[Congressional Record (Bound Edition), Volume 152 (2006), Part 3]
[Senate]
[Pages 3326-3333]
[From the U.S. Government Publishing Office, www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Ms. COLLINS (for herself, Mr. Lieberman, Mr. Coleman, Mr. 
        Akaka, Mr. Talent, and Mr. Graham):
  S. 2400. A bill to transfer authority to review certain mergers, 
acquisitions, and takeovers of United States entities by foreign 
entities to a designee established within the Department of Homeland 
Security, and for other purposes; to the Committee on Banking, Housing, 
and Urban Affairs.
  Ms. COLLINS. Mr. President, I rise today to introduce legislation to 
reform and strengthen the national security review process for foreign 
investments in the United States. I am very pleased to be joined by 
three of my colleagues--Senator Lieberman, Senator Coleman, and Senator 
Akaka--in introducing this legislation.
  In a global economy, foreign investment in this country is becoming 
increasingly common. The national security and homeland security 
implications of those investments must be scrutinized by the 
departments with responsibility for those critical matters.
  The controversy over the Dubai ports transaction has exposed serious 
flaws and shortcomings in the current law and process that is used to 
review foreign investments in our country.
  In 1988, Congress passed the Exon-Florio provision of the Defense 
Production Act to get the President the authority to suspend or 
prohibit any foreign acquisition, merger, or takeover of a U.S. 
corporation that is determined to threaten our national security.
  Through an Executive order, the President gave a new committee--known 
as the Committee on Foreign Investment in the United States, often 
referred to as CFIUS--the responsibility of reviewing transactions 
pursuant to the Exon-Florio law and to make recommendations to the 
President.
  The law is something of an anachronism because of what it doesn't 
say. It focuses on acquisitions of American companies that are either 
important to our military industrial base or have technology that could 
help a terrorist state develop weapons of mass destruction. Obviously, 
both of those concerns are very important. We do want to preserve our 
military industrial base, and we do want to safeguard technology that 
could help terrorists or anyone else develop weapons of mass 
destruction. But neither of those transactions or those requirements 
address transactions that could assist terrorists in threatening our 
security right here at home.
  Obviously, there are other ways for terrorists to undermine our 
security that might be completely separate from the military industrial 
base issues or the technological issues related to weapons of mass 
destruction. In other words, the law is simply too narrow in its 
application. The current CFIUS process is not designed to analyze 
transactions that involve a port terminal or other critical 
infrastructures within our borders.
  The Government Accountability Office, in a report issued last 
September, found that the Exon-Florio law's effectiveness in protecting 
U.S. national security may be limited--limited because the Department 
of Treasury, as the chairman of the Committee on Foreign Investment in 
the United States, narrowly defines what constitutes a threat to our 
national security. The Committee on Foreign Investment in the United 
States, CFIUS, focuses too much on the financial component and not 
enough on security.
  I think that is what many of us concluded happened in the review of 
the Dubai ports transaction. The focus was on investment, needed 
investment in our ports, rather than being focused on the national 
security or homeland security implications that could possibly arise 
from that transaction. The committee is supposed to identify 
transactions that could affect our national security. It doesn't say 
``harm'' our national security; it says ``affect'' our national 
security. That is supposed to be sufficient to trigger a full 45-day 
investigation. But, unfortunately, that is not initially what happened 
with the proposed Dubai ports transaction.
  I would like to draw the attention of my colleagues to a broader 
issue, and that is the composition of CFIUS. Remember, this is supposed 
to be a national security review, but who chairs the committee? Not the 
Department of Homeland Security, not the Department of Defense, not the 
Department of Justice. The committee is chaired by the Department of 
the Treasury, and chairing this committee is meaningful because the 
chairman's interpretation of the law, including the provision that 
makes a 45-day investigation mandatory in the case of foreign 
government control to entities that could affect national security, 
tends to govern. In other words, what the chairman decides in 
interpreting whether the 45-day investigation is triggered tends to be 
what happens.
  I suggest to you, and to my colleagues that the system is 
fundamentally flawed if it has the Secretary of Treasury, no matter how 
capable and well qualified he is--and I believe he is all of those 
things--chair a committee that is supposed to be looking at national 
security. Thus, I believe the CFIUS process has been weighed too much 
toward investment considerations and not sufficiently attentive to the 
national security and homeland security implications. Indeed, the GAO 
found that Treasury is ``reluctant to initiate investigations to 
determine

[[Page 3327]]

whether national security concerns require a recommendation for 
possible Presidential action.'' That is what GAO found, and that 
certainly seems to be an accurate finding.
  These are concerns which we simply cannot tolerate given today's 
threat environment, and that is why I am introducing legislation to 
abolish the CFIUS process and to create a new interagency, 
interdepartmental mechanism chaired by the Department of Homeland 
Security to analyze transactions for both their homeland security and 
national security implications. Our bill is designed to fix the process 
through the following changes:
  First, the bill would establish a new committee, the Committee for 
Secure Commerce, to replace the old CFIUS. The Committee for Secure 
Commerce would be chaired by the Secretary of Homeland Security, and 
the Secretary of Defense would serve as the vice chairman. The Director 
of National Intelligence would be specifically designated as a standing 
member of the committee in order to ensure that important intelligence 
information is part of the deliberative process. The Department of 
Treasury will still be represented on the committee, but with respect 
to the other members, the President shall name the appropriate agencies 
and departments to sit on the committee. This is an important change 
because it helps ensure that the focus will, indeed, be national 
homeland security, and it corrects what I believe to be a major 
shortcoming in the composition of the current committee, and that is 
that the intelligence community is not represented. That is 
extraordinary, given the purpose of this committee.
  Second, the bill would explicitly include homeland security among the 
factors the committee would evaluate in deciding whether to review or 
investigate a transaction.
  Third, the Secretary of Homeland Security would establish a process 
by which the committee reviews transactions and would establish the 
role and responsibility of each member.
  In addition, each member would establish the process and procedure by 
which each respective agency would conduct its review, sharing that 
with the other committee members. It is important that committee 
members each have a general understanding of the scrutiny being applied 
to a transaction both within their own agencies and across the 
government. Such understanding was not apparent in the current CFIUS 
process.
  Should a transaction warrant an investigation, the bill would require 
the Director of National Intelligence to consolidate intelligence 
assessments.
  Lastly, this legislation would strengthen the reporting requirements 
to Congress. The existing process lacks transparency and does not allow 
sufficient oversight. It may be appropriate for the reviews, which may 
involve proprietary data and classified information, to be conducted 
confidentially. However, it is wholly appropriate that Members of 
Congress be briefed in a timely manner.
  The bill would also address the so-called Byrd amendment loophole, 
requiring an investigation where the entity would be controlled by a 
foreign-government. In looking at the plain language of the existing 
statute, a 45-day investigation should have taken place in the Dubai 
Ports World purchase of Peninsular & Oriental Steam Navigation Company. 
However, the Treasury Department interpretation of the statute for 
nearly 15 years has been contrary to congressional intent, and thus, 
Treasury found there was no need for the 45-day investigation. That so-
called ambiguity has been clarified in our bill. The law requires a 45-
day investigation in cases where an acquirer is controlled by a foreign 
government, as in the case of DP World, and the acquisition could 
affect the national security of the U.S.
  It is important that Congress take action to reform the review 
process for foreign investment in the U.S. This bill provides a new 
structure, appropriately focused on national security and homeland 
security. I seek my colleagues support in moving this legislation 
forward.
  The Dubai ports controversy may have temporarily or perhaps 
permanently been set aside, but that does not mean we should abandon 
the efforts to reform and strengthen the law to ensure a proper review 
of foreign transactions.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 2400

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

     SECTION 1. TRANSFER OF AUTHORITY TO REVIEW CERTAIN MERGERS, 
                   ACQUISITIONS, AND TAKEOVERS.

