What This Bill Does
This bill imposes financial sanctions against China and Chinese entities if China attacks Taiwan or attempts to take control of Taiwan by force or coercion. The sanctions can include freezing assets, banning visas, prohibiting investment in Chinese companies, and blocking securities trading on United States exchanges.
##
Who It Affects
- The President of the United States
- Chinese government officials and military leaders
- Chinese companies and entities
- United States citizens and businesses
- Foreign banks and financial institutions
- The Securities and Exchange Commission
- The Secretary of Commerce
- The Secretary of State and Secretary of Homeland Security
##
Key Provisions
- The President must impose sanctions within 30 days after a "triggering event" (any military action, invasion, blockade, or attempt by China to change Taiwan's status by force) against any Chinese person the President determines participated in that event (Sec. 5(a))
- Sanctions include blocking all property and assets the person owns in the United States, making the person ineligible for visas, and banning the person from being admitted to the United States (Sec. 5(b)(1) and (2))
- The Securities and Exchange Commission must prohibit the trading of securities from any Chinese company on United States stock exchanges within 60 days after a triggering event (Sec. 6(a))
- Beginning 30 days after a triggering event, Americans are prohibited from buying or selling securities of Chinese military companies or investing in their stock and debt (Sec. 7(a))
- Beginning 30 days after a triggering event, Americans cannot conduct any transactions with Chinese software companies that develop certain digital wallet or payment applications, including WeChat Pay, Alipay, QQ Wallet, and others (Sec. 8(a) and (c))
- Beginning 30 days after a triggering event, Americans cannot conduct transactions with any digital currency issued by the Chinese government (Sec. 10)
##
What Changes
If this bill becomes law and China engages in armed aggression, invasion, blockade, or attempts to forcibly change Taiwan's status, the United States will sever financial transactions with China and Chinese entities. American citizens will be prohibited from investing in Chinese companies, trading Chinese securities, and conducting business with Chinese software companies that control certain payment platforms. Chinese government officials and military leaders involved in the aggression will have their assets frozen, lose visa eligibility, and be banned from entering the United States.
##
Important Definitions
- **Triggering event:** Any attempt by the Chinese government or forces under its control to force Taiwan under China's control, including armed aggression, invasion, blockade, or attempts to change Taiwan's government or status by force or coercion (Sec. 4(8))
- **Chinese person:** An individual who is a citizen of China or an entity organized under Chinese law or subject to China's government control (Sec. 4(3))
- **Chinese military company:** An entity on a specific list required under the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021 (Sec. 4(2))
- **United States person:** A United States citizen, someone lawfully admitted for permanent residence, an entity organized under United States law, or any person in the United States (Sec. 4(9))
- **Connected software application:** Software designed to be used on computing devices to collect, process, or transmit data over the internet, or software designed to facilitate international financial transactions, digital wallets, digital currency, mobile payments, or international financial messaging (Sec. 8(d))
##
Effective Date
Not specified in bill text. Sanctions are triggered 30 to 60 days after a "triggering event" occurs.
II
118TH CONGRESS
1ST SESSION
S. 481
To impose sanctions to deter aggression by the People’s Republic of China
against Taiwan, and for other purposes.
IN THE SENATE OF THE UNITED STATES
FEBRUARY 16, 2023
Mr. SCOTT of Florida (for himself and Mr. CRAMER) introduced the following
bill; which was read twice and referred to the Committee on Banking,
Housing, and Urban Affairs
A BILL
To impose sanctions to deter aggression by the People’s
Republic of China against Taiwan, and for other purposes.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE.
3
This Act may be cited as the ‘‘Deterring Communist
4
Chinese Aggression against Taiwan through Financial
5
Sanctions Act of 2023’’.
6
SEC. 2. FINDINGS.
7
Congress makes the following findings:
8
(1) Taiwan is a self-governing polity with all
9
the attributes of a constitutional democratic republic
10
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and consistently achieves exceedingly high scores
1
from Freedom House’s Freedom in the World Index.
