Defending America’s 5G Future Act

II 116TH CONGRESS 1ST SESSION S. 2118 To prohibit United States persons from dealing in certain information and communications technology or services from foreign adversaries and to require the approval of Congress to terminate certain export controls in effect with respect to Huawei Technologies Co. Ltd., and for other purposes. IN THE SENATE OF THE UNITED STATES JULY 15, 2019 Mr. COTTON (for himself, Mr. VAN HOLLEN, Mr. RUBIO, Mr. ROMNEY, Mr. WARNER, and Mr. BLUMENTHAL) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To prohibit United States persons from dealing in certain information and communications technology or services from foreign adversaries and to require the approval of Congress to terminate certain export controls in effect with respect to Huawei Technologies Co. Ltd., 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 ‘‘Defending America’s 4 5G Future Act’’. 5 VerDate Sep 11 2014 23:12 Jul 18, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 2 •S 2118 IS SEC. 2. DEFINITIONS. 1 In this Act: 2 (1) EXPORT ADMINISTRATION REGULATIONS.— 3 The term ‘‘Export Administration Regulations’’ 4 means subchapter C of chapter VII of title 15, Code 5 of Federal Regulations. 6 (2) FOREIGN ADVERSARY.—The term ‘‘foreign 7 adversary’’ means any foreign government or foreign 8 person engaged in a long-term pattern or serious in- 9 stances of conduct significantly adverse to the na- 10 tional security or foreign policy interests of the 11 United States or security and safety of United 12 States persons. 13 (3) FOREIGN PERSON.—The term ‘‘foreign per- 14 son’’ means any person that is not a United States 15 person. 16 (4) INFORMATION AND COMMUNICATIONS 17 TECHNOLOGY OR SERVICES.—The term ‘‘informa- 18 tion and communications technology or services’’ 19 means any hardware, software, or other product or 20 service primarily intended to fulfill or enable the 21 function of information or data processing, storage, 22 retrieval, or communication by electronic means, in- 23 cluding transmission, storage, and display. 24 (5) UNITED STATES PERSON.—The term 25 ‘‘United States person’’ means— 26 VerDate Sep 11 2014 23:12 Jul 18, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 3 •S 2118 IS (A) any United States citizen or alien law- 1 fully admitted for permanent residence in the 2 United States; 3 (B) any entity organized under the laws of 4 the United States or any jurisdiction within the 5 United States, including a foreign branch of 6 such an entity; or 7 (C) any person in the United States. 8 SEC. 3. PROHIBITION ON DEALING IN INFORMATION AND 9 COMMUNICATIONS TECHNOLOGY OR SERV- 10 ICES FROM FOREIGN ADVERSARIES. 11 (a) IN GENERAL.—No United States person may en- 12 gage in a transaction for the acquisition, importation, 13 transfer, installation, dealing in, or use of any information 14 and communications technology or service by a United 15 States person, or with respect to any property subject to 16 the jurisdiction of the United States, if— 17 (1) the transaction involves any property in 18 which any foreign country or foreign person has any 19 interest (including through an interest in a contract 20 for the provision of the technology or service); 21 (2) notwithstanding any contract entered into 22 or any license or permit issued before the date of the 23 enactment of this Act, the transaction is initiated or 24 pending on or after such date of enactment; and 25 VerDate Sep 11 2014 23:12 Jul 18, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 4 •S 2118 IS (3) the Secretary of Commerce, in consultation 1 with the officials specified in subsection (b), deter- 2 mines that— 3 (A) the transaction involves information 4 and communications technology or services de- 5 signed, developed, manufactured, or supplied, 6 by persons owned by, controlled by, or subject 7 to the jurisdiction or direction of a foreign ad- 8 versary; and 9 (B) the transaction— 10 (i) poses an undue risk of sabotage to 11 or subversion of the design, integrity, man- 12 ufacturing, production, distribution, instal- 13 lation, operation, or maintenance of infor- 14 mation and communications technology or 15 services in the United States; 16 (ii) poses an undue risk of cata- 17 strophic effects on the security or resil- 18 iency of United States critical infrastruc- 19 ture or the digital economy of the United 20 States; or 21 (iii) otherwise poses an unacceptable 22 risk to the national security or foreign pol- 23 icy interests of the United States or the se- 24 curity and safety of United States persons. 25 VerDate Sep 11 2014 23:12 Jul 18, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 5 •S 2118 IS (b) OFFICIALS SPECIFIED.