I 

113TH CONGRESS 

1ST SESSION H. R. 221 

To require reports on the acquisitions by certain foreign persons of companies 

that have received American taxpayer research and development funding, 

and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 14, 2013 

Mrs. BLACKBURN (for herself and Mr. HUIZENGA of Michigan) introduced the 

following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on Science, Space, and Technology, for a period to be subsequently determined by the Speaker, in 

each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To require reports on the acquisitions by certain foreign 

persons of companies that have received American taxpayer research and development funding, and for other 

purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Stop Mergers, Acquisi5 tions, and Risky Takeovers Supplied by American Labor 


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1 and Entrepreneurship Act of 2013’’ or the ‘‘SMART 

2 SALE Act of 2013’’. 

3 SEC. 2. DEFINITIONS. 

4 In this Act: 

5 (1) COVERED ENTITY.—The term ‘‘covered en6 tity’’ means any person, company, institution, or 

7 other entity engaged in interstate commerce in the 

8 United States that owns, licenses, or otherwise holds 

9 an interest in a federally-funded technology, or to 

10 which Federal energy research and development 

11 funding has been obligated by a Federal agency. 

12 (2) COVERED TRANSACTION.— 

13 (A) IN GENERAL.—The term ‘‘covered 

14 transaction’’ means any proposed or pending 

15 merger, acquisition, takeover, or other transfer 

16 that could result in control of a covered entity 

17 by— 

18 (i) a government of a foreign country 

19 described in subparagraph (B); or 

20 (ii)(I) a natural person who is a cit21 izen of a foreign country described in sub22 paragraph (B) or who owes permanent al23 legiance to such foreign country; or 

24 (II) a corporation or other legal entity 

25 which is organized under the laws of such 


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1 foreign country or any political subdivision 

2 thereof if natural persons described in sub3 clause (I) own, directly or indirectly, more 

4 than 50 percent of the outstanding capital 

5 stock or other beneficial interest in such 

6 legal entity. 

7 (B) FOREIGN COUNTRY DESCRIBED.— 

8 (i) IN GENERAL.—Except as provided 

9 in clause (ii), a foreign country referred to 

10 in subparagraph (A) means any of the fol11 lowing: 

12 (I) The People’s Republic of 

13 China. 

14 (II) The Democratic People’s Re15 public of Korea. 

16 (III) A country that is a state 

17 sponsor of terrorism (as defined in 

18 clause (iii)). 

19 (IV) A country that provides 

20 sanctuary to a foreign terrorist orga21 nization (as defined in clause (iv)). 

22 (V) Any other country with re23 spect to which the President deter24 mines the provisions of this paragraph 

25 should apply. 


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1 (ii) WAIVER.—The President may 

2 waive the applicability of this paragraph 

3 with respect to a foreign country described 

4 in clause (i) on a case-by-case basis if not 

5 later than 60 days before doing so the 

6 President— 

7 (I) determines that it is in the 

8 national interest of the United States 

9 to do so; and 

10 (II) submits to Congress a report 

11 providing a justification for the waiv12 er. 

13 (iii) STATE SPONSOR OF TERRORISM

14 DEFINED.—In clause (i)(III), the term 

15 ‘‘state sponsor of terrorism’’ means any 

16 country the government of which the Sec17 retary of State has determined has repeat18 edly provided support for international ter19 rorism pursuant to— 

20 (I) section 6(j) of the Export Ad21 ministration Act of 1979 (50 U.S.C. 

22 App. 2405) (as continued in effect 

23 under the International Emergency 

24 Economic Powers Act); 


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1 (II) section 620A of the Foreign 

2 Assistance Act of 1961 (22 U.S.C. 

3 2371); 

4 (III) section 40 of the Arms Ex5 port Control Act (22 U.S.C. 2780); or 

6 (IV) any other provision of law. 

7 (iv) FOREIGN TERRORIST ORGANIZA8 TION DEFINED.—In clause (i)(IV), the 

9 term ‘‘foreign terrorist organization’’ 

10 means any organization so designated by 

11 the Secretary of State under section 219 of 

12 the Immigration and Nationality Act (8 

13 U.S.C. 1189). 

14 (3) FEDERAL ENERGY RESEARCH AND DEVEL15 OPMENT FUNDING.—The term ‘‘Federal energy re16 search and development funding’’ means Federal 

17 funding provided for the purpose of researching or 

18 developing new energy technologies, products, proc19 esses, or systems, or for the application of existing 

20 energy technologies, products, processes, or systems 

21 in a novel manner. Such funding includes funding 

22 for a loan or loan guarantee made by a Federal 

23 agency. 

