```

[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3470 Referred in Senate (RFS)]

113th CONGRESS
  2d Session
                                H. R. 3470

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             April 8, 2014

Received; read twice and referred to the Committee on Foreign Relations

_______________________________________________________________________

                                 AN ACT

 
 To affirm the importance of the Taiwan Relations Act, to provide for 
  the transfer of naval vessels to certain foreign countries, 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 AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Taiwan Relations 
Act Affirmation and Naval Vessel Transfer Act of 2014''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title and table of contents.
TITLE I--AFFIRMATION OF IMPORTANCE OF TAIWAN RELATIONS ACT AND TRANSFER 
                       OF NAVAL VESSELS TO TAIWAN

Sec. 101. Statement of policy relating to Taiwan Relations Act.
Sec. 102. Transfer of naval vessels to Taiwan.
TITLE II--TRANSFER OF NAVAL VESSELS TO CERTAIN OTHER FOREIGN RECIPIENTS

Sec. 201. Findings.
Sec. 202. Transfer of naval vessels to certain other foreign 
                            recipients.
             TITLE III--ARMS EXPORT CONTROL ACT AMENDMENTS

Sec. 301. Increase in congressional notification thresholds.
Sec. 302. Licensing of certain commerce-controlled items.
Sec. 303. Amendments relating to removal of major defense equipment 
                            from United States Munitions List.
Sec. 304. Amendment to definition of ``security assistance'' under the 
                            Foreign Assistance Act of 1961.
Sec. 305. Amendments to definitions of ``defense article'' and 
                            ``defense service'' under the Arms Export 
                            Control Act.
Sec. 306. Technical amendments.
  TITLE IV--APPLICATION OF CERTAIN PROVISIONS OF EXPORT ADMINISTRATION

Sec. 401. Application of certain provisions of Export Administration 
                            Act of 1979.

TITLE I--AFFIRMATION OF IMPORTANCE OF TAIWAN RELATIONS ACT AND TRANSFER 
                       OF NAVAL VESSELS TO TAIWAN

SEC. 101. STATEMENT OF POLICY RELATING TO TAIWAN RELATIONS ACT.

    (a) Findings.--Congress finds the following:
            (1) The Taiwan Relations Act has been instrumental in 
        maintaining peace, security, and stability in the Western 
        Pacific since its enactment in 1979, and it is in the 
        political, security, and economic interests of the United 
        States.
            (2) The Taiwan Relations Act affirmed that the United 
        States' decision to establish a diplomatic relationship with 
        the People's Republic of China was based on the expectation 
        that the future of Taiwan would be determined by peaceful 
        means.
            (3) The Taiwan Relations Act also states that ``it is the 
        policy of the United States to provide Taiwan with arms of a 
        defensive character and to maintain the capacity of the United 
        States to resist any resort to force or other forms of coercion 
        that would jeopardize the security, or the social or economic 
        system, of the people on Taiwan''.
            (4) The Taiwan Relations Act also states that ``it is the 
        policy of the United States to preserve and promote extensive, 
        close, and friendly commercial, cultural, and other relations 
        between the people of the United States and the people on 
        Taiwan, as well as the people on the China mainland and all 
        other peoples of the Western Pacific area''.
            (5) The relationship between the United States and Taiwan 
        has been strengthened with--
                    (A) Taiwan's evolution into a free society and a 
                full-fledged, multi-party democracy;
                    (B) the development of Taiwan's robust market 
                economy;
                    (C) Taiwan's collaboration with the United States 
                to combat terrorism, as demonstrated in part by its 
                participation in the Container Security Initiative; and
                    (D) the role Taiwan has played in addressing 
                transnational and global challenges, including its 
                active engagement in humanitarian relief measures, 
                public health endeavors, environmental protection 
                initiatives, and financial market stabilization 
                efforts.
            (6) The United States is the third largest trading partner 
        and the largest investor in Taiwan, while Taiwan is the twelfth 
        largest trading partner of the United States and the eighth 
        largest United States agricultural market.
            (7) Taiwan's democracy has deepened with the second 
        peaceful transfer of power from one political party to another 
        after the presidential election in March 2008.
            (8) The United States and Taiwan are united in our shared 
        values in free elections, personal liberty, and free 
        enterprise.
