II 

118TH CONGRESS 

2D SESSION S. 5598 

To prohibit and require notifications with respect to certain investments 

by United States persons in the People’s Republic of China, and for 

other purposes. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 18 (legislative day, DECEMBER 16), 2024 

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

A BILL 

To prohibit and require notifications with respect to certain 

investments by United States persons in the People’s 

Republic of China, 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. PROHIBITION AND NOTIFICATION ON INVEST4 MENTS RELATING TO COVERED NATIONAL 

5 SECURITY TRANSACTIONS. 

6 The Defense Production Act of 1950 (50 U.S.C. 

7 4501 et seq.) is amended by adding at the end the fol8 lowing: 


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1 ‘‘TITLE VIII—PROHIBITION AND 

2 NOTIFICATION ON INVEST3 MENTS RELATING TO COV4 ERED NATIONAL SECURITY 

5 TRANSACTIONS 

6 ‘‘SEC. 801. PROHIBITION ON INVESTMENTS. 

7 ‘‘(a) IN GENERAL.—The Secretary may prohibit, in 

8 accordance with regulations issued under subsection (e), 

9 a United States person from knowingly engaging in a cov10 ered national security transaction in a prohibited tech11 nology. 

12 ‘‘(b) EVASION.—Any transaction by a United States 

13 person or within the United States that evades or avoids, 

14 has the purpose of evading or avoiding, causes a violation 

15 of, or attempts to violate the prohibition set forth in sub16 section (a) is prohibited. 

17 ‘‘(c) WAIVER.—Subject to subsection (d), the Sec18 retary is authorized to exempt from the prohibition set 

19 forth in subsection (a) any activity determined by the 

20 President, in consultation with the Secretary, the Sec21 retary of Commerce and, as appropriate, the heads of 

22 other relevant Federal departments and agencies, to be in 

23 the national interest of the United States. 

24 ‘‘(d) CONGRESSIONAL NOTIFICATION.—The Sec25 retary shall— 


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1 ‘‘(1) notify the appropriate congressional com2 mittees not later than 5 business days after issuing 

3 a waiver under subsection (c); and 

4 ‘‘(2) include in such notification an identifica5 tion of the national interest justifying the use of the 

6 waiver. 

7 ‘‘(e) REGULATIONS.— 

8 ‘‘(1) IN GENERAL.—The Secretary, in consulta9 tion with the Secretary of Commerce and, as appro10 priate, the heads of other relevant Federal depart11 ments and agencies, may issue regulations to carry 

12 out this section in accordance with subchapter II of 

13 chapter 5 and chapter 7 of title 5, United States 

14 Code (commonly known as ‘Administrative Proce15 dure Act’). 

16 ‘‘(2) NON-BINDING FEEDBACK.— 

17 ‘‘(A) IN GENERAL.—The regulations issued 

18 under paragraph (1) shall include a process 

19 under which a person can request non-binding 

20 feedback on a confidential basis as to whether 

21 a transaction would constitute a covered na22 tional security transaction in a prohibited tech23 nology. 

24 ‘‘(B) AUTHORITY TO LIMIT FRIVOLOUS

25 FEEDBACK REQUESTS.—In establishing the 


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1 process required by subparagraph (A), the Sec2 retary may prescribe limitations on requests for 

3 feedback identified as frivolous for purposes of 

4 this subsection. 

5 ‘‘(3) NOTICE AND OPPORTUNITY TO CURE.— 

6 ‘‘(A) IN GENERAL.—The regulations issued 

7 under paragraph (1) shall account for whether 

8 a United States person has self-identified a vio9 lation of the prohibition set forth in subsection 

10 (a) in determining the legal consequences of 

11 that violation. 

12 ‘‘(B) SELF-DISCLOSURE LETTERS.—The 

13 regulations issued under paragraph (1) shall 

14 dictate the form and content of a letter of self15 disclosure, which shall include relevant facts 

16 about the violation, why the United States per17 son believes its activity to have violated the pro18 hibition set forth in subsection (a), and a pro19 posal for mitigation of the harm of such action. 

20 ‘‘(4) PUBLIC NOTICE AND COMMENT.—The reg21 ulations issued under paragraph (1) shall be subject 

22 to public notice and comment. 

23 ‘‘(5) LOW-BURDEN REGULATIONS.—In issuing 

24 regulations under paragraph (1), the Secretary shall 

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1 rity interest of the United States while, to the extent 

2 practicable— 

3 ‘‘(A) minimizing the cost and complexity of 

4 compliance for affected parties, including the 

5 duplication of reporting requirements under 

6 current regulations; 

7 ‘‘(B) adopting the least burdensome alter8 native that achieves regulatory objectives; and 

9 ‘‘(C) prioritizing transparency and stake10 holder involvement in the process of issuing the 

11 rules. 

12 ‘‘(6) PENALTIES.— 

13 ‘‘(A) IN GENERAL.—The regulations issued 

14 under paragraph (1) shall provide for the impo15 sition of civil penalties described in subpara16 graph (B) for violations of the prohibition set 

17 forth in subsection (a). 

18 ‘‘(B) PENALTIES DESCRIBED.— 

19 ‘‘(i) UNLAWFUL ACTS.—It shall be 

20 unlawful for a person to violate, attempt to 

21 violate, conspire to violate, or cause a vio22 lation of any license, order, regulation, no23 tification requirement, or prohibition 

24 issued under this section. 


