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[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 3798 Introduced in Senate (IS)]

<DOC>

116th CONGRESS
  2d Session
                                S. 3798

  To impose sanctions with respect to foreign persons involved in the 
erosion of certain obligations of China with respect to Hong Kong, and 
                          for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                              May 21, 2020

     Mr. Toomey (for himself, Mr. Van Hollen, Mr. Tillis, and Mr. 
  Blumenthal) introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL

 
  To impose sanctions with respect to foreign persons involved in the 
erosion of certain obligations of China with respect to Hong Kong, and 
                          for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Hong Kong Autonomy 
Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Findings.
Sec. 4. Sense of Congress regarding Hong Kong.
Sec. 5. Identification of foreign persons involved in the erosion of 
                            the obligations of China under the Joint 
                            Declaration or the Basic Law and foreign 
                            financial institutions that conduct 
                            significant transactions with those 
                            persons.
Sec. 6. Sanctions with respect to foreign persons that contravene the 
                            obligations of China under the Joint 
                            Declaration or the Basic Law.
Sec. 7. Sanctions with respect to foreign financial institutions that 
                            do business with foreign persons that 
                            contravene the obligations of China under 
                            the Joint Declaration or the Basic Law.
Sec. 8. Waiver, termination, and congressional review process.
Sec. 9. Rule of construction.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Alien; national; national of the united states.--The 
        terms ``alien'', ``national'', and ``national of the United 
        States'' have the meanings given those terms in section 101 of 
        the Immigration and Nationality Act (8 U.S.C. 1101).
            (2) Appropriate congressional committees and leadership.--
        The term ``appropriate congressional committees and 
        leadership'' means--
                    (A) the Committee on Armed Services, the Committee 
                on Banking, Housing, and Urban Affairs, the Committee 
                on Foreign Relations, the Committee on Homeland 
                Security and Governmental Affairs, the Committee on the 
                Judiciary, the Select Committee on Intelligence, and 
                the majority leader and the minority leader of the 
                Senate; and
                    (B) the Committee on Armed Services, the Committee 
                on Financial Services, the Committee on Foreign 
                Affairs, the Committee on Homeland Security, the 
                Committee on the Judiciary, the Permanent Select 
                Committee on Intelligence, and the Speaker and the 
                minority leader of the House of Representatives.
            (3) Basic law.--The term ``Basic Law'' means the Basic Law 
        of the Hong Kong Special Administrative Region of the People's 
        Republic of China.
            (4) China.--The term ``China'' means the People's Republic 
        of China.
            (5) Entity.--The term ``entity'' means a partnership, joint 
        venture, association, corporation, organization, network, 
        group, or subgroup, or any other form of business 
        collaboration.
            (6) Financial institution.--The term ``financial 
        institution'' means a financial institution specified in 
        section 5312(a)(2) of title 31, United States Code.
            (7) Foreign financial institution.--
                    (A) In general.--Except as provided in subparagraph 
                (B), the term ``foreign financial institution'' means 
                any foreign entity that is engaged in the business of 
                accepting deposits, making, granting, transferring, 
                holding, or brokering loans or credits, or purchasing 
                or selling foreign exchange, securities, commodity 
                futures or options, or procuring purchasers and sellers 
                thereof, as principal or agent, including--
                            (i) a depository institution;
                            (ii) a bank;
                            (iii) a savings bank;
                            (iv) a money service business;
                            (v) a trust company;
                            (vi) a securities broker or dealer;
                            (vii) a commodity futures and options 
                        broker or dealer;
                            (viii) a forward contract or foreign 
                        exchange merchant;
                            (ix) a securities or commodities exchange;
                            (x) a clearing corporation;
                            (xi) an investment company;
                            (xii) an employee benefit plan;
                            (xiii) a dealer in precious metals, stones, 
                        or jewels; and
                            (xiv) any holding company, affiliate, or 
                        subsidiary of an entity specified in any of 
                        clauses (i) through (xiii).
                    (B) Exceptions.--The term ``foreign financial 
                institution'' does not include--
                            (i) an international financial institution, 
                        as defined in section 1701(c) of the 
                        International Financial Institutions Act (22 
                        U.S.C. 262r(c));
                            (ii) the International Fund for 
                        Agricultural Development;
                            (iii) the North American Development Bank; 
                        or
                            (iv) any other international financial 
                        institution specified by the Office of Foreign 
                        Assets Control of the Department of the 
                        Treasury.
            (8) Foreign person.--The term ``foreign person''--
                    (A) means--
                            (i) any citizen or national of a foreign 
                        country; or
                            (ii) any entity not organized under the 
                        laws of the United States or a jurisdiction 
                        within the United States; and
                    (B) does not include the government of a foreign 
                country.
            (9) Hong kong.--The term ``Hong Kong'' means the Hong Kong 
        Special Administrative Region of the People's Republic of 
        China.
            (10) Joint declaration.--The term ``Joint Declaration'' 
        means the Joint Declaration of the Government of the United 
        Kingdom of Great Britain and Northern Ireland and the 
        Government of the People's Republic of China on the Question of 
        Hong Kong, done at Beijing on December 19, 1984.
            (11) Knowingly.--The term ``knowingly'', with respect to 
        conduct, a circumstance, or a result, means that a person has 
        actual knowledge, or should have known, of the conduct, the 
        circumstance, or the result.
            (12) Person.--The term ``person'' means an individual or 
        entity.
            (13) Significant transaction.--The term ``significant 
        transaction'' means a transaction determined by the Secretary 
        of the Treasury to be significant on the basis of the following 
        factors--
                    (A) the size, number, and frequency of the 
                transaction;
                    (B) the nature of the transaction;
                    (C) whether the transaction is part of a pattern of 
                conduct;
                    (D) the nexus between the transaction and a person 
                subject to sanctions under this Act; and
                    (E) the impact of the transaction on the objectives 
                of this Act.
            (14) United states person.--The term ``United States 
        person'' means--
                    (A) any citizen or national of the United States;
                    (B) any alien lawfully admitted for permanent 
                residence in the United States;
                    (C) any entity organized under the laws of the 
                United States or any jurisdiction within the United 
                States (including a foreign branch of such an entity); 
                or
                    (D) any person located in the United States.

