Secure Government Buildings from Espionage Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 392 To require the disclosure of beneficial ownership by a foreign person of high-security space leased to accommodate a Federal agency, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JANUARY 9, 2019 Mr. LYNCH (for himself and Mr. KING of New York) introduced the following bill; which was referred to the Committee on Transportation and Infra- structure A BILL To require the disclosure of beneficial ownership by a foreign person of high-security space leased to accommodate a Federal agency, 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; FINDINGS. 3 (a) SHORT TITLE.—This Act may be cited as the 4 ‘‘Secure Government Buildings from Espionage Act of 5 2019’’. 6 (b) FINDINGS.—Congress finds that— 7 VerDate Sep 11 2014 18:07 Jan 19, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H392.IH H392 pbinns on DSK79D2C42PROD with BILLS 2 •HR 392 IH (1) the Government Accountability Office has 1 reported that the Federal Government often leases 2 high-security space from private sector landlords; 3 (2) the General Services Administration and 4 other Federal agencies with leasing authority are not 5 currently required to collect beneficial ownership in- 6 formation and therefore do not know if foreign own- 7 ers have a stake in the buildings leased by the agen- 8 cies, even when the leased space is used for classified 9 operations or to store sensitive data; and 10 (3) according to a report of the Government 11 Accountability Office, dated January 2017, that ex- 12 amined the risks of foreign ownership of Govern- 13 ment-leased real estate, ‘‘leasing space in foreign- 14 owned buildings could present security risks such as 15 espionage and unauthorized cyber and physical ac- 16 cess’’. 17 SEC. 2. DISCLOSURE OF BENEFICIAL OWNERSHIP BY FOR- 18 EIGN PERSONS OF HIGH-SECURITY SPACE 19 LEASED FOR FEDERAL AGENCIES. 20 (a) IN GENERAL.—Before entering into a lease 21 agreement with a covered entity for the accommodation 22 of a Federal agency in a building (or other improvement) 23 that will be used for high-security leased space, a Federal 24 lessee shall require the covered entity to— 25 VerDate Sep 11 2014 18:07 Jan 19, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H392.IH H392 pbinns on DSK79D2C42PROD with BILLS 3 •HR 392 IH (1) identify each beneficial owner of the covered 1 entity by— 2 (A) name; 3 (B) current residential or business street 4 address; and 5 (C) a unique identifying number from a 6 nonexpired passport issued by the United 7 States or a nonexpired drivers license issued by 8 a State; 9 (2) disclose to the Federal lessee any beneficial 10 owner of the covered entity that is a foreign person; 11 and 12 (3) if the Federal lessee is assigning the build- 13 ing (or other improvement) to a Federal tenant, no- 14 tify the Federal tenant of any disclosure made under 15 paragraph (2). 16 (b) TIMING.— 17 (1) IN GENERAL.—A Federal lessee shall re- 18 quire a covered entity to provide the information de- 19 scribed in subsections (a)(1) and (a)(2) when first 20 submitting a proposal in response to a solicitation 21 for offers issued by the Federal lessee. 22 (2) UPDATES.—A Federal lessee shall require a 23 covered entity to update a submission of the infor- 24 mation described in subsections (a)(1) and (a)(2) 25 VerDate Sep 11 2014 18:07 Jan 19, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H392.IH H392 pbinns on DSK79D2C42PROD with BILLS 4 •HR 392 IH not later than 60 days after the date of any change 1 in— 2 (A) the list of beneficial owners of the cov- 3 ered entity; or 4 (B) the information required to be pro- 5 vided relating to each such beneficial owner. 6 (c) DEFINITIONS.—In this section, the following defi- 7 nitions apply: 8 (1) BENEFICIAL OWNER.— 9 (A) IN GENERAL.—The term ‘‘beneficial 10 owner’’ means, with respect to a covered entity, 11 each natural person who, directly or indi- 12 rectly— 13 (i) exercises control over the covered 14 entity through ownership interests, voting 15 rights, agreements, or otherwise; or 16 (ii) has an interest in or receives sub- 17 stantial economic benefits from the assets 18 of the covered entity. 19 (B) EXCEPTIONS.—The term ‘‘beneficial 20 owner’’ does not include, with respect to a cov- 21 ered entity— 22 (i) a minor child; 23 VerDate Sep 11 2014 18:07 Jan 19, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H392.IH H392 pbinns on DSK79D2C42PROD with BILLS 5 •HR 392 IH (ii) a person acting as a nominee, 1 intermediary, custodian, or agent on behalf 2 of another person; 3 (iii) a person acting solely as an em- 4 ployee of the covered entity and whose con- 5 trol over or economic benefits from the 6 covered entity derives solely from the em- 7 ployment status of the person; 8 (iv) a person whose only interest in 9 the covered entity is through a right of in- 10 heritance, unless the person also meets the 11 requirements of subparagraph (A); or 12 (v) a creditor of the covered entity, 13 unless the creditor also meets the require- 14 ments of subparagraph (A). 15 (C) ANTI-ABUSE RULE.—The exceptions 16 under subparagraph (B) shall not apply if used 17 for the purpose of evading, circumventing, or 18 abusing the requirements of this section. 19 (2) COVERED ENTITY.—The term ‘‘covered en- 20 tity’’ means a person, copartnership, corporation, or 21 other public or private entity. 22 (3) EXECUTIVE AGENCY.—The term ‘‘Executive 23 agency’’ has the meaning given the term under sec- 24 tion 105 of title 5, United States Code. 25 VerDate Sep 11 2014 18:07 Jan 19, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H392.IH H392 pbinns on DSK79D2C42PROD with BILLS 6 •HR 392 IH (4) FEDERAL AGENCY.—The term ‘‘Federal 1 agency’’ means any Executive agency or any estab- 2 lishment in the legislative or judicial branch of the 3 Government. 4 (5) FEDERAL LESSEE.—The term ‘‘Federal les- 5 see’’ means the Administrator of General Services, 6 the Architect of the Capitol, or the head of any Fed- 7 eral agency, other than the Department of Defense, 8 that has independent statutory leasing authority. 9 (6) FOREIGN PERSON.—The term ‘‘foreign per- 10 son’’ means an individual who is not a United States 11 person or an alien lawfully admitted for permanent 12 residence into the United States. 13 (7) HIGH-SECURITY LEASED SPACE.—The term 14 ‘‘high-security leased space’’ means a space leased 15 by a Federal lessee that— 16 (A) will be occupied by Federal employees 17 for nonmilitary activities; and 18 (B) has a facility security level of III, IV, 19 or V, as determined by the Interagency Security 20 Committee. 21 (8) UNITED STATES PERSON.—The term 22 ‘‘United States person’’ means a natural person who 23 VerDate Sep 11 2014 18:07 Jan 19, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H392.IH H392 pbinns on DSK79D2C42PROD with BILLS 7 •HR 392 IH is a citizen of the United States or who owes perma- 1 nent allegiance to the United States. 2 Æ VerDate Sep 11 2014 18:07 Jan 19, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H392.IH H392 pbinns on DSK79D2C42PROD with BILLS