       (a) Repeal of Defense Production Act Provision.--Section 
     721 of the Defense Production Act of 1950 (50 U.S.C. App. 
     2170) is repealed.
       (b) Transfer to Homeland Security.--Title II of the 
     Homeland Security Act of 2002 (6U.S.C. 121 et seq.) is 
     amended by adding at the end the following:

   ``Subtitle--E--Review of Mergers, Acquisitions, and Takeovers by 
                            Foreign Entities

     ``SEC. 241. AUTHORITY TO REVIEW CERTAIN MERGERS, 
                   ACQUISITIONS, AND TAKEOVERS.

       ``(a) Review and Investigation.--
       ``(1) In general.--The President or the President's 
     designee may undertake an investigation to determine the 
     effects on national security or homeland security of mergers, 
     acquisitions, and takeovers proposed or pending on or after 
     the date of enactment of this section by or with foreign 
     persons which could result in foreign control of persons 
     engaged in interstate commerce in the United States.
       ``(2) Review.--For purposes of determining whether to 
     undertake an investigation under this subsection, the 
     President or the President's designee shall conduct a review 
     of the proposed or pending merger, acquisition, or takeover, 
     which review shall be completed not later than 30 days after 
     the date of receipt by the President or the President's 
     designee of written notification of the proposed or pending 
     merger, acquisition, or takeover.
       ``(3) Timing.--If it is determined that an investigation 
     should be undertaken under this subsection, such 
     investigation--
       ``(A) shall commence at such time as the determination is 
     made under paragraph (2), and not later than 30 days after 
     the date of receipt by the President or the President's 
     designee of written notification of the proposed or pending 
     merger, acquisition, or takeover, as prescribed by 
     regulations promulgated pursuant to this section; and
       ``(B) shall be completed not later than 45 days after the 
     date of its commencement.
       ``(4) Intelligence assessment reports.--With respect to any 
     investigation undertaken under this subsection, the Director 
     of National Intelligence shall create a report that 
     consolidates the intelligence findings, assessments, and 
     concerns of each of the relevant members of the intelligence 
     community. Such report shall be considered as part of the 
     investigation, provided to all members of the Committee, and 
     included as part of any recommendation to the President.
       ``(b) Mandatory Investigations.--
       ``(1) In general.--The President or the President's 
     designee shall undertake an investigation, as described in 
     subsection (a)(1), in any instance in which an entity 
     controlled by or acting on behalf of a foreign government 
     seeks to engage in any merger, acquisition, or takeover which 
     would result in control of a person engaged in interstate 
     commerce in the United States.
       ``(2) Timing.--An investigation undertaken under this 
     subsection--
       ``(A) shall commence not later than 30 days after the date 
     of receipt by the President or the President's designee of 
     written notification of the proposed or pending merger, 
     acquisition, or takeover, as prescribed by regulations 
     promulgated pursuant to this section; and
       ``(B) shall be completed not later than 45 days after the 
     date of its commencement.
       ``(c) Committee for Secure Commerce.--
       ``(1) Establishment.--There is established the Committee 
     for Secure Commerce, which shall serve as the President's 
     designee for purposes of this section.
       ``(2) Chairperson.--The Secretary, or the designee thereof, 
     shall serve as the chairperson of the Committee.
       ``(3) Vice chairs.--The Secretary of Defense, or the 
     designee thereof, and the Secretary of the Treasury, or the 
     designee thereof, shall serve as vice chairs of the 
     Committee.
       ``(4) Membership.--The standing members of the Committee 
     shall--
       ``(A) be made up of the heads of those executive 
     departments, agencies, and offices as the President 
     determines appropriate; and
       ``(B) include the Director of National Intelligence.
       ``(5) Assistance from other federal sources.--The 
     chairperson of the Committee may seek information and 
     assistance from any other department, agency, or office of

[[Page 3328]]

