[Senate Report 118-12]
[From the U.S. Government Publishing Office]


                                                    Calendar No. 36

118th Congress}                                            { Report
                                 SENATE
 1st Session  }                                            { 118-12

======================================================================

                  LOBBYING DISCLOSURE IMPROVEMENT ACT

                               __________

                              R E P O R T

                                 OF THE

                   COMMITTEE ON HOMELAND SECURITY AND

                          GOVERNMENTAL AFFAIRS

                          UNITED STATES SENATE

                              TO ACCOMPANY

                                 S. 264

              TO AMEND THE LOBBYING DISCLOSURE ACT OF 1995
             TO REQUIRE CERTAIN DISCLOSURES BY REGISTRANTS
             REGARDING EXEMPTIONS UNDER THE FOREIGN AGENTS
                  REGISTRATION ACT OF 1938, AS AMENDED

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


                 April 19, 2023.--Ordered to be printed
                 
                             __________

                                
                    U.S. GOVERNMENT PUBLISHING OFFICE                    
                           WASHINGTON : 2023                    
          
-----------------------------------------------------------------------------------                     
                
        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

                   GARY C. PETERS, Michigan, Chairman
THOMAS R. CARPER, Delaware           RAND PAUL, Kentucky
MAGGIE HASSAN, New Hampshire         RON JOHNSON, Wisconsin
KYRSTEN SINEMA, Arizona              JAMES LANKFORD, Oklahoma
JACKY ROSEN, Nevada                  MITT ROMNEY, Utah
ALEX PADILLA, California             RICK SCOTT, Florida
JON OSSOFF, Georgia                  JOSH HAWLEY, Missouri
RICHARD BLUMENTHAL, Connecticut      ROGER MARSHALL, Kansas

                   David M. Weinberg, Staff Director
                    Zachary I. Schram, Chief Counsel
            Lena C. Chang, Director of Governmental Affairs
               Emily I. Manna, Professional Staff Member
           William E. Henderson III, Minority Staff Director
              Christina N. Salazar, Minority Chief Counsel
       L. Margaret Harker, Minority Senior Investigative Counsel
                     Laura W. Kilbride, Chief Clerk
                     
                     
                     
                                                    Calendar No. 36

118th Congress}                                            { Report
                                 SENATE
 1st Session  }                                            { 118-12

======================================================================                     
 
                  LOBBYING DISCLOSURE IMPROVEMENT ACT

                                _______
                                

                 April 19, 2023.--Ordered to be printed

                                _______
                                

 Mr. Peters, from the Committee on Homeland Security and Governmental 
                    Affairs, submitted the following

                              R E P O R T

                         [To accompany S. 264]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Homeland Security and Governmental 
Affairs, to which was referred the bill (S. 264), to amend the 
Lobbying Disclosure Act of 1995 to require certain disclosures 
by registrants regarding exemptions under the Foreign Agents 
Registration Act of 1938, as amended, having considered the 
same, reports favorably thereon without amendment and 
recommends that the bill do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and Summary..............................................1
 II. Background and Need for the Legislation..........................2
III. Legislative History..............................................2
 IV. Section-by-Section Analysis of the Bill, as Reported.............2
  V. Evaluation of Regulatory Impact..................................3
 VI. Congressional Budget Office Cost Estimate........................3
VII. Changes in Existing Law Made by the Bill, as Reported............4

                         I. Purpose and Summary

    S. 264, the Lobbying Disclosure Improvement Act, amends the 
Lobbying Disclosure Act (LDA) of 1995. It would improve 
oversight of lobbyists for foreign persons and entities by 
requiring LDA registrants to indicate whether they believe a 
Foreign Agents Registration Act (FARA) provision exempts them 
from registering under FARA.\1\
---------------------------------------------------------------------------
    \1\On September 28, 2022, the Committee approved S. 4893, the 
Lobbying Disclosure Improvement Act. That bill is substantially similar 
to S. 264. Accordingly, this committee report is, in many respects, 
similar to the committee report for S. 4893. See S. Rept. 117-212.
---------------------------------------------------------------------------

              II. Background and the Need for Legislation

    FARA exempts lobbyists who are agents of foreign persons or 
organizations (but not foreign governments or political 
parties, or the equivalent) from registering under that law if 
they are properly registered under the LDA.\2\ However, the 
standard by which the Department of Justice (DOJ) applies the 
exemption has often lacked clarity, particularly the threshold 
by which it is determined whether lobbying activities primarily 
benefit a foreign government as opposed to a foreign individual 
or organization.\3\ Additionally, some lobbyists for whom the 
exemption should not apply are incentivized to improperly claim 
the exemption because the requirements for LDA registration are 
much less stringent than those for FARA.\4\
---------------------------------------------------------------------------
    \2\22 U.S.C. Sec. 613(h)
    \3\Enhancing the Foreign Agents Registration Act of 1938: Hearing 
before the House Committee on the Judiciary Subcommittee on the 
Constitution, Civil Rights, and Civil Liberties, 117th Cong. (April 5, 
2022) (Testimony of Dylan Hedtler-Gaudette, Government Affairs Manager, 
Project On Government Oversight), available at https://docs.house.gov/
meetings/JU/JU10/20220405/114580/HHRG-117-JU10-Wstate-Hedtler-
GaudetteD-20220405.pdf.
    \4\Congressional Research Service, The Foreign Agents Registration 
Act (FARA): A Legal Overview (Dec. 4, 2017).
---------------------------------------------------------------------------
    Currently, there is no way for FARA enforcement officials 
to easily identify LDA registrants who believe the exemption 
applies to them.\5\ The bill would simply require LDA 
registrants to indicate, as part of their registration, whether 
they believe the FARA exemption applies. This would help DOJ 
officials narrow the pool of LDA registrants they examine for 
potential violations, while not imposing any meaningful 
additional burden on registrants.
---------------------------------------------------------------------------
    \5\Project on Government Oversight, Loopholes, Filing Failures, and 
Lax Enforcement: How the Foreign Agents Registration Act Falls Short. 
(Dec. 16, 2014) available at https://docs.pogo.org/report/2014/pogo-
fara-report-20141216.pdf?_ga=2.243251271.49320974.1668452543-
1746055107.166845254.
---------------------------------------------------------------------------

