I 

118TH CONGRESS 

2D SESSION H. R. 8361 

To impose sanctions with respect to economic or industrial espionage by 

foreign adversarial companies, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 10, 2024 

Mr. MCCORMICK introduced the following bill; which was referred to the Committee on Foreign Affairs, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each 

case for consideration of such provisions as fall within the jurisdiction of 

the committee concerned 

A BILL 

To impose sanctions with respect to economic or industrial 

espionage by foreign adversarial companies, and for other 

purposes. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Economic Espionage 

5 Prevention Act’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 


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1 (1) On March 14, 2024, the Department of 

2 State notified Congress of the following: 

3 (A) People’s Republic of China exports of 

4 semiconductors to Russia have increased sub5 stantially since Russia’s full-scale invasion of 

6 Ukraine. 

7 (B) In the second half of 2023, China ex8 ported between $25,000,000 and $50,000,000 

9 in additional semiconductors to Russia every 

10 month relative to pre-invasion levels. 

11 (C) During the same period, China also ex12 ported between $50,000,000 and $100,000,000 

13 in additional exports to Russia every month to 

14 known transshipment hubs. 

15 (D) These exports include both Chinese 

16 and United States-branded semiconductors (in17 tegrated circuits), according to analysis of com18 mercially available trade data by the Bureau of 

19 Industry and Security of the Department of 

20 Commerce, and are almost certainly supporting 

21 Russia’s military capabilities based on Ukrain22 ian analysis of recovered Russian weapons. 

23 (E) Because of the prevalence of United 

24 States manufacturing equipment in global semi25 conductor supply chains, nearly all chips proVerDate Sep 11 2014 00:26 May 14, 2024 Jkt 049200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H8361.IH H8361

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1 duced worldwide, including in the People’s Re2 public of China, are subject to United States 

3 export controls if destined for Russia or 

4 Belarus. 

5 (F) All advanced semiconductors described 

6 on the Commerce Control List have been sub7 ject to a license requirement if destined to an 

8 entity in Russia since its further invasion of 

9 Ukraine. 

10 (2) On April 3, 2024, Deputy Secretary of 

11 State, Kurt Campbell, said ‘‘I think we have as12 sessed, over the course of the last couple of months 

13 that Russia has almost completely reconstituted 

14 militarily. And after the initial setbacks on the bat15 tlefield delivered to them by a brave and hearty 

16 group in Ukraine, with the support of China in par17 ticular, dual use capabilities and a variety of other 

18 efforts, industrial and commercial, Russia has re19 tooled and now poses a threat to Ukraine. . .But not 

20 just to Ukraine, its new found capabilities pose a 

21 longer term challenge to stability in Europe and 

22 threatens NATO allies.’’. 

23 SEC. 3. REPORT. 

24 (a) IN GENERAL.—Not later than 90 days after the 

25 date of the enactment of this Act, the Secretary of State, 


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1 in coordination with the heads of relevant Federal depart2 ments and agencies, as appropriate, shall submit to the 

3 appropriate congressional committees, a written report 

4 that contains the following: 

5 (1) An analysis and description of the extent to 

6 which any foreign person who is a citizen of the Peo7 ple’s Republic of China or an entity organized under 

8 the laws of the People’s Republic of China, or any 

9 foreign person or entity controlled by or operating at 

10 the direction of the Government of the People’s Re11 public of China— 

12 (A) is knowingly a material source of crit13 ical components necessary for the manufacture 

14 of weapons, vehicles, and other military equip15 ment by the defense industrial base of the Rus16 sian Federation; 

17 (B) has knowingly delivered critical compo18 nents to or entered into any agreement relating 

19 to the sale or delivery of critical components 

20 with any entity operating in the defense or in21 telligence sectors of the Government of the Rus22 sian Federation; 

23 (C) has knowingly delivered critical compo24 nents to or entered into any agreement relating 

25 to the sale or delivery of critical components 


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1 with any country or entity with which the de2 fense or intelligence sectors of the Government 

3 of Russian Federation are cooperating in sup4 port of Russia’s war against Ukraine; or 

5 (D) has knowingly delivered critical compo6 nents to or entered into any agreement relating 

7 to the sale or delivery of critical components 

8 with a foreign person that knowingly and di9 rectly provides these components to the defense 

10 or intelligence sectors of the Government of the 

11 Russian Federation. 

12 (2) The extent to which— 

13 (A) any foreign person that is a citizen of 

14 the People’s Republic of China or an entity or15 ganized under the laws of the People’s Republic 

16 of China has knowingly engaged, on or after the 

17 date of the enactment of this Act, in trans18 actions with a person that is part of, or oper19 ates on behalf of, the defense or intelligence 

20 sectors of the Government of the Russian Fed21 eration; 

22 (B) any foreign person identified pursuant 

23 to subparagraph (A) has engaged in trans24 actions which would constitute a significant 

25 transaction with persons that have been sancVerDate Sep 11 2014 00:26 May 14, 2024 Jkt 049200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H8361.IH H8361

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1 tioned for being part of, or operating on behalf 

2 of, the defense or intelligence sectors of the 

3 Government of the Russian Federation; or 

4 (C) any foreign person identified pursuant 

5 to subparagraph (A) has been subjected to 

6 sanctions imposed pursuant to sections 231 and 

7 235 of the Countering America’s Adversaries 

8 Through Sanctions Act (22 U.S.C. 9525 and 

9 9529). 

