[Congressional Record (Bound Edition), Volume 148 (2002), Part 8]
[Senate]
[Pages 10348-10360]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           TEXT OF AMENDMENTS

  SA 3835. Mr. LEAHY (for himself and Mr. Jeffords) submitted an 
amendment intended to be proposed by him to the bill S. 2600, to ensure 
the continued financial capacity of insurers to provide coverage for 
risks from terrorism; which was ordered to lie on the table; as 
follows:

       On page 14, line 9, insert before ``but'' the following: 
     ``or that could have operated through such self insurance 
     arrangements under applicable State law in effect on 
     September 11, 2001,''.
                                  ____

  SA 3836. Mr. McCONNELL (for himself, Mr. Gramm, Mr. Lott, and Mr. 
Santorum) proposed an amendment to the bill S. 2600, to ensure the 
continued financial capacity of insurers to provide coverage for risks 
from terrorism; as follows:

       On page 29, strike line 1 and all that follows through page 
     30, line 17, and insert the following:

     SEC. 10. PROCEDURES FOR CIVIL ACTIONS.

       (a) Federal Cause of Action.--
       (1) In general.--There shall exist a Federal cause of 
     action for claims arising out of or resulting from an act of 
     terrorism, which shall be the exclusive cause of action and 
     remedy for such claims, except as provided in subsection (f).
       (2) Preemption of state actions.--All State causes of 
     action of any kind for claims arising out of or resulting 
     from an act of terrorism that are otherwise available under 
     State law, are hereby preempted, except as provided in 
     subsection (f).
       (b) Governing Law.--The substantive law for decision in an 
     action described in subsection (a)(1) shall be derived from 
     the law, including applicable choice of law principles, of 
     the State in which the act of terrorism giving rise to the 
     action occurred, except to the extent that--
       (1) the law, including choice of law principles, of another 
     State is determined to be applicable to the action by the 
     district court hearing the action; or
       (2) otherwise applicable State law (including that 
     determined under paragraph (1), is inconsistent with or 
     otherwise preempted by Federal law.
       (c) Federal Jurisdiction.--
       (1) In general.--Notwithstanding any other provision of 
     law, not later than 90 days after the date of the occurrence 
     of an act of terrorism, the Judicial Panel on Multidistrict 
     Litigation shall assign a single Federal district court to 
     conduct pretrial and trial proceedings in all pending and 
     future civil actions for claims arising out of or resulting 
     from that act of terrorism.
       (2) Selection criteria.--The Judicial Panel on 
     Multidistrict Litigation shall select and assign the district 
     court under paragraph (1) based on the convenience of the 
     parties and the just and efficient conduct of the 
     proceedings.
       (3) Jurisdiction.--The district court assigned by the 
     Judicial Panel on Multidistrict Litigation shall have 
     original and exclusive jurisdiction over all actions under 
     paragraph (1). For purposes of personal jurisdiction, the 
     district court assigned by the Judicial Panel on 
     Multidistrict Litigation shall be deemed to sit in all 
     judicial districts in the United States.
       (4) Transfer of cases filed in other federal courts.--Any 
     civil action for claims arising out of or resulting from an 
     act of terrorism that is filed in a Federal district court 
     other than the Federal district court assigned by the 
     Judicial Panel on Multidistrict Litigation under paragraph 
     (1) shall be transferred to the Federal district court so 
     assigned.
       (5) Removal of cases filed in state courts.--Any civil 
     action for claims arising out of or resulting from an act of 
     terrorism that is filed in a State court shall be removable 
     to the Federal district court assigned by the Judicial Panel 
     on Multidistrict Litigation under paragraph (1).
       (d) Approval of Settlements.--Any settlement between the 
     parties of a civil action described in this section for 
     claims arising out of or resulting from an act of terrorism 
     shall be subject to prior approval by the Secretary after 
     consultation by the Secretary with the Attorney General.
       (e) Limitation on Damages.--
       (1) In general.--Punitive or exemplary damages shall not be 
     available for any losses in any action described in 
     subsection (a)(1), including any settlement described in 
     subsection (d), except where--
       (A) punitive or exemplary damages are permitted by 
     applicable State law; and
       (B) the harm to the plaintiff was caused by a criminal act 
     or course of conduct for which the defendant was convicted 
     under Federal or State criminal law, including a conviction

[[Page 10349]]

     based on a guilty pea or plea of nolo contendere.
       (2) Protection of taxpayer funds.--Any amounts awarded in, 
     or granted in settlement of, an action described in 
     subsection (a)(1) that are attributable to punitive or 
     exemplary damages allowable under paragraph (1) of this 
     subsection shall not count as insured losses for purposes of 
     this Act.
       (f) Claims Against Terrorists.--Nothing in this section 
     shall in any way be construed to limit the ability of any 
     plaintiff to seek any form of recovery from any person, 
     government, or other entity that was a participant in, or 
     aider and abettor of, any act of terrorism.
       (g) Effective Period.--This section shall apply only to 
     actions described in subsection (a)(1) arising out of or 
     resulting from acts of terrorism that occur during the 
     effective period of the Program, including any applicable 
     extension period.
                                  ____

  SA 3837. Mr. NELSON of Nebraska (for himself and Ms. Collins) 
submitted an amendment intended to be proposed by him to the bill S. 
2600, to ensure the continued financial capacity of insurers to provide 
coverage for risks from terrorism; which was ordered to lie on the 
table; as follows:

       Strike all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Terrorism Risk Insurance Act 
     of 2002''.

     SEC. 2. CONGRESSIONAL FINDINGS AND PURPOSE.

       (a) Findings.--The Congress finds that--
       (1) insurance firms that provide property and casualty 
     insurance are important financial institutions, the products 
     of which allow mutualization of risk and the efficient use of 
     financial resources and enhance the ability of the economy to 
     maintain stability, while responding to a variety of 
     economic, political, environmental, and other risks with a 
     minimum of disruption;
       (2) insurance firms that provide group term life and 
     accidental death insurance are important financial 
     institutions, the products of which allow employers, labor 
     unions, and other groups to protect their employees and 
     members against the financial impact of untimely death and 
     allow their employees and members to make financial 
     provisions for their families and other beneficiaries at 
     reasonable cost;
       (3) the ability of businesses and individuals to obtain 
     property and casualty insurance at reasonable and predictable 
     prices, in order to spread the risk of both routine and 
     catastrophic loss, is critical to economic growth, urban 
     development, and the construction and maintenance of public 
     and private housing, as well as to the promotion of United 
     States exports and foreign trade in an increasingly 
     interconnected world;
       (4) the ability of employers, labor unions, and other 
     groups to obtain group life and accidental death insurance is 
     critical to the ability of such groups to attract employees 
     and members, which is vital to sustained high levels of 
     employment and economic growth;
       (5) insurance firms that provide property and casualty 
     insurance and insurance firms that provide group life and 
     accidental death insurance face similar concentrations of 
     financial risk;
       (6) the ability of the insurance industry to cover the 
     unprecedented financial risks presented by potential acts of 
     terrorism in the United States can be a major factor in the 
     recovery from terrorist attacks, while maintaining the 
     stability of the economy;
       (7) widespread financial market uncertainties have arisen 
     following the terrorist attacks of September 11, 2001, 
     including the absence of information from which financial 
     institutions can make statistically valid estimates of the 
     probability and cost of future terrorist events, and 
     therefore the size, funding, and allocation of the risk of 
     loss caused by such acts of terrorism;
       (8) a decision by insurers to deal with such uncertainties, 
     either by terminating or excluding coverage for losses 
     arising from terrorist events, or by radically escalating 
     premium coverage to compensate for risks of loss that are not 
     readily predictable, could seriously hamper ongoing and 
     planned construction, property acquisition, and other 
     business projects, generate a dramatic increase in rents, 
     otherwise suppress economic activity and deprive the 
     beneficiaries of group life insureds the financial security 
     and benefits of such coverage; and
       (9) the United States Government should provide temporary 
     financial compensation to insured parties, contributing to 
     the stabilization of the United States economy in a time of 
     national crisis, while the financial services industry 
     develops the systems, mechanisms, products, and programs 
     necessary to create a viable financial services market for 
     private terrorism risk insurance.
       (b) Purpose.--The purpose of this Act is to establish a 
     temporary Federal program that provides for a transparent 
     system of shared public and private compensation for insured 
     losses resulting from acts of terrorism, in order to--
       (1) protect consumers by addressing market disruptions and 
     ensure the continued widespread availability and 
     affordability of property and casualty insurance and group 
     life and accidental death insurance for terrorism risk; and
       (2) allow for a transitional period for the private markets 
     to stabilize, resume pricing of such insurance, and build 
     capacity to absorb any future losses, while preserving State 
     insurance regulation and consumer protections.

     SEC. 3. DEFINITIONS.

       In this Act, the following definitions shall apply:
       (1) Act of terrorism.--
       (A) Certification.--The term ``act of terrorism'' means any 
     act that is certified by the Secretary, in concurrence with 
     the Secretary of State, and the Attorney General of the 
     United States--
       (i) to be a violent act or an act that is dangerous to--

       (I) human life;
       (II) property; or
       (III) infrastructure;

       (ii) to have resulted in damage or loss of life within the 
     United States, or outside the United States in the case of an 
     air carrier described in paragraph (3)(A)(ii); and
       (iii) to have been committed by an individual or 
     individuals acting on behalf of any foreign person or foreign 
     interest, as part of an effort to coerce the civilian 
     population of the United States or to influence the policy or 
     affect the conduct of the United States Government by 
     coercion.
       (B) Limitation.--No act or event shall be certified by the 
     Secretary as an act of terrorism if--
       (i) the act or event is committed in the course of a war 
     declared by the Congress; or
       (ii) losses resulting from the act or event, in the 
     aggregate, do not exceed $5,000,000.
       (C) Determinations final.--Any certification of, or 
     determination not to certify, an act or event as an act of 
     terrorism under this paragraph shall be final, and shall not 
     be subject to judicial review.
       (2) Business interruption coverage.--The term ``business 
     interruption coverage'' means--
       (A) coverage of losses for temporary relocation expenses 
     and ongoing expenses, including ordinary wages, where--
       (i) there is physical damage to the business premises of 
     such magnitude that the business cannot open for business;
       (ii) there is physical damage to other property that 
     totally prevents customers or employees from gaining access 
     to the business premises; or
       (iii) the Federal, State, or local government shuts down an 
     area due to physical or environmental damage, thereby 
     preventing customers or employees from gaining access to the 
     business premises; and
       (B) does not include lost profits, other than in the case 
     of a small business concern (as defined in section 3 of the 
     Small Business Act (15 U.S.C. 632) and applicable regulations 
     thereunder) in any case described in clause (i), (ii), or 
     (iii) of subparagraph (A).
       (3) Insured loss.--The term ``insured loss''--
       (A) means any loss resulting from an act of terrorism that 
     is covered by primary property and casualty insurance, 
     including business interruption coverage, or group life 
     insurance, including accidental death insurance, issued by a 
     participating insurance company, if such loss--
       (i) occurs within the United States; or
       (ii) occurs to or aboard an air carrier (as defined in 
     section 40102 of title 49, United States Code) or to a United 
     States flag vessel (or a vessel based principally in the 
     United States, on which United States income tax is paid and 
     whose insurance coverage is subject to regulation in the 
     United States), regardless of where the loss occurs; and
       (B) excludes coverage under any health insurance or 
     individual life insurance policy.
       (4) Market share.--
       (A) In general.--The ``market share'' of a participating 
     insurance company shall be calculated using the total amount 
     of direct written property and casualty insurance premiums or 
     group life insurance premiums, including premiums for 
     accidental death insurance for the participating insurance 
     company during the 2-year period preceding the year in which 
     the subject act of terrorism occurred (or during such other 
     period for which adequate data are available, as determined 
     by the Secretary), as a percentage of the aggregate of all 
     such property and casualty insurance or group life insurance, 
     including accidental death insurance premiums industry-wide 
     during that period.
       (B) Adjustments.--The Secretary may adjust the market share 
     of a participating insurance company under subparagraph (A), 
     as necessary to reflect current market participation of that 
     participating insurance company.
       (5) NAIC.--The term ``NAIC'' means the National Association 
     of Insurance Commissioners.
       (6) Participating insurance company.--The term 
     ``participating insurance company'' means any insurance 
     company, including any subsidiary or affiliate thereof--
       (A) that--
       (i) is licensed or admitted to engage in the business of 
     providing primary insurance in any State, and was so licensed 
     or admitted on September 11, 2001; or

[[Page 10350]]