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1 ‘‘(ii) CIVIL PENALTY.—The Secretary 

2 may impose a civil penalty on any person 

3 who commits an unlawful act described in 

4 clause (i) in an amount not to exceed the 

5 greater of— 

6 ‘‘(I) $250,000; or 

7 ‘‘(II) an amount that is twice the 

8 amount of the transaction that is the 

9 basis of the violation with respect to 

10 which the penalty is imposed. 

11 ‘‘(iii) DIVESTMENT.—The Secretary 

12 may compel the divestment of a covered 

13 national security transaction in a prohib14 ited technology determined to be in viola15 tion of this title. 

16 ‘‘(iv) RELIEF.—The President may di17 rect the Attorney General of the United 

18 States to seek appropriate relief, including 

19 divestment relief, in the district courts of 

20 the United States, in order to implement 

21 and enforce this title. 

22 ‘‘(7) BURDEN OF PROOF.—In accordance with 

23 section 556(d) of title 5, United States Code, in an 

24 enforcement action for a violation of the prohibition 


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1 set forth in subsection (a), the burden of proof shall 

2 be upon the Secretary. 

3 ‘‘SEC. 802. NOTIFICATION ON INVESTMENTS. 

4 ‘‘(a) MANDATORY NOTIFICATION.—Not later than 

5 450 days after the date of the enactment of this title, the 

6 Secretary shall issue regulations prescribed in accordance 

7 with subsection (b), to require a United States person that 

8 engages in a covered national security transaction in a 

9 prohibited technology (unless the Secretary has exercised 

10 the authority provided by section 801(a) to prohibit know11 ingly engaging in such covered national security trans12 action) or a notifiable technology to submit to the Sec13 retary a written notification of the transaction not later 

14 than 30 days after the completion date of the transaction. 

15 ‘‘(b) REGULATIONS.— 

16 ‘‘(1) IN GENERAL.—Not later than 450 days 

17 after the date of the enactment of this title, the Sec18 retary, in consultation with the Secretary of Com19 merce and, as appropriate, the heads of other rel20 evant Federal departments and agencies, shall issue 

21 regulations to carry out this section in accordance 

22 with subchapter II of chapter 5 and chapter 7 of 

23 title 5, United States Code (commonly known as 

24 ‘Administrative Procedure Act’). 


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1 ‘‘(2) PUBLIC NOTICE AND COMMENT.—The reg2 ulations issued under paragraph (1) shall be subject 

3 to public notice and comment. 

4 ‘‘(3) LOW-BURDEN REGULATIONS.—In issuing 

5 regulations under paragraph (1), the Secretary shall 

6 balance the priority of protecting the national secu7 rity interest of the United States while, to the extent 

8 practicable— 

9 ‘‘(A) minimizing the cost and complexity of 

10 compliance for affected parties, including the 

11 duplication of reporting requirements under 

12 current regulation; 

13 ‘‘(B) adopting the least burdensome alter14 native that achieves regulatory objectives; and 

15 ‘‘(C) prioritizing transparency and stake16 holder involvement in the process of issuing the 

17 rules. 

18 ‘‘(4) PENALTIES.— 

19 ‘‘(A) IN GENERAL.—The regulations issued 

20 under paragraph (1) shall provide for the impo21 sition of civil penalties described in subpara22 graph (B) for violations of the notification re23 quirement set forth in subsection (a). 

24 ‘‘(B) PENALTIES DESCRIBED.— 


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1 ‘‘(i) UNLAWFUL ACTS.—It shall be 

2 unlawful for a person to violate, attempt to 

3 violate, conspire to violate, or cause a vio4 lation of any license, order, regulation, no5 tification requirement, or prohibition 

6 issued under this section. 

7 ‘‘(ii) CIVIL PENALTY.—A civil penalty 

8 may be imposed on any person who com9 mits an unlawful act described in clause (i) 

10 in an amount not to exceed the greater 

11 of— 

12 ‘‘(I) $250,000; or 

13 ‘‘(II) an amount that is twice the 

14 amount of the transaction that is the 

15 basis of the violation with respect to 

16 which the penalty is imposed. 

17 ‘‘(5) BURDEN OF PROOF.—In accordance with 

18 section 556(d) of title 5, United States Code, in an 

19 enforcement action for a violation of the prohibition 

20 set forth in subsection (a), the burden of proof shall 

21 be upon the Secretary. 

22 ‘‘(6) COMPLETENESS OF NOTIFICATION.— 

23 ‘‘(A) IN GENERAL.—The Secretary shall, 

24 upon receipt of a notification under subsection 

25 (a), and in consultation with the Secretary of 


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1 Commerce, promptly inspect the notification for 

2 completeness. 

3 ‘‘(B) INCOMPLETE NOTIFICATIONS.—If a 

4 notification submitted under subsection (a) is 

5 incomplete, the Secretary shall promptly inform 

6 the United States person that submits the noti7 fication that the notification is not complete 

8 and provide an explanation of relevant material 

9 respects in which the notification is not com10 plete. 

11 ‘‘(7) IDENTIFICATION OF NON-NOTIFIED ACTIV12 ITY.—The Secretary, in coordination with the Sec13 retary of Commerce, shall establish a process to 

14 identify covered national security transactions in a 

15 prohibited technology or a notifiable technology for 

16 which— 

17 ‘‘(A) a notification is not submitted to the 

18 Secretary under subsection (a); and 

19 ‘‘(B) information is reasonably available. 

