SECTION 1. ANNUAL COUNTRY REPORTS ON BUSINESS AND INVESTMENT CLIMATES.

    (a) Annual Country Reports on Business and Investment Climates.--
Not later than September 1 of each year, the Secretary of State, in 
consultation with the Assistant Secretary of State for Economic, Energy 
and Business Affairs, as well as the Assistant Secretary of Commerce 
for Trade Promotion and the Director General of the Foreign Commercial 
Service, shall submit to the Committee on Foreign Affairs of the House 
of Representatives and the Committee on Foreign Relations of the Senate 
a report providing--
            (1) detailed assessments with respect to each foreign 
        country--
                    (A) in which acts of unfair business and investment 
                practices or other acts that have resulted in poor 
                business and investment climates were, in the opinion 
                of the Secretary, of major significance; and
                    (B) which the Secretary determines should be the 
                subject of such a report;
            (2) all relevant information about such unfair business and 
        investment practices or other actions during the preceding year 
        by members of the business community, the judiciary, and the 
        government of such country which may have impeded United States 
        business or investment in such country, including the capacity 
        for United States citizens to operate their businesses without 
        fear of reprisals; and
            (3) with respect to each foreign country from which the 
        United States Government has sought cooperation to assemble the 
        annual country-specific investment climate reports required 
        under this section and address issues of unfair business and 
        investment practices, information on--
                    (A) the extent to which the government of each such 
                foreign country is working to prevent unfair business 
                and investment practices; and
                    (B) the extent of United States Government action 
                to prevent unfair business and investment practices or 
                other actions that harm United States business or 
                investment interests in relevant cases.
    (b) Provisions To Be Included in the Report.--The report under 
subsection (a) should, to the extent feasible, include--
            (1) with respect to paragraph (1)(A) of such subsection--
                    (A) a review of the efforts undertaken by foreign 
                countries to promote a healthy business and investment 
                climate that is also conducive to the United States 
                business community and United States investors, 
                including, as appropriate, steps taken in international 
                fora;
                    (B) the response of the judicial and local 
                arbitration systems of each foreign country that is the 
                subject of such report with respect to matters relating 
                to the business and investment climates affecting 
                United States citizens and entities, or that have, in 
                the opinion of the Secretary, and in consultation with 
                the Director General of the Foreign Commercial Service, 
                a significant impact on United States business and 
                investment efforts; and
                    (C) each foreign country's access to the United 
                States market;
            (2) with respect to paragraph (2) of such subsection, any--
                    (A) actions undertaken by governments of foreign 
                countries that prevent United States citizens and 
                businesses from receiving equitable treatment;
                    (B) actions taken by private businesses and 
                citizens of foreign countries against members of the 
                United States business community and United States 
                investors;
                    (C) unfair decisions rendered by the legal systems 
                of foreign countries that clearly benefit State and 
                local corporations and industries; and
                    (D) unfair decisions rendered by local arbitration 
                panels of foreign countries that do not exemplify 
                objectivity and do not provide an equitable ground for 
                United States citizens and businesses to address their 
                disputes; and
            (3) with respect to paragraph (3)(A) of such subsection, 
        actions taken by the United States Government to--
                    (A) promote the rule of law, in general;
                    (B) prevent discriminatory treatment of United 
                States citizens and businesses engaged in business or 
                investment activities;
                    (C) allow United States goods to enter foreign 
                countries without requiring a co-production agreement; 
                and
                    (D) protect United States intellectual property 
                rights.
    (c) Preparation of Reports Regarding Business and Investment 
Climates.--
            (1) Standards and investigations.--The Secretary of State 
        shall ensure that the United States diplomatic and consular 
        missions abroad maintain a consistent reporting standard and 
        thoroughly investigate reports of unfair business and 
        investment practices or any other actions that impede a strong 
        business or investment climate in the countries in which such 
        missions are located.
