II 

109TH CONGRESS 

2D SESSION S. 2410 

To amend the Homeland Security Act of 2002 to limit foreign control of 

investments in certain United States critical infrastructure. 

IN THE SENATE OF THE UNITED STATES 

MARCH 14, 2006 

Mr. COLEMAN (for himself, Mr. LEVIN, and Mr. GRAHAM) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To amend the Homeland Security Act of 2002 to limit foreign control of investments in certain United States critical infrastructure. 

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 ‘‘Foreign Investment 

5 Transparency and Security Act of 2006’’. 


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1 SEC. 2. LIMITS ON FOREIGN CONTROL OF INVESTMENTS IN 

2 CERTAIN UNITED STATES CRITICAL INFRA3 STRUCTURE. 

4 (a) IN GENERAL.—Title II of the Homeland Security 

5 Act of 2002 (6 U.S.C. 201 et seq.) is amended by adding 

6 at the end the following: 

7 ‘‘Subtitle E—Limits on Foreign 

8 Control of Investments in Cer9 tain United States Critical In10 frastructure 

11 ‘‘SEC. 241. DEFINITIONS. 

12 ‘‘As used in this subtitle— 

13 ‘‘(1) the term ‘foreign government controlled 

14 entity’ means any entity in which a foreign govern15 ment owns a majority interest, or otherwise controls 

16 or manages the entity; and 

17 ‘‘(2) the term ‘general business corporation’ 

18 means any entity that qualifies for treatment for 

19 Federal taxation purposes under subchapter C or 

20 subchapter S of the Internal Revenue Code of 1986, 

21 established or organized under the laws of any 

22 State. 

23 ‘‘SEC. 242. LIMITATION ON FOREIGN INVESTMENTS. 

24 ‘‘(a) IN GENERAL.—A foreign government controlled 

25 entity may acquire, own, or otherwise control or manage 

26 any critical infrastructure of the United States only 


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1 through the establishment or operation of a foreign owned 

2 general business corporation that meets the requirements 

3 of subsection (b). 

4 ‘‘(b) REQUIREMENTS.—For purposes of this section, 

5 a general business corporation shall— 

6 ‘‘(1) have a board of directors, the majority of 

7 which is comprised of United States citizens; 

8 ‘‘(2) have a chief security officer who is a 

9 United States citizen, responsible for safety and se10 curity issues related to the critical infrastructure; 

11 and 

12 ‘‘(3) maintain all records related to operations, 

13 personnel, and security of the United States general 

14 business corporation in the United States. 

15 ‘‘(c) RULE OF CONSTRUCTION.—Nothing in this sub16 title may be construed to restrict or otherwise alter the 

17 authority of the President or the Committee on Foreign 

18 Investment in the United States (or any successor thereto) 

19 as the designee of the President, under section 721 of the 

20 Defense Production Act of 1950. 

21 ‘‘SEC. 243. REGULATIONS REQUIRED. 

22 ‘‘Not later than 6 months after the date of enactment 

23 of this subtitle, the Secretary, in coordination with the 

24 Secretary of the Treasury, shall promulgate final regula25 tions to carry out this subtitle. 


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1 ‘‘SEC. 244. EFFECTIVE DATE. 

2 ‘‘(a) IN GENERAL.—Section 242 shall apply begin3 ning on the date that is 6 months after the date of enact4 ment of this subtitle. 

5 ‘‘(b) EXISTING ENTITIES.—A foreign government 

6 controlled entity that owns or otherwise controls or man7 ages any critical infrastructure of the United States on 

8 the effective date of this subtitle shall comply with the re9 quirements of this subtitle not later than 180 days after 

10 that effective date.’’. 

11 (b) CONFORMING AMENDMENT.—The table of con12 tents under section 1(b) of the Homeland Security Act of 

13 2002 (6 U.S.C. 101) is amended by inserting after the 

14 item relating to section 237 the following: 

‘‘Subtitle E—Limits on Foreign Control of Investments in Certain United 

States Critical Infrastructure 

‘‘Sec. 241. Definitions. 

‘‘Sec. 242. Limitation on foreign investments. 

‘‘Sec. 243. Regulations required. 

‘‘Sec. 244. Effective date.’’. 

15 SEC. 3. MARITIME SECURITY. 

16 (a) FINDINGS.—Congress finds that— 

17 (1) existing scanning processes for maritime 

18 containers are insufficient; 

19 (2) it should be the goal of the United States 

20 to scan 100 percent of inbound maritime containers; 

21 and 


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1 (3) the maritime container inspection system 

2 employed in Hong Kong shows promise in enhancing 

3 the maritime security capabilities of the United 

4 States. 

5 (b) AMENDMENTS TO HOMELAND SECURITY ACT.— 

6 (1) IN GENERAL.—Subtitle A of title IV of the 

7 Homeland Security Act (6 U.S.C. 201 et seq.) is 

8 amended by adding at the end the following: 

9 ‘‘SEC. 404. REPORT ON SCANNING OF MARITIME CON10 TAINERS. 

11 ‘‘(a) REPORT TO CONGRESS.—Not later than 90 days 

12 after the date of enactment of this section, the Secretary 

13 shall submit a report to Congress detailing the processes 

14 and policies for implementation of a scanning system for 

15 100 percent of the inbound maritime containers described 

16 in subsection (a). 

17 ‘‘(b) DEFINITION OF CONTAINER.—The term ‘con18 tainer’ has the meaning given the term in the Inter19 national Convention for Safe Containers, with annexes, 

20 done at Geneva December 2, 1972 (29 UST 3707).’’. 

21 (2) CONFORMING AMENDMENT.—The table of 

22 contents under section 1(b) of the Homeland Secu23 rity Act of 2002 (6 U.S.C. 101) is amended by inVerDate Aug 31 2005 02:06 Mar 15, 2006 Jkt 049200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2410.IS S2410

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1 serting after the item relating to section 403 the fol2 lowing: 

‘‘Sec. 404. Report on scanning of maritime containers.’’. 

Æ 


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