—The officials specified in 1 this subsection are the following: 2 (1) The Secretary of the Treasury. 3 (2) The Secretary of State. 4 (3) The Secretary of Defense. 5 (4) The Attorney General. 6 (5) The Secretary of Homeland Security. 7 (6) The United States Trade Representative. 8 (7) The Director of National Intelligence. 9 (8) The Administrator of General Services. 10 (9) The Chairman of the Federal Communica- 11 tions Commission. 12 (10) The heads of such other Federal agencies 13 as the Secretary of Commerce considers appropriate. 14 (c) MITIGATION MEASURES.—The Secretary of Com- 15 merce, in consultation with the officials specified in sub- 16 section (b), as appropriate, may establish or negotiate 17 measures to mitigate concerns that are the basis for a de- 18 termination under subsection (a)(3). Such measures may 19 serve as a precondition to the approval of a transaction 20 or of a class of transactions that would otherwise be pro- 21 hibited by subsection (a). 22 (d) REGULATIONS.— 23 (1) IN GENERAL.—Not later than 150 days 24 after the date of the enactment of this Act, the Sec- 25 VerDate Sep 11 2014 23:12 Jul 18, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 6 •S 2118 IS retary of Commerce, in consultation with the offi- 1 cials specified in subsection (b), shall prescribe regu- 2 lations to carry out this section. 3 (2) INCLUSIONS.—The regulations prescribed 4 under paragraph (1) may include regulations with 5 respect to— 6 (A) determining that countries or persons 7 are foreign adversaries for purposes of sub- 8 section (a)(3)(A); 9 (B) identifying persons owned by, con- 10 trolled by, or subject to the jurisdiction or di- 11 rection of foreign adversaries for purposes of 12 subsection (a)(3)(A); 13 (C) identifying technologies or countries 14 with respect to which transactions involving in- 15 formation and communications technology or 16 services warrant particular scrutiny under sub- 17 section (a); 18 (D) establishing procedures to license 19 transactions otherwise prohibited by subsection 20 (a); 21 (E) establishing criteria, consistent with 22 section 1 of this order, by which particular 23 technologies or participants in the market for 24 information and communications technology or 25 VerDate Sep 11 2014 23:12 Jul 18, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 7 •S 2118 IS services may be recognized as categorically in- 1 cluded in or as categorically excluded from the 2 prohibition under subsection (a); and 3 (F) identifying a mechanism and relevant 4 factors for the negotiation of mitigation meas- 5 ures under subsection (c). 6 (e) IMPLEMENTATION; PENALTIES.— 7 (1) IMPLEMENTATION.—The Secretary of Com- 8 merce may exercise the authorities provided to the 9 President under sections 203 and 205 of the Inter- 10 national Emergency Economic Powers Act (50 11 U.S.C. 1702 and 1704) to the extent necessary to 12 carry out this section. 13 (2) PENALTIES.—A person that violates, at- 14 tempts to violate, conspires to violate, or causes a 15 violation of subsection (a) or any regulation, license, 16 or order issued to carry out that subsection shall be 17 subject to the penalties set forth in subsections (b) 18 and (c) of section 206 of the International Emer- 19 gency Economic Powers Act (50 U.S.C. 1705) to the 20 same extent as a person that commits an unlawful 21 act described in subsection (a) of that section. 22 VerDate Sep 11 2014 23:12 Jul 18, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 8 •S 2118 IS SEC. 4. CONTINUATION IN EFFECT OF EXPORT CONTROLS 1 WITH RESPECT TO HUAWEI TECHNOLOGIES 2 CO. LTD. 3 (a) IN GENERAL.—The Secretary of Commerce shall 4 not remove Huawei Technologies Co. Ltd., and its subsidi- 5 aries and affiliates, from the entity list maintained by the 6 Bureau of Industry and Security and set forth in Supple- 7 ment No. 4 to part 744 of the Export Administration Reg- 8 ulations, unless— 9 (1) the Secretary submits to Congress a request 10 for approval of such removal; and 11 (2) there is enacted into law a joint resolution 12 of approval under subsection (b). 13 (b) JOINT RESOLUTIONS OF APPROVAL.— 14 (1) JOINT RESOLUTION OF APPROVAL DE- 15 FINED.—In this subsection, the term ‘‘joint resolu- 16 tion of approval’’ means a joint resolution of either 17 House of Congress the sole matter after the resolv- 18 ing clause of which is as follows: ‘‘That Congress ap- 19 proves the removal of Huawei Technologies Co. Ltd., 20 and its subsidiaries and affiliates, from the entity 21 list maintained by the Bureau of Industry and Secu- 22 rity and set forth in Supplement No. 4 to part 744 23 of the Export Administration Regulations, pursuant 24 to the request of the Secretary of Commerce for 25 such removal submitted to Congress on lll.’’, 26 VerDate Sep 11 2014 02:52 Jul 20, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 9 •S 2118 IS with the blank space being filled with the appro- 1 priate date. 2 (2) INTRODUCTION; COMMITTEE REFERRAL.