    (b) Statement of Policy.--Congress--
            (1) reaffirms its unwavering commitment to the Taiwan 
        Relations Act as the cornerstone of relations between the 
        United States and Taiwan;
            (2) reaffirms its support for Taiwan's democratic 
        institutions;
            (3) reaffirms that peace in the Taiwan Strait should be 
        maintained to the benefit of the Asia-Pacific region;
            (4) supports the United States commitment to Taiwan's 
        security in accord with the Taiwan Relations Act, including 
        Taiwan's procurement of sophisticated weapons of a defensive 
        character, such as F-16 C/Ds aircraft and diesel electric 
        submarines;
            (5) reaffirms its commitment to deepen United States-Taiwan 
        trade and investment relations as well as support for Taiwan's 
        inclusion in bilateral and regional trade agreements at the 
        appropriate time and under the right conditions in which 
        outstanding issues affecting United States exports are being 
        addressed; and
            (6) supports the strong and deepening relationship between 
        the United States and Taiwan.

SEC. 102. TRANSFER OF NAVAL VESSELS TO TAIWAN.

    (a) Transfer by Sale.--The President is authorized to transfer the 
OLIVER HAZARD PERRY class guided missile frigates USS TAYLOR (FFG-50), 
USS GARY (FFG-51), USS CARR (FFG-52), and USS ELROD (FFG-55) to the 
Taipei Economic and Cultural Representative Office of the United States 
(which is the Taiwan instrumentality designated pursuant to section 
10(a) of the Taiwan Relations Act (22 U.S.C. 3309(a))) on a sale basis 
under section 21 of the Arms Export Control Act (22 U.S.C. 2761).
    (b) Costs of Transfers.--Any expense incurred by the United States 
in connection with a transfer authorized by this section shall be 
charged to the recipient notwithstanding section 516(e) of the Foreign 
Assistance Act of 1961 (22 U.S.C. 2321j(e)).
    (c) Repair and Refurbishment in United States Shipyards.--To the 
maximum extent practicable, the President shall require, as a condition 
of the transfer of a vessel under this section, that the recipient to 
which the vessel is transferred have such repair or refurbishment of 
the vessel as is needed, before the vessel joins the naval forces of 
that recipient, performed at a shipyard located in the United States, 
including a United States Navy shipyard.
    (d) Expiration of Authority.--The authority to transfer a vessel 
under this section shall expire at the end of the 3-year period 
beginning on the date of the enactment of this section.

TITLE II--TRANSFER OF NAVAL VESSELS TO CERTAIN OTHER FOREIGN RECIPIENTS

SEC. 201. FINDINGS.

    (a) Relating to Mexico.--Congress finds the following:
            (1) The partnership between the United States and Mexico 
        helps the economic and national security of both countries, 
        including in the area of energy.
            (2) The United States and Mexico share a common goal of 
        reducing the flow of narcotics and the influence of 
        transnational gangs in the Hemisphere.
            (3) The partnership between the United States and Mexico 
        helps the economic competitiveness and national security of 
        both countries.
            (4) The economies of the United States and Mexico are 
        increasingly interdependent, with bilateral foreign direct 
        investment increasing more than six-fold over the past two 
        decades.
            (5) In 2012 alone, bilateral trade in goods and services 
        between the United States and Mexico exceeded $500,000,000,000.
            (6) The transfer of naval vessels to Mexico authorized 
        under section 202 supports the modernization efforts of the 
        Mexican Navy.
            (7) Such naval vessels are suitable to support Mexico's 
        offshore maritime surveillance, counter trafficking, 
        interdiction, and oil platform security.
            (8) The transfer of such naval vessels will contribute to 
        United States interests in promoting increased maritime 
        awareness to support security and protection of the people of 
        the United States and the people of Mexico.
    (b) Relating to Thailand.--Congress finds the following:
            (1) Thailand was the first treaty ally of the United States 
        in the Asia-Pacific region and remains a steadfast friend of 
        the United States.
            (2) In December 2003, the United States designated Thailand 
        as a major non-NATO ally, which improved the security of both 
        countries, particularly by facilitating joint counterterrorism 
        efforts.
            (3) For more than 30 years, Thailand has been the host 
        country of Cobra Gold, the United States Pacific Command's 
        annual multinational military training exercise, which is 
        designed to ensure regional peace and promote regional security 
        cooperation.