20 ‘‘(c) CONFIDENTIALITY OF INFORMATION.— 

21 ‘‘(1) IN GENERAL.—Except as provided in para22 graph (2), any information or documentary material 

23 filed with the Secretary pursuant to this section 

24 shall be exempt from disclosure under section 

25 552(b)(3) of title 5, United States Code, and no 


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1 such information or documentary material may be 

2 made public by any government agency or Member 

3 of Congress. 

4 ‘‘(2) EXCEPTIONS.—The exemption from disclo5 sure provided by paragraph (1) shall not prevent the 

6 disclosure of the following: 

7 ‘‘(A) Information relevant to any adminis8 trative or judicial action or proceeding. 

9 ‘‘(B) Information provided to Congress or 

10 any of the appropriate congressional commit11 tees. 

12 ‘‘(C) Information important to the national 

13 security analysis or actions of the Secretary to 

14 any domestic governmental entity, or to any 

15 foreign governmental entity of an ally or part16 ner of the United States, under the direction 

17 and authorization of the Secretary, only to the 

18 extent necessary for national security purposes, 

19 and subject to appropriate confidentiality and 

20 classification requirements. 

21 ‘‘(D) Information that the parties have 

22 consented to be disclosed to third parties. 

23 ‘‘(E) Information where the disclosure of 

24 such information is determined by the Secretary 

25 to be in the national security interest. 


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1 ‘‘(d) INAPPLICABILITY.—If the Secretary prohibits a 

2 covered national security transaction in a prohibited tech3 nology under section 801, the requirements of this section 

4 shall not apply with respect to the covered national secu5 rity transaction. 

6 ‘‘SEC. 803. REPORT. 

7 ‘‘(a) IN GENERAL.—Not later than one year after the 

8 date on which the regulations issued under section 801(e) 

9 take effect, and not less frequently than annually there10 after for 7 years, the Secretary, in consultation with the 

11 Secretary of Commerce, shall submit to the appropriate 

12 congressional committees a report that— 

13 ‘‘(1) lists all enforcement actions taken subject 

14 to the regulations during the year preceding submis15 sion of the report, which includes, with respect to 

16 each such action, a description of— 

17 ‘‘(A) the prohibited technology or notifiable 

18 technology; 

19 ‘‘(B) the covered national security trans20 action; and 

21 ‘‘(C) the covered foreign person; 

22 ‘‘(2) provides an assessment of whether Con23 gress should amend the definition of the term ‘pro24 hibited technology’ by— 


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1 ‘‘(A) identifying additional technologies, 

2 not currently listed as a prohibited technology, 

3 that the Secretary, in consultation with the Sec4 retary of Commerce and, as applicable, the Sec5 retary of Defense, the Secretary of State, the 

6 Secretary of Energy, the Director of National 

7 Intelligence, and the heads of any other rel8 evant Federal agencies, determines may pose an 

9 acute threat to the national security of the 

10 United States if developed or acquired by a 

11 country of concern; 

12 ‘‘(B) explaining why each technology iden13 tified in subparagraph (A) may pose an acute 

14 threat to the national security of the United 

15 States if developed or acquired by a country of 

16 concern; and 

17 ‘‘(C) recommending the repeal of tech18 nologies from the category of prohibited tech19 nology to the extent that the technologies no 

20 longer pose an acute threat to the national se21 curity of the United States if developed or ac22 quired by a country of concern; 

23 ‘‘(3) lists all notifications submitted under sec24 tion 802 during the year preceding submission of the 


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1 report and includes, with respect to each such notifi2 cation— 

3 ‘‘(A) basic information on each party to 

4 the covered national security transaction with 

5 respect to which the notification was submitted; 

6 and 

7 ‘‘(B) the nature of the covered national se8 curity transaction that was the subject to the 

9 notification, including the elements of the cov10 ered national security transaction that neces11 sitated a notification; 

12 ‘‘(4) includes a summary of those notifications, 

13 disaggregated by prohibited technology, notifiable 

14 technology, by covered national security transaction, 

15 and by country of concern; 

16 ‘‘(5) provides additional context and informa17 tion regarding trends in the prohibited technology, 

18 notifiable technology, the types of covered national 

19 security transaction, and the countries involved in 

20 those notifications; and 

21 ‘‘(6) assesses the overall impact of those notifi22 cations, including recommendations for— 

23 ‘‘(A) expanding existing Federal programs 

24 to support the production or supply of prohib25 ited technologies or notifiable technologies in 


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1 the United States, including the potential of ex2 isting authorities to address any related na3 tional security concerns; 

4 ‘‘(B) investments needed to enhance pro5 hibited technologies or notifiable technologies 

6 and reduce dependence on countries of concern 

7 regarding those technologies; and 

8 ‘‘(C) the continuation, expansion, or modi9 fication of the implementation and administra10 tion of this title, including recommendations 

11 with respect to whether the definition of the 

12 term ‘country of concern’ under section 807(2) 

13 should be amended to add or remove countries. 

14 ‘‘(b) CONSIDERATION OF CERTAIN INFORMATION.— 

15 In preparing the report pursuant to subsection (a), the 

16 Secretary— 

17 ‘‘(1) shall consider information provided jointly 

18 by the chairperson and ranking member of any of 

19 the appropriate congressional committees; 

20 ‘‘(2) may consider credible information obtained 

21 by other countries and nongovernmental organiza22 tions that monitor the military, surveillance, intel23 ligence, or technology capabilities of a country of 

24 concern; and 


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1 ‘‘(3) may consider any other information that 

2 the Secretary deems relevant. 