SEC. 3. FINDINGS.

    Congress makes the following findings:
            (1) The Joint Declaration and the Basic Law clarify certain 
        obligations and promises that the Government of China has made 
        with respect to the future of Hong Kong.
            (2) The obligations of the Government of China under the 
        Joint Declaration were codified in a legally-binding treaty, 
        signed by the Government of the United Kingdom of Great Britain 
        and Northern Ireland and registered with the United Nations.
            (3) The obligations of the Government of China under the 
        Basic Law originate from the Joint Declaration, were passed 
        into the domestic law of China by the National People's 
        Congress, and are widely considered by citizens of Hong Kong as 
        part of the de facto legal constitution of Hong Kong.
            (4) Foremost among the obligations of the Government of 
        China to Hong Kong is the promise that, pursuant to Paragraph 
        3b of the Joint Declaration, ``the Hong Kong Special 
        Administrative Region will enjoy a high degree of autonomy, 
        except in foreign and defence affairs which are the 
        responsibilities of the Central People's Government''.
            (5) The obligation specified in Paragraph 3b of the Joint 
        Declaration is referenced, reinforced, and extrapolated on in 
        several portions of the Basic Law, including Articles 2, 12, 
        13, 14, and 22.
            (6) Article 22 of the Basic Law establishes that ``No 
        department of the Central People's Government and no province, 
        autonomous region, or municipality directly under the Central 
        Government may interfere in the affairs which the Hong Kong 
        Special Administrative Region administers on its own in 
        accordance with this Law.''.
            (7) The Joint Declaration and the Basic Law make clear that 
        additional obligations shall be undertaken by China to ensure 
        the ``high degree of autonomy'' of Hong Kong.
            (8) Paragraph 3c of the Joint Declaration states, as 
        reinforced by Articles 2, 16, 17, 18, 19, and 22 of the Basic 
        Law, that Hong Kong ``will be vested with executive, 
        legislative and independent judicial power, including that of 
        final adjudication''.
            (9) On multiple occasions, the Government of China has 
        undertaken actions that have contravened the letter or intent 
        of the obligation described in paragraph (8) of this section, 
        including the following:
                    (A) In 1999, the Standing Committee of the National 
                People's Congress overruled a decision by the Hong Kong 
                Court of Final Appeal on the right of abode.
                    (B) On multiple occasions, the Government of Hong 
                Kong, at the advice of the Government of China, is 
                suspected to have not allowed persons entry into Hong 
                Kong allegedly because of their support for democracy 
                and human rights in Hong Kong and China.
                    (C) The Liaison Office of China in Hong Kong has, 
                despite restrictions on interference in the affairs of 
                Hong Kong as detailed in Article 22 of the Basic Law--
                            (i) openly expressed support for candidates 
                        in Hong Kong for Chief Executive and 
                        Legislative Council;
                            (ii) expressed views on various policies 
                        for the Government of Hong Kong and other 
                        internal matters relating to Hong Kong; and
                            (iii) on April 17, 2020, asserted that both 
                        the Liaison Office of China in Hong Kong and 
                        the Hong Kong and Macau Affairs Office of the 
                        State Council ``have the right to exercise 
                        supervision . . . on affairs regarding Hong 
                        Kong and the mainland, in order to ensure 
                        correct implementation of the Basic Law''.
                    (D) The National People's Congress has passed laws 
                requiring Hong Kong to pass laws banning disrespectful 
                treatment of the national flag and national anthem of 
                China.
                    (E) The State Council of China released a white 
                paper on June 10, 2014, that stressed the 
                ``comprehensive jurisdiction'' of the Government of 
                China over Hong Kong and indicated that Hong Kong must 
                be governed by ``patriots''.
                    (F) The Government of China has directed operatives 
                to kidnap and bring to the mainland, or is otherwise 
                responsible for the kidnapping of, residents of Hong 
                Kong, including businessman Xiao Jianhua and bookseller 
                Gui Minhai.
                    (G) The Government of Hong Kong, acting with the 
                support of the Government of China, introduced an 
                extradition bill that would have permitted the 
                Government of China to request and enforce extradition 
                requests for any individual present in Hong Kong, 
                regardless of the legality of the request or the degree 
                to which it compromised the judicial independence of 
                Hong Kong.
                    (H) The spokesman for the Standing Committee of the 
                National People's Congress said, ``Whether Hong Kong's 
                laws are consistent with the Basic Law can only be 
                judged and decided by the National People's Congress 
                Standing Committee. No other authority has the right to 