     the Federal Government, and such department, agency, or 
     office shall provide such information or assistance, as the 
     chairperson determines necessary or appropriate to carry out 
     the duties of the Committee under this section.
       ``(6) Review process; documentation.--
       ``(A) Committee review process.--The chairperson of the 
     Committee shall establish written processes and procedures to 
     be used by the Committee in conducting reviews and 
     investigations under this section in any case in which the 
     Committee is acting as the President's designee, including a 
     description of the role and responsibilities of each of the 
     member departments, agencies, and offices in the 
     investigation of foreign investment in the United States.
       ``(B) Departmental review process.--The head of each 
     department, agency, or office that serves as a member of the 
     Committee shall establish written internal processes and 
     procedures to be used by the department, agency, or office in 
     conducting reviews and investigations under this section, and 
     shall provide such written procedures to the Committee.
       ``(7) Independent agency reviews required.--In any case in 
     which the Committee is acting as the President's designee 
     under this section, each member of the Committee shall 
     conduct, within the department, agency, or office of that 
     member, an independent review of each proposed merger, 
     acquisition, or takeover described in subsection (a) or (b), 
     and shall timely provide to the Committee written findings 
     relating to each such review.
       ``(8) Determinations not to conduct an investigation.--A 
     determination by the Committee not to conduct an 
     investigation under subsection (a) shall be made only after a 
     review required by subsection (a)(2), and shall be unanimous.
       ``(d) Action by the President.--
       ``(1) In general.--Subject to subsection (e), the President 
     may take such action for such time as the President considers 
     appropriate to suspend or prohibit any acquisition, merger, 
     or takeover of a person engaged in interstate commerce in the 
     United States proposed or pending on or after the date of 
     enactment of this section, by or with a foreign person so 
     that such control will not threaten to impair the national 
     security or homeland security.
       ``(2) Announcement by the president.--The President shall 
     announce the decision to take action pursuant to this 
     subsection not later than 15 days after the investigation 
     described in subsection (a) is completed. The President may 
     direct the Attorney General to seek appropriate relief, 
     including divestment relief, in the district courts of the 
     United States in order to implement and enforce this section.
       ``(e) Findings of the President.--The President may 
     exercise the authority conferred by subsection (d) only if 
     the President finds that--
       ``(1) there is credible evidence that leads the President 
     to believe that the foreign interest exercising control might 
     take action that threatens to impair the national security or 
     homeland security; and
       ``(2) provisions of law, other than this section and the 
     International Emergency Economic Powers Act, do not, in the 
     judgment of the President, provide adequate and appropriate 
     authority for the President to protect the national security 
     or homeland security in the matter before the President.
       ``(f) Actions and Findings Nonreviewable.--The actions of 
     the President under subsection (d) and the findings of the 
     President under subsection (e) shall not be subject to 
     judicial review.
       ``(g) Factors to Be Considered.--For purposes of this 
     section, the President or the President's designee shall, 
     taking into account the requirements of national security and 
     homeland security, consider among other factors--
       ``(1) critical infrastructure, the control of which is 
     important to homeland security;
       ``(2) domestic production needed for projected national 
     defense and homeland security requirements;
       ``(3) the capability and capacity of domestic industries to 
     meet national defense requirements, including the 
     availability of human resources, products, technology, 
     materials, and other supplies and services;
       ``(4) the control of domestic industries and commercial 
     activity by foreign citizens as it affects the capability and 
     capacity of the United States to meet the requirements of 
     national security or homeland security;
       ``(5) the potential effects of the proposed or pending 
     transaction on sales of military goods, equipment, or 
     technology to any country--
       ``(A) identified by the Secretary of State--
       ``(i) under section 6(j) of the Export Administration Act 
     of 1979, as a country that supports terrorism;
       ``(ii) under section 6(l) of the Export Administration Act 
     of 1979, as a country of concern regarding missile 
     proliferation; or
       ``(iii) under section 6(m) of the Export Administration Act 
     of 1979, as a country of concern regarding the proliferation 
     of chemical and biological weapons; or
       ``(B) listed under section 309(c) of the Nuclear Non-
     Proliferation Act of 1978, on the `Nuclear Non-Proliferation-
     Special Country List' (15 C.F.R. Part 778, Supplement No. 4) 
     or any successor list; and
       ``(6) the potential effects of the proposed or pending 
     transaction on United States international technological 
     leadership in areas affecting United States national security 
     or homeland security.
       ``(h) Confidentiality of Information.--Any information or 
     documentary material filed with the President or the 
     President's designee pursuant to this section shall be exempt 
     from disclosure under section 552 of title 5, United States 
     Code, and no such information or documentary material may be 
     made public, except as may be relevant to any administrative 
     or judicial action or proceeding. Nothing in this subsection 
     shall be construed to prevent disclosure to either House of 
     Congress or to any duly authorized committee or subcommittee 
     of Congress.
       ``(i) Reports to Congress.--
       ``(1) Reports on investigation.--The President, or the 
     President's designee, shall immediately upon completion of an 
     investigation under subsection (a) or (b) transmit to the 
     members of Congress specified in paragraph (3) a written 
     report of the results of the investigation, before any 
     determination by the President on whether or not to take 
     action under subsection (d), including a detailed explanation 
     of the findings made under subsection (e), details of any 
     legally binding assurances provided by the foreign entity 
     that were negotiated as a condition for approval, and the 
     factors considered under subsection (g). Such report shall be 
     prepared in a manner that is consistent with the requirements 
     of subsection (h).
       ``(2) Quarterly submissions.--The President, or the 
     President's designee, shall transmit to the members of the 
     Congress specified in paragraph (3) on a quarterly basis, a 
     detailed summary and analysis of each merger, acquisition, or 
     takeover that is being reviewed, was reviewed during the 
     preceding 90-day period, or is likely to be reviewed in the 
     coming quarter by the President or the Committee under 
     subsection (a) or (b). Each such summary and analysis shall 
     be submitted in unclassified form, with classified annexes, 
     as the Secretary determines are required to protect company 
     proprietary information and other sensitive information. Each 
     such summary and analysis shall include an appendix detailing 
     dissenting views.
       ``(3) Members of congress.--The reports required by this 
     subsection shall be transmitted to--
       ``(A) the Majority Leader and the Minority Leader of the 
     Senate;
       ``(B) the chairs and ranking members of the Committee on 
     Homeland Security and Government Affairs, the Committee on 
     Armed Services, and the Committee on Banking, Housing, and 
     Urban Affairs of the Senate;
       ``(C) the Speaker and the Minority Leader of the House of 
     Representatives; and
       ``(D) the chairs and ranking members of the Committee on 
     Homeland Security, the Committee on Armed Services, and the 
     Committee on Financial Services of the House of 
     Representatives.
       ``(j) Regulations.--The Secretary shall issue regulations 
     to carry out this section. Such regulations shall, to the 
     extent possible, minimize paperwork burdens and shall to the 
     extent possible coordinate reporting requirements under this 
     section with reporting requirements under any other provision 
     of Federal law.
       ``(k) Effect on Other Law.--Nothing in this section shall 
     be construed to alter or affect any existing power, process, 
     regulation, investigation, enforcement measure, or review 
     provided by any other provision of law.
       ``(l) Technology Risk Assessments.--In any case in which an 
     assessment of the risk of diversion of a critical technology 
     is performed by a person designated by the President for such 
     purpose, a copy of such assessment shall be provided to each 
     member of the Committee for purposes of reviewing or 
     investigating a merger, acquisition, or takeover under this 
     section.
       ``(m) Quadrennial Report.--
       ``(1) In general.--In order to assist the Congress in its 
     oversight responsibilities with respect to this section, the 
     President and such agencies as the President shall designate 
     shall complete and furnish to the Congress, not later than 1 
     year after the date of enactment of this section and every 4 
     years thereafter, a report which--
       ``(A) evaluates whether there is credible evidence of a 
     coordinated strategy by 1 or more countries or companies to 
     acquire critical infrastructure within the United States or 
     United States companies involved in research, development, or 
     production of critical technologies for which the United 
     States is a leading producer; and
       ``(B) evaluates whether there are industrial espionage 
     activities directed or directly assisted by foreign 
     governments against private United States companies aimed at 
     obtaining commercial secrets related to critical technologies 
     or critical infrastructure.
       ``(2) Release of unclassified study.--The report required 
     by this subsection may be classified. An unclassified version 
     of the report shall be made available to the public.
       ``(n) Exemption.--Notwithstanding any other provision of 
     law, the provisions of section 872 do not apply to the 
     Committee or with respect to any provision of this subtitle.

[[Page 3329]]

       ``(o) Definitions.--As used in this section--
       ``(1) the term `critical technologies' means technologies 
     identified under title VI of the National Science and 
     Technology Policy, Organization, and Priorities Act of 1976, 
     or other critical technology, critical components, or 
     critical technology items essential to national defense 
     identified pursuant to this section;
       ``(2) the term `Committee' means the Committee for Secure 
     Commerce, established under subsection (c);
       ``(3) the term `foreign person' means any foreign 
     organization or any individual resident in a foreign country 
     or any organization or individual owned or controlled by such 
     an organization or individual; and
       ``(4) the term `intelligence community' has the same 
     meaning as in section 3 of the National Security Act of 1947 
     (50 U.S.C. 401a).''.