       (ii) is not licensed or admitted as described in clause 
     (i), if it is an eligible surplus line carrier listed on the 
     Quarterly Listing of Alien Insurers of the NAIC, or any 
     successor thereto;
       (B) receives direct premiums for any type of commercial 
     property and casualty insurance coverage or that, not later 
     than 21 days after the date of enactment of this Act, submits 
     written notification to the Secretary of its intent to 
     participate in the Program with regard to personal lines of 
     property and casualty insurance;
       (C) that receives direct premiums for group life insurance 
     coverage, including accidental death insurance coverage and, 
     not later than 21 days after the date of enactment of this 
     Act, submits written notification to the Secretary of its 
     intent to participate in the Program; and
       (D) that meets any other criteria that the Secretary may 
     reasonably prescribe.
       (7) Participating property and casualty insurance company 
     deductible.--The term ``participating property and casualty 
     insurance company deductible'' means--
       (A) a participating property and casualty insurance 
     company's market share, multiplied by $10,000,000,000, with 
     respect to insured losses resulting from an act of terrorism 
     occurring during the period beginning on the date of 
     enactment of this Act and ending at midnight on December 31, 
     2002; and
       (B) a participating property and casualty insurance 
     company's market share, multiplied by $15,000,000,000, with 
     respect to insured losses resulting from an act of terrorism 
     occurring during the period beginning on January 1, 2003, and 
     ending at midnight on December 31, 2003, if the Program is 
     extended in accordance with section 6.
       (8) Participating group life insurance company 
     deductible.--The term ``participating group life insurance 
     company deductible'' means---
       (A) a participating group life insurance company's market 
     share, multiplied by $2,000,000,000, with respect to insured 
     losses resulting from an act of terrorism occurring during 
     the period beginning on the date of enactment of this Act and 
     ending at midnight on December 31, 2002; and
       (B) a participating group life insurance company's market 
     share, multiplied by $3,000,000,000, with respect to insured 
     losses resulting from an act of terrorism occurring during 
     the period beginning on January 1, 2003, and ending at 
     midnight on December 31, 2003, if the program is extended in 
     accordance with section 6.
       (9) Person.--The term ``person'' means any individual, 
     business, or nonprofit entity (including those organized in 
     the form of a partnership, limited liability company, 
     corporation, or association), trust or estate, or a State or 
     political subdivision of a State or other governmental unit.
       (10) Program.--The term ``Program'' means the Terrorism 
     Insured Loss Shared Compensation Program established by this 
     Act.
       (11) Property and casualty insurance.--The term ``property 
     and casualty insurance--
       (A) means commercial lines of property and casualty 
     insurance;
       (B) includes personal lines of property and casualty 
     insurance, if a notification is made in accordance with 
     paragraph (6)(B); and
       (C) does not include--
       (i) Federal crop insurance issued or reinsured under the 
     Federal Crop Insurance Act (7 U.S.C. 1501 et seq.); or
       (ii) private mortgage insurance, as that term is defined in 
     section 2 of the Homeowners Protection Act of 1998 (12 U.S.C. 
     4901).
       (12) Group life insurance.--The term ``group life 
     insurance'' means an insurance contract that provides life 
     insurance coverage for a number of persons under a single 
     contract and that provides such coverage on the basis of a 
     group selection of risks.
       (13) Secretary.--The term ``Secretary'' means the Secretary 
     of the Treasury.
       (14) State.--The term ``State'' means any State of the 
     United States, the District of Columbia, the Commonwealth of 
     Puerto Rico, the Commonwealth of the Northern Mariana 
     Islands, American Samoa, Guam, and each of the United States 
     Virgin Islands.
       (15) United states.--The term ``United States'' means all 
     States of the United States.

     SEC. 4. TERRORISM INSURED LOSS SHARED COMPENSATION PROGRAM.

       (a) Establishment of Program.--
       (1) In general.--There is established in the Department of 
     the Treasury the Terrorism Insured Loss Shared Compensation 
     Program.
       (2) Authority of the secretary.--Notwithstanding any other 
     provision of Federal or State law, the Secretary shall 
     administer the Program, and shall pay the Federal share of 
     compensation for insured losses in accordance with subsection 
     (e).
       (b) Conditions for Federal Payments.--No payment may be 
     made by the Secretary under subsection (e), unless--
       (1) a person that suffers an insured loss, or a person 
     acting on behalf of that person, files a claim with a 
     participating insurance company;
       (2) the participating insurance company provides clear and 
     conspicuous disclosure to the policyholder of the premium 
     charged for insured losses covered by the Program and the 
     Federal share of compensation for insured losses under the 
     Program--
       (A) in the case of any policy covering an insured loss that 
     is issued on or after the date of enactment of this Act, in 
     the policy, at the time of offer, purchase, and renewal of 
     the policy; and
       (B) in the case of any policy that is issued before the 
     date of enactment of this Act, not later than 90 days after 
     that date of enactment;
       (3) the participating insurance company processes the claim 
     for the insured loss in accordance with its standard business 
     practices, and any reasonable procedures that the Secretary 
     may prescribe; and
       (4) the participating insurance company submits to the 
     Secretary, in accordance with such reasonable procedures as 
     the Secretary may establish--
       (A) a claim for payment of the Federal share of 
     compensation for insured losses under the Program;
       (B) written verification and certification--
       (i) of the underlying claim; and
       (ii) of all payments made for insured losses; and
       (C) certification of its compliance with the provisions of 
     this subsection.
       (c) Mandatory Participation; Mandatory Availability.--Each 
     insurance company that meets the definition of a 
     participating insurance company under section 3--
       (1) shall participate in the Program;
       (2) shall make available in all of its property and 
     casualty insurance policies (in all of its participating 
     lines) and all of its group life and accidental death 
     policies, coverage for insured losses; and
       (3) shall make available property and casualty insurance 
     and group life and accidental death coverage for insured 
     losses that does not differ materially from the terms, 
     amounts, and other coverage limitations applicable to losses 
     arising from events other than acts of terrorism.-
       (d) Participation by Self Insured Entities.--
       (1) Determination by the secretary.--The Secretary may, in 
     consultation with the NAIC, establish procedures to allow 
     participation in the Program by municipalities and other 
     governmental or quasi-governmental entities (and by any other 
     entity, as the Secretary deems appropriate) operating through 
     self insurance arrangements that were in existence on 
     September 11, 2001, but only if the Secretary makes a 
     determination with regard to participation by any such entity 
     before the occurrence of an act of terrorism in which the 
     entity incurs an insured loss.
       (2) Participation.--If the Secretary makes a determination 
     to allow an entity described in paragraph (1) to participate 
     in the Program, all reports, conditions, requirements, and 
     standards established by this Act for participating insurance 
     companies shall apply to any such entity, as determined to be 
     appropriate by the Secretary.
       (e) Shared Insurance Loss Coverage.--
       (1) Federal share.--
       (A) In general.--Subject to the cap on liability under 
     paragraph (2) and the limitation under paragraph (6), the 
     Federal share of compensation under the Program to be paid by 
     the Secretary for insured losses resulting from an act of 
     terrorism occurring during the period beginning on the date 
     of enactment of this Act and ending at midnight on December 
     31, 2002--
       (i) shall be equal to 80 percent of that portion of the 
     amount of aggregate insured losses that--

       (I) exceeds the participating insurance company deductibles 
     required to be paid for those insured losses; and
       (II) does not exceed $10,000,000,000; and

       (ii) shall be equal to 90 percent of that portion of the 
     amount of aggregate insured losses that--

       (I) exceeds the participating insurance company deductibles 
     required to be paid for those insured losses; and
       (II) exceeds $10,000,000,000.

       (B) Extension period.--If the Program is extended in 
     accordance with section 6, the Federal share of compensation 
     under the Program to be paid by the Secretary for insured 
     losses resulting from an act of terrorism occurring during 
     the period beginning on January 1, 2003, and ending at 
     midnight on December 31, 2003, shall be calculated in 
     accordance with clauses (i) and (ii) of subparagraph (A), 
     subject to the cap on liability in paragraph (2) and the 
     limitation under paragraph (6).
       (C) Pro rata share.--If, during the period described in 
     subparagraph (A) (or during the period described in 
     subparagraph (B), if the -Program is extended in accordance 
     with section 6), the aggregate insured losses for that period 
     -exceed $10,000,000,000, the Secretary shall determine the 
     pro rata share for each participating insurance company of 
     the Federal share of compensation for insured losses 
     calculated under subparagraph (A).--
       (2) Cap on annual liability.--Notwithstanding paragraph 
     (1), or any other provision of Federal or State law, if the 
     aggregate insured losses exceed $100,000,000,000 during any 
     period referred to in subparagraph (A) or (B) of paragraph 
     (1)--
       (A) the Secretary shall not make any payment under this Act 
     for any portion of the amount of such losses that exceeds 
     $100,000,000,000; and

[[Page 10351]]

       (B) participating insurance companies shall not be liable 
     for the payment of any portion of the amount that exceeds 
     $100,000,000,000.
       (3) Notice to congress.--The Secretary shall notify the 
     Congress if estimated or actual aggregate insured losses 
     exceed $100,000,000,000 in any period described in paragraph 
     (1), and the Congress shall determine the procedures for and 
     the source of any such excess payments.
       (4) Final netting.--The Secretary shall have sole 
     discretion to determine the time at which claims relating to 
     any insured loss or act of terrorism shall become final.
       (5) Determinations final.--Any determination of the 
     Secretary under this subsection shall be final, and shall not 
     be subject to judicial review.
       (6) In-force reinsurance agreements.--For policies covered 
     by reinsurance contracts in force on the date of enactment of 
     this Act, until the in-force reinsurance contract is renewed, 
     amended, or has reached its 1-year anniversary date, any 
     Federal share of compensation due to a participating 
     insurance company for insured losses during the effective 
     period of the Program shall be shared--
       (A) with all reinsurance companies to which the 
     participating insurance company has ceded some share of the 
     insured loss pursuant to an in-force reinsurance contract; 
     and
       (B) in a manner that distributes the Federal share of 
     compensation for insured losses between the participating 
     insurance company and the reinsurance company or companies in 
     the same proportion as the insured losses would have been 
     distributed if the Program did not exist.

     SEC. 5. GENERAL AUTHORITY AND ADMINISTRATION OF CLAIMS.

       (a) General Authority.--The Secretary shall have the powers 
     and authorities necessary to carry out the Program, including 
     authority--
       (1) to investigate and audit all claims under the Program; 
     and
       (2) to prescribe regulations and procedures to implement 
     the Program.
       (b) Interim Rules and Procedures.--The Secretary shall 
     issue interim final rules or procedures specifying the manner 
     in which--
       (1) participating insurance companies may file, verify, and 
     certify claims under the Program;
       (2) the Secretary shall publish or otherwise publicly 
     announce the applicable percentage of insured losses that is 
     the responsibility of participating insurance companies and 
     the percentage that is the responsibility of the Federal 
     Government under the Program;
       (3) the Federal share of compensation for insured losses 
     will be paid under the Program, including payments based on 
     estimates of or actual aggregate insured losses;
       (4) the Secretary may, at any time, seek repayment from or 
     reimburse any participating insurance company, based on 
     estimates of insured losses under the Program, to effectuate 
     the insured loss sharing provisions contained in section 4;
       (5) each participating insurance company that incurs 
     insured losses shall pay its pro rata share of insured 
     losses, in accordance with section 4; and
       (6) the Secretary will determine any final netting of 
     payments for actual insured losses under the Program, 
     including payments owed to the Federal Government from any 
     participating insurance company and any Federal share of 
     compensation for insured losses owed to any participating 
     insurance company, to effectuate the insured loss sharing 
     provisions contained in section 4.
       (c) Subrogation Rights.--The United States shall have the 
     right of subrogation with respect to any payment made by the 
     United States under the Program.
       (d) Contracts for Services.--The Secretary may employ 
     persons or contract for services as may be necessary to 
     implement the Program.
       (e) Civil Penalties.--The Secretary may assess civil money 
     penalties for violations of this Act or any rule, regulation, 
     or order issued by the Secretary under this Act relating to 
     the submission of false or misleading information for 
     purposes of the Program, or any failure to repay any amount 
     required to be reimbursed under regulations or procedures 
     described in section 5(b). The authority granted under this 
     subsection shall continue during any period in which the 
     Secretary's authority under section 6(d) is in effect.

     SEC. 6. TERMINATION OF PROGRAM; DISCRETIONARY EXTENSION.