            (2) Updating information based on foreign country media.--
        In compiling data and assessing the business and investment 
        climates abroad for each report required under subsection (a), 
        United States foreign service officers shall, as appropriate 
        and with respect to the foreign country in which such officers 
        are posted, research such country's media sources, including 
        newspaper, radio, and television, to document any cases with 
        evidence of unfair business or investment practices or any 
        occurrences that may destabilize the business or investment 
        climate in such country.
            (3) Contacts with business leaders.--In compiling data and 
        assessing the business and investment climates abroad for each 
        report required under subsection (a), United States foreign 
        service officers shall, as appropriate and with respect to the 
        foreign country in which such officers are posted, seek out and 
        maintain contacts with corporate leaders in all sectors of the 
        market of such country to discuss issues of foreign direct 
        investment and the challenges United States citizens or 
        businesses may face in making investments or earning returns on 
        investments.
            (4) Contacts with union leaders.--In compiling data and 
        assessing the business and investment climates abroad for each 
        report required under subsection (a), United States foreign 
        service officers shall, as appropriate and with respect to the 
        foreign country in which such officers are posted, seek out and 
        maintain contacts with leaders of local and national unions of 
        such country to assess the political stability of such country 
        as measured through social cohesion and the rights of workers.
            (5) Contacts with the judiciary.--In compiling data and 
        assessing the business and investment climates abroad for each 
        report required under subsection (a), United States foreign 
        service officers shall, as appropriate and with respect to the 
        foreign country in which such officers are posted, seek out and 
        maintain contacts with members of the judicial system of such 
        country to evaluate the capacity of the legal institutions to 
        address discrepancies and disputes that may arise, including 
        corruption and nationalization. Such officers shall also 
        research the capacity for arbitration locally to address 
        concerns if such country's legal system is unable to provide 
        suitable or satisfactory recourse in a matter relating to an 
        unfair business or investment practice involving a United 
        States citizen or business.
            (6) Contacts with nongovernmental organizations.--In 
        compiling data and assessing the business and investment 
        climates abroad for each report required under subsection (a), 
        United States foreign service officers shall, as appropriate 
        and with respect to the foreign country in which such officers 
        are posted, seek out and maintain contacts with members of 
        nongovernmental organizations in such country that address the 
        concerns of the business community, with the consent of such 
        organizations, including receiving reports and updates from 
        such organizations and, when appropriate, investigating such 
        reports.
    (d) Classification of Report.--
            (1) In general.--A report required under subsection (a) of 
        this section shall, to the extent practicable, be submitted in 
        an unclassified form but may be accompanied by a classified 
        appendix if the Secretary of State determines that such is 
        appropriate.
            (2) Cooperation.--If the Secretary of State determines that 
        the submission of any information with respect to a foreign 
        country under paragraph (3) of subsection (a) in classified 
        form would make more likely the cooperation of the government 
        of such foreign country, the Secretary may submit such 
        information in classified form.
            (3) Summarization.--If the Secretary of State determines 
        that it is in the national security interests of the United 
        States or is necessary for the safety of individuals or 
        entities to be identified in a report required under subsection 
        (a) or is necessary to further the purposes of this Act, any 
        information required under such subsection, including measures 
        taken by the United States, may be summarized in such report 
        and submitted in more detail in a classified addendum.

SEC. 2. BUSINESS AND INVESTMENT CLIMATE WARNINGS.

    (a) In General.--The Secretary of State, with the assistance of the 
Assistant Secretary of State for Economic, Energy and Business Affairs, 
as well as the Assistant Secretary of Commerce for Trade Promotion and 
the Director General of the Foreign Commercial Service, shall establish 
a system that informs members of the United States business community 
and United States investors prior to their entry into a foreign country 
of the business and investment conditions in such country.