  Mr. LIEBERMAN. Mr. President, I rise today to speak on behalf of 
legislation introduced by Senator Collins and myself that would create 
a new Committee for Secure Commerce at the Department of Homeland 
Security to review the proposed sale of U.S. properties to foreign 
investers. This Committee would replace the Committee on Foreign 
Investments in the United States, whose hasty approval of the Dubai 
Ports World acquisition of terminals at several U.S. ports led to a 
public outcry, which eventually led to DPW's withdrawal from the deal.
  The entire affair has been poorly handled, from the original failure 
to conduct a thorough investigation to the failure to consult with and 
inform the Congress and the American public. Any proposed foreign 
investment in this country needs a thorough and fair review to ensure 
that our national security or homeland security is not jeopardized. I 
was not among those who called for the deal to be prohibited before a 
thorough investigation was conducted, because I felt that Dubai Ports 
World never got a chance to make a case that its ownership of port 
terminals in the U.S. would not jeopardize our homeland security. 
Because of the initial public outcry, they were condemned before they 
were allowed to stand trial, and I believed that violated this Nation's 
commitment to the rule of law. A required 45-day investigation of the 
deal should have been initiated. Congress should have been better 
informed of the proposed acquisition in the works. And the American 
people deserved a clear explanation from their President about why he 
thought the sale was in our interest.
  National security must be the first consideration in the sale of U.S. 
property to foreign investors, especially at this period in our 
history, when the threat of terrorist attack is always present. Our 
legislation would ensure that foreign investments are scrutinized by 
the agencies most directly responsible for protecting this Nation.
  That is the underlying purpose of our legislation.
  Our bill would create the Committee for Secure Commerce within the 
Department of Homeland Security to review and investigate any mergers, 
acquisitions, or takeovers of assets within the U.S. by foreign 
companies.
  Like CFIUS, the new Committee would have 30 days to conduct a review 
of transactions, but could also seek a longer, 45-day investigation as 
well. A 45-day investigation would be obligatory if a company 
controlled by a foreign government tries to purchase assets involved in 
U.S. interstate commerce. And if any member of the Committee objected 
to a proposed deal, the President would have the final say on whether 
it went forward, or whether a divestiture, or some other remedy, was 
necessary.
  The Committee would be chaired by the Department of Homeland 
Security. The Defense Department would serve as a vice chair. Our bill 
also strengthens Congressional oversight by requiring immediate 
congressional notification of all mandatory investigations, and 
quarterly reports on all other transactions.
  The Senate Committee on Homeland Security and Governmental Affairs 
received an illuminating briefing on the Dubai Ports World deal late 
last month. At that briefing, we learned that the Coast Guard had 
expressed some intelligence concerns about the transaction but that not 
all CFIUS members were informed of these concerns. Our legislation 
addresses this shortcoming by adding the Director of National 
Intelligence as a full member of the committee and ensuring all 
intelligence assessments are consolidated and shared with all Committee 
members and the President.
  Our legislation is intended to directly address the concerns raised 
by the Government Accountability Office that CFIUS tended to focus more 
on investments issues rather than security issues--by placing DHS and 
DoD in charge, and by specifically including homeland security issues 
as factors to be considered by the new committee.
  The rush to judgment on the DPW deal did not allow the company to 
stand or fall on its own merits. And that is not how we do things in 
America. We do not judge people in our democracy by their race, 
nationality, religion, gender, sexual orientation, or age. We judge 
people on their merits.
  I believe this legislation would establish a better process for 
judging the wisdom or folly of selling U.S. property to foreign owners 
by establishing that the Nation's security should be the pre-eminent 
consideration in foreign purchases of U.S. property and by ensuring 
that everyone's concerns about such sales get a fair hearing.
  Mr. AKAKA. Mr. President, I am pleased to join Senator Collins and 
Senator Lieberman in introducing a bill to transfer the authority of 
reviewing foreign investment in the United States to the Department of 
Homeland Security and to impose additional structure and increase 
congressional oversight on the review process. There has been a failure 
in Government procedure that must be corrected, and this legislation 
will address those procedural failures.
  I am concerned that our process to review acquisitions, mergers or 
takeovers of U.S. corporations by foreign entities that ``may'' pose a 
national security threat, did not trigger the Committee on Foreign 
Investment in the United States, CFIUS, to conduct a more thorough 
review. While the United Arab Emirates has supported the United States 
in the war against terrorism, its past activities related to terrorist 
groups should have triggered CFIUS to conduct a more thorough review.
  More specifically, the act states that if there is an acquisition, 
merger, or takeover of a U.S. corporation by a foreign entity, then 
CFIUS, an interagency committee chaired by the Secretary of Treasury, 
reviews the deal to ascertain if there is any threat to our national 
security. In addition, in accordance with Section 837(a) of the 
National Defense Authorization Act for fiscal year 1993, called the 
Byrd amendment, amended Section 721 of the Defense Production Act, the 
Exon-Florio provision, a more extensive review should have been 
conducted on the Dubai Ports World deal, especially since certain 
members of CFIUS did have national security concerns about the 
acquisition.
  Given the questionable interpretation by CFIUS on the Byrd amendment, 
I believe it is important for Congress to revisit the act and clarify 
the provisions that require CFIUS to conduct a thorough review of 
foreign acquisitions, mergers, and takeovers.
  Our legislation removes any ambiguity by specifically requiring an 
investigation any time a foreign government-owned corporation is 
involved in a transaction. As ranking member on the Oversight of 
Government Management Subcommittee, it is my responsibility to evaluate 
governmental processes and develop solutions that ensure our national 
and homeland security while maintaining the favorable promotion of 
foreign investments in the United States.
  I was pleased to work with Senator Collins and Senator Lieberman, 
chairman and ranking member of the Homeland Security and Government 
Affairs Committee, respectively, on drafting the legislation to address 
these process shortcomings, which will promote reasonable transparency 
and oversight within the foreign investment review process. The 
security of U.S. ports is of great concern to me because my home State 
of Hawaii receives 98 percent of its imports via sea-based 
transportation.
  Given the national and homeland security implications of the proposed 
DP

[[Page 3330]]

World takeover, I believe it is absolutely necessary for Congress to 
ensure that the executive branch performs a rigorous review of the 
transaction. Our bill ensures that Congress is informed of pending 
investigations that may impact national or homeland security prior to 
the President making a decision whether to disapprove the transaction. 
I believe that additional intelligence community resources should have 
been drawn upon before the President made his determination to support 
the transaction. There should have been a consolidated intelligence 
assessment, and this report should have been provided to all senior 
members of the review committee. The bill we introduce today requires 
consolidated intelligence assessments to be developed by the Director 
of National Intelligence and provided to all review committee members, 
thereby ensuring that all members are sufficiently informed.
  I was also disturbed that two of the reviewing Departments--the 
Departments of Defense and Homeland Security--do not currently have 
internal written instructions on their review processes. How do we know 
that adequate reviews of foreign investment in the United States are 
being conducted by these two critical CFIUS members if a systematic and 
documented process, subject to audit, does not exist? Our legislation 
requires the development and documentation of internal procedures to 
ensure that all reviewing members use a standardized process while 
conducting their review of foreign investment proposals.
  Mr. President, I am pleased that Dubai Ports World is attempting to 
address the concerns of the American public. However, this problem is 
bigger than just a single transaction, which is why we are introducing 
this legislation today. I am honored to cosponsor, with Senator Collins 
and Senator Lieberman, this bill which reforms the process of reviewing 
foreign investment in the United States.
                                 ______
                                 