24 (4) FEDERALLY-FUNDED TECHNOLOGY.— 


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1 (A) IN GENERAL.—Except as provided in 

2 subparagraph (B), the term ‘‘federally-funded 

3 technology’’ means any technology, product, 

4 process, or system developed as a result of Fed5 eral energy research and development funding. 

6 (B) EXCEPTION.—Such term does not 

7 apply to any technology, product, process, and 

8 system that was not— 

9 (i) specified in the documents and 

10 agreements associated with the provision of 

11 the Federal energy research and develop12 ment funding; or 

13 (ii) a foreseeable result or byproduct 

14 of the Federal energy research and devel15 opment funding at the time the funding 

16 was provided. 

17 SEC. 3. REQUIREMENTS. 

18 (a) NOTIFICATION.— 

19 (1) IN GENERAL.—A covered entity shall notify 

20 the Secretary of Energy in writing not later than 7 

21 days of entering into negotiations for any covered 

22 transaction. 

23 (2) CONTENTS.—A notification submitted pur24 suant to paragraph (1) shall include— 

25 (A) an identification of the covered entity; 


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1 (B) an identification of the purchasing, ac2 quiring, or merging entity; 

3 (C) the amounts of all Federal energy re4 search and development funding received by the 

5 covered entity, including a description of the 

6 form and amount of each transaction providing 

7 such funding; 

8 (D) an explanation of how the covered en9 tity or its purchaser will repay any outstanding 

10 loans or loan guarantees provided by a Federal 

11 agency, including interest accrued; 

12 (E) an appraisal of the value of any feder13 ally-funded technology owned, licensed, or oth14 erwise held by the covered entity, including esti15 mates of sales value and licensing fees; and 

16 (F) a description of the technical rights 

17 held by the Federal Government in all federally18 funded technology owned, licensed, or otherwise 

19 held by the covered entity. 

20 (3) PENALTIES.—Any person who knowingly 

21 and intentionally fails to make a notification re22 quired by this subsection shall be imprisoned for not 

23 more than 5 years and fined according to title 18, 

24 United States Code. 


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1 (b) RECOUPMENT OF FEDERAL FUNDS.—A Federal 

2 agency providing Federal energy research and develop3 ment funding shall require, as a condition of receipt of 

4 such funding, that all amounts provided shall be repaid 

5 to the Federal Government if a covered transaction results 

6 in control of the recipient by a foreign country described 

7 in section 2(2)(B). 

8 (c) REGULATIONS.—Not later than 180 days after 

9 the date of enactment of this Act, the Secretary of Energy 

10 shall promulgate regulations to carry out this section. 

11 SEC. 4. REPORTS TO CONGRESS. 

12 (a) REPORT ON NOTIFICATION.—Not later than 30 

13 days after receipt of a notification required by section 

14 3(a), the Secretary of Energy shall submit to Congress 

15 a report on the notification. Such a report shall contain, 

16 at a minimum, the following: 

17 (1) All of the information provided by the cov18 ered entity under section 3(a). 

19 (2) An assessment of any cybersecurity threats 

20 to the national interests of the United States with 

21 respect to the covered transaction. 

22 (3) Disclosure of any additional Federal energy 

23 research and development funding payments sched24 uled to be made by a Federal entity to the covered 

25 entity. 


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1 (4) An assessment of what effect the covered 

2 transaction will have on the interests of the United 

3 States, including the extent to which the covered 

4 transaction will cause, or will have a reasonable like5 lihood of causing, any negative effects to the na6 tional and economic security interests of the United 

7 States. 

8 (5) An estimate of any amounts of Federal, 

9 State, and foreign government funding that any 

10 party to the covered transaction, other than the cov11 ered entity, has received. 

12 (b) INITIAL REPORT.—Not later than 90 days after 

13 the date of enactment of this Act, the Secretary of Energy 

14 shall submit to Congress a report that— 

15 (1) identifies each covered entity that is en16 gaged in a covered transaction as of the date of en17 actment of this Act; and 

18 (2) specifies the total amount of Federal energy 

19 research and development funding the covered entity 

20 has received and is scheduled to receive. 

Æ 


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