       (a) Termination of Program.--
       (1) In general.--The Program shall terminate at midnight on 
     December 31, 2002, unless the Secretary--
       (A) determines, after considering the report and finding 
     required by this section, that the Program should be extended 
     for 1 additional year, until midnight on December 31, 2003; 
     and
       (B) promptly notifies the Congress of such determination 
     and the reasons therefor.
       (2) Determination final.--The determination of the 
     Secretary under paragraph (1) shall be final, and shall not 
     be subject to judicial review.
       (3) Termination after extension.--If the Program is 
     extended under paragraph (1), the Program shall terminate at 
     midnight on December 31, 2003.
       (b) Report to Congress.--Not later than 9 months after the 
     date of enactment of this Act, the Secretary shall submit a 
     report to Congress--
       (1) regarding--
       (A) the availability of insurance coverage for acts of 
     terrorism;
       (B) the affordability of such coverage, including the 
     effect of such coverage on premiums; and
       (C) the capacity of the insurance industry to absorb future 
     losses resulting from acts of terrorism, taking into account 
     the profitability of the insurance industry; and
       (2) that considers--
       (A) the impact of the Program on each of the factors 
     described in paragraph (1); and
       (B) the probable impact on such factors and on the United 
     States economy if the Program terminates at midnight on 
     December 31, 2002.
       (c) Finding Required.--A determination under subsection (a) 
     to extend the Program shall be based on a finding by the 
     Secretary that--
       (1) widespread market uncertainties continue to disrupt the 
     ability of insurance companies to price insurance coverage 
     for losses resulting from acts of terrorism, thereby 
     resulting in the continuing unavailability of affordable 
     insurance for consumers; and
       (2) extending the Program for an additional year would 
     likely encourage economic stabilization and facilitate a 
     transition to a viable market for private terrorism risk 
     insurance.
       (d) Continuing Authority To Pay or Adjust Compensation.--
     Following the termination of the Program under subsection 
     (a), the Secretary may take such actions as may be necessary 
     to ensure payment, reimbursement, or adjustment of 
     compensation for insured losses arising out of any act of 
     terrorism occurring during the period in which the Program 
     was in effect under this Act, in accordance with the 
     provisions of section 4 and regulations promulgated 
     thereunder.
       (e) Repeal; Savings Clause.--This Act is repealed at 
     midnight on the final termination date of the Program under 
     subsection (a), except that such repeal shall not be 
     construed--
       (1) to prevent the Secretary from taking, or causing to be 
     taken, such actions under subsection (d) of this section and 
     sections 4(e)(4), 4(e)(5), 5(a)(1), 5(c), 5(d), and 5(e) (as 
     in effect on the day before the date of such repeal), and 
     applicable regulations promulgated thereunder, during any 
     period in which the authority of the Secretary under 
     subsection (d) of this section is in effect; or
       (2) to prevent the availability of funding under section 
     10(b) during any period in which the authority of the 
     Secretary under subsection (d) of this section is in effect.
       (f) Sense of the Congress.--It is the sense of the Congress 
     that the Secretary should make any determination under 
     subsection (a) in sufficient time to enable participating 
     insurance companies to include coverage for acts of terrorism 
     in their policies for 2003.
       (g) Study and Report on Scope of the Program.--
       (1) Study.--The Secretary, after consultation with the 
     NAIC, representatives of the insurance industry, and other 
     experts in the insurance field, shall conduct a study of the 
     potential effects of acts of terrorism on the availability of 
     individual life insurance and other lines of insurance 
     coverage.
       (2) Report.--Not later than 9 months after the date of 
     enactment of this Act, the Secretary shall submit a report to 
     the Congress on the results of the study conducted under 
     paragraph (1).
       (h) Reports Regarding Terrorism Risk Insurance Premiums.--
       (1) Report to the naic.--Beginning 6 months after the date 
     of enactment of this Act, and every 6 months thereafter, each 
     participating insurance company shall submit a report to the 
     NAIC that states the premium rates charged by that 
     participating insurance company during the preceding 6-month 
     period for insured losses covered by the Program, and 
     includes an explanation of and justification for those rates.
       (2) Reports forwarded.--The NAIC shall promptly forward 
     copies of each report submitted under paragraph (1) to the 
     Secretary, the Secretary of Commerce, the Chairman of the 
     Federal Trade Commission, and the Comptroller General of the 
     United States.
       (3) Agency reports to congress.--
       (A) In general.--The Secretary, the Secretary of Commerce, 
     and the Chairman of the Federal Trade Commission shall submit 
     joint reports to Congress and the Comptroller General of the 
     United States summarizing and evaluating the reports 
     forwarded under paragraph (2).
       (B) Timing.--The reports required under subparagraph (A) 
     shall be submitted--
       (i) 9 months after the date of enactment of this Act; and
       (ii) 12 months after the date of submission of the first 
     report under clause (i).
       (4) GAO evaluation and report.--
       (A) Evaluation.--The Comptroller General of the United 
     States shall evaluate each report submitted under paragraph 
     (3), and upon request, the Secretary, the Secretary of 
     Commerce, the Chairman of the Federal Trade Commission, and 
     the NAIC shall provide to the Comptroller all documents,

[[Page 10352]]

     records, and any other information that the Comptroller deems 
     necessary to carry out such evaluation.
       (B) Report to congress.--Not later than 90 days after 
     receipt of each report submitted under paragraph (3), the 
     Comptroller General of the United States shall submit to 
     Congress a report of the evaluation required by subparagraph 
     (A).

     SEC. 7. PRESERVATION OF STATE LAW.

       Nothing in this Act shall affect the jurisdiction or 
     regulatory authority of the insurance commissioner (or any 
     agency or office performing like functions) of any State over 
     any participating insurance company or other person--
       (1) except as specifically provided in this Act; and
       (2) except that--
       (A) the definition of the term ``act of terrorism'' in 
     section 3 shall be the exclusive definition of that term for 
     purposes of compensation for insured losses under this Act, 
     and shall preempt any provision of State law that is 
     inconsistent with that definition, to the extent that such 
     provision of law would otherwise apply to any type of 
     insurance covered by this Act;
       (B) during the period beginning on the date of enactment of 
     this Act and ending at midnight on December 31, 2002, rates 
     for terrorism risk insurance covered by this Act and filed 
     with any State shall not be subject to prior approval or a 
     waiting period, under any law of a State that would otherwise 
     be applicable, except that nothing in this Act affects the 
     ability of any State to invalidate a rate as excessive, 
     inadequate, or unfairly discriminatory; and
       (C) during the period beginning on the date of enactment of 
     this Act and for so long as the Program is in effect, as 
     provided in section 6 (including any period during which the 
     authority of the Secretary under section 6(d) is in effect), 
     books and records of any participating insurance company that 
     are relevant to the Program shall be provided, or caused to 
     be provided, to the Secretary or the designee of the 
     Secretary, upon request by the Secretary or such designee, 
     notwithstanding any provision of the laws of any State 
     prohibiting or limiting such access.

     SEC. 8. SENSE OF THE CONGRESS REGARDING CAPACITY BUILDING.

       It is the sense of the Congress that the insurance industry 
     should build capacity and aggregate risk to provide 
     affordable property and casualty insurance coverage and group 
     life insurance coverage, including accidental death coverage, 
     for terrorism risk.

     SEC. 9. AUTHORIZATION OF APPROPRIATIONS; PAYMENT AUTHORITY.

       (a) Administrative Expenses.--There are authorized to be 
     appropriated to the Secretary, out of funds in the Treasury 
     not otherwise appropriated, such sums as may be necessary for 
     administrative expenses of the Program, to remain available 
     until expended.
       (b) Payment Authority.--This Act constitutes payment 
     authority in advance of appropriation Acts, and represents 
     the obligation of the Federal Government to provide for the 
     Federal share of compensation for insured losses under the 
     Program.

     SEC. 10. PROCEDURES FOR CIVIL ACTIONS.

       (a) Federal Cause of Action.--
       (1) In general.--There shall exist a Federal cause of 
     action for property damage, personal injury, or death arising 
     out of or resulting from an act of terrorism, which shall be 
     the exclusive cause of action and remedy for claims for such 
     property damage, personal injury, or death, except as 
     provided in subsection (d).
       (2) Preemption of state actions.--All State causes of 
     action of any kind for property damage, personal injury, or 
     death arising out of or resulting from an act of terrorism 
     that are otherwise available under State law, are hereby 
     preempted, except as provided in subsection (d).
       (b) Governing Law.--The substantive law for decision in an 
     action described in subsection (a)(1) shall be derived from 
     the law, including applicable choice of law principles, of 
     the State in which the act of terrorism giving rise to the 
     action occurred, except to the extent that--
       (1) the law, including choice of law principles, of another 
     State is determined to be applicable to the action by the 
     district court hearing the action; or
       (2) otherwise applicable State law (including that 
     determined pursuant to paragraph (1)), is in consistent with 
     or otherwise preempted by Federal law.
       (c) Punitive Damages.--Any amounts awarded in a civil 
     action described in subsection (a)(1) that are attributable 
     to punitive damages shall not count as insured losses for 
     purposes of this Act.
       (d) Claims Against Terrorists.--Nothing in this section 
     shall in any way be construed to limit the ability of any 
     plaintiff to seek any form of recovery from any person, 
     government, or other entity that was a participant in, or 
     aider and abettor of, any act of terrorism.
       (e) Effective Period.--This section shall apply only to 
     actions described in subsection (a)(1) arising out of or 
     resulting from acts of terrorism that occur during the 
     effective period of the Program, including, if applicable, 
     any extension period provided for under section 6.
                                  ____

  SA 3838. Mr. HARKIN (for himself, Mr. Allen, Mr. Burns, Mr. Warner, 
Mr. Smith of New Hampshire, and Mrs. Hutchison,) submitted an amendment 
intended to be proposed by him to the bill S. 2600, to ensure the 
continued financial capacity of insurers to provide coverage for risks 
from terrorism; as follows:

       At the appropriate place, insert the following:

     SEC. __. SATISFACTION OF JUDGMENTS FROM FROZEN ASSETS OF 
                   TERRORISTS, TERRORIST ORGANIZATIONS, AND STATE 
                   SPONSORS OF TERRORISM.

       (a) In General.--Notwithstanding any other provision of 
     law, and except as provided in subsection (b), in every case 
     in which a person has obtained a judgment against a terrorist 
     party on a claim based upon an act of terrorism or for which 
     a terrorist party is not immune under section 1605(a)(7) of 
     title 28, United States Code, the blocked assets of that 
     terrorist party (including the blocked assets of any agency 
     or instrumentality of that terrorist party) shall be subject 
     to execution or attachment in aid of execution in order to 
     satisfy such judgment to the extent of any compensatory 
     damages for which such terrorist party has been adjudged 
     liable.
       (b) Presidential Waiver.--
       (1) In general.--Subject to paragraph (2), upon determining 
     on an asset-by-asset basis that a waiver is necessary in the 
     national security interest, the President may waive the 
     requirements of subsection (a) in connection with (and prior 
     to the enforcement of) any judicial order directing 
     attachment in aid of execution or execution against any 
     property subject to the Vienna Convention on Diplomatic 
     Relations or the Vienna Convention on Consular Relations.
       (2) Exception.--A waiver under this subsection shall not 
     apply to--
       (A) property subject to the Vienna Convention on Diplomatic 
     Relations or the Vienna Convention on Consular Relations that 
     has been used by the United States for any nondiplomatic 
     purpose (including use as rental property), or the proceeds 
     of such use; or
       (B) the proceeds of any sale or transfer for value to a 
     third party of any asset subject to the Vienna Convention on 
     Diplomatic Relations or the Vienna Convention on Consular 
     Relations.
       (c) Special Rule for Cases Against Iran.--Section 2002 of 
     the Victims of Trafficking and Violence Protection Act of 
     2000 (Public Law 106-386; 114 Stat. 1542) is amended--
       (1) in subsection (a)(2)(A)(ii), by inserting after ``July 
     27, 2000'' the following: ``or before October 28, 2000,'';
       (2) in subsection (b)(2)(B), by inserting after ``the date 
     of enactment of this Act'' the following: ``(less amounts 
     therein as to which the United States has an interest in 
     subrogation pursuant to subsection (c) arising prior to the 
     date of entry of the judgment or judgments to be satisfied in 
     whole or in part hereunder).'';
       (3) by redesignating subsections (d), (e), and (f) as 
     subsections (e), (f), and (g), respectively; and
       (4) by inserting after subsection (c) the following new 
     subsection (d):
       ``(d) Distribution of Foreign Military Sales Funds 
     Inadequate to Satisfy Full Amount of Compensatory Awards 
     Against Iran.--
       ``(1)(A) In the event that the Secretary determines that 
     the amounts available to be paid under subsection (b)(2) are 
     inadequate to pay the entire amount of compensatory damages 
     awarded in judgments issued as of the date of the enactment 
     of this subsection in cases identified in subsection 
     (a)(2)(A), the Secretary shall, not later than 60 days after 
     such date, make payment from the account specified in 
     subsection (b)(2) to each party to which such judgment has 
     been issued a share of the amounts in that account which are 
     not subject to subrogation to the United States under this 
     Act.
       ``(B) The amount so paid to each such person shall be 
     calculated by the proportion that the amount of compensatory 
     damages awarded in a judgment issued to that particular 
     person bears to the total amount of all compensatory damages 
     awarded to all persons to whom judgments have been issued in 
     cases identified in subsection (a)(2)(A) as of the date 
     referred to in subparagraph (A).
       ``(2) Nothing herein shall bar, or require delay in, 
     enforcement of any judgment to which this subsection applies 
     under any procedure or against assets otherwise available 
     under this section or under any other provision of law.
       ``(3) Any person receiving less than the full amount of 
     compensatory damages awarded to that party in judgments to 
     which this subsection applies shall not be required to make 
     the election set forth in subsection (a)(2)(C) in order to 
     qualify for payment hereunder.''.
       (d) Definitions.--In this section:
       (1) The term ``terrorist party'' means a terrorist, a 
     terrorist organization, or a foreign state designated as a 
     state sponsor of terrorism under section 6(j) of the Export 
     Administration Act of 1979 (50 U.S.C. App. 2405(j)) or 
     section 620A of the Foreign Assistance Act of 1961 (22 U.S.C. 
     2371).
       (2) The term ``blocked asset'' means any asset seized or 
     frozen by the United States in

[[Page 10353]]

     accordance with law, or otherwise held by the United States 
     without claim of ownership by the United States.
       (3) The term ``property subject to the Vienna Convention on 
     Diplomatic Relations or the Vienna Convention on Consular 
     Relations'' and the term ``asset subject to the Vienna 
     Convention on Diplomatic Relations or the Vienna Convention 
     on Consular Relations'' mean any property or asset, 
     respectively, the attachment in aid of execution or execution 
     of which would result in a violation of an obligation of the 
     United States under the Vienna Convention on Diplomatic 
     Relations or the Vienna Convention on Consular Relations, as 
     the case may be.
                                  ____

  SA 3839. Mr. HATCH proposed an amendment to the bill S. 2600, to 
ensure the continued financial capacity of insurers to provide coverage 
for risks from terrorism; as follows:

       At the end, add the following:

                   TITLE II--ANTITERRORISM PROVISIONS

             Subtitle A--Suppression of Terrorist Bombings

     SEC. 201. SHORT TITLE.