3 ‘‘(c) FORM OF REPORT.—Each report required by 

4 this section shall be submitted in unclassified form, but 

5 may include a classified annex. 

6 ‘‘(d) TESTIMONY REQUIRED.—Not later than one 

7 year after the date of the enactment of this title, and an8 nually thereafter for five years, the Secretary and the Sec9 retary of Commerce shall each provide to the Committee 

10 on Banking, Housing, and Urban Affairs of the Senate 

11 and the Committee on Financial Services of the House of 

12 Representatives testimony with respect to the national se13 curity threats relating to investments by United States 

14 persons in countries of concern and broader international 

15 capital flows. 

16 ‘‘(e) REQUESTS BY APPROPRIATE CONGRESSIONAL

17 COMMITTEES.— 

18 ‘‘(1) IN GENERAL.—After receiving a request 

19 that meets the requirements of paragraph (2) with 

20 respect to whether a technology should be included 

21 in the amendments as described in subsection (a)(2), 

22 the Secretary shall, in preparing the report pursuant 

23 to subsection (a)— 

24 ‘‘(A) determine if that technology may 

25 pose an acute threat to the national security of 


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1 the United States if developed or acquired by a 

2 country of concern; and 

3 ‘‘(B) include in the report pursuant to sub4 section (a) an explanation with respect to that 

5 determination that includes— 

6 ‘‘(i) a statement of whether or not the 

7 technology, as determined by the Sec8 retary, may pose an acute threat to the na9 tional security of the United States if de10 veloped or acquired by a country of con11 cern; and 

12 ‘‘(ii) if the Secretary determines 

13 that— 

14 ‘‘(I) the technology may pose an 

15 acute threat to the national security 

16 of the United States if developed or 

17 acquired by a country of concern, an 

18 explanation for such determination 

19 and a recommendation whether that 

20 technology should be named a prohib21 ited technology or a notifiable tech22 nology; and 

23 ‘‘(II) the technology would not 

24 pose an acute threat to the national 

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1 oped or acquired by a country of con2 cern, an explanation for such deter3 mination. 

4 ‘‘(2) REQUIREMENTS.—A request under para5 graph (1) with respect to whether a technology may 

6 pose an acute threat to the national security of the 

7 United States if developed or acquired by a country 

8 of concern shall be submitted to the Secretary in 

9 writing jointly by the chairperson and ranking mem10 ber of one or more of the appropriate congressional 

11 committees. 

12 ‘‘SEC. 804. MULTILATERAL ENGAGEMENT AND COORDINA13 TION. 

14 ‘‘(a) AUTHORITIES.—The Secretary, in coordination 

15 with the Secretary of State, the Secretary of Commerce, 

16 and the heads of other relevant Federal agencies, should— 

17 ‘‘(1) conduct bilateral and multilateral engage18 ment with the governments of countries that are al19 lies and partners of the United States to promote 

20 and increase coordination of protocols and proce21 dures to facilitate the effective implementation of 

22 and appropriate compliance with the prohibitions 

23 pursuant to this title; 

24 ‘‘(2) upon adoption of protocols and procedures 

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1 ments to establish mechanisms for sharing informa2 tion, including trends, with respect to such activities; 

3 and 

4 ‘‘(3) work with and encourage the governments 

5 of countries that are allies and partners of the 

6 United States to develop similar mechanisms of their 

7 own, for the exclusive purpose of preventing the de8 velopment or acquisition of prohibited technologies 

9 by a country of concern. 

10 ‘‘(b) STRATEGY FOR MULTILATERAL ENGAGEMENT

11 AND COORDINATION.—Not later than 180 days after the 

12 date of the enactment of this title, the Secretary, in con13 sultation with the Secretary of State, the Secretary of 

14 Commerce, and the heads of other relevant Federal agen15 cies, should— 

16 ‘‘(1) develop a strategy to work with the gov17 ernments of countries that are allies and partners of 

18 the United States to develop mechanisms that are 

19 comparable to the prohibitions pursuant to this title, 

20 for the exclusive purpose of preventing the develop21 ment and acquisition of prohibited technologies by a 

22 country of concern; and 

23 ‘‘(2) assess opportunities to provide technical 

24 assistance to those countries with respect to the de25 velopment of those mechanisms. 


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1 ‘‘(c) REPORT.—Not later than one year after the date 

2 of the enactment of this title, and annually thereafter for 

3 four years, the Secretary shall submit to the appropriate 

4 congressional committees a report that includes— 

5 ‘‘(1) a discussion of any strategy developed pur6 suant to subsection (b)(1), including key tools and 

7 objectives for the development of comparable mecha8 nisms by the governments of allies and partners of 

9 the United States; 

10 ‘‘(2) a list of partner and allied countries to 

11 target for cooperation in developing their own prohi12 bitions; 

13 ‘‘(3) the status of the strategy’s implementation 

14 and outcomes; and 

15 ‘‘(4) a description of impediments to the estab16 lishment of comparable mechanisms by governments 

17 of allies and partners of the United States. 