                make judgments and decisions.''.
            (10) Paragraph 3e of the Joint Declaration states, as 
        reinforced by Article 5 of the Basic Law, that the ``current 
        social and economic systems in Hong Kong will remain unchanged, 
        as so will the life-style.''.
            (11) On multiple occasions, the Government of China has 
        undertaken actions that have contravened the letter or intent 
        of the obligation described in paragraph (10) of this section, 
        including the following:
                    (A) In 2002, the Government of China pressured the 
                Government of Hong Kong to introduce ``patriotic'' 
                curriculum in primary and secondary schools.
                    (B) The governments of China and Hong Kong proposed 
                the prohibition of discussion of Hong Kong independence 
                and self-determination in primary and secondary 
                schools, which infringes on freedom of speech.
                    (C) The Government of Hong Kong mandated that 
                Mandarin, and not the native language of Cantonese, be 
                the language of instruction in Hong Kong schools.
                    (D) The governments of China and Hong Kong agreed 
                to a daily quota of mainland immigrants to Hong Kong, 
                which is widely believed by citizens of Hong Kong to be 
                part of an effort to ``mainlandize'' Hong Kong.
            (12) Paragraph 3e of the Joint Declaration states, as 
        reinforced by Articles 4, 26, 27, 28, 29, 30, 31, 32 33, 34, 
        and 39 of the Basic Law, that the ``rights and freedoms, 
        including those of person, of speech, of the press, of 
        assembly, of association, of travel, of movement, of 
        correspondence, of strike, of choice of occupation, of academic 
        research and of religious belief will be ensured by law'' in 
        Hong Kong.
            (13) On multiple occasions, the Government of China has 
        undertaken actions that have contravened the letter or intent 
        of the obligation described in paragraph (12) of this section, 
        including the following:
                    (A) On February 26, 2003, the Government of Hong 
                Kong introduced a national security bill that would 
                have placed restrictions on freedom of speech and other 
                protected rights.
                    (B) The Liaison Office of China in Hong Kong has 
                pressured businesses in Hong Kong not to advertise in 
                newspapers and magazines critical of the governments of 
                China and Hong Kong.
                    (C) The Hong Kong Police Force selectively blocked 
                demonstrations and protests expressing opposition to 
                the governments of China and Hong Kong or the policies 
                of those governments.
                    (D) The Government of Hong Kong refused to renew 
                work visa for a foreign journalist, allegedly for 
                hosting a speaker from the banned Hong Kong National 
                Party.
                    (E) The Justice Department of Hong Kong selectively 
                prosecuted cases against leaders of the Umbrella 
                Movement, while failing to prosecute police officers 
                accused of using excessive force during the protests in 
                2014.
                    (F) On April 18, 2020, the Hong Kong Police Force 
                arrested 14 high-profile democracy activists and 
                campaigners for their role in organizing a protest 
                march that took place on August 18, 2019, in which 
                almost 2,000,000 people rallied against a proposed 
                extradition bill.
            (14) Articles 45 and 68 of the Basic Law assert that the 
        selection of Chief Executive and all members of the Legislative 
        Council of Hong Kong should be by ``universal suffrage.''.
            (15) On multiple occasions, the Government of China has 
        undertaken actions that have contravened the letter or intent 
        of the obligation described in paragraph (14) of this section, 
        including the following:
                    (A) In 2004, the National People's Congress created 
                new, antidemocratic procedures restricting the adoption 
                of universal suffrage for the election of the Chief 
                Executive of Hong Kong.
                    (B) The decision by the National People's Congress 
                on December 29, 2007, which ruled out universal 
                suffrage in 2012 elections and set restrictions on when 
                and if universal suffrage will be implemented.
                    (C) The decision by the National People's Congress 
                on August 31, 2014, which placed limits on the 
                nomination process for the Chief Executive of Hong Kong 
                as a condition for adoption of universal suffrage.
                    (D) On November 7, 2016, the National People's 
                Congress interpreted Article 104 of the Basic Law in 
                such a way to disqualify 6 elected members of the 
                Legislative Council.
                    (E) In 2018, the Government of Hong Kong banned the 
                Hong Kong National Party and blocked the candidacy of 
                pro-democracy candidates.
            (16) The ways in which the Government of China, at times 
        with the support of a subservient Government of Hong Kong, has 
        acted in contravention of its obligations under the Joint 
        Declaration and the Basic Law, as set forth in this section, 
        are deeply concerning to the people of Hong Kong, the United 
        States, and members of the international community who support 
        the autonomy of Hong Kong.

