congress 
     or to any duly authorized committee or subcommittee of 
     Congress.
       ``(i) Assurances.--
       ``(1) In general.--This subsection shall govern the 
     provision of any assurances to one or more agencies of the 
     United States in connection with the review or investigation 
     of, or any Presidential decision concerning, any transaction 
     under this section.
       ``(2) Condition to determination.--Any such assurances 
     shall be deemed to be a continuing covenant of the persons on 
     whose behalf such review is sought (and of all persons 
     controlling such person), the observance of which shall be a 
     condition of the determination of CFIUS, the President, or 
     both, on whether to take any action with respect to such 
     transaction.
       ``(3) Contract with the united states.--Such assurances 
     shall be embodied in an agreement executed by the foreign 
     person or foreign government on whose behalf a review of a 
     transaction is sought under this section and the chairperson 
     or vice chairperson of CFIUS, on behalf of the United States.
       ``(4) Monitoring of agreement.--Compliance with assurances 
     provided under this subsection shall be monitored, and may be 
     investigated, in the same manner as a violation of a civil 
     statute, by the agency designated by the chairperson of 
     CFIUS, in consultation with the vice chairperson of CFIUS and 
     the Attorney General of the United States.
       ``(5) Grant of jurisdiction; remedies.--The United States 
     District Court for the District of Columbia shall have 
     jurisdiction to enforce an agreement referred to in this 
     subsection upon application by the Attorney General. 
     Available remedies shall include divestiture, injunctive 
     relief, enforcing the terms of such agreement, and monetary 
     damages, as appropriate.
       ``(j) Notice and Reports to Congress.--
       ``(1) Notice regarding reviews.--
       ``(A) Notice at initiation of review.--CFIUS shall transmit 
     written notice of a proposed or pending transaction subject 
     to this section to the members of Congress specified in 
     paragraph (3)(C), not later than 10 days after the date of 
     receipt of a notice of such proposed or pending transaction, 
     including the identities of all parties involved and any 
     foreign government ownership or control of any such party.
       ``(B) Certification at completion of review.--Upon 
     completion of a review under subsection (a), the chairperson 
     and vice chairperson of CFIUS and the head of the lead agency 
     assigned under subsection (c)(5), shall transmit a certified 
     notice to the members of Congress specified in paragraph 
     (3)(C).
       ``(2) Notice regarding investigations.--
       ``(A) Notice at initiation of investigations.--Upon 
     commencement of an investigation under subsection (b), CFIUS 
     shall notify in writing the members of Congress specified in 
     paragraph (3)(C).
       ``(B) Certification at completion of investigations.--As 
     soon as practicable after completion of an investigation 
     under subsection (b), the chairperson and vice chairperson of 
     CFIUS and the head of the lead agency assigned under 
     subsection (c)(5), shall transmit to the members of Congress 
     specified in paragraph (3)(C) a certified written report 
     (consistent with the requirements of subsection (h)) on the 
     results of the investigation, unless the matter under 
     investigation has been sent to the President for decision.
       ``(3) Certifications.--
       ``(A) In general.--Each certified notice and report 
     required by this subsection shall be submitted to the members 
     of Congress specified in subparagraph (C), and shall 
     include--
       ``(i) information on whether or not an investigation 
     occurred under subsection (b) and has been completed;
       ``(ii) a description of the actions taken by CFIUS with 
     respect to the transaction; and
       ``(iii) identification of the determinative factors 
     considered under subsection (g).
       ``(B) Content of certification.--Each notice required to be 
     certified by this subsection shall be signed by the 
     chairperson and vice chairperson of CFIUS and the head of the 
     lead agency assigned under subsection (c)(5), and shall 
     contain a specific attestation of each such person that, in 
     the determination of CFIUS, the transaction that is the 
     subject of the notice does or does not impair the national 
     security.
       ``(C) Members of congress.--The notices and reports 
     required by this subsection shall be transmitted to--
       ``(i) the Majority Leader and the Minority Leader of the 
     Senate;
       ``(ii) the chair and ranking member of the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and of any 
     committee of the Senate having oversight over the agency 
     assigned to lead a review or investigation under subsection 
     (c)(5);
       ``(iii) the Speaker and the Minority Leader of the House of 
     Representatives; and
       ``(iv) the chair and ranking member of the Committee on 
     Financial Services of the House of Representatives and of any 
     committee of the House of Representatives having oversight 
     over the agency assigned to lead a review or investigation 
     under subsection (c)(5).
       ``(D) Transmittal to other members of congress.--The 
     Majority Leader or the Minority Leader, in the case of the 
     Senate, and the Speaker or the Minority Leader, in the case 
     of the House of Representatives, may provide the notices and 
     reports required by this paragraph regarding a proposed or 
     pending transaction involving critical infrastructure--
       ``(i) in the case of the Senate, to members of the Senate 
     from the State in which such critical infrastructure is 
     located; and
       ``(ii) in the case of the House of Representatives, to a 
     member from a Congressional District in which such critical 
     infrastructure is located.
       ``(E) Limitation on delegation of certifications.--Notices 
     and reports required to be certified under this subsection 
     shall be signed by the chairperson and vice chairperson of 
     CFIUS, and such certification requirement may not be 
     delegated.
       ``(4) Annual reports.--
       ``(A) Report required.--The Secretary of the Treasury, on 
     behalf of and after consultation with the members of CFIUS, 
     shall submit to the Committee on Banking, Housing, and Urban 
     Affairs of the Senate and the Committee on Financial Services 
     of the House of Representatives, on or before March 15 of 
     each year, a written report on the policy of the United 
     States with respect to the preservation of the Nation's 
     defense production and critical infrastructure. The Secretary 
     shall appear before both committees to provide testimony on 
     such reports.
       ``(B) Contents of report.--Each report submitted under 
     subparagraph (A) shall contain--
       ``(i) an analysis of each transaction involving a foreign 
     person or foreign government affecting national security that 
     has occurred during the preceding year to which the report 
     relates, including the nature of the acquisitions and the 
     effect or potential impact of such acquisitions on the United 
     States defense industrial base and critical infrastructure;
       ``(ii) a similar updated analysis for any transaction that 
     occurred during the 4 years immediately preceding the year 
     dealt with in the report in clause (i), including a separate 
     section discussing the impact of transactions involving 
     foreign governments or persons acting on behalf of or in 
     concert with foreign governments;
       ``(iii) a detailed discussion of all perceived risks to 
     national security or United States critical infrastructure 
     that CFIUS will take into account in its deliberations during 
     the year in which the report is delivered to the committees;
       ``(iv) a table showing on a cumulative basis, by sector, 
     product, and country of foreign ownership, the number of 
     acquisitions reviewed, investigated, or both, by CFIUS, to 
     provide a census of production potentially relevant to the 
     Nation's defense industrial base owned or controlled by 
     foreign persons or foreign governments;
       ``(v) an evaluation of whether there is credible evidence 
     of a coordinated strategy by 1 or more countries or companies 
     to acquire critical infrastructure of or within the United 
     States or United States companies involved in research, 
     development, or production of critical technologies for which 
     the United States is a leading producer;
       ``(vi) an evaluation of whether there are industrial 
     espionage activities directed or directly assisted by foreign 
     governments against private United States companies aimed at 
     obtaining commercial secrets related to critical technologies 
     or critical infrastructure; and
       ``(vii) such other matters as are necessary to give a 
     complete disclosure and analysis of the work of CFIUS during 
     the year to which the report relates.