       This subtitle may be cited as the ``Terrorist Bombings 
     Convention Implementation Act of 2002''.

     SEC. 202. BOMBING STATUTE.

       (a) Offense.--Chapter 113B of title 18, United States Code, 
     relating to terrorism, is amended by inserting after section 
     2332e the following:

     ``Sec. 2332f. Bombings of places of public use, government 
       facilities, public transportation systems and 
       infrastructure facilities

       ``(a) Offenses.--
       ``(1) In general.--Whoever unlawfully delivers, places, 
     discharges, or detonates an explosive or other lethal device 
     in, into, or against a place of public use, a state or 
     government facility, a public transportation system, or an 
     infrastructure facility--
       ``(A) with the intent to cause death or serious bodily 
     injury, or
       ``(B) with the intent to cause extensive destruction of 
     such a place, facility, or system, where such destruction 
     results in or is likely to result in major economic loss,
     shall be punished as prescribed in subsection (c).
       ``(2) Attempts and conspiracies.--Whoever attempts or 
     conspires to commit an offense under paragraph (1) shall be 
     punished as prescribed in subsection (c).
       ``(b) Jurisdiction.--There is jurisdiction over the 
     offenses in subsection (a) if--
       ``(1) the offense takes place in the United States and--
       ``(A) the offense is committed against another state or a 
     government facility of such state, including its embassy or 
     other diplomatic or consular premises of that state;
       ``(B) the offense is committed in an attempt to compel 
     another state or the United States to do or abstain from 
     doing any act;
       ``(C) at the time the offense is committed, it is 
     committed--
       ``(i) on board a vessel flying the flag of another state;
       ``(ii) on board an aircraft which is registered under the 
     laws of another state; or
       ``(iii) on board an aircraft which is operated by the 
     government of another state;
       ``(D) a perpetrator is found outside the United States;
       ``(E) a perpetrator is a national of another state or a 
     stateless person; or
       ``(F) a victim is a national of another state or a 
     stateless person;
       ``(2) the offense takes place outside the United States 
     and--
       ``(A) a perpetrator is a national of the United States or 
     is a stateless person whose habitual residence is in the 
     United States;
       ``(B) a victim is a national of the United States;
       ``(C) a perpetrator is found in the United States;
       ``(D) the offense is committed in an attempt to compel the 
     United States to do or abstain from doing any act;
       ``(E) the offense is committed against a state or 
     government facility of the United States, including an 
     embassy or other diplomatic or consular premises of the 
     United States;
       ``(F) the offense is committed on board a vessel flying the 
     flag of the United States or an aircraft which is registered 
     under the laws of the United States at the time the offense 
     is committed; or
       ``(G) the offense is committed on board an aircraft which 
     is operated by the United States.
       ``(c) Penalties.--Whoever violates this section shall be 
     imprisoned for any term of years or for life, and if death 
     results from the violation, shall be punished by death or 
     imprisoned for any term of years or for life.
       ``(d) Exemptions to Jurisdiction.--This section does not 
     apply to--
       ``(1) the activities of armed forces during an armed 
     conflict, as those terms are understood under the law of war, 
     which are governed by that law,
       ``(2) activities undertaken by military forces of a state 
     in the exercise of their official duties; or
       ``(3) offenses committed within the United States, where 
     the alleged offender and the victims are United States 
     citizens and the alleged offender is found in the United 
     States, or where jurisdiction is predicated solely on the 
     nationality of the victims or the alleged offender and the 
     offense has no substantial effect on interstate or foreign 
     commerce.
       ``(e) Definitions.--As used in this section, the term--
       ``(1) `serious bodily injury' has the meaning given that 
     term in section 1365(g)(3) of this title;
       ``(2) `national of the United States' has the meaning given 
     that term in section 101(a)(22) of the Immigration and 
     Nationality Act (8 U.S.C. 1101(a)(22));
       ``(3) `state or government facility' includes any permanent 
     or temporary facility or conveyance that is used or occupied 
     by representatives of a state, members of Government, the 
     legislature or the judiciary or by officials or employees of 
     a state or any other public authority or entity or by 
     employees or officials of an intergovernmental organization 
     in connection with their official duties;
       ``(4) `intergovernmental organization' includes 
     international organization (as defined in section 1116(b)(5) 
     of this title);
       ``(5) `infrastructure facility' means any publicly or 
     privately owned facility providing or distributing services 
     for the benefit of the public, such as water, sewage, energy, 
     fuel, or communications;
       ``(6) `place of public use' means those parts of any 
     building, land, street, waterway, or other location that are 
     accessible or open to members of the public, whether 
     continuously, periodically, or occasionally, and encompasses 
     any commercial, business, cultural, historical, educational, 
     religious, governmental, entertainment, recreational, or 
     similar place that is so accessible or open to the public;
       ``(7) `public transportation system' means all facilities, 
     conveyances, and instrumentalities, whether publicly or 
     privately owned, that are used in or for publicly available 
     services for the transportation of persons or cargo;
       ``(8) `explosive' has the meaning given in section 844(j) 
     of this title insofar that it is designed, or has the 
     capability, to cause death, serious bodily injury, or 
     substantial material damage;
       ``(9) `other lethal device' means any weapon or device that 
     is designed or has the capability to cause death, serious 
     bodily injury, or substantial damage to property through the 
     release, dissemination, or impact of toxic chemicals, 
     biological agents or toxins (as those terms are defined in 
     section 178 of this title), or radiation or radioactive 
     material;
       ``(10) `military forces of a state' means the armed forces 
     of a state which are organized, trained, and equipped under 
     its internal law for the primary purpose of national defense 
     or security, and persons acting in support of those armed 
     forces who are under their formal command, control, and 
     responsibility;
       ``(11) `armed conflict' does not include internal 
     disturbances and tensions, such as riots, isolated and 
     sporadic acts of violence, and other acts of a similar 
     nature; and
       ``(12) `state' has the same meaning as that term has under 
     international law, and includes all political subdivisions 
     thereof.''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 113B of title 18, United States Code, is 
     amended by adding after the item relating to section 2332e 
     the following:

``2332f. Bombings of places of public use, government facilities, 
              public transportation systems and infrastructure 
              facilities.''.

       (c) Disclaimer.--Nothing contained in this section is 
     intended to affect the applicability of any other Federal or 
     State law which might pertain to the underlying conduct.

     SEC. 203. EFFECTIVE DATE.

       Section 202 shall become effective on the date that the 
     International Convention for the Suppression of Terrorist 
     Bombings enters into force for the United States.

         Subtitle B--Suppression of the Financing of Terrorism

     SEC. 211. SHORT TITLE.

       This subtitle may be cited as the ``Suppression of the 
     Financing of Terrorism Convention Implementation Act of 
     2002''.

     SEC. 212. TERRORISM FINANCING STATUTE.

       (a) In General.--Chapter 113B of title 18, United States 
     Code, is amended by adding at the end the following:

     ``Sec. 2339C. Prohibitions against the financing of terrorism

       ``(a) Offenses.--
       ``(1) In general.--Whoever, in a circumstance described in 
     subsection (c), by any means, directly or indirectly, 
     unlawfully and willfully provides or collects funds with the 
     intention that such funds be used, or with the knowledge that 
     such funds are to be used, in full or in part, in order to 
     carry out--
       ``(A) an act which constitutes an offense within the scope 
     of a treaty specified in subsection (e)(7), as implemented by 
     the United States, or
       ``(B) any other act intended to cause death or serious 
     bodily injury to a civilian, or to any other person not 
     taking an active part in the hostilities in a situation of 
     armed conflict, when the purpose of such act, by its nature 
     or context, is to intimidate a population, or to compel a 
     government or an

[[Page 10354]]

     international organization to do or to abstain from doing any 
     act,
     shall be punished as prescribed in subsection (d)(1).
       ``(2) Attempts and conspiracies.--Whoever attempts or 
     conspires to commit an offense under paragraph (1) shall be 
     punished as prescribed in subsection (d)(1).
       ``(3) Relationship to predicate act.--For an act to 
     constitute an offense set forth in this subsection, it shall 
     not be necessary that the funds were actually used to carry 
     out a predicate act.
       ``(b) Concealment.--
       ``(1) In General.--Whoever, in the United States, or 
     outside the United States and a national of the United States 
     or a legal entity organized under the laws of the United 
     States (including any of its States, districts, 
     commonwealths, territories, or possessions), knowingly 
     conceals or disguises the nature, the location, the source, 
     or the ownership or control of any material support or 
     resources provided in violation of section 2339B of this 
     chapter, or of any funds provided or collected in violation 
     of subsection (a) or any proceeds of such funds, shall be 
     punished as prescribed in subsection (d)(2).
       ``(2) Attempts and conspiracies.--Whoever attempts or 
     conspires to commit an offense under paragraph (1) shall be 
     punished as prescribed in subsection (d)(2).
       ``(c) Jurisdiction.--There is jurisdiction over the 
     offenses in subsection (a) in the following circumstances--
       ``(1) the offense takes place in the United States and--
       ``(A) a perpetrator was a national of another state or a 
     stateless person;
       ``(B) on board a vessel flying the flag of another state or 
     an aircraft which is registered under the laws of another 
     state at the time the offense is committed;
       ``(C) on board an aircraft which is operated by the 
     government of another state;
       ``(D) a perpetrator is found outside the United States;
       ``(E) was directed toward or resulted in the carrying out 
     of a predicate act against--
       ``(i) a national of another state; or
       ``(ii) another state or a government facility of such 
     state, including its embassy or other diplomatic or consular 
     premises of that state;
       ``(F) was directed toward or resulted in the carrying out 
     of a predicate act committed in an attempt to compel another 
     state or international organization to do or abstain from 
     doing any act; or
       ``(G) was directed toward or resulted in the carrying out 
     of a predicate act--
       ``(i) outside the United States; or
       ``(ii) within the United States, and either the offense or 
     the predicate act was conducted in, or the results thereof 
     affected, interstate or foreign commerce;
       ``(2) the offense takes place outside the United States 
     and--
       ``(A) a perpetrator is a national of the United States or 
     is a stateless person whose habitual residence is in the 
     United States;
       ``(B) a perpetrator is found in the United States; or
       ``(C) was directed toward or resulted in the carrying out 
     of a predicate act against--
       ``(i) any property that is owned, leased, or used by the 
     United States or by any department or agency of the United 
     States, including an embassy or other diplomatic or consular 
     premises of the United States;
       ``(ii) any person or property within the United States;
       ``(iii) any national of the United States or the property 
     of such national; or
       ``(iv) any property of any legal entity organized under the 
     laws of the United States, including any of its States, 
     districts, commonwealths, territories, or possessions;
       ``(3) the offense is committed on board a vessel flying the 
     flag of the United States or an aircraft which is registered 
     under the laws of the United States at the time the offense 
     is committed;
       ``(4) the offense is committed on board an aircraft which 
     is operated by the United States; or
       ``(5) the offense was directed toward or resulted in the 
     carrying out of a predicate act committed in an attempt to 
     compel the United States to do or abstain from doing any act.
       ``(d) Penalties.--
       ``(1) Whoever violates subsection (a) shall be fined under 
     this title, imprisoned for not more than 20 years, or both.
       ``(2) Whoever violates subsection (b) shall be fined under 
     this title, imprisoned for not more than 10 years, or both.
       ``(e) Definitions.--As used in this section--
       ``(1) the term `funds' means assets of every kind, whether 
     tangible or intangible, movable or immovable, however 
     acquired, and legal documents or instruments in any form, 
     including electronic or digital, evidencing title to, or 
     interest in, such assets, including coin, currency, bank 
     credits, travelers checks, bank checks, money orders, shares, 
     securities, bonds, drafts, and letters of credit;
       ``(2) the term `government facility' means any permanent or 
     temporary facility or conveyance that is used or occupied by 
     representatives of a state, members of a government, the 
     legislature, or the judiciary, or by officials or employees 
     of a state or any other public authority or entity or by 
     employees or officials of an intergovernmental organization 
     in connection with their official duties;
       ``(3) the term `proceeds' means any funds derived from or 
     obtained, directly or indirectly, through the commission of 
     an offense set forth in subsection (a);
       ``(4) the term `provides' includes giving, donating, and 
     transmitting;
       ``(5) the term `collects' includes raising and receiving;
       ``(6) the term `predicate act' means any act referred to in 
     subparagraph (A) or (B) of subsection (a)(1);
       ``(7) the term `treaty' means--
       ``(A) the Convention for the Suppression of Unlawful 
     Seizure of Aircraft, done at The Hague on December 16, 1970;
       ``(B) the Convention for the Suppression of Unlawful Acts 
     against the Safety of Civil Aviation, done at Montreal on 
     September 23, 1971;
       ``(C) the Convention on the Prevention and Punishment of 
     Crimes against Internationally Protected Persons, including 
     Diplomatic Agents, adopted by the General Assembly of the 
     United Nations on December 14, 1973;
       ``(D) the International Convention against the Taking of 
     Hostages, adopted by the General Assembly of the United 
     Nations on December 17, 1979;
       ``(E) the Convention on the Physical Protection of Nuclear 
     Material, adopted at Vienna on March 3, 1980;
       ``(F) the Protocol for the Suppression of Unlawful Acts of 
     Violence at Airports Serving International Civil Aviation, 
     supplementary to the Convention for the Suppression of 
     Unlawful Acts against the Safety of Civil Aviation, done at 
     Montreal on February 24, 1988;
       ``(G) the Convention for the Suppression of Unlawful Acts 
     against the Safety of Maritime Navigation, done at Rome on 
     March 10, 1988;
       ``(H) the Protocol for the Suppression of Unlawful Acts 
     against the Safety of Fixed Platforms located on the 
     Continental Shelf, done at Rome on March 10, 1988; or
       ``(I) the International Convention for the Suppression of 
     Terrorist Bombings, adopted by the General Assembly of the 
     United Nations on December 15, 1997;
       ``(8) the term `intergovernmental organization' includes 
     international organizations;
       ``(9) the term `international organization' has the same 
     meaning as in section 1116(b)(5) of this title;
       ``(10) the term `armed conflict' does not include internal 
     disturbances and tensions, such as riots, isolated and 
     sporadic acts of violence, and other acts of a similar 
     nature;
       ``(11) the term `serious bodily injury' has the same 
     meaning as in section 1365(g)(3) of this title;
       ``(12) the term `national of the United States' has the 
     meaning given that term in section 101(a)(22) of the 
     Immigration and Nationality Act (8 U.S.C. 1101(a)(22)); and
       ``(13) the term `state' has the same meaning as that term 
     has under international law, and includes all political 
     subdivisions thereof.
       ``(f) Civil Penalty.--In addition to any other criminal, 
     civil, or administrative liability or penalty, any legal 
     entity located within the United States or organized under 
     the laws of the United States, including any of the laws of 
     its States, districts, commonwealths, territories, or 
     possessions, shall be liable to the United States for the sum 
     of at least $10,000, if a person responsible for the 
     management or control of that legal entity has, in that 
     capacity, committed an offense set forth in subsection 
     (a).''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 113B of title 18, United States Code, is 
     amended by adding at the end the following:

``2339C. Prohibitions against the financing of terrorism.''.

       (c) Disclaimer.--Nothing contained in this section is 
     intended to affect the scope or applicability of any other 
     Federal or State law.

     SEC. 213. EFFECTIVE DATE.

       Except for sections 2339C(c)(1)(D) and (2)(B) of title 18, 
     United States Code, which shall become effective on the date 
     that the International Convention for the Suppression of the 
     Financing of Terrorism enters into force for the United 
     States, and for the provisions of section 2339C(e)(7)(I) of 
     title 18, United States Code, which shall become effective on 
     the date that the International Convention for the 
     Suppression of Terrorist Bombing enters into force for the 
     United States, section 212 of this subtitle shall take effect 
     upon the date of enactment of this Act.

                     Subtitle C--Ancillary Measures

     SEC. 221. ANCILLARY MEASURES.

       (a) Wiretap Predicates.--Section 2516(1)(q) of title 18, 
     United States Code, is amended by--
       (1) inserting ``2332f,'' after ``2332d,''; and
       (2) striking ``or 2339B'' and inserting ``2339B, or 
     2339C''.
       (b) Federal Crime of Terrorism.--Section 2332b(g)(5)(B) of 
     title 18, United States Code, is amended by--
       (1) inserting ``2332f (relating to bombing of public places 
     and facilities),'' after ``2332b (relating to acts of 
     terrorism transcending national boundaries),''; and
       (2) inserting ``2339C (relating to financing of 
     terrorism),'' before ``or 2340A (relating to torture)''.

[[Page 10355]]

       (c) Providing Material Support to Terrorists Predicate.--
     Section 2339A of title 18, United States Code, is amended by 
     inserting ``2332f,'' before ``or 2340A''.
       (d) Forfeiture of Funds, Proceeds, and Instrumentalities.--
     Section 981(a)(1) of title 18, United States Code, is amended 
     by adding at the end the following:
       ``(H) Any property, real or personal, involved in a 
     violation or attempted violation, or which constitutes or is 
     derived from proceeds traceable to a violation, of section 
     2339C of this title.''.
                                  ____

  SA 3840 Mr. NELSON of Florida submitted an amendment intended to be 
proposed by him to the bill S. 2600, to ensure the continued financial 
capacity of insurers to provide coverage for risks from terrorism; 
which was ordered to lie on the table; as follows:

       At the appropriate place, insert the following:

     SEC.  . SEPARATE ACCOUNT REQUIRED.

       If a participating insurance company increases annual 
     premium rates on covered risks, the company--
       (1) shall deposit the amount of the increase in premium in 
     a separate, segregated account;
       (2) shall identify the portion of the premium insuring 
     against terrorism risk on a separate line item on the policy; 
     and
       (3) may not disburse any funds from amounts in that 
     separate, segregated account for any purpose other than the 
     payment of losses from acts of terrorism.
                                  ____

  SA 3841. Mr. HOLLINGS submitted an amendment intended to be proposed 
by him to the bill S. 2600, to ensure the continued financial capacity 
of insurers to provide coverage for risks from terrorism; which was 
ordered to lie on the table; as follows:

       Strike out all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS

       (a) Short Title.--This Act may be cited as the ``National 
     Terrorism Reinsurance Fund Act''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Purpose.
Sec. 4. National terrorism reinsurance program.
Sec. 5. Fund operations.
Sec. 6. Coverage provided.
Sec. 7. Secretary to determine if loss is attributable to terrorism.
Sec. 8. Mandatory coverage by property and casualty insurers for acts 
              of terrorism.
Sec. 9. Pass-throughs and other rate increases.
Sec. 10. Credit for reinsurance.
Sec. 11. Administrative provisions.
Sec. 12. Inapplicability of certain laws.
Sec. 13. Sunset provision.
Sec. 14. Definitions.

     SEC. 2. FINDINGS.

       The Congress finds the following:
       (1) The terrorist attacks on the World Trade Center and 
     Pentagon on September 11, 2001, have inflicted possibly the 
     largest loss ever incurred by insurers and reinsurers.
       (2) The magnitude of the loss, and its impact on the 
     current capacity of the reinsurance market, threaten the 
     ability of the property and casualty insurance market to 
     provide coverage to building owners, businesses, and American 
     citizens.
       (3) It is necessary to create a temporary reinsurance 
     mechanism to augment the capacity of private insurers to 
     provide insurance for terrorism related risks.

     SEC. 3. PURPOSE.

       The purpose of this Act is to facilitate the coverage by 
     property and casualty insurers of the peril for losses due to 
     acts of terrorism by providing additional reinsurance 
     capacity for loss or damage due to acts of terrorism 
     occurring within the United States, its territories, and 
     possessions.

     SEC. 4. NATIONAL TERRORISM REINSURANCE PROGRAM.

       (a) In General.--The Secretary of Commerce shall establish 
     and administer a program to provide reinsurance to 
     participating insurers for losses due to acts of terrorism.
       (b) Advisory Committee; Membership.--There is established 
     an advisory committee to provide advice and counsel to the 
     Secretary in carrying out the program of reinsurance 
     established by the Secretary. The advisory committee shall 
     consist of 10 members, as follows:
       (1) 3 representatives of the property and casualty 
     insurance industry, appointed by the Secretary.
       (2) A representative of property and casualty insurance 
     agents, appointed by the Secretary.
       (3) A representative of consumers of property casualty 
     insurance, appointed by the Secretary.
       (4) A representative of a recognized national credit rating 
     agency, appointed by the Secretary.
       (5) A representative of the banking or real estate 
     industry, appointed by the Secretary.
       (6) 2 representatives of the National Association of 
     Insurance Commissioners, designated by that organization.
       (7) A representative of the Department of the Treasury, 
     designated by the Secretary of the Treasury.
       (c) National Terrorism Reinsurance Fund.--
       (1) Establishment.--To carry out the reinsurance program, 
     the Secretary shall establish a National Terrorism 
     Reinsurance Fund which shall be available, without fiscal 
     year limitations--
       (A) to make such payments as may, from time to time, be 
     required under reinsurance contracts under this Act;
       (B) to pay such administrative expenses as may be necessary 
     or appropriate to carry out the purposes of this Act, but 
     such expenses may not exceed $5,000,000 for each of fiscal 
     years 2002, 2003, and 2004; and
       (C) to repay to the Secretary of the Treasury such sums, 
     including interest thereon, as may be borrowed from the 
     Treasury for purposes of this Act.
       (2) Credits to fund.--The Fund shall be credited with--
       (A) reinsurance premiums, fees, and other charges which may 
     be paid or collected in connection with reinsurance provided 
     under this Act;
       (B) interest which may be earned on investments of the 
     Fund;
       (C) receipts from any other source which may, from time to 
     time, be credited to the Fund; and
       (D) Funds borrowed by the Secretary from the Treasury.
       (3) Investment in Obligations issued or guaranteed by 
     united states.--If the Secretary determines that the moneys 
     of the Fund are in excess of current needs, he may request 
     the investment of such amounts as he deems advisable by the 
     Secretary of the Treasury in obligations issued or guaranteed 
     by the United States.
       (4) Loans to fund.--The Secretary of the Treasury shall 
     grant loans to the Fund in the manner and to the extent 
     provided in this Act.
       (d) Underwriting Standards.--In order to carry out the 
     responsibilities of the Secretary under this Act and protect 
     the Fund, the Secretary shall establish minimum underwriting 
     standards for participating insurers.
       (e) Monitoring of Terrorism Insurance Rates.--
       (1) Secretary to establish special committee on rates.--The 
     Secretary shall establish a special committee on rates, the 
     size and membership of which shall be determined by the 
     Secretary, except that the committee shall, at a minimum, 
     include--
       (A) representatives of providers of insurance for losses 
     due to acts of terrorism;
       (B) representatives of purchases of such insurance;
       (C) at least 2 representatives of NAIC; and
       (D) at least 2 independent insurance actuaries.
       (2) Duties.--The special committee on rates shall meet at 
     the call of the Secretary and shall--
       (A) review reports filed with the Secretary by State 
     insurance regulatory authorities;
       (B) collect data on rate disclosure practices of 
     participating insurers for insurance for covered lines and 
     for losses due to acts of terrorism; and
       (C) provide such advice and counsel to the Secretary as the 
     Secretary may require.

     SEC. 5. FUND OPERATIONS.

       (a) Funding by Premium.--
       (1) In general.--For the year beginning January 1, 2002, 
     and each subsequent year of operation, participating insurers 
     shall pay into the Fund an annual reinsurance contract 
     premium of not less than 3 percent of their respective gross 
     direct written premiums for covered lines for the calendar 
     year. The annual premium shall be paid in installments at the 
     end of each calendar quarter. The reinsurance contract 
     premium and any annual assessment may be recovered by a 
     participating insurer from its covered lines policyholders as 
     a direct surcharge calculated as a uniform percentage of 
     premium.
       (2) Additional credit risk premium.--If the Secretary 
     determines that a participating insurer has a credit rating 
     that is lower than the second from highest credit rating 
     awarded by nationally recognized credit rating agencies, the 
     Secretary may charge an additional credit risk premium, of up 
     to 0.5 percent of gross direct written premiums for covered 
     lines received by that insurer, to compensate the Fund for 
     credit risk associated with providing reinsurance to that 
     insurer.
       (b) Initial Capital.--
       (1) Loan.--The Fund shall have an initial capital of 
     $2,000,000,000, which the Secretary shall borrow from the 
     Treasury of the United States. Upon application by the 
     Secretary, the Secretary of the Treasury shall transfer that 
     amount to the Fund, out of amounts in the Treasury not 
     otherwise appropriated, at standard market rates.
       (2) Repayment of start-up loan.--The Secretary shall use 
     premiums received from assessments in calendar year 2002 to 
     repay the loan provided to the Fund under paragraph (1).
       (c) Shortfall Loans.--
       (1) In general.--If the Secretary determines that the 
     balance in the accounts of

[[Page 10356]]

     the Fund is insufficient to cover anticipated claims, 
     administrative expenses, and maintain adequate reserves for 
     any other reason, after taking into account premiums assessed 
     under subsection (a) and any other amounts receivable, the 
     Secretary shall borrow from the Treasury an amount sufficient 
     to satisfy the obligations of the Fund and to maintain a 
     positive balance of $2,000,000,000 in the accounts of the 
     Fund. Upon application by the Secretary, the Secretary of the 
     Treasury shall transfer to the Fund, out of amounts in the 
     Treasury not otherwise appropriated, the requested amount as 
     an interest-bearing loan.
       (2) Interest rate.--The rate of interest on any loan made 
     to the Fund under paragraph (1) shall be established by the 
     Secretary of the Treasury and based on the weighted average 
     credit rating of the Fund before the loss that made the loan 
     necessary.
       (3) $50 billion loan limit.--Notwithstanding any other 
     provision of this Act, the total amount of loans outstanding 
     at any time from the Treasury to the Fund may not exceed the 
     amount by which $50,000,000,000 exceeds the Fund's assets.
       (4) Repayment of loans by assessment.--Any loan under 
     paragraph (1) shall be repaid from reserves of the Fund, 
     assessments of participating insurers, or a combination 
     thereof. If an assessment is necessary, the maximum annual 
     assessment under this subsection shall be not more than 3 
     percent of the direct written premium for covered lines. The 
     reinsurance contract premium and any annual assessment may be 
     recovered by a participating insurer from its covered lines 
     policyholders as a direct surcharge calculated as a uniform 
     percentage of premium.