      By Mr. GRASSLEY (for himself and Mr. Baucus):
  S. 2401. A bill to amend the Internal Revenue Code of 1986 to extend 
certain energy tax incentives, and for other purposes; to the Committee 
on Finance.
  Mr. GRASSLEY. Mr. President, I rise to speak in support of a bill 
that I am introducing today, the Combating Money Laundering and 
Terrorist Financing Act of 2006.
  I first introduced the Combating Money Laundering and Terrorist 
Financing Act in 2003 to address what I saw as a significant threat to 
the security of our Nation. Money laundering is an issue of profound 
importance to our national security because it undermines financial 
stability by infiltrating and using legitimate financial institutions 
to hide the illegitimate source of these funds. Money laundering also 
affects our national security simply because money is the motivating 
factor for so much of the criminal activities that affect our daily 
lives, from shoplifting and petty theft to drug trafficking and multi-
million dollar stock frauds.
  We also know that money laundering is a key tool for terrorist groups 
because it fuels their ability to spread murder, fear and destruction 
throughout the world. One of the 9/11 Commission Report recommendations 
stated that, ``Vigorous efforts to track terrorist financing must 
remain front and center in the U.S. counter-terrorism efforts.'' The 
Commission expressed its concerns about terrorist financing and ``the 
need to crack down on terrorist organizations and curtail their 
funding.'' I strongly share the Commission's concerns and support their 
recommendations that they provided in their final report.
  However, I am very concerned about the 9/11 Commission's Final Report 
Card, released on December 5, 2005, which gave the U.S. Government an 
A- for our ``vigorous efforts against terror financing.'' After the 
release of the 9/11 Commission Report and nearly 4 years after the 
terrorist attacks on the World Trade Center and the Pentagon, our 
Government is still too ill-equipped and fraught with in-fighting to 
rate an A- for its efforts. While we have made significant strides in 
identifying the methods used to earn, store and move this money, we are 
still far behind the curve on shutting down the flow of illicit 
financing permanently.
  Billions of dollars continue to be funneled to terrorist and criminal 
organizations after being laundered for these organizations around the 
world. Therefore, we must continue to increase the pressure we put on 
these organizations until we reach the point where their ever-changing 
money laundering methods are no longer convenient, profitable or 
effective.
  The legislation I am introducing today includes several provisions 
that will strengthen our current money laundering laws by streamlining 
a number of statutes, clarifying language in the current law and 
closing loopholes that are often exploited by criminal organizations. 
As our new anti-money laundering laws have proven to be effective and 
make money laundering through traditional financial institutions more 
difficult, criminals are forced to shift methods to launder their 
illegally gained funds. As these criminals change their tactics, so 
must we. Allow me to tell you about some of the key changes that this 
bill includes to meet these challenges.
  To begin with, under current law there are over 200 ``specified 
unlawful activities'' or ``SUA's'' that serve as predicate offenses for 
money laundering charges. As criminals continue to alter their methods 
of laundering illegal funds, this list of required ``SUA's'' is sure to 
grow. My legislation will eliminate the need to continually update the 
statutes by consolidating the growing list of ``specified unlawful 
activities'' to include all offenses punishable by imprisonment for 
more than 1 year. This legislation also recognizes the global aspect of 
money laundering by including foreign offenses that would be illegal 
money laundering offenses had they occurred within U.S. jurisdiction.
  This bill also simplifies current law by allowing the government to 
charge money laundering acts as a ``course of conduct.'' Currently, in 
most circuits, courts are required to charge each money laundering 
transaction as a separate count. This legislation allows, but does not 
require, courts to charge a series of money laundering offenses as a 
``course of conduct.'' This change would reduce the time and expense 
currently incurred by courts that are required to charge and prosecute 
each separate violation of the money laundering laws.
  As new laws have made money laundering through traditional financial 
institutions more difficult, criminals are turning to riskier methods 
of moving their money. One growing area is bulk cash smuggling, and as 
such, this bill increases the penalty for bulk cash smuggling to 10 
years.
  In addition, many ``money service businesses,'' or ``MSB's'' have 
also come under increased scrutiny because of their suspected role in 
moving funds from the United States to terrorist organizations 
throughout the world. Another provision of my legislation amends 
Section 373 of the USA PATRIOT Act regarding money service businesses 
to read ``illegal'' instead of ``unlicensed'' to ensure that the law 
covers any money service business that promotes unlawful activity as a 
course of business.
  Another money laundering technique is for couriers to carry checks 
that are complete except for the dollar amount. Under this approach the 
couriers attempt to avoid U.S. Customs reporting requirements through 
the movement of monetary instruments that are in bearer form and are 
worth over $10,000. Even though the blank checks are in bearer form, 
they argue that the value being left blank is not over $10,000 and does 
not need to be reported. Once they and the blank check reach their 
destination, all they need to do is to fill in the amount, whatever 
that may be, and have it negotiated. This legislation removes any 
confusion as to whether this act is a violation of the reporting 
requirement. This bill would resolve this issue by clarifying that a 
check in bearer form, with an amount left blank shall be deemed to have 
a value equal to the highest amount in the bank account that it is 
drawn upon while the

[[Page 3331]]

check was being transported, or when the blank check is cashed or 
intended to be cashed.
  My legislation eliminates confusion or ambiguity about the definition 
of ``commingled funds,'' and structured transactions. ``Commingling of 
funds'' is a method often used by criminals to disguise illegal money 
from legal money by mixing the funds together in one account. 
``Structured transactions'' is a method used to circumvent our monetary 
transaction reporting requirements by breaking monetary transactions 
into several smaller dollar amounts so as to avoid a Government 
reporting requirement if the transaction had been only one transaction 
with a value over $10,000. Plus, this legislation clarifies extraterri-
torial jurisdiction to include money laundering acts that have an 
effect in the United States.
  Often, money couriers are intercepted before they reach the 
collection point but are released because they claim that they didn't 
know that the money was derived illegally. My bill ensures that the 
courier can no longer be released from responsibility in the money 
laundering chain by claiming ignorance about how the money was derived, 
which means the law enforcement agency can get both the courier and the 
money off the street.
  Finally, this bill updates counterfeiting statutes to keep them 
current with new technology and devices, such as holograms, that are 
used to produce counterfeits of U.S. obligations and securities.
  The battle against terrorism and organized criminal groups must be 
fought on many fronts--including the financial front. We know that we 
have made strides in this area as evidenced by the money launderers' 
use of different techniques. As important as it is to learn what 
techniques these criminals use, it is just as important to act upon 
this knowledge. If we can shut down the flow of illegal money, whether 
generated by drug sales or in support of terrorist activities, I 
believe we will make a significant impact on the demise of these 
criminal and terrorist groups. This bill is important to identifying 
particular criminal and terrorist financing operations and putting them 
out of business. I urge my colleagues to support my legislation and 
strengthen our national efforts against the continued threat of 
terrorist financing and financial crimes.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 2402

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Combating Money Laundering 
     and Terrorist Financing Act of 2006''.

                       TITLE I--MONEY LAUNDERING

     SEC. 101. SPECIFIED UNLAWFUL ACTIVITY.

       Section 1956(c)(7) of title 18, United States Code, is 
     amended to read as follows:
       ``(7) the term `specified unlawful activity' means--
       ``(A) any act or activity constituting an offense in 
     violation of the laws of the United States or any State 
     punishable by imprisonment for a term exceeding 1 year; and
       ``(B) any act or activity occurring outside of the United 
     States that would constitute an offense covered under 
     subparagraph (A) if the act or activity had occurred within 
     the jurisdiction of the United States or any State;''.

     SEC. 102. MAKING THE DOMESTIC MONEY LAUNDERING STATUTE APPLY 
                   TO ``REVERSE MONEY LAUNDERING'' AND INTERSTATE 
                   TRANSPORTATION.