2
(2) Taiwan practices and enshrines in law a
3
free market and entrepreneurial economy and con-
4
sistently achieves exceedingly high scores in the Her-
5
itage Foundation’s Index of Economic Freedom.
6
(3) Taiwan’s government and political culture
7
cherish individual rights and the protection of ethnic
8
minorities, and do so through respect for the rule of
9
law.
10
(4) Taiwan’s democracy, free market economy,
11
and cultural, industrial, and scientific achievements
12
have made it a model for the world as it contributes
13
greatly to the peace, prosperity, and well-being of
14
the United States and all other countries that trade
15
and cooperate with Taiwan despite the constraints
16
on trade and cooperation resulting from the threats
17
and intimidation by the Communist Party of China
18
against countries that seek relations with Taiwan.
19
(5) Section 2(b) of the Taiwan Relations Act
20
(22 U.S.C. 3301(b)) asserts that it is the policy of
21
the United States—
22
(A) ‘‘to declare that peace and stability in
23
the area are in the political, security, and eco-
24
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nomic interests of the United States, and are
1
matters of international concern’’;
2
(B) ‘‘to make clear that the United States
3
decision to establish diplomatic relations with
4
the People’s Republic of China rests upon the
5
expectation that the future of Taiwan will be
6
determined by peaceful means’’;
7
(C) ‘‘to consider any effort to determine
8
the future of Taiwan by other than peaceful
9
means, including by boycotts or embargoes, a
10
threat to the peace and security of the Western
11
Pacific area and of grave concern to the United
12
States’’; and
13
(D) ‘‘to maintain the capacity of the
14
United States to resist any resort to force or
15
other forms of coercion that would jeopardize
16
the security, or the social or economic system,
17
of the people on Taiwan’’.
18
(6) The Chinese Communist Party, especially
19
under the leadership of General Secretary Xi
20
Jinping, threatens Taiwan in terms of national secu-
21
rity, trade, and its relationships with countries and
22
international organizations.
23
(7) Such threats are designed to intimidate Tai-
24
wan into submission to Communist Party rule and
25
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to cause other countries and international organiza-
1
tions to shun Taiwan and cut off relations with it.
2
(8) General Secretary Xi and the Communist
3
Party have made clear their intention to take Tai-
4
wan by force if they so choose, and they demonstrate
5
that intention with increased provocative and dan-
6
gerous actions threatening the peace against Taiwan
7
in the Taiwan Straits.
8
(9) Supporting Taiwan’s defense against such
9
increasingly imminent threats is a vital interest of
10
the United States for the sake of the national secu-
11
rity of the United States and allies of the United
12
States in the region, and the preservation of democ-
13
racy, free market economics, and the rules and
14
norms of the international order.
15
(10) The peace and stability of the entire Pa-
16
cific region and the countries in that region require
17
that Taiwan not be subjected to the rule of the Com-
18
munist Party of China.
19
(11) The credibility of the avowal of the United
20
States to defend the principles of the United States
21
and the principles the international order is built
22
upon require a policy that can and will deter and
23
thwart any attempt by the Communist Party of
24
China to dominate Taiwan by coercion.
25
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SEC. 3. STATEMENT OF POLICY.
1
It is the policy of the United States to sever all finan-
2
cial transactions between the United States and the Peo-
3
ple’s Republic of China, including any and all public or
4
private entities in the People’s Republic of China, if the
5
Government of the People’s Republic of China or any
6
forces subject to the control of that Government—
7
(1) engage in armed aggression against Taiwan;
8
(2) invade the territory of Taiwan, including
9
the mainland of Taiwan and any territories under its
10
control, without regard to whether those territories
11
are inhabited or not;
12
(3) blockade by sea or air the mainland of Tai-
13
wan or territories under its control; or
14
(4) attempt to change the status of Taiwan or
15
its government by force or coercive actions.
16
SEC. 4. DEFINITIONS.
17
In this Act:
18
(1) APPROPRIATE
CONGRESSIONAL
COMMIT-
19
TEES.—The term ‘‘appropriate congressional com-
20
mittees’’ means—
21
(A) the Committee on Banking, Housing,
22
and Urban Affairs and the Committee on Fi-
23
nance of the Senate; and
24
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(B) the Committee on Financial Services
1
and the Committee on Ways and Means of the
2
House of Representatives.