     SEC. 6. COVERAGE PROVIDED.

       (a) In General.--The Fund shall provide reinsurance for 
     losses resulting from acts of terrorism covered by 
     reinsurance contracts entered into between the Fund and 
     participating insurers that write covered lines of insurance 
     within the meaning of section 14(5)(A) or that have elected, 
     under section 14(5)(C), to voluntarily include another line 
     of insurance.
       (b) Retention.--The Fund shall reimburse participating 
     insurers for losses resulting from acts of terrorism on 
     direct losses in any calendar year in excess of 10 percent of 
     a participating insurer's average gross direct written 
     premiums and policyholders' surplus for covered lines for the 
     most recently ended calendar year for which data are 
     available, based on each participating insurer's annual 
     statement for that calendar year as reported to NAIC.
       (c) Reimbursement Amount.--If a participating insurer 
     demonstrates to the satisfaction of the Secretary that it is 
     has paid claims for losses resulting from acts of terrorism 
     equal to or in excess of the amount of retention required by 
     subsection (b), then the Fund shall reimburse the 
     participating insurer for--
       (1) 90 percent of its covered losses in calendar year 2002; 
     and
       (2) a percentage of its covered losses in calendar years 
     beginning after calendar year 2002 equal to--
       (A) 90 percent if the insurer pays an assessment equal to 4 
     percent of the insurer's average gross direct written 
     premiums and policy-holders' surplus for the most recently 
     ended calendar year;
       (B) 80 percent if the insurer pays as assessment equal to 3 
     percent of the insurer's average gross direct written 
     premiums and policyholders' surplus for the most recently 
     calendar year; and
       (C) 70 percent if the insurer pays an assessment equal to 2 
     percent of the insurer's average gross direct written 
     premiums and policyholders' surplus for the most recently 
     ended calendar year.
       (d) $50,000,000,000 Limit.--Except as provided in 
     subsection (e), the Fund may not reimburse participating 
     insurers for covered losses in excess of a total Fund 
     reimbursement amount for all participating insurers of 
     $50,000,000,000.
       (e) Losses Exceeding $50,000,000,000 Limit.--If the 
     Secretary determines that reimbursable losses in a calendar 
     year from an event exceed $50,000,000,000, the Secretary--
       (1) shall pay, out of amounts in the Treasury not otherwise 
     appropriated.
       (A) 90 percent of the covered losses occurring in calendar 
     year 2002 in excess, in the aggregate, of $50,000,000,000 but 
     not in excess of $100,000,000; and
       (B) 80 percent of the covered losses occurring in calendar 
     year 2003 or 2004 in excess, in the aggregate, of 
     $50,000,000,000 but not in excess of $100,000,000; and
       (2) shall notify the Congress of that determination and 
     transmit to the Congress recommendations for responding to 
     the insufficiency of available amounts to cover reimbursable 
     losses.
       (f) Reports to State Regulator; Certification.--
       (1) Reporting terrorism coverage.--A participating insurer 
     shall--
       (A) report the amount of its terrorism insurance coverage 
     to the insurance regulatory authority for each State in which 
     it does business; and
       (B) obtain a certification from the State that it is not 
     providing terrorism insurance coverage in excess of its 
     capacity under State solvency requirements.
       (2) Reports to secretary.--The State regulator shall 
     furnish a copy of the certification received under paragraph 
     (1) to the Secretary.

     SEC. 7. SECRETARY TO DETERMINE IF LOSS IS ATTRIBUTABLE TO 
                   TERRORISM.

       (a) Initial Determination.--If a participating insurer 
     files a claim for reimbursement from the Fund, the Secretary 
     shall make an initial determination as to whether the losses 
     or expected losses were caused by an act of terrorism.
       (b) Notice and Hearing.--The Secretary shall give public 
     notice of the initial determination and afford all interested 
     parties an opportunity to be heard on the question of whether 
     the losses or expected losses were caused by an act of 
     terrorism.
       (c) Final Determination.--Within 30 days after the 
     Secretary's initial determination, the Secretary shall make a 
     final determination as to whether the losses or expected 
     losses were caused by an act of terrorism.
       (d) Standard of Review.--The Secretary's determination 
     shall be upheld upon judicial review if based upon 
     substantial evidence.

     SEC. 8. MANDATORY COVERAGE BY PROPERTY AND CASUALTY INSURERS 
                   FOR ACTS OF TERRORISM.

       (a) In General.--An insurer that provides lines of coverage 
     described in section 14(5)(A) or 14(5)(B) may not--
       (1) exclude or limit coverage in those lines for losses 
     from acts of terrorism in the United States, its territories, 
     and possessions in property and casualty insurance policy 
     forms; or
       (2) deny or cancel coverage solely due to the risk of 
     losses from acts of terrorism in the United States.
       (b) Terms and Conditions.--Insurance against losses from 
     acts of terrorism in the United States shall be covered with 
     the same deductibles, limits, terms, and conditions as the 
     standard provisions of the policy for non-catastrophic 
     perils.

     SEC. 9. PASS-THROUGHS AND OTHER RATE INCREASES.

       (a) Limitation on Rate Increases for Covered Risks.--Except 
     as provided in subsection (b), a participating insurer that 
     provides lines of coverage described in section 14(5)(A) or 
     14(5)(B) may not increase annual rates on covered risks 
     during any period in which the insurer participates in the 
     Fund by a percent in excess of the sum of--
       (1) the percent used to determine the insurer's assessment 
     under section 5(a)(1); and
       (2) if there is an assessment against the insurer under 
     section 5(c)(4), a percent equivalent to the percent 
     assessment of the insurer's gross direct written premium for 
     covered lines.
       (b) Terrorism-Related Increases in Excess of Pass-
     Throughs.--
       (1) Reports by insurers.--Not less than 30 days before the 
     date on which a participating insurer increases the premium 
     rate for insurance on any covered line of insurance described 
     in section 14(5) based, in whole or in part, on risk 
     associated with insurance against losses due to acts of 
     terrorism, the insurer shall file a report with the State 
     insurance regulatory authority for the State in which the 
     premium increase is effective that--
       (A) explains the need for the increased premium;
       (B) identifies the portion of the increase properly 
     attributable to risk associated with insurance offered by 
     that insurer against losses due to acts of terrorism; and
       (C) demonstrates, by substantial evidence, why that portion 
     of the increase is warranted.
       (2) Reports by state regulators.--Within 15 days after a 
     State insurance regulatory authority receives a report from 
     an insurer required by paragraph (1), the authority--
       (A) shall transmit a copy of the report to the Secretary;
       (B) may include a determination with respect to whether an 
     insurer has met the requirement of paragraph (1)(C); and
       (C) may include with the report any commentary or analysis 
     it deems appropriate.

     SEC. 10. CREDIT FOR REINSURANCE.

       Each State shall afford an insurer obtaining reinsurance 
     from the Fund credit for such reinsurance on the same basis 
     and to the same extent that credit for reinsurance would be 
     available to that insurer under applicable State law when 
     reinsurance is obtained from an assuming insurer licensed or 
     accredited in that State.

     SEC. 11. ADMINISTRATIVE PROVISIONS; REPORTS AND ANALYSIS.

       (a) In General.--In carrying out this Act, the Secretary 
     may--
       (1) issue such rules and regulations as may be necessary to 
     administer this Act;
       (2) enter into reinsurance contracts, adjust and pay claims 
     as provided in this Act, and carry out the activities 
     necessary to implement this Act;
       (3) set forth the coverage provided by the Fund to 
     accomplish the purposes of this Act;
       (4) provide for an audit of the books and records of the 
     Fund by the General Accounting Office;
       (5) take appropriate action to collect premiums or 
     assessments under this Act; and
       (6) audit the reports, claims, books, and records of 
     participating insurers.
       (b) Reports From Insurers.--Participaitng insurers shall 
     submit reports

[[Page 10357]]

     on a quarterly or other basis (as required by the Secretary) 
     to the Secretary, the Federal Trade Commission, and the 
     General Accounting Office setting forth rates, premiums, risk 
     analysis, coverage, reserves, claims made for reimbursement 
     from the Fund, and such additional financial and actuarial 
     information as the Secretary may require regarding lines of 
     coverage described in section 14(5)(A) or 14(5)(B).
       (c) FTC Analysis and Enforcement.--The Federal Trade 
     Commission shall review the reports submitted under 
     subsection (b), treating the information contained in the 
     reports as privileged and confidential, for the purpose of 
     determining whether any insurer is engaged in unfair methods 
     of competition or unfair or deceptive acts or practices in or 
     affecting commerce (within the meaning of section 5 of the 
     Federal Trade Commission Act (15 U.S.C. 45)).
       (d) GAO Review.--The Comptroller General shall provide for 
     review and analysis of the reports submitted under subsection 
     (b), and, if necessary, provide of audit of reimbursement 
     claims filed by insurers with the Fund.
       (e) Reports by Secretary.--No later than march 31st of each 
     calendar year, the Secretary shall transmit to the Senate 
     Committee on Commerce, Science, and Technology and the House 
     of Representatives Committee on Commerce an annual report on 
     insurance rate increases for the preceding calendar year in 
     the United States based upon the reports received by the 
     Secretary under this Act. The Secretary may include in the 
     report a recommendation for legislation to impose Federal 
     regulation of insurance rates on covered lines of insurance 
     if the Secretary determines that premium rates for insurance 
     on covered lines of insurance are--
       (1) unreasonable; and
       (2) attributable to insurance for losses from acts of 
     terrorism.

     SEC. 12. INAPPLICABILITY OF CERTAIN LAWS.

       (a) In General.--State laws relating to insurance rates, 
     insurance policy forms, insurance rates on any covered lines 
     of insurance described in section 14(5)(A) or 14(5)(B), 
     insurer financial requirements, and insurer licensing do not 
     apply to contracts entered into by the Fund. The Fund is not 
     subject to State tax and is exempt from Federal income tax. 
     The reinsurance contract premium paid and assessments 
     collected by insurers shall not be subject to local, State, 
     or Federal tax. The reinsurance contract premium and 
     assessments recovered from policyholders shall not be subject 
     to local, State, or Federal tax.
       (b) Exception for Unfair Trade Practice Laws.--
     Notwithstanding subsection (a), nothing in this Act 
     supersedes or preempts a State law that prohibits unfair 
     methods of competition in commerce, unfair or deceptive acts 
     or practices in commerce, or unfair insurance claims 
     practices.

     SEC. 13. SUNSET PROVISION.

       (a) Assessment and Collection of Premiums.--The Secretary 
     shall continue the premium assessment and collection 
     operations of the Fund under this Act as long as loans due 
     from the Fund to the United States Treasury are outstanding.
       (b) Provision of Reinsurance.--The Secretary shall suspend 
     other operations of the Fund for new contract years on the 
     close of business on December 31, 2004, and may suspend the 
     offering of reinsurance contracts for new contract years at 
     any time before that date if the Secretary determines that 
     the reinsurance provided by the Fund is no longer needed for 
     covered lines due to market conditions.
       (c) Review of Private Reinsurance Availability.--The 
     Secretary shall review the cost and availability of private 
     reinsurance for acts of terrorism at least annually and shall 
     report the findings and any recommendations to Congress by 
     June 1 of each year the Fund is in operation.
       (d) Dissolution of Fund.--
       (1) Distribution for reserves.--When the Secretary 
     determines that all Fund operations have been terminated, the 
     Secretary shall dissolve the Fund. Any unencumbered Fund 
     assets remaining after the satisfaction of all outstanding 
     claims, loans from the Treasury, and other liabilities of the 
     fund shall be distributed, on a pro rata basis based on 
     premiums paid, to any insurer that--
       (A) participated in the Fund during its operation; and
       (B) demonstrates, to the satisfaction of the Secretary, 
     that any amount received as a distribution from the Fund will 
     be permanently credited to a reserve account maintained by 
     that insurer against claims for industrywide aggregate losses 
     of $2,000,000,000 from--
       (i) acts of terrorism in the United States; or
       (ii) the effects of earthquakes, volcanic eruptions, 
     tsunamis, or hurricanes.
       (2) Retention requirement for tapping reserve.--Amounts 
     credited to a reserve under paragraph (a) may not be used by 
     an insurer to pay claims until the insurer has paid claims 
     for losses resulting from acts or events described in 
     paragraph (1)(B) in excess of 10 percent of that insurer's 
     average gross direct written premiums and policyholders' 
     surplus for covered lines for the most recently ended 
     calendar year for which data are available.
       (3) Officer and director penalties for misuse of 
     reserves.--Any officer or director of an insurer who 
     knowingly authorizes or directs the use of any amount 
     received from the Fund under paragraph (1) for any purpose 
     other than an appropriate use of amounts in the reserve to 
     which the amount is credited shall be guilty of a Class E 
     felony and sentenced in accordance with the provisions of 
     section 3551 of title 18, United States Code.
       (4) Residual distribution to treasury.-- Any unencumbered 
     Fund assets remaining after the distribution under paragraph 
     (1) shall be covered into the Treasury of the United States 
     as miscellaneous receipts.

