II 118TH CONGRESS 1ST SESSION S. 1368 To counter the military-civil fusion strategy of the Chinese Communist Party and prevent United States contributions to the development of dual- use technology in China. IN THE SENATE OF THE UNITED STATES APRIL 27, 2023 Mr. RUBIO (for himself, Mrs. BLACKBURN, Mr. SCOTT of Florida, and Mr. BRAUN) introduced the following bill; which was read twice and referred to the Committee on Foreign Relations A BILL To counter the military-civil fusion strategy of the Chinese Communist Party and prevent United States contribu- tions to the development of dual-use technology in China. 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 ‘‘Preventing PLA Ac- 4 quisition of United States Technology Act of 2023’’. 5 SEC. 2. COUNTERING THE MILITARY-CIVIL FUSION STRAT- 6 EGY OF THE CHINESE COMMUNIST PARTY. 7 (a) DEFINITIONS.—In this section: 8 VerDate Sep 11 2014 23:56 May 04, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1368.IS S1368 kjohnson on DSK79L0C42PROD with BILLS 2 •S 1368 IS (1) CHINESE ENTITY OF CONCERN.—The term 1 ‘‘Chinese entity of concern’’ means— 2 (A) any college or university in the Peo- 3 ple’s Republic of China that is determined by 4 the Secretary of Defense to be involved in the 5 implementation of the military-civil fusion strat- 6 egy, including— 7 (i) any college or university known as 8 the ‘‘Seven Sons of National Defense’’; 9 (ii) any college or university that re- 10 ceives funding from— 11 (I) the People’s Liberation Army; 12 or 13 (II) the Equipment Development 14 Department, or the Science and Tech- 15 nology Commission, of the Central 16 Military Commission; 17 (iii) any college or university in the 18 People’s Republic of China involved in 19 military training and education, including 20 any such college or university in partner- 21 ship with the People’s Liberation Army; 22 (iv) any college or university in the 23 People’s Republic of China that conducts 24 military research or hosts dedicated mili- 25 VerDate Sep 11 2014 23:56 May 04, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1368.IS S1368 kjohnson on DSK79L0C42PROD with BILLS 3 •S 1368 IS tary initiatives or laboratories, including 1 such a college or university designated 2 under the ‘‘double first-class university 3 plan’’; 4 (v) any college or university in the 5 People’s Republic of China that is des- 6 ignated by the State Administration for 7 Science, Technology, and Industry for the 8 National Defense to host ‘‘joint construc- 9 tion’’ programs; 10 (vi) any college or university in the 11 People’s Republic of China that has 12 launched a platform for military-civil fu- 13 sion or created national defense labora- 14 tories; and 15 (vii) any college or university in the 16 People’s Republic of China that conducts 17 research or hosts dedicated initiatives or 18 laboratories for any other related security 19 entity beyond the People’s Liberation 20 Army, including the People’s Armed Po- 21 lice, the Ministry of Public Security, and 22 the Ministry of State Security; 23 (B) any enterprise for which the majority 24 shareholder or ultimate parent entity is the 25 VerDate Sep 11 2014 23:56 May 04, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1368.IS S1368 kjohnson on DSK79L0C42PROD with BILLS 4 •S 1368 IS Government of the People’s Republic of China 1 at any level of that government; 2 (C) any privately owned company in the 3 People’s Republic of China— 4 (i) that has received a military pro- 5 duction license, such as the Weapons and 6 Equipment Research and Production Cer- 7 tificate, the Equipment Manufacturing 8 Unit Qualification, the Weapons and 9 Equipment Quality Management System 10 Certificate, or the Weapons and Equip- 11 ment Research and Production Unit Clas- 12 sified Qualification Permit; 13 (ii) that is otherwise known to have 14 set up mechanisms for engaging in activity 15 in support of military initiatives; 16 (iii) that has a history of subcon- 17 tracting for the People’s Liberation Army 18 or its affiliates; 