3
(2) CHINESE MILITARY COMPANY.—The term
4
‘‘Chinese military company’’ means an entity on the
5
most recent list required to be submitted under sec-
6
tion 1260H of the William M. (Mac) Thornberry
7
National Defense Authorization Act for Fiscal Year
8
2021 (Public Law 116–283; 10 U.S.C. 113 note).
9
(3) CHINESE
PERSON.—The term ‘‘Chinese
10
person’’ means—
11
(A) an individual who is a citizen or na-
12
tional of the People’s Republic of China; or
13
(B) an entity organized under the laws of
14
the People’s Republic of China or otherwise
15
subject to the jurisdiction of the Government of
16
the People’s Republic of China.
17
(4) FINANCIAL
INSTITUTION.—The term ‘‘fi-
18
nancial institution’’ means a financial institution
19
specified in subparagraph (A), (B), (C), (D), (E),
20
(F), (G), (H), (I), (J), (K), (M), (N), (P), (R), (T),
21
(Y), or (Z) of section 5312(a)(2) of title 31, United
22
States Code.
23
(5) FOREIGN
FINANCIAL
INSTITUTION.—The
24
term ‘‘foreign financial institution’’ has the meaning
25
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•S 481 IS
given that term in section 1010.605 of title 31, Code
1
of Federal Regulations (or any corresponding similar
2
regulation or ruling).
3
(6) ISSUER; SECURITY.—The terms ‘‘issuer’’
4
and ‘‘security’’ have the meanings given those terms
5
in section 3(a) of the Securities Exchange Act of
6
1934 (15 U.S.C. 78c).
7
(7) NATIONAL
SECURITIES
EXCHANGE.—The
8
term ‘‘national securities exchange’’ means an ex-
9
change registered as a national securities exchange
10
in accordance with section 6 of the Securities Ex-
11
change Act of 1934 (15 U.S.C. 78f).
12
(8) TRIGGERING EVENT.—The term ‘‘triggering
13
event’’ means any attempt by the Government of the
14
People’s Republic of China or any forces subject to
15
the control of that Government to subject Taiwan to
16
the control of the People’s Republic of China, includ-
17
ing though any of the following acts:
18
(A) Engaging in armed aggression against
19
Taiwan.
20
(B) Invading the territory of Taiwan, in-
21
cluding the mainland of Taiwan and any terri-
22
tories under its control, without regard to
23
whether those territories are inhabited or not.
24
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(C) Blockading by sea or air the mainland
1
of Taiwan or territories under its control.
2
(D) Attempting to change the status of
3
Taiwan or its government by force or coercive
4
actions.
5
(9)
UNITED
STATES
PERSON.—The
term
6
‘‘United States person’’ means—
7
(A) a United States citizen or an alien law-
8
fully admitted for permanent residence to the
9
United States;
10
(B) an entity organized under the laws of
11
the United States or of any jurisdiction within
12
the United States, including a foreign branch of
13
such an entity; or
14
(C) any person in the United States.
15
SEC. 5. IMPOSITION OF SANCTIONS WITH RESPECT TO CHI-
16
NESE PERSONS RESPONSIBLE FOR AGGRES-
17
SION AGAINST TAIWAN.
18
(a) INITIAL IMPOSITION OF SANCTIONS.—On and
19
after the date that is 30 days after a triggering event,
20
the President shall impose the sanctions described in sub-
21
section (b) with respect to any Chinese person, including
22
any senior official of the Government of the People’s Re-
23
public of China, that the President determines participates
24
in a triggering event.
25
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•S 481 IS
(b) SANCTIONS DESCRIBED.—The sanctions to be
1
imposed with respect to a person described in subsection
2
(a) are the following:
3
(1) BLOCKING OF PROPERTY.—
4
(A) IN GENERAL.—The President shall ex-
5
ercise all of the powers granted by the Inter-
6
national Emergency Economic Powers Act (50
7
U.S.C. 1701 et seq.) to block and prohibit all
8
transactions in all property and interests in
9
property of the person if such property and in-
10
terests in property are in the United States,
11
come within the United States, or come within
12
the possession or control of a United States
13
person.