SEC. 4. SENSE OF CONGRESS REGARDING HONG KONG.

    It is the sense of Congress that--
            (1) the United States continues to uphold the principles 
        and policy established in the United States-Hong Kong Policy 
        Act of 1992 (22 U.S.C. 5701 et seq.) and the Hong Kong Human 
        Rights and Democracy Act of 2019 (Public Law 116-76; 22 U.S.C. 
        5701 note), which remain consistent with China's obligations 
        under the Joint Declaration and certain promulgated objectives 
        under the Basic Law, including that--
                    (A) as set forth in section 101(1) of the United 
                States-Hong Kong Policy Act of 1992 (22 U.S.C. 
                5711(1)), ``The United States should play an active 
                role, before, on, and after July 1, 1997, in 
                maintaining Hong Kong's confidence and prosperity, Hong 
                Kong's role as an international financial center, and 
                the mutually beneficial ties between the people of the 
                United States and the people of Hong Kong.''; and
                    (B) as set forth in section 2(5) of the United 
                States-Hong Kong Policy Act of 1992 (22 U.S.C. 
                5701(5)), ``Support for democratization is a 
                fundamental principle of United States foreign policy. 
                As such, it naturally applies to United States policy 
                toward Hong Kong. This will remain equally true after 
                June 30, 1997.'';
            (2) although the United States recognizes that, under the 
        Joint Declaration, the Government of China ``resumed the 
        exercise of sovereignty over Hong Kong with effect on 1 July 
        1997'', the United States supports the autonomy of Hong Kong in 
        furtherance of the United States-Hong Kong Policy Act of 1992 
        and the Hong Kong Human Rights and Democracy Act of 2019 and 
        advances the desire of the people of Hong Kong to continue the 
        ``one country, two systems'' regime, in addition to other 
        obligations promulgated by China under the Joint Declaration 
        and the Basic Law;
            (3) in order to support the benefits and protections that 
        Hong Kong has been afforded by the Government of China under 
        the Joint Declaration and the Basic Law, the United States 
        should establish a clear and unambiguous set of penalties with 
        respect to foreign persons determined by the Secretary of State 
        to be involved in the contravention of the obligations of China 
        under the Joint Declaration and the Basic Law and the financial 
        institutions transacting with those foreign persons;
            (4) the Secretary of State should provide an unclassified 
        assessment of the reason for imposition of certain economic 
        penalties on entities, so as to permit a clear path for the 
        removal of economic penalties if the sanctioned behavior is 
        reversed and verified by the Secretary of State;
            (5) relevant Federal agencies should establish a 
        multilateral sanctions regime with respect to foreign persons 
        involved in the contravention of the obligations of China under 
        the Joint Declaration and the Basic Law; and
            (6) in addition to the penalties on foreign persons, and 
        financial institutions transacting with those foreign persons, 
        for the contravention of the obligations of China under the 
        Joint Declaration and the Basic Law, the United States should 
        take steps, in a time of crisis, to assist permanent residents 
        of Hong Kong who are persecuted or fear persecution as a result 
        of the contravention by China of its obligations under the 
        Joint Declaration and the Basic Law to become eligible to 
        obtain lawful entry into the United States.

SEC. 5. IDENTIFICATION OF FOREIGN PERSONS INVOLVED IN THE EROSION OF 
              THE OBLIGATIONS OF CHINA UNDER THE JOINT DECLARATION OR 
              THE BASIC LAW AND FOREIGN FINANCIAL INSTITUTIONS THAT 
              CONDUCT SIGNIFICANT TRANSACTIONS WITH THOSE PERSONS.