18 ‘‘(d) APPROPRIATE CONGRESSIONAL COMMITTEES

19 DEFINED.—In this section, the term ‘appropriate congres20 sional committees’ means— 

21 ‘‘(1) the Committee on Foreign Relations and 

22 the Committee on Banking, Housing, and Urban Af23 fairs of the Senate; and 


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1 ‘‘(2) the Committee on Foreign Affairs and the 

2 Committee on Financial Services of the House of 

3 Representatives. 

4 ‘‘SEC. 805. PUBLIC DATABASE OF COVERED FOREIGN PER5 SONS. 

6 ‘‘(a) IN GENERAL.—The Secretary, in consultation 

7 with the Secretary of Commerce, may establish a publicly 

8 accessible, non-exhaustive database that identifies covered 

9 foreign persons in a prohibited technology pursuant to this 

10 title. 

11 ‘‘(b) CONFIDENTIALITY OF EVIDENCE.—The Sec12 retary shall establish a mechanism for the public, includ13 ing Congress, stakeholders, investors, and nongovern14 mental organizations, to submit evidence on a confidential 

15 basis regarding whether a foreign person is a covered for16 eign person in a prohibited technology and should be in17 cluded in the database described in subsection (a), if any. 

18 ‘‘(c) EXEMPTION FROM DISCLOSURE.— 

19 ‘‘(1) IN GENERAL.—Except as provided in para20 graph (2), any information or documentary material 

21 filed with the Secretary pursuant to this section 

22 shall be exempt from disclosure under section 

23 552(b)(3) of title 5, United States Code, and no 

24 such information or documentary material may be 


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1 made public (other than the identity of a covered 

2 foreign person in accordance with subsection (b)). 

3 ‘‘(2) EXCEPTIONS.—Paragraph (1) shall not 

4 prohibit the disclosure of the following: 

5 ‘‘(A) Information relevant to any adminis6 trative or judicial action or proceeding. 

7 ‘‘(B) Information to Congress or any duly 

8 authorized committee or subcommittee of Con9 gress. 

10 ‘‘(C) Information important to the national 

11 security analysis or actions of the Secretary to 

12 any domestic governmental entity, or to any 

13 foreign governmental entity of a United States 

14 ally or partner, under the exclusive direction 

15 and authorization of the Secretary, only to the 

16 extent necessary for national security purposes, 

17 and subject to appropriate confidentiality and 

18 classification requirements. 

19 ‘‘(D) Information that the parties have 

20 consented to be disclosed to third parties. 

21 ‘‘(d) RULE OF CONSTRUCTION.—The database de22 scribed in subsection (a), if any, shall not be considered 

23 to be an exhaustive or comprehensive list of covered for24 eign persons for the purposes of this title. 


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1 ‘‘SEC. 806. RULE OF CONSTRUCTION. 

2 ‘‘Nothing in this title may be construed to negate the 

3 authority of the President under any authority, process, 

4 regulation, investigation, enforcement measure, or review 

5 provided by or established under any other provision of 

6 Federal law, or any other authority of the President or 

7 the Congress under the Constitution of the United States. 

8 ‘‘SEC. 807. DEFINITIONS. 

9 ‘‘In this title: 

10 ‘‘(1) APPROPRIATE CONGRESSIONAL COMMIT11 TEES.—Except as provided by section 804(d), the 

12 term ‘appropriate congressional committees’ 

13 means— 

14 ‘‘(A) the Committee on Financial Services, 

15 the Committee on Foreign Affairs, the Com16 mittee on Energy and Commerce, and the Com17 mittee on Appropriations of the House of Rep18 resentatives; and 

19 ‘‘(B) the Committee on Banking, Housing, 

20 and Urban Affairs and the Committee on Ap21 propriations of the Senate. 

22 ‘‘(2) COUNTRY OF CONCERN.—The term ‘coun23 try of concern’— 

24 ‘‘(A) means the People’s Republic of 

25 China; and 


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1 ‘‘(B) includes the Hong Kong Special Ad2 ministrative Region and the Macau Special Ad3 ministrative Region. 

4 ‘‘(3) COVERED FOREIGN PERSON.—Subject to 

5 regulations prescribed in accordance with this title, 

6 the term ‘covered foreign person’ means a foreign 

7 person that— 

8 ‘‘(A) is incorporated in, has a principal 

9 place of business in, or is organized under the 

10 laws of a country of concern; 

11 ‘‘(B) is a member of the Central Com12 mittee of the Chinese Communist Party; 

13 ‘‘(C) is subject to the direction or control 

14 of a country of concern, an entity described in 

15 subparagraph (A) or (B), or the state or the 

16 government of a country of concern (including 

17 any political subdivision, agency, or instrumen18 tality thereof); or 

19 ‘‘(D) is owned in the aggregate, directly or 

20 indirectly, 50 percent or more by a country of 

21 concern, an entity described in subparagraph 

22 (A) or (B), or the state or the government of 

23 a country of concern (including any political 

24 subdivision, agency, or instrumentality thereof). 


