[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 1053 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 1053
To protect the national security of the United States by imposing
sanctions with respect to certain persons of the People's Republic of
China and prohibiting and requiring notifications with respect to
certain investments by United States persons in the People's Republic
of China, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 13, 2025
Mr. Cornyn (for himself, Ms. Cortez Masto, Mr. Scott of South Carolina,
Mr. Schumer, Mr. Sullivan, Ms. Warren, Mr. Hagerty, Mr. Kim, Mr.
Ricketts, Ms. Slotkin, Mr. Banks, Mr. Bennet, Mr. McCormick, and Mr.
Fetterman) introduced the following bill; which was read twice and
referred to the Committee on Banking, Housing, and Urban Affairs
_______________________________________________________________________
A BILL
To protect the national security of the United States by imposing
sanctions with respect to certain persons of the People's Republic of
China and prohibiting and requiring notifications with respect to
certain investments by United States persons in the People's Republic
of China, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This title may be cited as the ``Foreign
Investment Guardrails to Help Thwart China Act of 2025'' or ``FIGHT
China Act of 2025''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Secretary defined.
Sec. 3. Severability.
Sec. 4. Authorization of appropriations.
Sec. 5. Termination.
TITLE I--IMPOSITION OF SANCTIONS
Sec. 101. Imposition of sanctions.
Sec. 102. Definitions.
TITLE II--PROHIBITION AND NOTIFICATION ON INVESTMENTS RELATING TO
COVERED NATIONAL SECURITY TRANSACTIONS
Sec. 201. Prohibition and notification on investments relating to
covered national security transactions.
TITLE III--SECURITIES AND RELATED MATTERS
Sec. 301. Requirements relating to the Non-SDN Chinese Military-
Industrial Complex Companies List.
SEC. 2. SECRETARY DEFINED.
Except as otherwise provided, in this Act, the term ``Secretary''
means the Secretary of the Treasury.
SEC. 3. SEVERABILITY.
If any provision of this Act, or the application thereof, is held
invalid, the validity of the remainder of this Act and the application
of such provision to other persons and circumstances shall not be
affected thereby.
SEC. 4. AUTHORIZATION OF APPROPRIATIONS.
(a) In General.--There is authorized to be appropriated
$150,000,000 to the Department of the Treasury, out of which amounts
may be transferred to the Department of Commerce to jointly conduct
outreach to industry and persons affected by this Act, for each of the
first two fiscal years beginning on or after the date of the enactment
of this Act, to carry out this Act.
(b) Hiring Authority.--
(1) By the president.--The President may appoint, without
regard to the provisions of sections 3309 through 3318 of title
5, United States Code, not more than 15 individuals directly to
positions in the competitive service (as defined in section
2102 of that title) to carry out this Act.
(2) By agencies.--The Secretary and the Secretary of
Commerce may appoint, without regard to the provisions of
sections 3309 through 3318 of title 5, United States Code,
individuals directly to positions in the competitive service
(as defined in section 2102 of that title) of the Department of
the Treasury and the Department of Commerce, respectively, to
carry out this Act.
SEC. 5. TERMINATION.
This Act shall cease to have any force or effect on the date on
which the Secretary of Commerce revises section 791.4 of title 15, Code
of Federal Regulations, to remove the People's Republic of China from
the list of foreign adversaries contained in such section.
TITLE I--IMPOSITION OF SANCTIONS
SEC. 101. IMPOSITION OF SANCTIONS.
(a) In General.--The President may impose the sanctions described
in subsection (b) with respect to any foreign person determined by the
Secretary, in consultation with the Secretary of State, to be a covered
foreign person.
(b) Sanctions Described.--The President may exercise all of the
powers granted to the President under the International Emergency
Economic Powers Act (50 U.S.C. 1701 et seq.) to the extent necessary to
block and prohibit all transactions in property and interests in
property of a foreign person that is determined to be a covered foreign
person pursuant to subsection (a) if such property and interests in
property are in the United States, come within the United States, or
are or come within the possession or control of a United States person.
(c) Penalties.--The penalties provided for in subsections (b) and
(c) of section 206 of the International Emergency Economic Powers Act
(50 U.S.C. 1705) shall apply to any person who violates, attempts to
violate, conspires to violate, or causes a violation of any prohibition
of this section, or an order or regulation prescribed under this
section, to the same extent that such penalties apply to a person that
commits an unlawful act described in section 206(a) of such Act (50
U.S.C. 1705(a)).
(d) Exception for Intelligence and Law Enforcement Activities.--
Sanctions under this section shall not apply with respect to any
activity subject to the reporting requirements under title V of the
National Security Act of 1947 (50 U.S.C. 3091 et seq.) or any
authorized intelligence activities of the United States.