       (a) In General.--Section 1957 of title 18, United States 
     Code, is amended--
       (1) in the heading, by inserting ``or in support of 
     criminal activity'' after ``specified unlawful activity'';
       (2) in subsection (a), by striking ``Whoever'' and 
     inserting the following:
       ``(1) Whoever''; and
       (3) by adding at the end the following:
       ``(2) Whoever--
       ``(A) in any of the circumstances set forth in subsection 
     (d)--
       ``(i) conducts or attempts to conduct a monetary 
     transaction involving property of a value that is greater 
     than $10,000; or
       ``(ii) transports, attempts to transport, or conspires to 
     transport property of a value that is greater than $10,000;
       ``(B) in or affecting interstate commerce; and
       ``(C) either--
       ``(i) knowing that the property was derived from some form 
     of unlawful activity; or
       ``(ii) with the intent to promote the carrying on of 
     specified unlawful activity;

     shall be fined under this title, imprisoned for a term of 
     years not to exceed the statutory maximum for the unlawful 
     activity from which the property was derived or the unlawful 
     activity being promoted, or both.''.
       (b) Chapter Analysis.--The item relating to section 1957 in 
     the table of sections for chapter 95 of title 18, United 
     States Code, is amended to read as follows:

``1957. Engaging in monetary transactions in property derived from 
              specified unlawful activity or in support of criminal 
              activity.''.

     SEC. 103. PROCEDURE FOR ISSUING SUBPOENAS IN MONEY LAUNDERING 
                   CASES.

       (a) In General.--Section 986 of title 18, United States 
     Code, is amended by adding at the end the following:
       ``(e) Procedure for Issuing Subpoenas.--The Attorney 
     General, the Secretary of the Treasury, or the Secretary of 
     Homeland Security may issue a subpoena in any investigation 
     of a violation of sections 1956, 1957 or 1960, or sections 
     5316, 5324, 5331 or 5332 of title 31, United States Code, in 
     the manner set forth under section 3486.''.
       (b) Grand Jury and Trial Subpoenas.--Section 
     5318(k)(3)(A)(i) of title 31, United States Code, is 
     amended--
       (1) by striking ``related to such correspondent account'';
       (2) by striking ``or the Attorney General'' and inserting 
     ``, the Attorney General, or the Secretary of Homeland 
     Security''; and
       (3) by adding at the end the following:
       ``(iii) Grand jury or trial subpoena.--In addition to a 
     subpoena issued by the Attorney General, Secretary of the 
     Treasury, or the Secretary of Homeland Security under clause 
     (i), a subpoena under clause (i) includes a grand jury or 
     trial subpoena requested by the Government.''.
       (c) Fair Credit Reporting Act Amendment.--Section 604(a)(1) 
     of the Fair Credit Reporting Act (15 U.S.C. 1681b(a)(1)) is 
     amended--
       (1) by striking ``or''; and
       (2) by inserting before the period the following: ``, or an 
     investigative subpoena issued under section 5318 of title 31, 
     United States Code''.
       (d) Obstruction of Justice.--Section 1510(b) of title 18, 
     United States Code, is amended--
       (1) in paragraph (2)(A), by inserting ``or an investigative 
     subpoena issued under section 5318 of title 31, United States 
     Code'' after ``grand jury subpoena''; and
       (2) in paragraph (3)(B), by inserting ``, an investigative 
     subpoena issued under section 5318 of title 31, United States 
     Code,'' after ``grand jury subpoena''.
       (e) Right to Financial Privacy Act.--Section 1120 of the 
     Right to Financial Privacy Act of 1978 (12 U.S.C. 3420) is 
     amended--
       (1) in subsection (a)(1), by inserting ``or to the 
     Government'' after ``to the grand jury''; and
       (2) in subsection (b)(1), by inserting ``, or an 
     investigative subpoena issued pursuant to section 5318 of 
     title 31, United States Code,'' after ``grand jury 
     subpoena''.

     SEC. 104. TRANSPORTATION OR TRANSHIPMENT OF BLANK CHECKS IN 
                   BEARER FORM.

       Section 5316 of title 31, United States Code, is amended by 
     adding at the end the following:
       ``(e) Monetary Instruments With Amount Left Blank.--For 
     purposes of this section, a monetary instrument in bearer 
     form that has the amount left blank, such that the amount 
     could be filled in by the bearer, shall be considered to have 
     a value equal to the highest value of the funds in the 
     account on which the monetary instrument is drawn during the 
     time period the monetary instrument was being transported or 
     the time period it was negotiated or was intended to be 
     negotiated.''.

     SEC. 105. BULK CASH SMUGGLING.

       Section 5332(a) of title 31, United States Code, is 
     amended--
       (1) in subsection (b)(1), by striking ``5 years'' and 
     inserting ``10 years''; and
       (2) by adding the end the following:
       ``(d) Investigative Authority.--Violations of this section 
     may be investigated by the Attorney General, the Secretary of 
     the Treasury, the Secretary of Homeland Security, and the 
     Postal Service.''.

     SEC. 106. VIOLATIONS INVOLVING COMMINGLED FUNDS AND 
                   STRUCTURED TRANSACTIONS.

       Section 1957(f) of title 18, United States Code, is 
     amended--
       (1) in paragraph (2) by striking ``and'' at the end;
       (2) in paragraph (3), by striking the period and inserting 
     a semicolon; and
       (3) by adding at the end the following:
       ``(4) the term `monetary transaction in criminally derived 
     property that is of a value greater than $10,000' includes--
       ``(A) a monetary transaction involving the transfer, 
     withdrawal, encumbrance or other disposition of more than 
     $10,000 from a bank account in which more than $10,000 in 
     proceeds of specified unlawful activity have been commingled 
     with other funds;

[[Page 3332]]

       ``(B) a series of monetary transactions in amounts under 
     $10,000 that exceed $10,000 in the aggregate and that are 
     closely related to each other in terms of such factors as 
     time, the identity of the parties involved, the nature and 
     purpose of the transactions, and the manner in which they are 
     conducted; and
       ``(C) any financial transaction covered under section 
     1956(j) that involves more than $10,000 in proceeds of 
     specified unlawful activity; and
       ``(5) the term `monetary transaction involving property of 
     a value that is greater than $10,000' includes a series of 
     monetary transactions in amounts under $10,000 that exceed 
     $10,000 in the aggregate and that are closely related to each 
     other in terms of such factors as time, the identity of the 
     parties involved, the nature and purpose of the transactions, 
     and the manner in which they are conducted.''.

     SEC. 107. CHARGING MONEY LAUNDERING AS A COURSE OF CONDUCT.

       (a) In General.--Section 1956 of title 18, United States 
     Code, is amended by adding at the end the following:
       ``(j) Multiple Violations.--Multiple violations of this 
     section that are part of the same scheme or continuing course 
     of conduct may be charged, at the election of the Government, 
     in a single count in an indictment or information.''.
       (b) Conspiracies.--Section 1956(h) of title 18, United 
     States Code, is amended by striking ``or section 1957'' and 
     inserting ``, section 1957, or section 1960''.

     SEC. 108. ILLEGAL MONEY TRANSMITTING BUSINESSES.

       (a) Technical Amendments.--
       (1) In general.--Section 1960 of title 18, United States 
     Code, is amended--
       (A) in the heading by striking ``unlicensed'' and inserting 
     ``illegal'';
       (B) in subsection (a), by striking ``unlicensed'' and 
     inserting ``illegal'';
       (C) in subsection (b)(1), by striking ``unlicensed'' and 
     inserting ``illegal''; and
       (D) in subsection (b)(1)(C), by striking ``to be used to be 
     used'' and inserting ``to be used''.
       (2) Chapter analysis.--The item relating to section 1960 in 
     the table of sections for chapter 95 of title 18, United 
     States Code, is amended to read as follows:

``1960. Prohibition of illegal money transmitting businesses.''.