19 (iv) that is participating in, or receiv- 20 ing benefits under, a military-civil fusion 21 demonstration base; or 22 (v) that has an owner, director, or a 23 senior management official who has served 24 as a delegate to the National People’s Con- 25 VerDate Sep 11 2014 23:56 May 04, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1368.IS S1368 kjohnson on DSK79L0C42PROD with BILLS 5 •S 1368 IS gress, a member of the Chinese People’s 1 Political Consultative Conference, or a 2 member of the Central Committee of the 3 Chinese Communist Party; and 4 (D) any entity that— 5 (i) is identified by the Secretary of 6 Defense under section 1260H(a) of the 7 William M. (Mac) Thornberry National 8 Defense Authorization Act for Fiscal Year 9 2021 (10 U.S.C. 113 note) as a Chinese 10 military company; and 11 (ii) is included in the Non-SDN Chi- 12 nese Military-Industrial Complex Compa- 13 nies List published by the Department of 14 the Treasury. 15 (2) COVERED ENTITY.—The term ‘‘covered en- 16 tity’’ means— 17 (A) any Federal agency that engages in re- 18 search or provides funding for research, includ- 19 ing the National Science Foundation and the 20 National Institutes of Health; 21 (B) any institution of higher education, or 22 any other private research institution, that re- 23 ceives any Federal financial assistance; and 24 VerDate Sep 11 2014 23:56 May 04, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1368.IS S1368 kjohnson on DSK79L0C42PROD with BILLS 6 •S 1368 IS (C) any private company headquartered in 1 the United States that receives Federal finan- 2 cial assistance. 3 (3) FEDERAL FINANCIAL ASSISTANCE.—The 4 term ‘‘Federal financial assistance’’ has the meaning 5 given the term in section 200.1 of title 2, Code of 6 Federal Regulations (or successor regulations). 7 (4) MILITARY-CIVIL FUSION STRATEGY.—The 8 term ‘‘military-civil fusion strategy’’ means the 9 strategy of the Chinese Communist Party aiming to 10 mobilize non-military resources and expertise for 11 military application, including the development of 12 technology, improvements in logistics, and other uses 13 by the People’s Liberation Army. 14 (b) PROHIBITIONS.— 15 (1) IN GENERAL.—No covered entity may en- 16 gage with a Chinese entity of concern in any sci- 17 entific research or technical exchange that has a di- 18 rect bearing on, or the potential for dual use in, the 19 development of technologies that the Chinese Com- 20 munist Party has identified as a priority of its na- 21 tional strategy of military-civil fusion and that are 22 listed on the website under subsection (c)(1)(A). 23 (2) PRIVATE PARTNERSHIPS.—No covered enti- 24 ty described in subsection (a)(2)(C) may form a 25 VerDate Sep 11 2014 23:56 May 04, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1368.IS S1368 kjohnson on DSK79L0C42PROD with BILLS 7 •S 1368 IS partnership or joint venture with another such cov- 1 ered entity for the purpose of engaging in any sci- 2 entific research or technical exchange described in 3 paragraph (1). 4 (c) WEBSITE.— 5 (1) IN GENERAL.—The Secretary of Defense, in 6 consultation with the Secretary of State, the Direc- 7 tor of National Intelligence, the Director of the Fed- 8 eral Bureau of Investigation, the Secretary of En- 9 ergy, the Secretary of Education, the Secretary of 10 the Treasury, and the Secretary of Commerce, shall 11 establish, and periodically update not less than twice 12 a year, a website that includes— 13 (A) a list of the specific areas of scientific 14 research or technical exchange for which the 15 prohibitions under subsection (b) apply, which 16 shall initially include some or all aspects of the 17 fields of quantum computing, photonics and la- 18 sers, robotics, big data analytics, semiconduc- 19 tors, new and advanced materials, biotechnology 20 (including synthetic biology and genetic engi- 21 neering), 5G and all future generations of tele- 22 communications, advanced nuclear technology 23 (including nuclear power and energy storage), 24 VerDate Sep 11 2014 23:56 May 04, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S1368.IS S1368 kjohnson on DSK79L0C42PROD with BILLS 8 •S 1368 IS aerospace technology, and artificial intelligence; 1 and 2 (B) to the extent practicable, a list of all 3 Chinese entities of concern. 