            (4) The Royal Thai Navy has commanded Combined Task Force 
        151 (CTF 151) of the Combined Maritime Forces, a multi-national 
        naval partnership consisting of 30 nations operating in and 
        around the Gulf of Aden and off the eastern coast of Somalia.
            (5) With the assistance of the Royal Thai Navy's Counter 
        Piracy Task Group, CTF 151 is helping to expressly disrupt and 
        suppress piracy, protect all vessels in the region and secure 
        their free navigation.
            (6) The Royal Thai Navy is also participating in the 
        multilateral Malacca Straits patrols with other regional 
        partners to promote maritime safety and security.
            (7) The transfer of naval vessels to Thailand authorized 
        under section 202 will support enhanced interoperability 
        between the Royal Thai Navy and United States Navy forces.
            (8) The transfer of such naval vessels underscores the 
        United States commitment to United States-Thai relations and to 
        peace and security in the Asia-Pacific region.

SEC. 202. TRANSFER OF NAVAL VESSELS TO CERTAIN OTHER FOREIGN 
              RECIPIENTS.

    (a) Transfers by Grant.--The President is authorized to transfer 
vessels to foreign countries on a grant basis under section 516 of the 
Foreign Assistance Act of 1961 (22 U.S.C. 2321j), as follows:
            (1) Mexico.--To the Government of Mexico, the OLIVER HAZARD 
        PERRY class guided missile frigates USS CURTS (FFG-38) and USS 
        MCCLUSKY (FFG-41).
            (2) Thailand.--To the Government of Thailand, the OLIVER 
        HAZARD PERRY class guided missile frigates USS RENTZ (FFG-46) 
        and USS VANDEGRIFT (FFG-48).
    (b) Alternative Transfer Authority.--Notwithstanding the authority 
provided in subsection (a) to transfer specific vessels to specific 
countries, the President is authorized, subject to the same conditions 
that would apply for such country under this section, to transfer any 
vessel named in this section to any country named in this section such 
that the total number of vessels transferred to such country does not 
exceed the total number of vessels authorized for transfer to such 
country by this section.
    (c) Grants Not Counted in Annual Total of Transferred Excess 
Defense Articles.--The value of a vessel transferred to another country 
on a grant basis pursuant to authority provided by subsection (a) or 
(b) shall not be counted against the aggregate value of excess defense 
articles transferred in any fiscal year under section 516 of the 
Foreign Assistance Act of 1961 (22 U.S.C. 2321j).
    (d) Costs of Transfers.--Any expense incurred by the United States 
in connection with a transfer authorized by this section shall be 
charged to the recipient notwithstanding section 516(e) of the Foreign 
Assistance Act of 1961 (22 U.S.C. 2321j(e)).
    (e) Repair and Refurbishment in United States Shipyards.--To the 
maximum extent practicable, the President shall require, as a condition 
of the transfer of a vessel under this section, that the recipient to 
which the vessel is transferred have such repair or refurbishment of 
the vessel as is needed, before the vessel joins the naval forces of 
that recipient, performed at a shipyard located in the United States, 
including a United States Navy shipyard.
    (f) Expiration of Authority.--The authority to transfer a vessel 
under this section shall expire at the end of the 3-year period 
beginning on the date of the enactment of this Act.

             TITLE III--ARMS EXPORT CONTROL ACT AMENDMENTS

SEC. 301. INCREASE IN CONGRESSIONAL NOTIFICATION THRESHOLDS.