(e) Exception for United States Government Activities.--Nothing in
this section shall prohibit transactions for the conduct of the
official business of the Federal Government by employees, grantees, or
contractors thereof.
(f) Report to Congress.--Not later than 365 days after the date of
the enactment of this Act, and annually thereafter for 7 years, the
Secretary shall submit to the appropriate congressional committees a
report that--
(1) states whether each foreign person on the Non-SDN
Chinese Military-Industrial Complex Companies List is a covered
foreign person; and
(2) shall be submitted in unclassified form, but may
include a classified annex.
(g) Consideration of Certain Information in Imposing Sanctions.--In
determining whether a foreign person is a covered foreign person, the
President--
(1) may consider credible information obtained by other
countries, nongovernmental organizations, or the appropriate
congressional committees that relates to the foreign person;
and
(2) may consider any other information that the Secretary
deems relevant.
(h) Administrative Provisions.--The President may exercise all
authorities provided under sections 203 and 205 of the International
Emergency Economic Powers Act (50 U.S.C. 1702 and 1704) to carry out
this section.
(i) Delegation.--The President shall delegate the authorities
granted by this section to the Secretary.
SEC. 102. DEFINITIONS.
In this title:
(1) Appropriate congressional committees.--The term
``appropriate congressional committees'' means--
(A) the Committee on Financial Services and the
Committee on Foreign Affairs of the House of
Representatives; and
(B) the Committee on Banking, Housing, and Urban
Affairs and the Committee on Foreign Relations of the
Senate.
(2) Country of concern.--The term ``country of concern''--
(A) means the People's Republic of China; and
(B) includes the Hong Kong Special Administrative
Region and the Macau Special Administrative Region.
(3) Covered foreign person.--The term ``covered foreign
person'' means a foreign person--
(A)(i) that is incorporated in, has a principal
place of business in, or is organized under the laws of
a country of concern;
(ii) the equity securities of which are primarily
traded in the ordinary course of business on one or
more exchanges in a country of concern;
(iii) that is a member of the Central Committee of
the Chinese Communist Party;
(iv) that is the state or the government of a
country of concern, as well as any political
subdivision, agency, or instrumentality thereof;
(v) that is subject to the direction or control of
any entity described in clause (i), (ii), (iii), or
(iv); or
(vi) that is owned in the aggregate, directly or
indirectly, 50 percent or more by an entity or a group
of entities described in clause (i), (ii), (iii), or
(iv); and
(B) that knowingly engaged in significant
operations in the defense and related materiel sector
or the surveillance technology sector of the economy of
a country of concern.
(4) Foreign person.--The term ``foreign person'' means a
person, country, state, or government (and any political
subdivision, agency, or instrumentality thereof) that is not a
United States person.
(5) Non-SDN chinese military-industrial complex companies
list.--The term ``Non-SDN Chinese Military-Industrial Complex
Companies List'' means the list maintained by the Office of
Foreign Assets Control of the Department of the Treasury under
Executive Order 13959, as amended by Executive Order 14032 (50
U.S.C. 1701 note; relating to addressing the threat from
securities investments that finance certain companies of the
People's Republic of China), or any successor order.
(6) United states person.--The term ``United States
person'' means--
(A) any United States citizen or an alien lawfully
admitted for permanent residence to the United States;
(B) an entity organized under the laws of the
United States or of any jurisdiction within the United
States (including any foreign branch of such an
entity); or
(C) any person in the United States.
TITLE II--PROHIBITION AND NOTIFICATION ON INVESTMENTS RELATING TO
COVERED NATIONAL SECURITY TRANSACTIONS
SEC. 201. PROHIBITION AND NOTIFICATION ON INVESTMENTS RELATING TO
COVERED NATIONAL SECURITY TRANSACTIONS.
The Defense Production Act of 1950 (50 U.S.C. 4501 et seq.) is
amended by adding at the end the following:
``TITLE VIII--PROHIBITION AND NOTIFICATION ON INVESTMENTS RELATING TO
COVERED NATIONAL SECURITY TRANSACTIONS
``SEC. 801. PROHIBITION ON INVESTMENTS.
``(a) In General.--The Secretary may prohibit, in accordance with
regulations issued under subsection (e), a United States person from
knowingly engaging in a covered national security transaction in a
prohibited technology.
``(b) Evasion.--Any transaction by a United States person or within
the United States that evades or avoids, has the purpose of evading or
avoiding, causes a violation of, or attempts to violate the prohibition
set forth in subsection (a) is prohibited.
``(c) Waiver.--Subject to subsection (d), the Secretary is
authorized to exempt from the prohibition set forth in subsection (a)
any activity determined by the President, in consultation with the
Secretary, the Secretary of Commerce and, as appropriate, the heads of
other relevant Federal departments and agencies, to be in the national
interest of the United States.