4 (2) LIST OF SPECIFIC AREAS.—In developing 5 the list under paragraph (1)(A), the Secretary of 6 Defense shall monitor and consider the fields identi- 7 fied by the State Administration for Science, Tech- 8 nology, and Industry for the National Defense of the 9 People’s Republic of China as defense-relevant and 10 consider, including the more than 280 fields of study 11 designated as of the date of enactment of this Act, 12 and any others designated thereafter, as disciplines 13 with national defense characteristics that have the 14 potential to support military-civil fusion. 15 (3) RESOURCES.—In establishing the website 16 under paragraph (1), the Secretary of Defense may 17 use as a model any existing resources, such as the 18 China Defense Universities Tracker maintained by 19 the Australian Strategic Policy Institute, subject to 20 any other laws applicable to such resources. 21 (d) EXCEPTION.—The prohibitions under subsection 22 (b) shall not apply to any collaborative study or research 23 project in fields involving information that would not con- 24 tribute substantially to the goals of the military-civil fu- 25 VerDate Sep 11 2014 23:56 May 04, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1368.IS S1368 kjohnson on DSK79L0C42PROD with BILLS 9 •S 1368 IS sion strategy, as determined by regulations issued by the 1 Secretary of Defense. 2 (e) ANNUAL REPORTING REQUIREMENTS.— 3 (1) IN GENERAL.—Not later than 180 days 4 after the date of enactment of this Act, and Decem- 5 ber 31 of each year thereafter, each covered entity 6 shall submit to the Secretary of Defense a report 7 that discloses— 8 (A) any research relationships the covered 9 entity has with a Chinese entity of concern or 10 has had during the previous year; 11 (B) any research relationships the covered 12 entity has considered with a Chinese entity of 13 concern during the previous year and declined; 14 and 15 (C) any research relationships the covered 16 entity has terminated with a Chinese entity of 17 concern during the previous year because the 18 relationship violates subsection (b) or as a re- 19 sult of related concerns. 20 (2) AUDIT.—The Secretary of Defense may 21 enter into a contract with an independent entity to 22 conduct an audit of any report submitted under 23 paragraph (1) to ensure compliance with the re- 24 quirements of such paragraph. 25 VerDate Sep 11 2014 23:56 May 04, 2023 Jkt 039200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S1368.IS S1368 kjohnson on DSK79L0C42PROD with BILLS 10 •S 1368 IS (f) ENFORCEMENT.— 1 (1) IN GENERAL.—Notwithstanding any other 2 provision of law, a covered entity described in sub- 3 paragraph (B) or (C) of subsection (a)(2) that vio- 4 lates a prohibition under subsection (b), or violates 5 subsection (e), on or after the date of enactment of 6 this Act shall be precluded from receiving any Fed- 7 eral financial assistance on or after the date of such 8 violation. 9 (2) REGULATIONS.—The Secretary of Defense, 10 in consultation with the Secretary of State, the Di- 11 rector of National Intelligence, the Director of the 12 Federal Bureau of Investigation, the Secretary of 13 Energy, the Secretary of Education, the Secretary of 14 the Treasury, and the Secretary of Commerce, 15 shall— 16 (A) promulgate regulations to enforce the 17 prohibitions under subsection (b), the auditing 18 requirements under subsection (e), and the re- 19 quirement under paragraph (1); and 20 (B) coordinate with the heads of other 21 Federal agencies to ensure the enforcement of 22 such prohibitions and requirements. 23 Æ VerDate Sep 11 2014 23:56 May 04, 2023 Jkt 039200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6301 E:\BILLS\S1368.IS S1368 kjohnson on DSK79L0C42PROD with BILLS