       (b) Definition of Business To Include Informal Value 
     Transfer Systems and Money Brokers for Drug Cartels.--Section 
     1960(b) of title 18, United States Code, is amended--
       (1) in paragraph (2), by striking ``and'' at the end;
       (2) in paragraph (3), by striking the period and inserting 
     ``; and''; and
       (3) by adding at the end the following:
       ``(4) the term `business' includes any person or 
     association of persons, formal or informal, licensed or 
     unlicenced, that provides money transmitting services on 
     behalf of any third party in return for remuneration or other 
     consideration.''.
       (c) Prohibition of Unlicensed Money Transmitting 
     Businesses.--Section 1960(b)(1)(B) of title 18, United States 
     Code, is amended by inserting the following before the 
     semicolon: ``, whether or not the defendant knew that the 
     operation was required to comply with such registration 
     requirements''.
       (d) Authority To Investigate.--Section 1960 of title 18, 
     United States Code, is amended by adding at the end the 
     following:
       ``(c) Authority To Investigate.--Violations of this section 
     may be investigated by the Attorney General, the Secretary of 
     the Treasury, and the Secretary of Homeland Security.''.

     SEC. 109. KNOWLEDGE THAT THE PROPERTY IS THE PROCEEDS OF A 
                   SPECIFIC FELONY.

       (a) Proceeds of a Felony.--Section 1956(c)(1) of title 18, 
     United States Code, is amended by inserting ``, and 
     regardless of whether or not the person knew that the 
     activity constituted a felony'' before the semicolon at the 
     end.
       (b) Intent To Conceal or Disguise.--Section 1956(a) of 
     title 18, United States Code, is amended--
       (1) in paragraph (1)(B)(i), by striking ``specified 
     unlawful activity'' and inserting ``some form of unlawful 
     activity''; and
       (2) in paragraph (2)(B)(i), by striking ``specified 
     unlawful activity'' and inserting ``some form of unlawful 
     activity''.

     SEC. 110. EXTRATERRITORIAL JURISDICTION.

       Section 1956(f)(1) of title 18, United States Code, is 
     amended by inserting ``or has an effect in the United 
     States'' after ``conduct occurs in part in the United 
     States''.

     SEC. 111. CONDUCT IN AID OF COUNTERFEITING.

       (a) In General.--Section 474(a) of title 18, United States 
     Code, is amended by inserting after the paragraph beginning 
     ``Whoever has in his control, custody, or possession any 
     plate'' the following:
       ``Whoever, with intent to defraud, has custody, control, or 
     possession of any material that can be used to make, alter, 
     forge, or counterfeit any obligation or other security of the 
     United States or any part of such obligation or security, 
     except under the authority of the Secretary of the Treasury; 
     or''.
       (b) Foreign Obligations and Securities.--Section 481 of 
     title 18, United States Code, is amended by inserting after 
     the paragraph beginning ``Whoever, with intent to defraud'' 
     the following:
       ``Whoever, with intent to defraud, has custody, control, or 
     possession of any material that can be used to make, alter, 
     forge, or counterfeit any obligation or other security of any 
     foreign government, bank, or corporation; or''.
       (c) Counterfeit Acts.--Section 470 of title 18, United 
     States Code, is amended by striking ``or 474'' and inserting 
     ``474, or 474A''.
       (d) Materials Used in Counterfeiting.--Section 474A(b) of 
     title 18, United States Code, is amended by striking ``any 
     essentially identical'' and inserting ``any thing or material 
     made after or in the similitude of any''.

                     TITLE II--TECHNICAL AMENDMENTS

     SEC. 201. TECHNICAL AMENDMENTS TO SECTIONS 1956 AND 1957.

       (a) Unlawful Activity.--Section 1956(c) of title 18, United 
     States Code, is amended--
       (1) in paragraph (2), by striking ```conducts''' and 
     inserting ```conduct'''; and
       (2) in paragraph (7)(F), by inserting ``, as defined in 
     section 24(a)'' before the semicolon.
       (b) Property From Unlawful Activity.--Section 1957 of title 
     18, United States Code, is amended--
       (1) in subsection (a), by striking ``engages or attempts to 
     engage in'' and inserting ``conducts or attempts to 
     conduct''; and
       (2) in subsection (f)--
       (A) in paragraph (2), by striking ``and'' at the end;
       (B) in paragraph (3), by striking the period and inserting 
     ``; and''; and
       (C) by adding at the end the following:
       ``(4) the term `conduct' has the meaning given such term 
     under section 1956(c)(2).''.
                                 ______
                                 
      By Mr. GRASSLEY (for himself, Mr. Kyl, Mr. Cornyn, Mr. DeWine, 
        and Mr. Graham):
  S. 2402. A bill to improve the prohibitions on money laundering, and 
for other purposes; to the Committee on the Judiciary.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the text of 
a bill introduced by me today that may be cited as the ``Alternative 
Energy Extender Act'' be printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 2401

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the 
     ``Alternative Energy Extender Act''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.

             TITLE I--ENERGY INFRASTRUCTURE TAX INCENTIVES

Sec. 101. Extension of credit for electricity produced from certain 
              renewable resources.
Sec. 102. Extension and expansion of credit to holders of clean 
              renewable energy bonds.
Sec. 103. Extension and expansion of qualifying advanced coal project 
              credit.
Sec. 104. Extension and expansion of qualifying gasification project 
              credit.

                TITLE II--DOMESTIC FOSSIL FUEL SECURITY

Sec. 201. Extension of election to expense certain refineries.

        TITLE III--CONSERVATION AND ENERGY EFFICIENCY PROVISIONS

Sec. 301. Extension of energy efficient commercial buildings deduction.
Sec. 302. Extension of new energy efficient home credit.
Sec. 303. Extension of residential energy efficient property credit.
Sec. 304. Extension of credit for business installation of qualified 
              fuel cells and stationary microturbine power plants.
Sec. 305. Extension of business solar investment tax credit.

          TITLE IV--ALTERNATIVE FUELS AND VEHICLES INCENTIVES

Sec. 401. Extension of excise tax provisions, income tax credits, and 
              tariff duties.

             TITLE I--ENERGY INFRASTRUCTURE TAX INCENTIVES

     SEC. 101. EXTENSION OF CREDIT FOR ELECTRICITY PRODUCED FROM 
                   CERTAIN RENEWABLE RESOURCES.

       Section 45(d) of the Internal Revenue Code of 1986 
     (relating to qualified facilities) is amended by striking 
     ``2008'' each place it appears and inserting ``2011''.

     SEC. 102. EXTENSION AND EXPANSION OF CREDIT TO HOLDERS OF 
                   CLEAN RENEWABLE ENERGY BONDS.

       (a) In General.--Section 54(m) of the Internal Revenue Code 
     of 1986 (relating to termination) is amended by striking 
     ``2007'' and inserting ``2010''.

[[Page 3333]]

       (b) Annual Volume Cap for Bonds Issued During Extension 
     Period.--Paragraph (1) of section 54(f) of the Internal 
     Revenue Code of 1986 (relating to limitation on amount of 
     bonds designated) is amended to read as follows:
       ``(1) National limitation.--
       ``(A) Initial national limitation.--With respect to bonds 
     issued after December 31, 2005, and before January 1, 2008, 
     there is a national clean renewable energy bond limitation of 
     $800,000,000.
       ``(B) Annual national limitation.--With respect to bonds 
     issued after December 31, 2007, and before January 1, 2011, 
     there is a national clean renewable energy bond limitation 
     for each calendar year of $800,000,000.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to bonds issued after the date of the enactment 
     of this Act.