    (a) In General.--Not later than 90 days after the date of the 
enactment of this Act, and annually thereafter, if the Secretary of 
State determines that a foreign person is materially contributing to, 
has materially contributed to, or attempts to materially contribute to 
the failure of the Government of China to meet its obligations under 
the Joint Declaration or the Basic Law, the Secretary of State shall 
submit to the appropriate congressional committees and leadership a 
report that includes--
            (1) an identification of the foreign person;
            (2) a clear explanation for why the foreign person was 
        identified and a description of the activity that resulted in 
        the identification; and
            (3) an identification of any foreign financial institution 
        that knowingly conducts a significant transactions with the 
        foreign person.
    (b) Exclusion of Certain Information.--
            (1) Intelligence.--The Secretary of State shall not 
        disclose the identity of a person in a report submitted under 
        subsection (a) if the Director of National Intelligence 
        determines that such disclosure could compromise an 
        intelligence operation, activity, source, or method of the 
        United States.
            (2) Law enforcement.--The Secretary of State shall not 
        disclose the identity of a person in a report submitted under 
        subsection (a) if the Attorney General, in coordination, as 
        appropriate, with the Director of the Federal Bureau of 
        Investigation, the head of any other appropriate Federal law 
        enforcement agency, and the Secretary of the Treasury, 
        determines that such disclosure could reasonably be expected--
                    (A) to compromise the identity of a confidential 
                source, including a State, local, or foreign agency or 
                authority or any private institution that furnished 
                information on a confidential basis;
                    (B) to jeopardize the integrity or success of an 
                ongoing criminal investigation or prosecution;
                    (C) to endanger the life or physical safety of any 
                person; or
                    (D) to cause substantial harm to physical property.
            (3) Notification required.--If the Director of National 
        Intelligence makes a determination under paragraph (1) or the 
        Attorney General makes a determination under paragraph (2), the 
        Director or the Attorney General, as the case may be, shall 
        notify the appropriate congressional committees and leadership 
        of the determination and the reasons for the determination.
    (c) Exclusion of Foreign Persons and Foreign Financial 
Institutions.--
            (1) Foreign persons.--The President may exclude a foreign 
        person from the report under subsection (a) if the material 
        contribution (as described in subsection (d)) that merited 
        inclusion in that report--
                    (A) does not have a significant and lasting 
                negative effect that contravenes the obligations of 
                China under the Joint Declaration and the Basic Law;
                    (B) is not likely to be repeated in the future; and
                    (C) has been reversed or otherwise mitigated 
                through positive countermeasures taken by that foreign 
                person.
            (2) Foreign financial institutions.--The President may 
        exclude a foreign financial institution from the report under 
        subsection (a) if the significant transaction or significant 
        transactions of the foreign financial institution that merited 
        inclusion in that report--
                    (A) does not have a significant and lasting 
                negative effect that contravenes the obligations of 
                China under the Joint Declaration and the Basic Law;
                    (B) is not likely to be repeated in the future; and
                    (C) has been reversed or otherwise mitigated 
                through positive countermeasures taken by that foreign 
                financial institution.
    (d) Form of Report.--Each report under subsection (a) shall be 
submitted in unclassified form but may include a classified annex.
    (e) Timing of Report.--
            (1) In general.--Each report under subsection (a), to the 
        extent practicable, shall be submitted with the annual report 
        under section 301 of the United States-Hong Kong Policy Act of 
        1992 (22 U.S.C. 5731).
            (2) Rule of construction.--Nothing in this subsection shall 
        be construed to terminate the requirement to submit the report 
        under subsection (a) upon the termination of the requirement to 
        submit the annual report under section 301 of the United 
        States-Hong Kong Policy Act of 1992 (22 U.S.C. 5731).
    (f) Material Contributions Related to Obligations of China 
Described.--For purposes of this section, a foreign person materially 
contributes to the failure of the Government of China to meet its 
obligations under the Joint Declaration or the Basic Law if the 
person--
            (1) took action that resulted in the inability of the 
        people of Hong Kong--
                    (A) to enjoy freedom of assembly, speech, press, or 
                independent rule of law; or
                    (B) to participate in democratic outcomes; or
            (2) otherwise took action that reduces the high degree of 
        autonomy of Hong Kong.

SEC. 6. SANCTIONS WITH RESPECT TO FOREIGN PERSONS THAT CONTRAVENE THE 
              OBLIGATIONS OF CHINA UNDER THE JOINT DECLARATION OR THE 
              BASIC LAW.

    (a) Imposition of Sanctions.--
            (1) In general.--On and after the date on which a foreign 
        person is included in a report under section 5(a)(1), the 
        President may impose sanctions described in subsection (b) with 
        respect to that foreign person.
            (2) Mandatory sanctions.--On and after the date on which a 
        foreign person is included in 2 reports submitted under section 
        5(a)(1), the President shall impose sanctions described in 
        subsection (b) with respect to that foreign person.
    (b) Sanctions Described.--The sanctions described in this 
subsection with respect to a foreign person are the following:
            (1) Property transactions.--The President may, pursuant to 
        such regulations as the President may prescribe, prohibit any 
        person from--
                    (A) acquiring, holding, withholding, using, 
                transferring, withdrawing, transporting, or exporting 
                any property that is subject to the jurisdiction of the 
                United States and with respect to which the foreign 
                person has any interest;
                    (B) dealing in or exercising any right, power, or 
                privilege with respect to such property; or
                    (C) conducting any transaction involving such 
                property.
            (2) Exclusion from the united states and revocation of visa 
        or other documentation.--In the case of a foreign person who is 
        an individual, the President may direct the Secretary of State 
        to deny a visa to, and the Secretary of Homeland Security to 
        exclude from the United States, the foreign person, subject to 
        regulatory exceptions to permit the United States to comply 
        with the Agreement regarding the Headquarters of the United 
        Nations, signed at Lake Success June 26, 1947, and entered into 
        force November 21, 1947, between the United Nations and the 
        United States, or other applicable international obligations.