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1 ‘‘(4) COVERED NATIONAL SECURITY TRANS2 ACTION.— 

3 ‘‘(A) IN GENERAL.—Subject to such regu4 lations as may be issued in accordance with this 

5 title, the term ‘covered national security trans6 action’ means any activity engaged in by a 

7 United States person that involves— 

8 ‘‘(i) the acquisition of an equity inter9 est or contingent equity interest in a cov10 ered foreign person; 

11 ‘‘(ii) the provision of a loan or similar 

12 debt financing arrangement to a covered 

13 foreign person, where such debt financ14 ing— 

15 ‘‘(I) is convertible to an equity 

16 interest; or 

17 ‘‘(II) affords or will afford the 

18 United States person the right to 

19 make management decisions with re20 spect to or on behalf of a covered for21 eign person or the right to appoint 

22 members of the board of directors (or 

23 equivalent) of the covered foreign per24 son; 


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1 ‘‘(iii) the entrance by such United 

2 States person into a joint venture with a 

3 covered foreign person; 

4 ‘‘(iv) the conversion of a contingent 

5 equity interest (or interest equivalent to a 

6 contingent equity interest) or conversion of 

7 debt to an equity interest in a covered for8 eign person; 

9 ‘‘(v) the acquisition, leasing, or other 

10 development of operations, land, property, 

11 or other assets in a country of concern 

12 that will result in, or that the United 

13 States person intends to result in— 

14 ‘‘(I) the establishment of a cov15 ered foreign person; or 

16 ‘‘(II) the engagement of a person 

17 of a country of concern in a prohib18 ited technology where it was not pre19 viously engaged in such prohibited 

20 technology; 

21 ‘‘(vi) knowingly directing transactions 

22 by foreign persons that the United States 

23 person has knowledge at the time of the 

24 transaction would constitute an activity deVerDate Sep 11 2014 17:39 Jan 25, 2025 Jkt 059200 PO 00000 Frm 00026 Fmt 6652 Sfmt 6201 E:\BILLS\S5598.IS S5598

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1 scribed in clause (i), (ii), (iii), (iv), or (v), 

2 if engaged in by a United States person; or 

3 ‘‘(vii) the acquisition of a limited part4 ner or equivalent interest in a venture cap5 ital fund, private equity fund, fund of 

6 funds, or other pooled investment fund 

7 that the United States person has knowl8 edge at the time of the acquisition, intends 

9 to engage in an activity described in clause 

10 (i), (ii), (iii), (iv), (v), or (vi). 

11 ‘‘(B) EXCEPTIONS.—Subject to notice and 

12 comment regulations prescribed in consultation 

13 with Congress and in accordance with this title, 

14 the term ‘covered national security transaction’ 

15 does not include— 

16 ‘‘(i) any transaction the value of 

17 which the Secretary determines is de mini18 mis; 

19 ‘‘(ii) any category of transactions that 

20 the Secretary determines is in the national 

21 interest of the United States; 

22 ‘‘(iii) an investment— 

23 ‘‘(I) in a security (as defined in 

24 section 3(a) of the Securities Ex25 change Act of 1934(15 U.S.C. 


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1 78c(a))) that is traded on an ex2 change or the over-the-counter market 

3 in any jurisdiction; 

4 ‘‘(II) in a security issued by an 

5 investment company (as defined in 

6 section 3 of the Investment Company 

7 Act of 1940(15 U.S.C. 80a–3)) that is 

8 registered with the Securities and Ex9 change Commission; 

10 ‘‘(III) made as a limited partner 

11 or equivalent in a venture capital 

12 fund, private equity fund, fund of 

13 funds, or other pooled investment 

14 fund (other than as described in sub15 clause (II)) where— 

16 ‘‘(aa) the limited partner or 

17 equivalent’s committed capital is 

18 not more than $2,000,000, ag19 gregated across any investment 

20 and co-investment vehicles of the 

21 fund; or 

22 ‘‘(bb) the limited partner or 

23 equivalent has secured a binding 

24 contractual assurance that its 

25 capital in the fund will not be 


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1 used to engage in a transaction 

2 that would be a covered national 

3 security transaction if engaged in 

4 by a United States person; or 

5 ‘‘(IV) in a derivative of a security 

6 described under subclause (I), (II), or 

7 (III); 

8 ‘‘(iv) any ancillary transaction under9 taken by a financial institution (as defined 

10 in section 5312 of title 31, United States 

11 Code); 

12 ‘‘(v) the acquisition by a United 

13 States person of the equity or other inter14 est owned or held by a covered foreign per15 son in an entity or assets located outside 

16 of a country of concern in which the 

17 United States person is acquiring the to18 tality of the interest in the entity held by 

19 the covered foreign person; 

20 ‘‘(vi) an intracompany transfer of 

21 funds, as defined in regulations prescribed 

22 in accordance with this title, from a United 

23 States parent company to a subsidiary lo24 cated in a country of concern or a trans25 action that, but for this clause, would be a 


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1 covered national security transaction be2 tween a United States person and its con3 trolled foreign person that supports oper4 ations that are not covered national secu5 rity transactions or that maintains covered 

6 national security transactions that the con7 trolled foreign person was engaged in prior 

8 to January 2, 2025; 

9 ‘‘(vii) a transaction secondary to a 

10 covered national security transaction, in11 cluding— 

12 ‘‘(I) contractual arrangements or 

13 the procurement of material inputs 

14 for any covered national security 

15 transaction (such as raw materials); 

16 ‘‘(II) bank lending; 

17 ‘‘(III) the processing, clearing, or 

18 sending of payments by a bank; 

19 ‘‘(IV) underwriting services; 

20 ‘‘(V) debt rating services; 

21 ‘‘(VI) prime brokerage; 

22 ‘‘(VII) global custody; 

23 ‘‘(VIII) equity research or anal24 ysis; or 

25 ‘‘(IX) other similar services; 


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1 ‘‘(viii) any ordinary or administrative 

2 business transaction as may be defined in 

3 such regulations; or 

4 ‘‘(ix) any transaction completed before 

5 the date of the enactment of this title. 