                        III. Legislative History

    Chairman Gary Peters (D-MI) introduced S. 264, the Lobbying 
Disclosure Improvement Act, on February 2, 2023, with Senator 
Chuck Grassley (R-IA). The bill was referred to the Committee 
on Homeland Security and Governmental Affairs.
    The Committee considered S. 264 at a business meeting on 
March 29, 2023. During the business meeting. S. 933 was ordered 
reported favorably by a roll call vote of 12 yeas and 0 nays 
with Senators Peters, Hassan, Sinema, Rosen, Padilla, Ossoff, 
Blumenthal, Paul, Lankford, Romney, Scott, and Hawley voting in 
the affirmative, and with Senators Carper, Johnson, and 
Marshall voting yea by proxy, for the record only.

        IV. Section-by-Section Analysis of the Bill, as Reported


Section 1. Short title

    This section provides that the Act may be cited as the 
``Lobbying Disclosure Improvement Act.''

Section 2. Registrant disclosure regarding foreign agent registration 
        exemption

    This section amends the LDA by adding a new requirement 
that LDA registrants indicate whether they believe section 3(h) 
of FARA exempts them from registering under FARA.

                   V. Evaluation of Regulatory Impact

    Pursuant to the requirements of paragraph 11(b) of rule 
XXVI of the Standing Rules of the Senate, the Committee has 
considered the regulatory impact of this bill and determined 
that the bill will have no regulatory impact within the meaning 
of the rules. The Committee agrees with the Congressional 
Budget Office`s statement that the bill contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act (UMRA) and would impose no costs 
on state, local, or tribal governments.

             VI. Congressional Budget Office Cost Estimate
             

                                                     April 5, 2023.

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    S. 264 would require lobbyists to disclose whether they are 
claiming an exemption from the Foreign Agents Registration Act. 
CBO estimates that implementing the bill would not 
significantly increase the administrative costs of the House of 
Representatives or the Senate over the 2023-2028 period. Any 
spending would be subject to the availability of appropriated 
funds.
    Failure to disclose the newly required information could 
increase collections of civil fines, which are recorded in the 
budget as revenues. CBO estimates that those collections would 
not be significant in any year or over the 2023-2033 period 
because of the relatively small number of cases likely to be 
affected.
    S. 264 would impose a private-sector mandate as defined in 
the Unfunded Mandates Reform Act (UMRA) by requiring 
registrants under the Lobbying Disclosure Act to indicate 
whether they are claiming an exemption under the Foreign Agents 
Registration Act. CBO estimates that the cost of the mandate 
would not exceed the private-sector threshold established in 
UMRA ($198 million in 2022, adjusted annually for inflation).
    S. 264 contains no intergovernmental mandates as defined in 
UMRA.
    The CBO staff contacts for this estimate are Matthew 
Pickford (for federal costs) and Andrew Laughlin (for 
mandates). The estimate was reviewed by H. Samuel Papenfuss, 
Deputy Director of Budget Analysis.
                                         Phillip L. Swagel,
                             Director, Congressional Budget Office.

       VII. Changes in Existing Law Made by the Bill, as Reported

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in brackets, new matter is 
printed in italic, and existing law in which no change is 
proposed is shown in roman):

UNITED STATES CODE

           *       *       *       *       *       *       *


TITLE 2--ORGANIZATION OF CONGRESS

           *       *       *       *       *       *       *


CHAPTER 26--DISCLOSURE OF LOBBYING ACTIVITIES

           *       *       *       *       *       *       *



SEC. 1603--REGISTRATION OF LOBBYISTS

    (a) * * *
    (b) Contents of registration
    Each registration under this section shall contain--
          (1) * * *

           *       *       *       *       *       *       *

          (6) the name of each employee of the registrant who 
        has acted or whom the registrant expects to act as a 
        lobbyist on behalf of the client and, if any such 
        employee has served as a covered executive branch 
        official or a covered legislative branch official in 
        the 20 years before the date on which the employee 
        first acted as a lobbyist on behalf of the client, the 
        position in which such employee served; [and]
          (7) for any listed lobbyist who was convicted in a 
        Federal or State court of an offense involving bribery, 
        extortion, embezzlement, an illegal kickback, tax 
        evasion, fraud, a conflict of interest, making a false 
        statement, perjury, or money laundering, the date of 
        the conviction and a description of the offense.
    No disclosure is required under paragraph (3)(B) if the 
organization that would be identified as affiliated with the 
client is listed on the client's publicly accessible Internet 
website as being a member of or contributor to the client, 
unless the organization in whole or in major part plans, 
supervises, or controls such lobbying activities. If a 
registrant relies upon the preceding sentence, the registrant 
must disclose the specific Internet address of the web page 
containing the information relied upon. Nothing in paragraph 
(3)(B) shall be construed to require the disclosure of any 
information about individuals who are members of, or donors to, 
an entity treated as a client by this chapter or an 
organization identified under that paragraph[.]; and 
          (8) a statement as to whether the registrant is 
        exempt under section 3(h) of the Foreign Agents 
        Registration Act of 1938, as amended (22 U.S.C. 
        613(h)).

           *       *       *       *       *       *       *


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