SB2430 - Relating to measures to protect public institutions of higher education from foreign adversaries and to the prosecution of the criminal offense of theft of trade secrets; providing civil and administrative penalties; increasing a criminal penalty.

  89R4522 CXP-F     By: Hughes S.B. No. 2430       A BILL TO BE ENTITLED   AN ACT   relating to measures to protect public institutions of higher   education from foreign adversaries and to the prosecution of the   criminal offense of theft of trade secrets; providing civil and   administrative penalties; increasing a criminal penalty.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subtitle A, Title 3, Education Code, is amended   by adding Chapter 51B to read as follows:   CHAPTER 51B.   HIGHER EDUCATION RESEARCH AND PROTECTION   SUBCHAPTER A.   GENERAL PROVISIONS           Sec. 51B.001.  DEFINITIONS. In this chapter:                 (1)     "Affiliate organization" means an entity under the   control of or established for the benefit of an organization.   The   term includes a direct-support organization that is organized and   operated to receive, hold, invest, and administer property and make   expenditures to or for the benefit of an institution of higher   education or for the benefit of a research and development park or   authority affiliated with an institution of higher education.                 (2)     "Coordinating board" means the Texas Higher   Education Coordinating Board.                 (3)  "Foreign adversary" means:                       (A)     any country designated as a foreign adversary   by the United States secretary of commerce under 15 C.F.R. Section   791.4; and                       (B)  the State of Qatar.                 (4)     "Foreign government" means the government or an   agent of a country, nation, or group of nations, or a province or   other political subdivision of a country or nation, other than the   United States government.                 (5)  "Foreign source" means:                       (A)     a foreign government or agency of a foreign   government;                       (B)     a legal entity created solely under the laws   of a foreign government;                       (C)     an individual who is not a citizen or a   national of the United States, including a territory or   protectorate of the United States;                       (D)     a partnership, association, organization, or   other combination of persons, or a subsidiary of such an entity,   organized under the laws of or having its principal place of   business in a foreign adversary;                       (E)     a political party or member of a political   party of a foreign adversary; or                       (F)     an agent acting on behalf of an individual or   entity described by Paragraph (A), (B), (C), (D), or (E).                 (6)     "Gift" means a gift, grant, endowment, award, or   donation of money or property of any kind, including a conditional   or unconditional pledge of the gift, grant, endowment, award, or   donation.                 (7)     "Institution of higher education" has the meaning   assigned by Section 61.003.                 (8)     "Interest" when referring to an entity means any   direct or indirect:                       (A)     investment in or loan extended to the entity   that is valued at five percent or more of the entity's net worth; or                       (B)     control over the entity at a level exerting   similar or greater influence on the governance of the entity as an   investment described by Paragraph (A).                 (9)     "Political party" means an organization or   combination of individuals whose aim or purpose is, or who is   engaged in an activity devoted to, the establishment, control, or   acquisition of administration or control of a government, or the   furtherance or influencing of the political or public interest,   policies, or relations of a government.           Sec.   51B.002.     RULES. The coordinating board shall adopt   rules as necessary to implement this chapter.   SUBCHAPTER B. REQUIREMENTS FOR GIFTS FROM AND CONTRACTS WITH   FOREIGN ADVERSARIES           Sec.   51B.051.     GIFT FROM FOREIGN ADVERSARY. (a)   Each   institution of higher education may not accept a gift the   institution is directly or indirectly offered from a foreign source   of a foreign adversary unless the gift is approved by the   coordinating board.           (b)     An institution of higher education shall promptly   submit to the coordinating board a report on any gift the   institution is directly or indirectly offered from a foreign source   of a foreign adversary.           (b-1)     Not later than November 1, 2025, each institution of   higher education shall submit to the coordinating board a report on   each gift the institution received directly or indirectly from a   foreign source of a foreign adversary from December 31, 2015, to   September 1, 2025.   This subsection expires January 1, 2026.           (c)     For each gift required to be reported under this   section, an institution of higher education must include in the   report the following information, unless the disclosure of that   information is prohibited or the information is confidential under   federal or state law:                 (1)     the date the institution received the offer of the   gift;                 (2)  the value of the gift;                 (3)  the purpose of the gift;                 (4)     an identification of the persons the gift is   explicitly intended to benefit;                 (5)     any applicable condition, requirement,   restriction, or term made a part of the gift;                 (6)     the foreign source's name and country of residence   or domicile;                 (7)     the name and mailing address of the person making   the disclosure; and                 (8)  the date the gift terminates, if applicable.           (d)     Not later than the 30th day after the date the   coordinating board receives a report under Subsection (b), the   coordinating board shall determine whether and under what   conditions the institution may accept the gift.           (e)  The coordinating board shall adopt:                 (1)     forms for an institution of higher education to   use in reporting the offering of a gift described by Subsection (b);   and                 (2)     rules and procedures for deciding whether to allow   an institution of higher education to accept a gift described by   Subsection (b).           (f)     The coordinating board shall maintain a public Internet   portal disclosing each gift reported under this section and the   coordinating board's decision whether to allow the institution of   higher education to accept the gift.           (g)     For purposes of this section, a gift offered through an   intermediary or affiliate organization is considered an indirect   gift and subject to reporting.           (h)     On the request of the governor, the lieutenant governor,   or the speaker of the house of representatives, the coordinating   board shall inspect or audit a gift reported under this section.           (i)     Information required to be reported under this section   is not confidential except as otherwise provided by state law or   unless protected as a trade secret by federal or state law.           Sec.   51B.052.     CONTRACT OR CULTURAL AGREEMENT WITH FOREIGN   ADVERSARY. (a)   Each institution of higher education may not enter   into a contract or cultural agreement with a foreign source of a   foreign adversary unless the contract or agreement is approved by   the coordinating board.           (b)     An institution of higher education shall promptly   submit to the coordinating board a report on any contract or   cultural agreement the institution is directly or indirectly   offered from a foreign source of a foreign adversary.           (b-1)     Not later than November 1, 2025, each institution of   higher education shall submit to the coordinating board a report on   each contract or cultural agreement the institution directly or   indirectly entered into with a foreign source of a foreign   adversary from December 31, 2013, to September 1, 2025.   This   subsection expires January 1, 2026.           (c)     For each contract or cultural agreement required to be   reported under this section, an institution of higher education   must include in the report, unless the disclosure of that   information is prohibited or the information is confidential under   federal or state law:                 (1)     the information described by Section 51B.051(c)   with respect to the contract or agreement; and                 (2)  a copy of the contract or agreement.           (d)     Not later than the 30th day after the date the   coordinating board receives a report under Subsection (b), the   coordinating board shall determine whether and under what   conditions the institution may enter into the contract or cultural   agreement.           (e)  The coordinating board shall adopt:                 (1)     forms for an institution of higher education to   use in reporting the offering of a contract or cultural agreement   described by Subsection (b); and                 (2)     rules and procedures for deciding whether to allow   an institution of higher education to enter into a contract or   cultural agreement described by Subsection (b).           (f)     The coordinating board shall maintain a public Internet   portal disclosing each contract and cultural agreement reported   under this section and the coordinating board's decision whether to   allow the institution of higher education to enter into the   contract or agreement.           (g)     For purposes of this section, a contract or cultural   agreement entered into through an intermediary or affiliate   organization is considered an indirect contract or cultural   agreement and subject to reporting.           (h)     On the request of the governor, the lieutenant governor,   or the speaker of the house of representatives, the coordinating   board shall inspect or audit a contract or cultural agreement   reported under this section.           Sec.   51B.053.     INVESTIGATION. (a) The coordinating board   shall investigate an alleged violation of this subchapter if the   coordinating bo [Text truncated for display. Full text available on LegiScan.]