SEC. 7. SANCTIONS WITH RESPECT TO FOREIGN FINANCIAL INSTITUTIONS THAT 
              DO BUSINESS WITH FOREIGN PERSONS THAT CONTRAVENE THE 
              OBLIGATIONS OF CHINA UNDER THE JOINT DECLARATION OR THE 
              BASIC LAW.

    (a) Imposition of Sanctions.--With respect to any financial 
institution included in a report under section 5(a)(3)--
            (1) not later than one year after the submittal of the 
        report, the President shall impose not fewer than five of the 
        sanctions described in subsection (b); and
            (2) not later than 2 years after the submittal of the 
        report, the President shall impose each of the sanctions 
        described in subsection (b).
    (b) Sanctions Described.--The sanctions that may imposed with 
respect to a foreign financial institution included in the report under 
section 5(a)(3) are the following:
            (1) Loans from united states financial institutions.--The 
        United States Government may prohibit any United States 
        financial institution from making loans or providing credits to 
        the foreign financial institution.
            (2) Prohibition on designation as primary dealer.--Neither 
        the Board of Governors of the Federal Reserve System nor the 
        Federal Reserve Bank of New York may designate, or permit the 
        continuation of any prior designation of, the foreign financial 
        institution as a primary dealer in United States Government 
        debt instruments.
            (3) Prohibition on service as a repository of government 
        funds.--The foreign financial institution may not serve as 
        agent of the United States Government or serve as repository 
        for United States Government funds.
            (4) Foreign exchange.--The President may, pursuant to such 
        regulations as the President may prescribe, prohibit any 
        transactions in foreign exchange that are subject to the 
        jurisdiction of the United States and in which the foreign 
        financial institution has any interest.
            (5) Banking transactions.--The President may, pursuant to 
        such regulations as the President may prescribe, prohibit any 
        transfers of credit or payments between financial institutions 
        or by, through, or to any financial institution, to the extent 
        that such transfers or payments are subject to the jurisdiction 
        of the United States and involve any interest of the foreign 
        financial institution.
            (6) Property transactions.--The President may, pursuant to 
        such regulations as the President may prescribe, prohibit any 
        person from--
                    (A) acquiring, holding, withholding, using, 
                transferring, withdrawing, transporting, importing, or 
                exporting any property that is subject to the 
                jurisdiction of the United States and with respect to 
                which the foreign financial institution has any 
                interest;
                    (B) dealing in or exercising any right, power, or 
                privilege with respect to such property; or
                    (C) conducting any transaction involving such 
                property.
            (7) Restriction on exports.--The President may restrict or 
        prohibit exports of goods, technology, or services, directly or 
        indirectly, from the United States to the foreign financial 
        institution.
            (8) Ban on investment in equity or debt.--The President 
        may, pursuant to such regulations or guidelines as the 
        President may prescribe, prohibit any United States person from 
        investing in or purchasing significant amounts of equity or 
        debt instruments of the foreign financial institution.
            (9) Exclusion of corporate officers.--The President may 
        direct the Secretary of State to deny a visa to, and the 
        Secretary of Homeland Security to exclude from the United 
        States, any alien that the President determines is a corporate 
        officer or principal of, or a shareholder with a controlling 
        interest in, the foreign financial institution.
            (10) Sanctions on principal executive officers.--The 
        President may impose on the principal executive officer or 
        officers of the foreign financial institution, or on 
        individuals performing similar functions and with similar 
        authorities as such officer or officers, any of the sanctions 
        described in paragraphs (1) through (8) that are applicable.
    (c) Timing of Sanctions.--The President may impose sanctions 
required under subsection (a) with respect to a financial institution 
included in a report under section 5(a)(3) beginning on the day on 
which the financial institution is included in that report.

SEC. 8. WAIVER, TERMINATION, AND CONGRESSIONAL REVIEW PROCESS.