6 ‘‘(C) ANCILLARY TRANSACTION DE7 FINED.—In this paragraph, the term ‘ancillary 

8 transaction’ means— 

9 ‘‘(i) the processing, settling, clearing, 

10 or sending of payments and cash trans11 actions; 

12 ‘‘(ii) underwriting services; 

13 ‘‘(iii) credit rating services; and 

14 ‘‘(iv) other services ordinarily incident 

15 to and part of the provision of financial 

16 services, such as opening deposit accounts, 

17 direct custody services, foreign exchange 

18 services, remittances services, and safe de19 posit services. 

20 ‘‘(5) FOREIGN PERSON.—The term ‘foreign per21 son’ means a person that is not a United States per22 son. 

23 ‘‘(6) NOTIFIABLE TECHNOLOGY.— 


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1 ‘‘(A) IN GENERAL.—The term ‘notifiable 

2 technology’ means a technology with respect to 

3 which a covered foreign person— 

4 ‘‘(i) designs any advanced integrated 

5 circuit that is not covered under paragraph 

6 (8)(A)(iii); 

7 ‘‘(ii) fabricates any integrated circuit 

8 that is not covered under paragraph 

9 (8)(A)(iv); 

10 ‘‘(iii) packages any integrated circuit 

11 that is not covered under paragraph 

12 (8)(A)(v); or 

13 ‘‘(iv) develops any artificial intel14 ligence system that is not covered under 

15 clause (vii), (viii), (ix), or (xvi) of para16 graph (8)(A), and that is— 

17 ‘‘(I) designed to be used for— 

18 ‘‘(aa) any military end use 

19 (such as for weapons targeting, 

20 target identification, combat sim21 ulation, military vehicle or weap22 ons control, military decision23 making, weapons design (includ24 ing chemical, biological, radio25 logical, or nuclear weapons), or 


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1 combat system logistics and 

2 maintenance); or 

3 ‘‘(bb) any government intel4 ligence or mass-surveillance end 

5 use (such as through incorpora6 tion of features such as mining 

7 text, audio, or video, image rec8 ognition, location tracking, or 

9 surreptitious listening devices); 

10 ‘‘(II) intended by the covered for11 eign person or joint venture to be 

12 used for— 

13 ‘‘(aa) cybersecurity applica14 tions; 

15 ‘‘(bb) digital forensics tools; 

16 ‘‘(cc) penetration testing 

17 tools; or 

18 ‘‘(dd) control of robotic sys19 tems; or 

20 ‘‘(III) trained using a quantity of 

21 computing power greater than 1023

22 computational operations (such as in23 teger or floating-point operations). 

24 ‘‘(B) UPDATES.—The Secretary, in con25 sultation with Congress, may prescribe regulaVerDate Sep 11 2014 17:39 Jan 25, 2025 Jkt 059200 PO 00000 Frm 00033 Fmt 6652 Sfmt 6201 E:\BILLS\S5598.IS S5598

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1 tions in accordance with this title to refine the 

2 technical parameters of technologies described 

3 in subparagraph (A) as reasonably needed for 

4 national security purposes or to add or remove 

5 categories to or from the list in subparagraph 

6 (A). 

7 ‘‘(7) PARTY.—The term ‘party’, with respect to 

8 a covered national security transaction, has the 

9 meaning given that term in regulations prescribed in 

10 accordance with this title. 

11 ‘‘(8) PROHIBITED TECHNOLOGY.— 

12 ‘‘(A) IN GENERAL.—The term ‘prohibited 

13 technology’ means a technology with respect to 

14 which a covered foreign person— 

15 ‘‘(i) develops or produces any design 

16 automation software for the design of inte17 grated circuits or advanced packaging; 

18 ‘‘(ii) develops or produces any— 

19 ‘‘(I) electronic design automation 

20 software for the design of integrated 

21 circuits or advanced packaging; 

22 ‘‘(II) front-end semiconductor 

23 fabrication equipment designed for the 

24 volume fabrication of integrated cir25 cuits, including equipment used in the 


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1 production stages from a blank wafer 

2 or substrate to a completed wafer or 

3 substrate; or 

4 ‘‘(III) equipment for performing 

5 volume advanced packaging; 

6 ‘‘(iii) designs any integrated circuit 

7 designs that meet or exceed the specifica8 tions set in Export Control Classification 

9 Number (ECCN) 3A090 in Supplement 

10 No. 1 to the Export Administration Regu11 lations, or integrated circuits designed for 

12 operation at or below 4.5 Kelvin; 

13 ‘‘(iv) fabricates integrated circuits 

14 that are— 

15 ‘‘(I) logic integrated circuits 

16 using a non-planar transistor architec17 ture or with a technology node of 16/ 

18 14 nanometers or less, including fully 

19 depleted silicon-on-insulator (FDSOI) 

20 integrated circuits; 

21 ‘‘(II) NOT–AND (NAND) mem22 ory integrated circuits with 128 layers 

23 or more; 

24 ‘‘(III) dynamic random-access 

25 memory (DRAM) integrated circuits 


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1 using a technology node of 18 

2 nanometer half-pitch or less; 

3 ‘‘(IV) integrated circuits manu4 factured from a gallium-based com5 pound semiconductor; 

6 ‘‘(V) integrated circuits using 

7 graphene transistors or carbon 

8 nanotubes; or 

9 ‘‘(VI) integrated circuits designed 

10 for operation at or below 4.5 Kelvin; 