10 (b) FORM AND AVAILABILITY.— 

11 (1) FORM.—The report required by subsection 

12 (a) shall be submitted in unclassified form, but may 

13 include a classified annex. 

14 (2) AVAILABILITY.—The unclassified portion of 

15 the report required by subsection (a) may also be 

16 made available to the public. 

17 SEC. 4. IMPOSITION OF SANCTIONS WITH RESPECT TO ECO18 NOMIC OR INDUSTRIAL ESPIONAGE BY FOR19 EIGN ADVERSARY ENTITIES. 

20 (a) IN GENERAL.—On and after the date that is 30 

21 days after the date of the enactment of this Act, the Presi22 dent (a) may impose the sanctions described in subsection 

23 (c) against any of the foreign persons described in sub24 section (b). 


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1 (b) FOREIGN PERSONS DESCRIBED.—A foreign per2 son is described in this subsection if the President deter3 mines on or after the date of the enactment of this Act 

4 that the person is a foreign adversary entity that know5 ingly engages in— 

6 (1) economic or industrial espionage with re7 spect to trade secrets or proprietary information 

8 owned by United States persons; 

9 (2) the provision of material support or services 

10 to a foreign adversaries’ military, intelligence, or 

11 other national security entities; or 

12 (3) the violation of United States export control 

13 laws. 

14 (c) SANCTIONS DESCRIBED.—The sanctions that 

15 may be imposed with respect to a foreign person under 

16 subsection (b) are the following: 

17 (1) PROPERTY BLOCKING.—The exercise of all 

18 powers granted to the President by the International 

19 Emergency Economic Powers Act (50 U.S.C. 1701 

20 et seq.) to the extent necessary to block and prohibit 

21 all transactions in property and interests in property 

22 of the foreign person if such property and interests 

23 in property are in the United States, come within 

24 the United States, or are or come within the posses25 sion or control of a United States person. 


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1 (2) VISA REVOCATION.— 

2 (A) IN GENERAL.—An alien described in 

3 subsection (b) is subject to revocation of any 

4 visa or other entry documentation regardless of 

5 when the visa or other entry documentation is 

6 or was issued. 

7 (B) IMMEDIATE EFFECT.—A revocation 

8 under subparagraph (A) shall take effect imme9 diately; and automatically cancel any other 

10 valid visa or entry documentation that is in the 

11 alien’s possession. 

12 (d) EXCEPTIONS.— 

13 (1) EXCEPTION FOR INTELLIGENCE ACTIVI14 TIES.—Sanctions under this section shall not apply 

15 to any activity subject to the reporting requirements 

16 under title V of the National Security Act of 1947 

17 (50 U.S.C. 3091 et seq.) or any authorized intel18 ligence activities of the United States. 

19 (2) EXCEPTION TO COMPLY WITH INTER20 NATIONAL OBLIGATIONS.—Sanctions under sub21 section (c)(2) shall not apply with respect to the ad22 mission of an alien if admitting or paroling the alien 

23 into the United States is necessary to permit the 

24 United States to comply with— 


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1 (A) the Agreement regarding the Head2 quarters of the United Nations, signed at Lake 

3 Success June 26, 1947, and entered into force 

4 November 21, 1947, between the United Na5 tions and the United States; or 

6 (B) other applicable international obliga7 tions. 

8 (3) EXCEPTION TO CARRY OUT OR ASSIST LAW

9 ENFORCEMENT ACTIVITIES.—Sanctions under sub10 section (c)(2) shall not apply with respect to an alien 

11 if admitting or paroling the alien into the United 

12 States is necessary to carry out or assist law en13 forcement activity in the United States. 

14 (e) WAIVER.—The President may waive the applica15 tion of sanctions under this section with respect to a for16 eign person for renewable periods of not more than 180 

17 days each if the President determines and submits to the 

18 appropriate congressional committees a report that con19 tains a determination of the President that such a waiver 

20 is in the national security interests of the United States. 

21 (f) IMPLEMENTATION; PENALTIES.— 

22 (1) IMPLEMENTATION.—The President may ex23 ercise the authorities provided to the President 

24 under sections 203 and 205 of the International 

25 Emergency Economic Powers Act (50 U.S.C. 1702 


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1 and 1704) to the extent necessary to carry out this 

2 section. 

3 (2) PENALTIES.—A person that violates, at4 tempts to violate, conspires to violate, or causes a 

5 violation of subsection (a) or any regulation, license, 

6 or order issued to carry out that subsection shall be 

7 subject to the penalties set forth in subsections (b) 

8 and (c) of section 206 of the International Emer9 gency Economic Powers Act (50 U.S.C. 1705) to the 

10 same extent as a person that commits an unlawful 

11 act described in subsection (a) of that section. 