    (a) National Security Waiver.--Unless a disapproval resolution is 
enacted under subsection (d), the President may waive the application 
of sanctions under section 6 or 7 with respect to a foreign person or 
foreign financial institution if the President--
            (1) determines that the waiver is in the national security 
        interest of the United States; and
            (2) submits to the appropriate congressional committees and 
        leadership a report on the determination and the reasons for 
        the determination.
    (b) Termination of Sanctions and Removal From Report.--Unless a 
disapproval resolution is enacted under subsection (d), the President 
may terminate the application of sanctions under section 6 or 7 with 
respect to a foreign person or foreign financial institution and remove 
that foreign person or foreign financial institution from the report 
required under section 5(a) if the Secretary of State determines that 
the actions taken by the foreign person or foreign financial 
institution that led to the imposition of sanctions--
            (1) do not have a significant and lasting negative effect 
        that contravenes the obligations of China under the Joint 
        Declaration and the Basic Law;
            (2) are not likely to be repeated in the future; and
            (3) have been reversed or otherwise mitigated through 
        positive countermeasures taken by that foreign person or 
        foreign financial institution.
    (c) Termination of Act.--
            (1) Report.--
                    (A) In general.--Not later than July 1, 2046, the 
                President, in consultation with the Secretary of State, 
                the Secretary of the Treasury, and the heads of such 
                other Federal agencies as the President considers 
                appropriate, shall submit to Congress a report 
                evaluating the implementation of this Act and sanctions 
                imposed pursuant to this Act.
                    (B) Elements.--The President shall include in the 
                report submitted under paragraph (1) an assessment of 
                whether this Act and the sanctions imposed pursuant to 
                this Act should be terminated.
            (2) Termination.--This Act and the sanctions imposed 
        pursuant to this Act shall remain in effect unless a 
        termination resolution is enacted under subsection (d) after 
        July 1, 2047.
    (d) Congressional Review.--
            (1) Resolutions.--
                    (A) Disapproval resolution.--In this section, the 
                term ``disapproval resolution'' means only a joint 
                resolution of either House of Congress--
                            (i) the title of which is as follows: ``A 
                        joint resolution disapproving the waiver or 
                        termination of sanctions with respect to a 
                        foreign person that contravenes the obligations 
                        of China with respect to Hong Kong or a foreign 
                        financial institution that provides services to 
                        that person.''; and
                            (ii) the sole matter after the resolving 
                        clause of which is the following: ``Congress 
                        disapproves of the action under section 8 of 
                        the Hong Kong Autonomy Act relating to the 
                        application of sanctions imposed with respect 
                        to a foreign person that contravenes the 
                        obligations of China with respect to Hong Kong, 
                        or a foreign financial institution that 
                        provides services to that person, on _______ 
                        relating to ________.'', with the first blank 
                        space being filled with the appropriate date 
                        and the second blank space being filled with a 
                        short description of the proposed action.
                    (B) Termination resolution.--In this section, the 
                term ``termination resolution'' means only a joint 
                resolution of either House of Congress--
                            (i) the title of which is as follows: ``A 
                        joint resolution terminating sanctions with 
                        respect to foreign persons that contravene the 
                        obligations of China with respect to Hong Kong 
                        and foreign financial institutions that provide 
                        services to those persons.''; and
                            (ii) the sole matter after the resolving 
                        clause of which is the following: ``The Hong 
                        Kong Autonomy Act and any sanctions imposed 
                        pursuant to that Act shall terminate on 
                        ____.'', with the blank space being filled with 
                        the termination date.
                    (C) Covered resolution.--In this subsection, the 
                term ``covered resolution'' means a disapproval 
                resolution or a termination resolution.
            (2) Introduction.--A covered resolution may be introduced--
                    (A) in the House of Representatives, by the 
                majority leader or the minority leader; and
                    (B) in the Senate, by the majority leader (or the 
                majority leader's designee) or the minority leader (or 
                the minority leader's designee).
            (3) Floor consideration in house of representatives.--If a 
        committee of the House of Representatives to which a covered 
        resolution has been referred has not reported the resolution 
        within 10 calendar days after the date of referral, that 
        committee shall be discharged from further consideration of the 
        resolution.
            (4) Consideration in the senate.--
                    (A) Committee referral.--
                            (i) Disapproval resolution.--A disapproval 
                        resolution introduced in the Senate shall be--
                                    (I) referred to the Committee on 
                                Banking, Housing, and Urban Affairs if 
                                the resolution relates to an action 
                                that is not intended to significantly 
                                alter United States foreign policy with 
                                regard to China; and
                                    (II) referred to the Committee on 
                                Foreign Relations if the resolution 
                                relates to an action that is intended 
                                to significantly alter United States 
                                foreign policy with regard to China.
                            (ii) Termination resolution.--A termination 
                        resolution introduced in the Senate shall be 
                        referred to the Committee on Banking, Housing, 
                        and Urban Affairs and the Committee on Foreign 
                        Relations.
                    (B) Reporting and discharge.--If a committee to 
                which a covered resolution was referred has not 
                reported the resolution within 10 calendar days after 
                the date of referral of the resolution, that committee 
                shall be discharged from further consideration of the 
                resolution and the resolution shall be placed on the 
                appropriate calendar.
                    (C) Proceeding to consideration.--Notwithstanding 