     SEC. 14. DEFINITIONS.

       In this Act:
       (1) Secretary.--Except where otherwise specifically 
     provided, the term ``Secretary'' means the Secretary of 
     Commerce.
       (2) NAIC.--The term ``NAIC'' means the National Association 
     of Insurance Commissioners.
       (3) Fund.--The term ``Fund'' means the National Terrorism 
     Reinsurance Fund established under section 4.
       (4) Participating insurer.--The term ``participating 
     insurer'' means every property and casualty insurer writing 
     on a direct basis a covered line or lines of insurance in any 
     jurisdiction of the United States, its territories, or 
     possessions, including residual market insurers.
       (5) Covered line.--
       (A) In general.--The term ``covered line'' means any one or 
     a combination of the following, written on a direct basis, as 
     reported by property and casualty insurers in required 
     financial reports on Statutory Page 14 of the NAIC Annual 
     Statement Blank:
       (i) Fire.
       (ii) Allied lines.
       (iii) Commercial multiple peril.
       (iv) Ocean marine.
       (v) Inland marine.
       (vi) Workers compensation.
       (vii) Products liability.
       (viii) Commercial auto no-fault (personal injury 
     protection), other commercial auto liability, or commercial 
     auto physical damage.
       (ix) Aircraft (all peril).
       (x) Fidelity and surety.
       (xi) Burglary and theft.
       (xii) Boiler and machinery.
       (xiii) Any other line of insurance that is reported by 
     property and casualty insurers in required financial reports 
     on Statutory Page 14 of the NAIC Annual Statement Blank which 
     is voluntarily elected by a participating insurer to be 
     included in its reinsurance contract with the Fund.
       (B) Other lines.--For purposes of clause (xiii), the lines 
     of business that may be voluntarily selected are the 
     following:
       (i) Farmowners multiple peril.
       (ii) Homeowners multiple peril.
       (iii) Mortgage guaranty.
       (iv) Financial guaranty.
       (v) Private passenger automobile insurance.
       (C) Election.--The election to voluntarily include another 
     line of insurance, if made, must apply to all affiliated 
     insurers that are members of an insurer group. Any voluntary 
     election is on a one-time basis and is irrevocable.
       (6) Losses.--The term ``losses'' means direct incurred 
     losses from an act of terrorism for covered lines, plus 
     defense and cost containment expenses. Notwithstanding the 
     preceding sentence, a loss shall not be recognized as a loss 
     for the purpose of determining the amount of an insurer's 
     retention or reimbursement under this Act unless the claim 
     for the loss has been paid within 12 months after the 
     terrorism event occurs and other loss adjustments.
       (7) Covered losses.--The term ``covered losses'' means 
     direct losses in excess of the participating insurer's 
     retention.
       (8) Terrorism; act of terrorism.--
       (A) In general.--The terms ``terrorism'' and ``act of 
     terrorism'' means any act, certified by the Secretary in 
     concurrence with the Secretary of State and the Attorney 
     General, as a violent act or act dangerous to human life, 
     property or infrastructure, within the United States, its 
     territories and possessions, that is committed by an 
     individual or individuals acting on behalf of foreign agents 
     or foreign interests (other than a foreign government) as 
     part of an effort to coerce or intimidate the civilian 
     population of the United States or to influence the policy or 
     affect the conduct of the United States government.
       (B) Acts of war.--No act shall be certified as an act of 
     terrorism if the act is committed in the course of a war 
     declared by the Congress of the United States or by a foreign 
     government.
       (C) Finality of certification.--Any certification, or 
     determination not to certify, by the Secretary under 
     subparagraph (A) is final and not subject to judicial review.
       (9) Insurer.--
       (A) In general.--The term ``insurer'' means an entity 
     writing covered lines on a direct basis and licensed as a 
     property and casualty insurer, risk retention group, or other 
     entity authorized by law as a residual market mechanism 
     providing property or casualty coverage in at least one 
     jurisdiction of the United States, its territories, or 
     possessions.
       (B) Voluntary participation.--A State workers' 
     compensation, auto, or property insurance Fund may 
     voluntarily participate as an insurer.

[[Page 10358]]

       (10) Contract year.--The term ``contract year'' means the 
     period of time that obligations exist between a participating 
     insurer and the Fund for a given annual reinsurance contract.
       (11) Retention.--The term ``retention'' means the level of 
     direct losses retained by a participating insurer for which 
     the insurer is not entitled to reimbursement by the Fund.
                                  ____

  SA 3842. Mr. SANTORUM proposed an amendment to the bill S. 2600, to 
ensure the continued financial capacity of insurers to provide coverage 
for risks from terrorism; as follows:

       At the end, add the following:

                   TITLE II--ANTITERRORISM PROVISIONS

             Subtitle A--Suppression of Terrorist Bombings

     SEC. 201. SHORT TITLE.

       This subtitle may be cited as the ``Terrorist Bombings 
     Convention Implementation Act of 2002''.

     SEC. 202. BOMBING STATUTE.

       (a) Offense.--Chapter 113B of title 18, United States Code, 
     relating to terrorism, is amended by inserting after section 
     2332e the following:

     ``Sec. 2332f. Bombings of places of public use, government 
       facilities, public transportation systems and 
       infrastructure facilities

       ``(a) Offenses.--
       ``(1) In general.--Whoever unlawfully delivers, places, 
     discharges, or detonates an explosive or other lethal device 
     in, into, or against a place of public use, a state or 
     government facility, a public transportation system, or an 
     infrastructure facility--
       ``(A) with the intent to cause death or serious bodily 
     injury, or
       ``(B) with the intent to cause extensive destruction of 
     such a place, facility, or system, where such destruction 
     results in or is likely to result in major economic loss,

     shall be punished as prescribed in subsection (c).
       ``(2) Attempts and conspiracies.--Whoever attempts or 
     conspires to commit an offense under paragraph (1) shall be 
     punished as prescribed in subsection (c).
       ``(b) Jurisdiction.--There is jurisdiction over the 
     offenses in subsection (a) if--
       ``(1) the offense takes place in the United States and--
       ``(A) the offense is committed against another state or a 
     government facility of such state, including its embassy or 
     other diplomatic or consular premises of that state;
       ``(B) the offense is committed in an attempt to compel 
     another state or the United States to do or abstain from 
     doing any act;
       ``(C) at the time the offense is committed, it is 
     committed--
       ``(i) on board a vessel flying the flag of another state;
       ``(ii) on board an aircraft which is registered under the 
     laws of another state; or
       ``(iii) on board an aircraft which is operated by the 
     government of another state;
       ``(D) a perpetrator is found outside the United States;
       ``(E) a perpetrator is a national of another state or a 
     stateless person; or
       ``(F) a victim is a national of another state or a 
     stateless person;
       ``(2) the offense takes place outside the United States 
     and--
       ``(A) a perpetrator is a national of the United States or 
     is a stateless person whose habitual residence is in the 
     United States;
       ``(B) a victim is a national of the United States;
       ``(C) a perpetrator is found in the United States;
       ``(D) the offense is committed in an attempt to compel the 
     United States to do or abstain from doing any act;
       ``(E) the offense is committed against a state or 
     government facility of the United States, including an 
     embassy or other diplomatic or consular premises of the 
     United States;
       ``(F) the offense is committed on board a vessel flying the 
     flag of the United States or an aircraft which is registered 
     under the laws of the United States at the time the offense 
     is committed; or
       ``(G) the offense is committed on board an aircraft which 
     is operated by the United States.
       ``(c) Penalties.--Whoever violates this section shall be 
     imprisoned for any term of years or for life, and if death 
     results from the violation, shall be punished by death or 
     imprisoned for any term of years or for life.
       ``(d) Exemptions to Jurisdiction.--This section does not 
     apply to--
       ``(1) the activities of armed forces during an armed 
     conflict, as those terms are understood under the law of war, 
     which are governed by that law,
       ``(2) activities undertaken by military forces of a state 
     in the exercise of their official duties; or
       ``(3) offenses committed within the United States, where 
     the alleged offender and the victims are United States 
     citizens and the alleged offender is found in the United 
     States, or where jurisdiction is predicated solely on the 
     nationality of the victims or the alleged offender and the 
     offense has no substantial effect on interstate or foreign 
     commerce.
       ``(e) Definitions.--As used in this section, the term--
       ``(1) `serious bodily injury' has the meaning given that 
     term in section 1365(g)(3) of this title;
       ``(2) `national of the United States' has the meaning given 
     that term in section 101(a)(22) of the Immigration and 
     Nationality Act (8 U.S.C. 1101(a)(22));
       ``(3) `state or government facility' includes any permanent 
     or temporary facility or conveyance that is used or occupied 
     by representatives of a state, members of Government, the 
     legislature or the judiciary or by officials or employees of 
     a state or any other public authority or entity or by 
     employees or officials of an intergovernmental organization 
     in connection with their official duties;
       ``(4) `intergovernmental organization' includes 
     international organization (as defined in section 1116(b)(5) 
     of this title);
       ``(5) `infrastructure facility' means any publicly or 
     privately owned facility providing or distributing services 
     for the benefit of the public, such as water, sewage, energy, 
     fuel, or communications;
       ``(6) `place of public use' means those parts of any 
     building, land, street, waterway, or other location that are 
     accessible or open to members of the public, whether 
     continuously, periodically, or occasionally, and encompasses 
     any commercial, business, cultural, historical, educational, 
     religious, governmental, entertainment, recreational, or 
     similar place that is so accessible or open to the public;
       ``(7) `public transportation system' means all facilities, 
     conveyances, and instrumentalities, whether publicly or 
     privately owned, that are used in or for publicly available 
     services for the transportation of persons or cargo;
       ``(8) `explosive' has the meaning given in section 844(j) 
     of this title insofar that it is designed, or has the 
     capability, to cause death, serious bodily injury, or 
     substantial material damage;
       ``(9) `other lethal device' means any weapon or device that 
     is designed or has the capability to cause death, serious 
     bodily injury, or substantial damage to property through the 
     release, dissemination, or impact of toxic chemicals, 
     biological agents or toxins (as those terms are defined in 
     section 178 of this title), or radiation or radioactive 
     material;
       ``(10) `military forces of a state' means the armed forces 
     of a state which are organized, trained, and equipped under 
     its internal law for the primary purpose of national defense 
     or security, and persons acting in support of those armed 
     forces who are under their formal command, control, and 
     responsibility;
       ``(11) `armed conflict' does not include internal 
     disturbances and tensions, such as riots, isolated and 
     sporadic acts of violence, and other acts of a similar 
     nature; and
       ``(12) `state' has the same meaning as that term has under 
     international law, and includes all political subdivisions 
     thereof.''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 113B of title 18, United States Code, is 
     amended by adding after the item relating to section 2332e 
     the following:

``2332f. Bombings of places of public use, government facilities, 
              public transportation systems and infrastructure 
              facilities.''.

       (c) Disclaimer.--Nothing contained in this section is 
     intended to affect the applicability of any other Federal or 
     State law which might pertain to the underlying conduct.

     SEC. 203. EFFECTIVE DATE.

       Section 202 shall become effective on the date that the 
     International Convention for the Suppression of Terrorist 
     Bombings enters into force for the United States.

         Subtitle B--Suppression of the Financing of Terrorism

     SEC. 211. SHORT TITLE.

       This subtitle may be cited as the ``Suppression of the 
     Financing of Terrorism Convention Implementation Act of 
     2002''.

     SEC. 212. TERRORISM FINANCING STATUTE.

       (a) In General.--Chapter 113B of title 18, United States 
     Code, is amended by adding at the end the following:

     ``Sec. 2339C. Prohibitions against the financing of terrorism

       ``(a) Offenses.--
       ``(1) In general.--Whoever, in a circumstance described in 
     subsection (c), by any means, directly or indirectly, 
     unlawfully and willfully provides or collects funds with the 
     intention that such funds be used, or with the knowledge that 
     such funds are to be used, in full or in part, in order to 
     carry out--
       ``(A) an act which constitutes an offense within the scope 
     of a treaty specified in subsection (e)(7), as implemented by 
     the United States, or
       ``(B) any other act intended to cause death or serious 
     bodily injury to a civilian, or to any other person not 
     taking an active part in the hostilities in a situation of 
     armed conflict, when the purpose of such act, by its nature 
     or context, is to intimidate a population, or to compel a 
     government or an international organization to do or to 
     abstain from doing any act,

     shall be punished as prescribed in subsection (d)(1).