—A 3 joint resolution of approval— 4 (A) in the House of Representatives— 5 (i) may be introduced by the Speaker 6 or the minority leader; and 7 (ii) shall be referred to the Committee 8 on Financial Services; and 9 (B) in the Senate— 10 (i) may be introduced by the majority 11 leader or the minority leader; and 12 (ii) shall be referred to the Committee 13 on Banking, Housing, and Urban Affairs. 14 (3) COMMITTEE DISCHARGE AND FLOOR CON- 15 SIDERATION.—The provisions of paragraphs (4), (5) 16 (other than subparagraph (A) of paragraph (5)), 17 and (6) of section 216(c) of the Countering Amer- 18 ica’s Adversaries Through Sanctions Act (22 U.S.C. 19 9511(c)) apply to a joint resolution of approval 20 under this subsection to the same extent as such 21 provisions apply to joint resolution of approval under 22 such section 216(c). 23 VerDate Sep 11 2014 23:12 Jul 18, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 10 •S 2118 IS (4) RULES OF HOUSE OF REPRESENTATIVES 1 AND SENATE.—This subsection is enacted by Con- 2 gress— 3 (A) as an exercise of the rulemaking power 4 of the Senate and the House of Representa- 5 tives, respectively, and as such is deemed a part 6 of the rules of each House, respectively, and su- 7 persedes other rules only to the extent that it 8 is inconsistent with such rules; and 9 (B) with full recognition of the constitu- 10 tional right of either House to change the rules 11 (so far as relating to the procedure of that 12 House) at any time, in the same manner, and 13 to the same extent as in the case of any other 14 rule of that House. 15 SEC. 5. CONGRESSIONAL DISAPPROVAL OF EXPORT LI- 16 CENSES ISSUED TO HUAWEI TECHNOLOGIES 17 CO. LTD., OR ITS SUBSIDIARIES OR AFFILI- 18 ATES. 19 (a) REPORT REQUIRED.—Not later than 15 days 20 after issuing a license to or with respect to Huawei Tech- 21 nologies Co. Ltd., or any of its subsidiaries or affiliates, 22 pursuant to the Export Administration Regulations, the 23 Secretary of Commerce shall submit to Congress a report 24 on the license and the reasons for issuing the license. 25 VerDate Sep 11 2014 23:12 Jul 18, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 11 •S 2118 IS (b) CONGRESSIONAL DISAPPROVAL.—A license de- 1 scribed in subsection (a) shall have no force or effect on 2 or after the date of the enactment of a joint resolution 3 of disapproval under subsection (c). 4 (c) JOINT RESOLUTIONS OF DISAPPROVAL.— 5 (1) JOINT RESOLUTION OF DISAPPROVAL DE- 6 FINED.—In this subsection, the term ‘‘joint resolu- 7 tion of disapproval’’ means a joint resolution of ei- 8 ther House of Congress the sole matter after the re- 9 solving clause of which is as follows: ‘‘That Congress 10 does not approve the license issued to or with re- 11 spect to Huawei Technologies Co. Ltd., or one of its 12 subsidiaries or affiliates, under the Export Adminis- 13 tration Regulations, relating to lll, notice of 14 which was submitted to Congress on lll.’’, with 15 the first blank space being filled with a brief descrip- 16 tion of the items covered by the license and the sec- 17 ond blank space being filled with the appropriate 18 date. 19 (2) INTRODUCTION; COMMITTEE REFERRAL.—A 20 joint resolution of disapproval— 21 (A) in the House of Representatives— 22 (i) may be introduced by the Speaker 23 or the minority leader during the 30-day 24 period beginning on the date on which the 25 VerDate Sep 11 2014 23:12 Jul 18, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.IS S2118 kjohnson on DSK79L0C42 with BILLS 12 •S 2118 IS report is submitted under subsection (a); 1 and 2 (ii) shall be referred to the Committee 3 on Financial Services; and 4 (B) in the Senate— 5 (i) may be introduced by the majority 6 leader or the minority leader during the 7 30-day period beginning on the date on 8 which the report is submitted under sub- 9 section (a); and 10 (ii) shall be referred to the Committee 11 on Banking, Housing, and Urban Affairs. 12 (3) COMMITTEE DISCHARGE AND FLOOR CON- 13 SIDERATION.—The provisions of paragraphs (4), (5) 14 (other than subparagraph (A) of paragraph (5)), 15 and (6) of section 216(c) of the Countering Amer- 16 ica’s Adversaries Through Sanctions Act (22 U.S.C. 17 9511(c)) apply to a joint resolution of disapproval [Text truncated for display. 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