                Rule XXII of the Standing Rules of the Senate, it is in 
                order at any time after the Committee on Banking, 
                Housing, and Urban Affairs or the Committee on Foreign 
                Relations, as the case may be, reports a covered 
                resolution to the Senate or has been discharged from 
                consideration of such a resolution (even though a 
                previous motion to the same effect has been disagreed 
                to) to move to proceed to the consideration of the 
                resolution, and all points of order against the 
                resolution (and against consideration of the 
                resolution) are waived. The motion to proceed is not 
                debatable. The motion is not subject to a motion to 
                postpone. A motion to reconsider the vote by which the 
                motion is agreed to or disagreed to shall not be in 
                order.
                    (D) Rulings of the chair on procedure.--Appeals 
                from the decisions of the Chair relating to the 
                application of the rules of the Senate, as the case may 
                be, to the procedure relating to a covered resolution 
                shall be decided without debate.
                    (E) Consideration of veto messages.--Debate in the 
                Senate of any veto message with respect to a covered 
                resolution, including all debatable motions and appeals 
                in connection with the resolution, shall be limited to 
                10 hours, to be equally divided between, and controlled 
                by, the majority leader and the minority leader or 
                their designees.
            (5) Rules relating to senate and house of 
        representatives.--
                    (A) Treatment of senate resolution in house.--In 
                the House of Representatives, the following procedures 
                shall apply to a covered resolution received from the 
                Senate (unless the House has already passed a 
                resolution relating to the same proposed action):
                            (i) The resolution shall be referred to the 
                        appropriate committees.
                            (ii) If a committee to which a resolution 
                        has been referred has not reported the 
                        resolution within 2 calendar days after the 
                        date of referral, that committee shall be 
                        discharged from further consideration of the 
                        resolution.
                            (iii) Beginning on the third legislative 
                        day after each committee to which a resolution 
                        has been referred reports the resolution to the 
                        House or has been discharged from further 
                        consideration thereof, it shall be in order to 
                        move to proceed to consider the resolution in 
                        the House. All points of order against the 
                        motion are waived. Such a motion shall not be 
                        in order after the House has disposed of a 
                        motion to proceed on the resolution. The 
                        previous question shall be considered as 
                        ordered on the motion to its adoption without 
                        intervening motion. The motion shall not be 
                        debatable. A motion to reconsider the vote by 
                        which the motion is disposed of shall not be in 
                        order.
                            (iv) The resolution shall be considered as 
                        read. All points of order against the 
                        resolution and against its consideration are 
                        waived. The previous question shall be 
                        considered as ordered on the resolution to 
                        final passage without intervening motion except 
                        2 hours of debate equally divided and 
                        controlled by the sponsor of the resolution (or 
                        a designee) and an opponent. A motion to 
                        reconsider the vote on passage of the 
                        resolution shall not be in order.
                    (B) Treatment of house resolution in senate.--
                            (i) Received before passage of senate 
                        resolution.--If, before the passage by the 
                        Senate of a covered resolution, the Senate 
                        receives an identical resolution from the House 
                        of Representatives, the following procedures 
                        shall apply:
                                    (I) That resolution shall not be 
                                referred to a committee.
                                    (II) With respect to that 
                                resolution--
                                            (aa) the procedure in the 
                                        Senate shall be the same as if 
                                        no resolution had been received 
                                        from the House of 
                                        Representatives; but
                                            (bb) the vote on passage 
                                        shall be on the resolution from 
                                        the House of Representatives.
                            (ii) Received after passage of senate 
                        resolution.--If, following passage of a covered 
                        resolution in the Senate, the Senate receives 
                        an identical resolution from the House of 
                        Representatives, that resolution shall be 
                        placed on the appropriate Senate calendar.
                            (iii) No senate companion.--If a covered 
                        resolution is received from the House of 
                        Representatives, and no companion resolution 
                        has been introduced in the Senate, the Senate 
                        procedures under this subsection shall apply to 
                        the resolution from the House of 
                        Representatives.
                    (C) Application to revenue measures.--The 
                provisions of this paragraph shall not apply in the 
                House of Representatives to a covered resolution that 
                is a revenue measure.
            (6) Rules of house of representatives and senate.--This 
        subsection is enacted by Congress--
                    (A) as an exercise of the rulemaking power of the 
                Senate and the House of Representatives, respectively, 
                and as such is deemed a part of the rules of each 
                House, respectively, and supersedes other rules only to 
                the extent that it is inconsistent with such rules; and
                    (B) with full recognition of the constitutional 
                right of either House to change the rules (so far as 
                relating to the procedure of that House) at any time, 
                in the same manner, and to the same extent as in the 
                case of any other rule of that House.

SEC. 9. RULE OF CONSTRUCTION.

    Nothing in this Act shall be construed as an authorization of 
military force against China.
                                 <all>
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