[[Page 10359]]

       ``(2) Attempts and conspiracies.--Whoever attempts or 
     conspires to commit an offense under paragraph (1) shall be 
     punished as prescribed in subsection (d)(1).
       ``(3) Relationship to predicate act.--For an act to 
     constitute an offense set forth in this subsection, it shall 
     not be necessary that the funds were actually used to carry 
     out a predicate act.
       ``(b) Concealment.--
       ``(1) In General.--Whoever, in the United States, or 
     outside the United States and a national of the United States 
     or a legal entity organized under the laws of the United 
     States (including any of its States, districts, 
     commonwealths, territories, or possessions), knowingly 
     conceals or disguises the nature, the location, the source, 
     or the ownership or control of any material support or 
     resources provided in violation of section 2339B of this 
     chapter, or of any funds provided or collected in violation 
     of subsection (a) or any proceeds of such funds, shall be 
     punished as prescribed in subsection (d)(2).
       ``(2) Attempts and conspiracies.--Whoever attempts or 
     conspires to commit an offense under paragraph (1) shall be 
     punished as prescribed in subsection (d)(2).
       ``(c) Jurisdiction.--There is jurisdiction over the 
     offenses in subsection (a) in the following circumstances--
       ``(1) the offense takes place in the United States and--
       ``(A) a perpetrator was a national of another state or a 
     stateless person;
       ``(B) on board a vessel flying the flag of another state or 
     an aircraft which is registered under the laws of another 
     state at the time the offense is committed;
       ``(C) on board an aircraft which is operated by the 
     government of another state;
       ``(D) a perpetrator is found outside the United States;
       ``(E) was directed toward or resulted in the carrying out 
     of a predicate act against--
       ``(i) a national of another state; or
       ``(ii) another state or a government facility of such 
     state, including its embassy or other diplomatic or consular 
     premises of that state;
       ``(F) was directed toward or resulted in the carrying out 
     of a predicate act committed in an attempt to compel another 
     state or international organization to do or abstain from 
     doing any act; or
       ``(G) was directed toward or resulted in the carrying out 
     of a predicate act--
       ``(i) outside the United States; or
       ``(ii) within the United States, and either the offense or 
     the predicate act was conducted in, or the results thereof 
     affected, interstate or foreign commerce;
       ``(2) the offense takes place outside the United States 
     and--
       ``(A) a perpetrator is a national of the United States or 
     is a stateless person whose habitual residence is in the 
     United States;
       ``(B) a perpetrator is found in the United States; or
       ``(C) was directed toward or resulted in the carrying out 
     of a predicate act against--
       ``(i) any property that is owned, leased, or used by the 
     United States or by any department or agency of the United 
     States, including an embassy or other diplomatic or consular 
     premises of the United States;
       ``(ii) any person or property within the United States;
       ``(iii) any national of the United States or the property 
     of such national; or
       ``(iv) any property of any legal entity organized under the 
     laws of the United States, including any of its States, 
     districts, commonwealths, territories, or possessions;
       ``(3) the offense is committed on board a vessel flying the 
     flag of the United States or an aircraft which is registered 
     under the laws of the United States at the time the offense 
     is committed;
       ``(4) the offense is committed on board an aircraft which 
     is operated by the United States; or
       ``(5) the offense was directed toward or resulted in the 
     carrying out of a predicate act committed in an attempt to 
     compel the United States to do or abstain from doing any act.
       ``(d) Penalties.--
       ``(1) Whoever violates subsection (a) shall be fined under 
     this title, imprisoned for not more than 20 years, or both.
       ``(2) Whoever violates subsection (b) shall be fined under 
     this title, imprisoned for not more than 10 years, or both.
       ``(e) Definitions.--As used in this section--
       ``(1) the term `funds' means assets of every kind, whether 
     tangible or intangible, movable or immovable, however 
     acquired, and legal documents or instruments in any form, 
     including electronic or digital, evidencing title to, or 
     interest in, such assets, including coin, currency, bank 
     credits, travelers checks, bank checks, money orders, shares, 
     securities, bonds, drafts, and letters of credit;
       ``(2) the term `government facility' means any permanent or 
     temporary facility or conveyance that is used or occupied by 
     representatives of a state, members of a government, the 
     legislature, or the judiciary, or by officials or employees 
     of a state or any other public authority or entity or by 
     employees or officials of an intergovernmental organization 
     in connection with their official duties;
       ``(3) the term `proceeds' means any funds derived from or 
     obtained, directly or indirectly, through the commission of 
     an offense set forth in subsection (a);
       ``(4) the term `provides' includes giving, donating, and 
     transmitting;
       ``(5) the term `collects' includes raising and receiving;
       ``(6) the term `predicate act' means any act referred to in 
     subparagraph (A) or (B) of subsection (a)(1);
       ``(7) the term `treaty' means--
       ``(A) the Convention for the Suppression of Unlawful 
     Seizure of Aircraft, done at The Hague on December 16, 1970;
       ``(B) the Convention for the Suppression of Unlawful Acts 
     against the Safety of Civil Aviation, done at Montreal on 
     September 23, 1971;
       ``(C) the Convention on the Prevention and Punishment of 
     Crimes against Internationally Protected Persons, including 
     Diplomatic Agents, adopted by the General Assembly of the 
     United Nations on December 14, 1973;
       ``(D) the International Convention against the Taking of 
     Hostages, adopted by the General Assembly of the United 
     Nations on December 17, 1979;
       ``(E) the Convention on the Physical Protection of Nuclear 
     Material, adopted at Vienna on March 3, 1980;
       ``(F) the Protocol for the Suppression of Unlawful Acts of 
     Violence at Airports Serving International Civil Aviation, 
     supplementary to the Convention for the Suppression of 
     Unlawful Acts against the Safety of Civil Aviation, done at 
     Montreal on February 24, 1988;
       ``(G) the Convention for the Suppression of Unlawful Acts 
     against the Safety of Maritime Navigation, done at Rome on 
     March 10, 1988;
       ``(H) the Protocol for the Suppression of Unlawful Acts 
     against the Safety of Fixed Platforms located on the 
     Continental Shelf, done at Rome on March 10, 1988; or
       ``(I) the International Convention for the Suppression of 
     Terrorist Bombings, adopted by the General Assembly of the 
     United Nations on December 15, 1997;
       ``(8) the term `intergovernmental organization' includes 
     international organizations;
       ``(9) the term `international organization' has the same 
     meaning as in section 1116(b)(5) of this title;
       ``(10) the term `armed conflict' does not include internal 
     disturbances and tensions, such as riots, isolated and 
     sporadic acts of violence, and other acts of a similar 
     nature;
       ``(11) the term `serious bodily injury' has the same 
     meaning as in section 1365(g)(3) of this title;
       ``(12) the term `national of the United States' has the 
     meaning given that term in section 101(a)(22) of the 
     Immigration and Nationality Act (8 U.S.C. 1101(a)(22)); and
       ``(13) the term `state' has the same meaning as that term 
     has under international law, and includes all political 
     subdivisions thereof.
       ``(f) Civil Penalty.--In addition to any other criminal, 
     civil, or administrative liability or penalty, any legal 
     entity located within the United States or organized under 
     the laws of the United States, including any of the laws of 
     its States, districts, commonwealths, territories, or 
     possessions, shall be liable to the United States for the sum 
     of at least $10,000, if a person responsible for the 
     management or control of that legal entity has, in that 
     capacity, committed an offense set forth in subsection 
     (a).''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 113B of title 18, United States Code, is 
     amended by adding at the end the following:

``2339C. Prohibitions against the financing of terrorism.''.

       (c) Disclaimer.--Nothing contained in this section is 
     intended to affect the scope or applicability of any other 
     Federal or State law.

     SEC. 213. EFFECTIVE DATE.

       Except for sections 2339C(c)(1)(D) and (2)(B) of title 18, 
     United States Code, which shall become effective on the date 
     that the International Convention for the Suppression of the 
     Financing of Terrorism enters into force for the United 
     States, and for the provisions of section 2339C(e)(7)(I) of 
     title 18, United States Code, which shall become effective on 
     the date that the International Convention for the 
     Suppression of Terrorist Bombing enters into force for the 
     United States, section 212 of this subtitle shall take effect 
     upon the date of enactment of this Act.

                     Subtitle C--Ancillary Measures

     SEC. 221. ANCILLARY MEASURES.

       (a) Wiretap Predicates.--Section 2516(1)(q) of title 18, 
     United States Code, is amended by--
       (1) inserting ``2332f,'' after ``2332d,''; and
       (2) striking ``or 2339B'' and inserting ``2339B, or 
     2339C''.
       (b) Federal Crime of Terrorism.--Section 2332b(g)(5)(B) of 
     title 18, United States Code, is amended by--
       (1) inserting ``2332f (relating to bombing of public places 
     and facilities),'' after ``2332b (relating to acts of 
     terrorism transcending national boundaries),''; and
       (2) inserting ``2339C (relating to financing of 
     terrorism),'' before ``or 2340A (relating to torture)''.
       (c) Providing Material Support to Terrorists Predicate.--
     Section 2339A of title 18, United States Code, is amended by 
     inserting ``2332f,'' before ``or 2340A''.

[[Page 10360]]

       (d) Forfeiture of Funds, Proceeds, and Instrumentalities.--
     Section 981(a)(1) of title 18, United States Code, is amended 
     by adding at the end the following:
       ``(H) Any property, real or personal, involved in a 
     violation or attempted violation, or which constitutes or is 
     derived from proceeds traceable to a violation, of section 
     2339C of this title.''.
                                  ____

  SA 3843. Mr. BROWNBACK proposed an amendment to the bill S. 2600, to 
ensure the continued financial capacity of insurers to provide coverage 
for risks from terrorism; as follows:

       At the appropriate place add the following:

     SEC. __. UNPATENTABILITY OF HUMAN ORGANISMS.

       Section 101 of title 35, United States Code, is amended--
       (1) by inserting ``(a) In General.--'' before ``Whoever''; 
     and
       (2) by adding at the end the following:
       ``(b) Unpatentability of Human Organisms.--
       ``(1) Definition.--In this subsection, the term `human 
     cloning' means human asexual reproduction, accomplished by 
     introducing nuclear material from one or more human somatic 
     cells into a fertilized or unfertilized oocyte whose nuclear 
     material has been removed or inactivated so as to produce a 
     living organism (at any stage of development) that is 
     genetically virtually identical to an existing or previously 
     existing human organism.
       ``(2) Unpatentability.--A patent may not be obtained for--
       ``(A) an organism of the human species at any stage of 
     development produced by any method, whether in vitro or in 
     vivo, including the zygote, embryo, fetus, child or adult;
       ``(B) a living organism made by human cloning; or
       ``(C) a process of human cloning.''.
                                  ____

  SA 3844. Mr. ENSIGN proposed an amendment to amendment SA 3843 
proposed by Mr. Brownback to the bill (S. 2600) to ensure the continued 
financial capacity of insurers to provide coverage for risks from 
terrorism; as follows:

       Strike all after the first word and insert the following:

     UNPATENTABILITY OF HUMAN ORGANISMS.

       Section 101 of title 35, United States Code, is amended--
       (1) by inserting ``(a) In General.--'' before ``Whoever''; 
     and
       (2) by adding at the end the following:
       ``(b) Unpatentability of Human Organisms.--
       ``(1) Definition.--In this subsection, the term `human 
     cloning' means human asexual reproduction, accomplished by 
     introducing nuclear material from one or more human somatic 
     cells into a fertilized or unfertilized oocyte whose nuclear 
     material has been removed or inactivated so as to produce a 
     living organism (at any stage of development) that is 
     genetically virtually identical to an existing or previously 
     existing human organism.
       ``(2) Unpatentability.--A patent may not be obtained for--
       ``(A) an organism of the human species at any stage of 
     development produced by any method, whether in vitro or in 
     vivo, including the zygote, embryo, fetus, child or adult;
       ``(B) a living organism made by human cloning; or
       ``(C) a process of human cloning.''.
       ``(3) Effective date.--This section shall become effective 
     30 days after the date of enactment.''
                                  ____

  SA 3845. Mr. REID (for Mrs. Feinstein) proposed an amendment to the 
bill S. 672, to amend the Immigration and Nationality Act to provide 
for the continued classification of certain aliens as children for 
purposes of that Act in cases where the aliens ``age-out'' while 
awaiting immigration processing, and for other purposes; as follows:

       On page 9, line 9, strike ``(a)(4)'' and insert 
     ``(a)(2)(A)''.
       On page 10, line 9, strike ``209(b)(2)'' and insert 
     ``209(b)(3)''.
                                  ____

  SA 3846. Mr. REID (for Mrs. Feinstein) proposed an amendment to the 
bill H.R. 1209, to amend the Immigration and Nationality Act to 
determine whether an alien is a child, for purposes of classification 
as an immediate relative, based on the age of the alien on the date the 
classification petition with respect to the alien is filed, and for 
other purposes; as follows:

       On page 7, line 9, strike ``(a)(4)'' and insert 
     ``(a)(2)(A)''.
       On page 8, line 9, strike ``209(b)(2)'' and insert 
     ``209(b)(3)''.

                          ____________________