``(d) Congressional Notification.--The Secretary shall--
``(1) notify the appropriate congressional committees not
later than 5 business days after issuing a waiver under
subsection (c); and
``(2) include in such notification an identification of the
national interest justifying the use of the waiver.
``(e) Regulations.--
``(1) In general.--The Secretary, in consultation with the
Secretary of Commerce and, as appropriate, the heads of other
relevant Federal departments and agencies, may issue
regulations to carry out this section in accordance with
subchapter II of chapter 5 and chapter 7 of title 5, United
States Code (commonly known as `Administrative Procedure Act').
``(2) Non-binding feedback.--
``(A) In general.--The regulations issued under
paragraph (1) shall include a process under which a
person can request non-binding feedback on a
confidential basis as to whether a transaction would
constitute a covered national security transaction in a
prohibited technology.
``(B) Authority to limit frivolous feedback
requests.--In establishing the process required by
subparagraph (A), the Secretary may prescribe
limitations on requests for feedback identified as
frivolous for purposes of this subsection.
``(3) Notice and opportunity to cure.--
``(A) In general.--The regulations issued under
paragraph (1) shall account for whether a United States
person has self-identified a violation of the
prohibition set forth in subsection (a) in determining
the legal consequences of that violation.
``(B) Self-disclosure letters.--The regulations
issued under paragraph (1) shall dictate the form and
content of a letter of self-disclosure, which shall
include relevant facts about the violation, why the
United States person believes its activity to have
violated the prohibition set forth in subsection (a),
and a proposal for mitigation of the harm of such
action.
``(4) Public notice and comment.--The regulations issued
under paragraph (1) shall be subject to public notice and
comment.
``(5) Low-burden regulations.--In issuing regulations under
paragraph (1), the Secretary shall balance the priority of
protecting the national security interest of the United States
while, to the extent practicable--
``(A) minimizing the cost and complexity of
compliance for affected parties, including the
duplication of reporting requirements under current
regulations;
``(B) adopting the least burdensome alternative
that achieves regulatory objectives; and
``(C) prioritizing transparency and stakeholder
involvement in the process of issuing the rules.
``(6) Penalties.--
``(A) In general.--The regulations issued under
paragraph (1) shall provide for the imposition of civil
penalties described in subparagraph (B) for violations
of the prohibition set forth in subsection (a).
``(B) Penalties described.--
``(i) Unlawful acts.--It shall be unlawful
for a person to violate, attempt to violate,
conspire to violate, or cause a violation of
any license, order, regulation, notification
requirement, or prohibition issued under this
section.
``(ii) Civil penalty.--The Secretary may
impose a civil penalty on any person who
commits an unlawful act described in clause (i)
in an amount not to exceed the greater of--
``(I) $250,000; or
``(II) an amount that is twice the
amount of the transaction that is the
basis of the violation with respect to
which the penalty is imposed.
``(iii) Divestment.--The Secretary may
compel the divestment of a covered national
security transaction in a prohibited technology
determined to be in violation of this title.
``(iv) Relief.--The President may direct
the Attorney General of the United States to
seek appropriate relief, including divestment
relief, in the district courts of the United
States, in order to implement and enforce this
title.
``(7) Burden of proof.--In accordance with section 556(d)
of title 5, United States Code, in an enforcement action for a
violation of the prohibition set forth in subsection (a), the
burden of proof shall be upon the Secretary.
``SEC. 802. NOTIFICATION ON INVESTMENTS.
``(a) Mandatory Notification.--Not later than 450 days after the
date of the enactment of this title, the Secretary shall issue
regulations prescribed in accordance with subsection (b), to require a
United States person that engages in a covered national security
transaction in a prohibited technology (unless the Secretary has
exercised the authority provided by section 801(a) to prohibit
knowingly engaging in such covered national security transaction) or a
notifiable technology to submit to the Secretary a written notification
of the transaction not later than 30 days after the completion date of
the transaction.
``(b) Regulations.--
``(1) In general.--Not later than 450 days after the date
of the enactment of this title, the Secretary, in consultation
with the Secretary of Commerce and, as appropriate, the heads
of other relevant Federal departments and agencies, shall issue
regulations to carry out this section in accordance with
subchapter II of chapter 5 and chapter 7 of title 5, United
States Code (commonly known as `Administrative Procedure Act').
``(2) Public notice and comment.--The regulations issued
under paragraph (1) shall be subject to public notice and
comment.
``(3) Low-burden regulations.--In issuing regulations under
paragraph (1), the Secretary shall balance the priority of
protecting the national security interest of the United States
while, to the extent practicable--
``(A) minimi