14
(B) INAPPLICABILITY OF NATIONAL EMER-
15
GENCY
REQUIREMENT.—The requirements of
16
section 202 of the International Emergency
17
Economic Powers Act (50 U.S.C. 1701) shall
18
not apply for purposes of subparagraph (A).
19
(2) INELIGIBILITY FOR VISAS, ADMISSION, OR
20
PAROLE.—
21
(A) VISAS, ADMISSION, OR
PAROLE.—In
22
the case of an alien, the alien shall be—
23
(i) inadmissible to the United States;
24
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•S 481 IS
(ii) ineligible to receive a visa or other
1
documentation to enter the United States;
2
and
3
(iii) otherwise ineligible to be admitted
4
or paroled into the United States or to re-
5
ceive any other benefit under the Immigra-
6
tion and Nationality Act (8 U.S.C. 1101 et
7
seq.).
8
(B) CURRENT VISAS REVOKED.—
9
(i) IN GENERAL.—An alien described
10
in subparagraph (A) shall be subject to
11
revocation of any visa or other entry docu-
12
mentation regardless of when the visa or
13
other entry documentation is or was
14
issued.
15
(ii) IMMEDIATE
EFFECT.—A revoca-
16
tion under clause (i) shall—
17
(I) take effect immediately; and
18
(II) cancel any other valid visa or
19
entry documentation that is in the
20
alien’s possession.
21
(3) EXCLUSION
OF
CORPORATE
OFFICERS.—
22
The President shall direct the Secretary of State to
23
deny a visa to, and the Secretary of Homeland Secu-
24
rity to exclude from the United States, any alien
25
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•S 481 IS
that the President determines is a corporate officer
1
or principal of, or a shareholder with a controlling
2
interest in, the person.
3
(4) EXPORT
SANCTION.—The President may
4
order the United States Government not to issue
5
any specific license and not to grant any other spe-
6
cific permission or authority to export any goods or
7
technology to the person under—
8
(A) the Export Control Reform Act of
9
2018 (50 U.S.C. 4801 et seq.); or
10
(B) any other statute that requires the
11
prior review and approval of the United States
12
Government as a condition for the export or re-
13
export of goods or services.
14
(5) INCLUSION ON ENTITY LIST.—The Presi-
15
dent shall include the entity on the entity list main-
16
tained by the Bureau of Industry and Security of
17
the Department of Commerce and set forth in Sup-
18
plement No. 4 to part 744 of the Export Adminis-
19
tration Regulations, for activities contrary to the na-
20
tional security or foreign policy interests of the
21
United States.
22
(6) BAN ON INVESTMENT IN EQUITY OR DEBT
23
OF SANCTIONED PERSON.—The President shall, pur-
24
suant to such regulations or guidelines as the Presi-
25
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•S 481 IS
dent may prescribe, prohibit any United States per-
1
son from investing in or purchasing equity or debt
2
instruments of the person.
3
(7) BANKING
TRANSACTIONS.—The President
4
shall, pursuant to such regulations as the President
5
may prescribe, prohibit any transfers of credit or
6
payments between financial institutions or by,
7
through, or to any financial institution, to the extent
8
that such transfers or payments are subject to the
9
jurisdiction of the United States and involve any in-
10
terest of the person.
11
(8) CORRESPONDENT AND PAYABLE-THROUGH
12
ACCOUNTS.—In the case of a foreign financial insti-
13
tution, the President may prohibit the opening, and
14
prohibit or impose strict conditions on the maintain-
15
ing, in the United States of a correspondent account
16
or a payable-through account by the foreign finan-
17
cial institution.
18
(c) EXCEPTIONS.—
19
(1) EXCEPTION FOR INTELLIGENCE, LAW EN-
20
FORCEMENT,
AND
NATIONAL
SECURI
[Text truncated for display. Full text available on Congress.gov.]