11 ‘‘(v) packages any integrated circuit 

12 using advanced packaging techniques; 

13 ‘‘(vi) develops, designs, or produces 

14 any commodity, material, software, or 

15 technology designed exclusively for use in 

16 or with extreme ultraviolet lithography fab17 rication equipment; 

18 ‘‘(vii) develops, designs, or produces 

19 any artificial intelligence models trained 

with at least 1025 20 floating point oper21 ations; 

22 ‘‘(viii) develops, designs, or produces 

23 any artificial intelligence models that rely 

24 upon or utilize advanced integrated circuits 

25 that meet or exceed the specifications set 


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1 in Export Control Classification Number 

2 (ECCN) 3A090 in Supplement No. 1 to 

3 the Export Administration Regulations; 

4 ‘‘(ix) develops, designs, or produces 

5 any artificial intelligence models designed 

6 for use by the Government of the People’s 

7 Republic of China, its special administra8 tive regions, or its agencies and instrumen9 talities; 

10 ‘‘(x) develops a quantum computer or 

11 produces any critical components required 

12 to produce a quantum computer such as a 

13 dilution refrigerator or two-stage pulse 

14 tube cryocooler; 

15 ‘‘(xi) develops or produces any quan16 tum sensing platform designed for, or 

17 which the relevant covered foreign person 

18 intends to be used for, any military, gov19 ernment intelligence, or mass-surveillance 

20 end use; 

21 ‘‘(xii) develops or produces quantum 

22 networks or quantum communication sys23 tems designed for or intended to be used 

24 for— 


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1 ‘‘(I) networking to scale up the 

2 capabilities of quantum computers, 

3 such as for the purposes of breaking 

4 or compromising encryption; 

5 ‘‘(II) secure communications, 

6 such as quantum key distribution; or 

7 ‘‘(III) any other application that 

8 has any military, government intel9 ligence, or mass-surveillance end use; 

10 ‘‘(xiii) develops, designs, or produces 

11 materials, components, avionics, flight con12 trol, propulsion, Global Positioning System 

13 (GPS), data relay, and target detection 

14 systems designed for use in hypersonic sys15 tems or capable of sustainable operations 

16 above 1,000 degrees Celsius; 

17 ‘‘(xiv) develops, installs, sells, or pro18 duces any supercomputer enabled by ad19 vanced integrated circuits that can provide 

20 theoretical compute capacity of 100 or 

21 more double-precision (64-bit) petaflops or 

22 200 or more single-precision (32-bit) 

23 petaflops of processing power within a 

24 41,600 cubic foot or smaller envelope; 


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1 ‘‘(xv) develops, designs, or produces 

2 any other technologies in the advanced 

3 semiconductors and microelectronics sec4 tor, the artificial intelligence sector, the 

5 high-performance computing and super6 computing sector, the hypersonic missiles 

7 sector, or the quantum information science 

8 and technology sector that are— 

9 ‘‘(I) defense articles or defense 

10 services included on the United States 

11 Munitions List set forth in the Inter12 national Traffic in Arms Regulations 

13 under subchapter M of chapter I of 

14 title 22, Code of Federal Regulations; 

15 ‘‘(II) specially designed and pre16 pared nuclear equipment, parts or 

17 components, materials, software, or 

18 technologies covered by part 810 of 

19 title 10, Code of Federal Regulations 

20 (relating to assistance to foreign 

21 atomic energy activities); 

22 ‘‘(III) nuclear facilities, equip23 ment, or materials covered by part 

24 110 of title 10, Code of Federal Regu25 lations (relating to export and import 


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1 of nuclear equipment and material); 

2 or 

3 ‘‘(IV) emerging or foundational 

4 technologies controlled pursuant to 

5 section 1758 of the Export Control 

6 Reform Act of 2018 (50 U.S.C. 

7 4817); or 

8 ‘‘(xvi) develops any artificial intel9 ligence system that is designed to be exclu10 sively used for, or which the relevant cov11 ered foreign person intends to be used for, 

12 any— 

13 ‘‘(I) military end use (such as for 

14 weapons targeting, target identifica15 tion, combat simulation, military vehi16 cle or weapon control, military deci17 sion-making, weapons design (includ18 ing chemical, biological, radiological, 

19 or nuclear weapons), or combat sys20 tem logistics and maintenance); or 

21 ‘‘(II) government intelligence or 

22 mass-surveillance end (such as 

23 through incorporation of features such 

24 as mining text, audio, or video, image 


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1 recognition, location tracking, or sur2 reptitious listening devices). 

3 ‘‘(B) UPDATES.—The Secretary, in con4 sultation with Congress, may prescribe regula5 tions in accordance with this title to make up6 dates to the technical parameters of tech7 nologies described in subparagraph (A) as rea8 sonably needed for national security purposes. 

9 ‘‘(9) SECRETARY.—Except as otherwise pro10 vided, the term ‘Secretary’ means the Secretary of 

11 the Treasury. 

12 ‘‘(10) UNITED STATES PERSON.—The term 

13 ‘United States person’ means— 

14 ‘‘(A) any United States citizen or an alien 

15 lawfully admitted for permanent residence to 

16 the United States; 

17 ‘‘(B) an entity organized under the laws of 

18 the United States or of any jurisdiction within 

19 the United States (including any foreign branch 

20 of such an entity); or 

21 ‘‘(C) any person in the United States.’’. 

Æ 


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