12 (3) PROCEDURES AND GUIDELINES FOR SANC13 TIONS.—The President shall establish procedures 

14 and guidelines for the implementation and enforce15 ment of sanctions imposed under this section. 

16 (4) ANNUAL REPORT.— 

17 (A) Unless the exception in subparagraph 

18 (B) applies, not later than one year after the 

19 date of the enactment of this Act, and for each 

20 of the 5 years thereafter, the President shall 

21 submit to the appropriate congressional com22 mittees a report on any notable developments 

23 regarding economic or industrial espionage ac24 tivities by foreign persons. 


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1 (B) The President shall not be required to 

2 submit the annual report described by subpara3 graph (A) if the President has imposed sanc4 tions as authorized under this section within 

5 the previous calendar year. 

6 (g) RULE OF CONSTRUCTION.—For purposes of this 

7 section, a transaction shall not be construed to include 

8 participation in an international standards-setting body or 

9 the activities of such a body. 

10 SEC. 5. CLARIFYING AMENDMENTS. 

11 Section 203 of the International Emergency Eco12 nomic Powers Act (50 U.S.C. 1702) is amended— 

13 (1) in subsection (b)— 

14 (A) in the matter preceding paragraph (1), 

15 by striking ‘‘, directly or indirectly’’; 

16 (B) in paragraph (3)— 

17 (i) by striking ‘‘including but not lim18 ited to’’ and all that follows through ‘‘news 

19 wire feeds.’’ and inserting ‘‘except to the 

20 extent that the President determines that 

21 such imports and exports would seriously 

22 impair his ability to deal with any national 

23 emergency declared under section 202.’’; 

24 and 


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1 (ii) by striking ‘‘under section 5 of the 

2 Export Administration Act of 1979, or 

3 under section 6 of such Act’’ and inserting 

4 ‘‘under other statutory or regulatory ex5 port control authorities’’; and 

6 (C) in paragraph (4), by inserting ‘‘, ex7 cept to the extent that the President determines 

8 that such imports and exports would seriously 

9 impair the ability to deal with any national 

10 emergency declared under section 202’’ before 

11 the period at the end; and 

12 (2) by adding at the end the following: 

13 ‘‘(d) RULES OF CONSTRUCTION RELATING TO SEN14 SITIVE AND PERSONAL DATA.—The communication, the 

15 importation to a country, or the exportation from a coun16 try, directly or indirectly, whether commercial or other17 wise, of bulk sensitive personal data or of source code used 

18 in a connected software application may not be construed 

19 to constitute— 

20 ‘‘(1) a ‘postal, telegraphic, telephonic, or other 

21 personal communication’, for purposes of subsection 

22 (b)(1); or 

23 ‘‘(2) an importation from a country, or an ex24 portation to a country, of ‘information or informa25 tional materials’, for purposes of subsection (b)(3).’’. 


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1 SEC. 6. DEFINITIONS. 

2 In this Act: 

3 (1) APPROPRIATE CONGRESSIONAL COMMIT4 TEES.—The term ‘‘appropriate congressional com5 mittees’’ means— 

6 (A) the Committee on Foreign Affairs of 

7 the House of Representatives; and 

8 (B) the Committee on Foreign Relations of 

9 the Senate. 

10 (2) ECONOMIC OR INDUSTRIAL ESPIONAGE.— 

11 The term ‘‘economic or industrial espionage’’ has 

12 the meaning given that term in section 1637(d) of 

13 the Carl Levin and Howard P. ‘‘Buck’’ McKeon Na14 tional Defense Authorization Act for Fiscal Year 

15 2015. 

16 (3) FOREIGN PERSON.—The term ‘‘foreign per17 son’’ means any person that is not a United States 

18 person. 

19 (4) KNOWINGLY.—The term ‘‘knowingly’’, with 

20 respect to conduct, a circumstance, or a result, 

21 means that a person has actual knowledge, or should 

22 have known, of the conduct, the circumstance, or the 

23 result. 

24 (5) OWN, PROPRIETARY INFORMATION, AND

25 TRADE SECRET.—The terms ‘‘own’’, ‘‘proprietary in26 formation’’, and ‘‘trade secret’’ have the meanings 


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1 given those terms in section 1637(d) of the Carl 

2 Levin and Howard P. ‘‘Buck’’ McKeon National De3 fense Authorization Act for Fiscal Year 2015 (50 

4 U.S.C. 1708(d)). 

5 (6) PERSON.—The term ‘‘person’’ means an in6 dividual or entity. 

7 (7) UNITED STATES PERSON.—The term 

8 ‘‘United States person’’ means— 

9 (A) a United States citizen or an alien law10 fully admitted for permanent residence to the 

11 United States; or 

12 (B) an entity organized under the laws of 

13 the United States or any jurisdiction within the 

14 United States, including a foreign branch of 

15 such an entity. 

16 (8) FOREIGN ADVERSARY.—The term ‘‘foreign 

17 adversary’’ means the countries listed in section 7.4 

18 of title 15, Code of Federal Regulations. 

Æ 


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