    (b) Warnings.--The system established under subsection (a) shall, 
if appropriate, issue investment warnings--
            (1) to describe long-term, protracted conditions that make 
        a country's business or investment climate risky or potentially 
        dangerous to members of the United States business community 
        and United States investors; or
            (2) when the ability of the United States Government to 
        assist such members and investors is constrained due to the 
        closure of a United States diplomatic or consular mission in 
        such country.
    (c) Four-Tier System.--
            (1) In general.--The Secretary of State and the Secretary 
        of Commerce shall develop a four-tier system to grade the 
        business and investment climate of each country that receives 
        over $5,000,000,000 in exports, aid, and remittances from the 
        United States, based on the following criteria:
                    (A) Political stability.
                    (B) Macroeconomic stability.
                    (C) Rule of law.
                    (D) Corruption and transparency.
                    (E) Regulatory quality.
                    (F) Good governance.
                    (G) Civil society engagement.
            (2) Additional criteria.--The grading within the four-tier 
        system referred to in paragraph (1) shall also address the 
        following unfair business and investment practices with respect 
        to each country identified and graded under such paragraph:
                    (A) Discriminatory treatment of United States 
                citizens and businesses engaged in business or 
                investment activities.
                    (B) The status of allowing United States goods to 
                enter each such country without requiring a co-
                production agreement.
                    (C) Protection of United States intellectual 
                property rights.
    (d) Public Accessibility.--The Secretary of State shall publish on 
the website of the Department of State information on countries under 
this section.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Civil society engagement.--The term ``civil society 
        engagement'' means the extent to which individuals exercise 
        peacefully their rights of expression, association, and 
        assembly, including through their establishing and 
        participating in nongovernmental organizations, unions, and 
        other civil society organizations.
            (2) Corruption and transparency.--The term ``corruption and 
        transparency'' means the extent to which public officials seek 
        illegitimate personal gain, including through bribery, 
        extortion, graft, nepotism, or embezzlement.
            (3) Co-production agreement.--The term ``co-production 
        agreement'' means a United States Government or United States 
        business working with a foreign government, foreign company, or 
        an international organization to produce or manufacture an 
        item.
            (4) Good governance.--The term ``good governance'' means 
        the extent to which institutions are sustainable and 
        democratic, with responsive, professional civil services 
        providing high quality public services.
            (5) Macroeconomic stability.--The term ``macroeconomic 
        stability'' means the extent to which the economy of a foreign 
        country is vulnerable to internal and external shocks.
            (6) Political stability.--The term ``political stability'' 
        means the likelihood that the government of a foreign country 
        will be destabilized or overthrown by unconstitutional or 
        violent means.
            (7) Regulatory quality.--The term ``regulatory quality'' 
        means the extent to which the government of a foreign country 
        is able to formulate and implement sound policies and 
        regulations that permit and promote private sector development.
            (8) Rule of law.--The term ``rule of law'' means the extent 
        to which laws of a foreign country are publicly promulgated, 
        equally enforced, independently adjudicated, and are consistent 
        with international norms and standards.
            (9) Unfair business and investment practices.--The term 
        ``unfair business and investment practices'' includes any of 
        the following:
                    (A) Unlawful actions under international law or the 
                law of the foreign country taken by the government of 
                such country or by businesses, citizens, or other 
                entities of such country that have resulted in lost 
                assets, contracts, or otherwise contributed to an 
                inhospitable business or investment climate.
                    (B) Discriminatory treatment of United States 
                businesses, whether wholly- or partially-owned.
                    (C) Failure to protect intellectual property 
                rights.
                    (D) Requiring a co-production agreement in order 
                for goods from the United States to enter a foreign 
                country.
Directs the Secretary of State to: (1) report annually to the House Committee on Foreign Affairs and the Senate Committee on Foreign Relations regarding each foreign country in which acts of unfair business and investment practices have resulted in poor business and investment climates; and (2) establish a system to inform the U.S. business and investing communities of such conditions.
To require a report on business and investment climates in foreign countries, and for other purposes.