     SEC. 103. EXTENSION AND EXPANSION OF QUALIFYING ADVANCED COAL 
                   PROJECT CREDIT.

       (a) In General.--Section 48A(d)(3)(A) of the Internal 
     Revenue Code of 1986 (relating to aggregate credits) is 
     amended by striking ``$1,300,000,000'' and inserting 
     ``$1,800,000,000''.
       (b) Authorization of Additional Integrated Gasification 
     Combined Cycle Projects.--Subparagraph (B) of section 
     48A(d)(3) of te Internal Revenue Code of 1986 (relating to 
     aggregate credits) is amended to read as follows:
       ``(B) Particular projects.--Of the dollar amount in 
     subparagraph (A), the Secretary is authorized to certify--
       ``(i) $800,000,000 for integrated gasification combined 
     cycle projects the application for which is submitted during 
     the period described in paragraph (2)(A)(i),
       ``(ii) $500,000,000 for projects which use other advanced 
     coal-based generation technologies the application for which 
     is submitted during the period described in paragraph 
     (2)(A)(i), and
       ``(iii) $500,000,000 for integrated gasification combined 
     cycle projects the application for which is submitted during 
     the period described in paragraph (2)(A)(ii).''.
       (c) Application Period for Additional Projects.--
     Subparagraph (A) of section 48A(d)(2) of the Internal Revenue 
     Code of 1986 (relating to certification) is amended to read 
     as follows:
       ``(A) Application period.--Each applicant for certification 
     under this paragraph shall submit an application meeting the 
     requirements of subparagraph (B). An applicant may only 
     submit an application--
       ``(i) for an allocation from the dollar amount specified in 
     clause (i) or (ii) of paragraph (3)(A) during the 3-year 
     period beginning on the date the Secretary establishes the 
     program under paragraph (1), and
       ``(ii) for an allocation from the dollar amount specified 
     in paragraph (3)(A)(iii) during the 3-year period beginning 
     at the termination of the period described in clause (i).''.
       (d) Effective Date.--The amendments made by this section 
     shall take effect as if included in the amendments made by 
     section 1307 of the Energy Policy Act of 2005.

     SEC. 104. EXTENSION AND EXPANSION OF QUALIFYING GASIFICATION 
                   PROJECT CREDIT.

       (a) In General.--Section 48B(d)(1) of the Internal Revenue 
     Code of 1986 (relating to qualifying gasification project 
     program) is amended by striking ``$350,000,000'' and 
     inserting ``$850,000,000''.
       (b) Effective Date.--The amendment made by this section 
     shall take effect as if included in the amendments made by 
     section 1307 of the Energy Policy Act of 2005.

                TITLE II--DOMESTIC FOSSIL FUEL SECURITY

     SEC. 201. EXTENSION OF ELECTION TO EXPENSE CERTAIN 
                   REFINERIES.

       (a) In General.--Section 179C(c)(1) of the Internal Revenue 
     Code of 1986 (defining qualified refinery property) is 
     amended--
       (1) by striking ``and before January 1, 2012'' in 
     subparagraph (B) and inserting ``and, in the case of any 
     qualified refinery described in subsection (d)(1), before 
     January 1, 2012'', and
       (2) by inserting ``if described in subsection (d)(1)'' 
     after ``of which'' in subparagraph (F)(i).
       (b) Conforming Amendment.--Subsection (d) of section 179C 
     of the Internal Revenue Code of 1986 is amended to read as 
     follows:
       ``(d) Qualified Refinery.--For purposes of this section, 
     the term `qualified refinery' means any refinery located in 
     the United States which is designed to serve the primary 
     purpose of processing liquid fuel from--
       ``(1) crude oil, or
       ``(2) qualified fuels (as defined in section 45K(c)).''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect as if included in the amendment made by 
     section 1323(a) of the Energy Policy Act of 2005.

        TITLE III--CONSERVATION AND ENERGY EFFICIENCY PROVISIONS

     SEC. 301. EXTENSION OF ENERGY EFFICIENT COMMERCIAL BUILDINGS 
                   DEDUCTION.

       Section 179D(h) of the Internal Revenue Code of 1986 
     (relating to termination) is amended by striking ``2007'' and 
     inserting ``2010''.

     SEC. 302. EXTENSION OF NEW ENERGY EFFICIENT HOME CREDIT.

       (a) In General.--Subsection (g) of section 45L of the 
     Internal Revenue Code of 1986 (relating to new energy 
     efficient home credit) is amended to read as follows:
       ``(g) Termination.--This section shall not apply to--
       ``(1) any qualified new energy efficient home meeting the 
     energy saving requirements of subsection (c)(1) acquired 
     after December 31, 2010, and
       ``(2) any qualified new energy efficient home meeting the 
     energy saving requirements of paragraph (2) or (3) of 
     subsection (c) acquired after December 31, 2007.''.
       (b) Effective Date.--The amendment made by this section 
     shall take effect as if included in the amendments made by 
     section 1332 of the Energy Policy Act of 2005.

     SEC. 303. EXTENSION OF RESIDENTIAL ENERGY EFFICIENT PROPERTY 
                   CREDIT.

       Section 25D(g) of the Internal Revenue Code of 1986 
     (relating to termination) is amended by striking ``2007'' and 
     inserting ``2010''.

     SEC. 304. EXTENSION OF CREDIT FOR BUSINESS INSTALLATION OF 
                   QUALIFIED FUEL CELLS AND STATIONARY 
                   MICROTURBINE POWER PLANTS.

       Sections 48(c)(1)(E) and 48(c)(2)(E) of the Internal 
     Revenue Code of 1986 (relating to termination) are each 
     amended by striking ``2007'' and inserting ``2010''.

     SEC. 305. EXTENSION OF BUSINESS SOLAR INVESTMENT TAX CREDIT.

       Sections 48(a)(2)(A)(i)(II) and 48(a)(3)(A)(ii) of the 
     Internal Revenue Code of 1986 (relating to termination) are 
     each amended by striking ``2008'' and inserting ``2011''.

          TITLE IV--ALTERNATIVE FUELS AND VEHICLES INCENTIVES

     SEC. 401. EXTENSION OF EXCISE TAX PROVISIONS, INCOME TAX 
                   CREDITS, AND TARIFF DUTIES.

       (a) Biodiesel.--Sections 40A(g), 6426(c)(6), and 
     6427(e)(5)(B) of the Internal Revenue Code of 1986 are each 
     amended by striking ``2008'' and inserting ``2010''.
       (b) Alternative Fuel.--
       (1) Fuels.--Sections 6426(d)(4) and 6427(e)(5)(C) of the 
     Internal Revenue Code of 1986 are each amended by striking 
     ``September 30, 2009'' and inserting ``December 31, 2010''.
       (2) Refueling property.--Section 30C(g) of such Code is 
     amended by striking ``2009'' and inserting ``2010''.
       (c) Ethanol Tariff Schedule.--Headings 9901.00.50 and 
     9901.00.52 of the Harmonized Tariff Schedule of the United 
     States (19 U.S.C. 3007) are each amended in the effective 
     period column by striking ``10/1/2007'' each place it appears 
     and inserting ``1/1/2011''.
       (d) Effective Date.--The amendments made by this section 
     shall take effect on January 1, 2007.

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