[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 3555 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 3555
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 countries of concern.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
December 17, 2025
Mr. Cornyn (for himself, Ms. Cortez Masto, Mr. Scott of South Carolina,
Ms. Warren, and Mr. Sullivan) 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 countries of concern.
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 ``Comprehensive
Outbound Investment National Security Act of 2025''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; Table of contents.
TITLE I--GENERAL MATTERS
Sec. 101. Secretary defined.
Sec. 102. Severability.
Sec. 103. Authorization of appropriations.
Sec. 104. Sense of Congress.
Sec. 105. Termination.
TITLE II--IMPOSITION OF SANCTIONS
Sec. 201. Imposition of sanctions.
Sec. 202. Definitions.
Sec. 203. Exception relating to importation of goods.
TITLE III--PROHIBITION AND NOTIFICATION ON INVESTMENTS RELATING TO
COVERED NATIONAL SECURITY TRANSACTIONS
Sec. 301. Prohibition and notification on investments relating to
covered national security transactions.
TITLE IV--SECURITIES AND RELATED MATTERS
Sec. 401. Requirements relating to the Non-SDN Chinese Military-
Industrial Complex Companies List.
TITLE I--GENERAL MATTERS
SEC. 101. SECRETARY DEFINED.
Except as otherwise provided, in this Act, the term ``Secretary''
means the Secretary of the Treasury.
SEC. 102. SEVERABILITY.
If any provision of this Act or any amendment made by this Act, or
the application thereof, is held invalid, the validity of the remainder
of this Act or any amendment made by this Act and the application of
such provision to other persons and circumstances shall not be affected
thereby.
SEC. 103. 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 or any amendment
made by this Act, and to administer the provisions of this Act or any
amendment made 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 or any amendment made by 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 or any amendment made
by 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 or any amendment made by this Act.
SEC. 104. SENSE OF CONGRESS.
It is the sense of Congress that--
(1) due to the fact that there are countless known and
unknown entities in countries of concern, to include the
People's Republic of China (PRC), developing dual-use strategic
technologies that benefit a foreign adversary's military
modernization efforts, surveillance states, and human rights
abuses, restricting certain United States outbound investments
into these technologies in countries of concern is necessary to
prevent harm to United States national security and foreign
policy interests; and
(2) the President should therefore exercise the authorities
granted in this Act or any amendment made by this Act to
prevent countries of concern from exploiting United States
capital to undermine United States national security and
foreign policy interests.
SEC. 105. TERMINATION.
This Act and any amendment made by this Act shall cease to have any
force or effect on the date that is seven years after the date of the
enactment of this Act.
TITLE II--IMPOSITION OF SANCTIONS
SEC. 201. IMPOSITION OF SANCTIONS.
(a) In General.--The President may impose the sanctions described
in subsection (b) with respect to any foreign person determined 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
prohibit any United States person from investing in or purchasing
significant amounts of equity or debt instruments of a foreign person
that is determined to be a covered foreign person pursuant to
subsection (a).
(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--
(1) 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
(2) 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.--
(1) In general.--Not later than one year after the date of
the enactment of this Act, and annually thereafter for seven
years, the President shall submit to the appropriate
congressional committees a report that states whether any
foreign person on the Non-SDN Chinese Military-Industrial
Complex Companies List is a covered foreign person.
(2) Form.--The report required by paragraph (1) shall be
submitted in unclassified form, but may include a classified
annex.
(g) 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.
(h) Rule of Construction.--Nothing in this section may be construed
to limit the authority of the President to designate foreign persons
for the imposition of sanctions pursuant to any other provision of
Federal law, including the International Emergency Economic Powers Act
(50 U.S.C. 1701 et seq.).
SEC. 202. 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''
means the People's Republic of China, including the Hong Kong
and Macau Special Administrative Regions.