[[Page S8321]]

       ``(C) Classified reports.--The evaluations required by 
     clauses (v) and (vi) of subparagraph (B) may be classified. 
     If they are submitted in classified form, an unclassified 
     version of such evaluations shall be made available to the 
     public.
       ``(D) Other information withheld from public reports.--
       ``(i) Proprietary information.--The chairperson of CFIUS, 
     in consultation with the vice chairperson of CFIUS, may 
     withhold from public release other such information as the 
     chairperson determines is proprietary information.
       ``(ii) Rule of construction.--Nothing in this subparagraph 
     shall prohibit such information from being provided to 
     relevant Committees of Congress.
       ``(5) Appearances before congress.--The chairperson and 
     vice chairperson of CFIUS, and the heads of such additional 
     CFIUS member agencies specified in a written request by the 
     Chairman of the Committee on Banking, Housing, and Urban 
     Affairs of the Senate shall annually appear before the 
     Committee on Banking, Housing, and Urban Affairs and the 
     Committee on Financial Services of the House of 
     Representatives to provide testimony on the activities of 
     CFIUS.
       ``(k) Regulations.--
       ``(1) In general.--The Secretary shall issue regulations to 
     carry out this section. Such regulations shall, to the extent 
     possible, minimize paperwork burdens and shall, to the extent 
     possible, coordinate reporting requirements under this 
     section with reporting requirements under any other provision 
     of Federal law.
       ``(2) Regulations relating to definitions.--Not later than 
     30 days after the date of enactment of the Foreign Investment 
     and National Security Act of 2006, the Secretary of the 
     Treasury and the Secretary of Defense shall jointly agree to 
     and issue rules concerning the manner in which the definition 
     of the term `critical infrastructure' in subsection (m)(2) 
     shall be applied to particular acquisitions, mergers, and 
     takeovers, for purposes of the mandatory investigation 
     requirement of subsection (b)(1)(A), except that, until such 
     rules are issued in final form and become effective, such 
     definition shall be applied without regard to any such rules 
     (whether proposed or otherwise).
       ``(l) Effect on Other Law.--Nothing in this section shall 
     be construed to alter or affect any existing power, process, 
     regulation, investigation, enforcement measure, or review 
     provided by any other provision of law, including the 
     International Emergency Economic Powers Act, or of the 
     President or Congress.
       ``(m) Definitions.--As used in this section--
       ``(1) the term `assurances' means any term, understanding, 
     commitment, agreement, or limitation, however described, that 
     relates to ameliorating in any way the potential effect of a 
     transaction on the national security;
       ``(2) the term `critical infrastructure' means, subject to 
     rules issued under subsection (k)(2), any systems and assets, 
     whether physical or cyber-based, so vital to the United 
     States that the degradation or destruction of such systems or 
     assets would have a debilitating impact on national security, 
     including national economic security and national public 
     health or safety;
       ``(3) the term `critical technologies' means technologies 
     identified under title VI of the National Science and 
     Technology Policy, Organization, and Priorities Act of 1976, 
     or other critical technology, critical components, or 
     critical technology items essential to national defense 
     identified pursuant to this section;
       ``(4) the terms `Committee on Foreign Investment in the 
     United States' and `CFIUS' mean the committee established 
     under subsection (c);
       ``(5) the term `foreign government' means any government or 
     body exercising governmental functions, other than the 
     Government of the United States or of a State or political 
     subdivision thereof, and includes national, State, 
     provincial, and municipal governments, including their 
     respective departments, agencies, government-owned 
     enterprises, and other agencies and instrumentalities;
       ``(6) the term `foreign person' means any non-United States 
     national, any organization owned or controlled by such a 
     person, and any entity organized under the laws of a country 
     other than the United States, and any entity owned or 
     controlled by such entity;
       ``(7) the term `intelligence community' has the same 
     meaning as in section 3 of the National Security Act of 1947 
     (50 U.S.C. 401a); and
       ``(8) the term `transaction' means a proposed or pending 
     merger, acquisition, or takeover''.

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