(3) Covered foreign person.--The term ``covered foreign
person'' means a foreign person--
(A) that is incorporated in, has a principal place
of business in, or is organized under the laws of a
country of concern;
(B) that is a member of the Central Committee of
the Chinese Communist Party or member of the political
leadership of a country of concern;
(C) that is the state or the government of a
country of concern, as well as any political
subdivision, agency, or instrumentality thereof;
(D) that is subject to the direction or control of
any entity described in subparagraphs (A) through (C);
or
(E) that is owned in the aggregate, directly or
indirectly, 50 percent or more by an entity or a group
of entities described in subparagraphs (A) through (C);
and
(F) 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 that is not a United States person.
(5) Knowingly.--The term ``knowingly'', with respect to
conduct, a circumstance, or a result, means that a person has
actual knowledge, or should have known, of the conduct, the
circumstance, or the result.
(6) 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.
(7) Person.--The term ``person'' means an individual or
entity.
(8) 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.
SEC. 203. EXCEPTION RELATING TO IMPORTATION OF GOODS.
(a) In General.--The authorities and requirements to impose
sanctions authorized under this Act shall not include the authority or
requirement to impose sanctions on the importation of goods.
(b) Good Defined.--In this section, the term ``good'' means any
article, natural or manmade substance, material, supply or manufactured
product, including inspection and test equipment, and excluding
technical data.
TITLE III--PROHIBITION AND NOTIFICATION ON INVESTMENTS RELATING TO
COVERED NATIONAL SECURITY TRANSACTIONS
SEC. 301. 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,
including its controlled foreign entities, from knowingly engaging in a
covered national security transaction in any prohibited technology.
``(b) Evasion.--Any action 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) Exemptions.--
``(1) National interest exemption.--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, or delegated to
the Secretary, in coordination with the Secretary of Commerce,
the Secretary of State, and, as appropriate, the heads of other
relevant Federal departments and agencies, to be in the
national interest of the United States.
``(2) Intelligence exemption.--Regulations issued under
subsection (e) shall not apply to any authorized intelligence
activities of the United States.
``(d) Congressional Notification.--The Secretary shall--
``(1) notify the appropriate congressional committees not
later than five business days after issuing an exemption under
subsection (c); and
``(2) include in such notification an identification of the
national interest justifying the use of the exemption, subject
to appropriate confidentiality and classification requirements.
``(e) Regulations.--
``(1) In general.--The Secretary, in consultation with the
Secretary of Commerce, the Secretary of State and, as
appropriate, the heads of other relevant Federal departments
and agencies, may issue or update existing regulations to carry
out this section subject to public notice and comment in
accordance with subchapter II of chapter 5 and chapter 7 of
title 5, United States Code, and not subject to the
requirements of section 709. The regulations issued pursuant to
this paragraph shall, as necessary, amend, terminate,
supersede, revoke, or streamline existing requirements in part
850 of title 31, Code of Federal Regulations (the Outbound
Investment Rule) and shall provide a reasonable timeframe for
compliance.
``(2) Non-binding feedback.--
``(A) In general.--The regulations issued under
paragraph (1) shall include a process under which a
person can request to receive non-binding feedback on a
confidential basis, or as anonymized guidance to the
public, 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; opportunity to cure.--
``(A) In general.--The regulations issued under
paragraph (1) shall account for whether a United States
person has self-identified and self-disclosed 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) Low-burden regulations.--In issuing regulations under
paragraph (1), the Secretary should 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.
``(5) 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 itself or whose controlled foreign entity
knowingly 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, the Secretary of State, and, as
appropriate, the heads of other relevant Federal departments
and agencies, shall issue regulations to carry out this section
subject to public notice and comment in accordance with
subchapter II of chapter 5 and chapter 7 of title 5, United
States Code, and not subject to the requirements of section
709. The regulations issued pursuant to this paragraph shall as
necessary, amend, terminate, supersede, revoke, or streamline
existing requirements in part 850 of title 31, Code of Federal
Regulations (th