    (a) Foreign Military Sales.--
            (1) In general.--Section 36(b) of the Arms Export Control 
        Act (22 U.S.C. 2776(b)) is amended--
                    (A) in paragraph (1)--
                            (i) in the matter preceding subparagraph 
                        (A)--
                                    (I) by striking ``$50,000,000'' and 
                                inserting ``$100,000,000'';
                                    (II) by striking ``$200,000,000'' 
                                and inserting ``$300,000,000''; and
                                    (III) by striking ``$14,000,000'' 
                                and inserting ``$25,000,000''; and
                            (ii) in the matter following subparagraph 
                        (P)--
                                    (I) by inserting ``of any defense 
                                articles or defense services under this 
                                Act for $200,000,000 or more, any 
                                design and construction services for 
                                $300,000,000 or more, or any major 
                                defense equipment for $75,000,000 or 
                                more,'' after ``The letter of offer 
                                shall not be issued, with respect to a 
                                proposed sale''; and
                                    (II) by inserting ``of any defense 
                                articles or services under this Act for 
                                $100,000,000 or more, any design and 
                                construction services for $200,000,000 
                                or more, or any major defense equipment 
                                for $50,000,000 or more,'' after ``or 
                                with respect to a proposed sale''; and
                    (B) in paragraph (6)--
                            (i) in subparagraph (A), by striking 
                        ``$25,000,000'' and inserting ``$75,000,000''; 
                        and
                            (ii) in subparagraph (B), by striking 
                        ``$100,000,000'' and inserting 
                        ``$200,000,000''.
    (b) Commercial Sales.--Section 36(c) of the Arms Export Control Act 
(22 U.S.C. 2776(c)) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``$14,000,000'' and inserting 
                ``$25,000,000''; and
                    (B) by striking ``$50,000,000'' and inserting 
                ``$100,000,000''; and
            (2) in paragraph (5)--
                    (A) in subparagraph (A), by striking 
                ``$25,000,000'' and inserting ``$75,000,000''; and
                    (B) in subparagraph (B), by striking 
                ``$100,000,000'' and inserting ``$200,000,000''.

SEC. 302. LICENSING OF CERTAIN COMMERCE-CONTROLLED ITEMS.

    Section 38 of the Arms Export Control Act (22 U.S.C. 2778) is 
amended by adding at the end the following new subsection:
    ``(k) Licensing of Certain Commerce-Controlled Items.--
            ``(1) In general.--A license or other approval from the 
        Department of State granted in accordance with this section may 
        also authorize the export of items subject to the Export 
        Administration Regulations if such items are to be used in or 
        with defense articles controlled on the United States Munitions 
        List.
            ``(2) Other requirements.--The following requirements shall 
        apply with respect to a license or other approval to authorize 
        the export of items subject to the Export Administration 
        Regulations under paragraph (1):
                    ``(A) Separate approval from the Department of 
                Commerce shall not be required for such items if such 
                items are approved for export under a Department of 
                State license or other approval.
                    ``(B) Such items subject to the Export 
                Administration Regulations that are exported pursuant 
                to a Department of State license or other approval 
                would remain under the jurisdiction of the Department 
                of Commerce with respect to any subsequent 
                transactions.
                    ``(C) The inclusion of the term `subject to the 
                EAR' or any similar term on a Department of State 
                license or approval shall not affect the jurisdiction 
                with respect to such items.
            ``(3) Definition.--In this subsection, the term `Export 
        Administration Regulations' means--
                    ``(A) the Export Administration Regulations as 
                maintained and amended under the authority of the 
                International Emergency Economic Powers Act (50 U.S.C. 
                1701 et seq.); or
                    ``(B) any successor regulations.''.

SEC. 303. AMENDMENTS RELATING TO REMOVAL OF MAJOR DEFENSE EQUIPMENT 
              FROM UNITED STATES MUNITIONS LIST.

    (a) Requirements for Removal of Major Defense Equipment From United 
States Munitions List.--Section 38(f) of the Arms Export Control Act 
(22 U.S.C. 2778(f)) is amended by adding at the end the following:
            ``(5)(A) Except as provided in subparagraph (B), the 
        President shall take such actions as may be necessary to 
        require that, at the time of export or reexport of any major 
        defense equipment listed on the 600 series of the Commerce 
        Control List contained in Supplement No. 1 to part 774 of 
        subtitle B of title 15, Code of Federal Regulations, the major 
        defense equipment will not be subsequently modified so as to 
        transform such major defense equipment into a defense article.
            ``(B) The President may authorize the transformation of any 
        major defense equipment described in subparagraph (A) into a 
        defense article if the President--
                    ``(i) determines that such transformation is 
                appropriate and in the national interests of the United 
                States; and
                    ``(ii) provides notice of such transformation to 
                the chairman of the Committee on Foreign Affairs of the 
                House of Representatives and the chairman of the 
                Committee on Foreign Relations of the Senate consistent 
                with the notification requirements of section 
                36(b)(5)(A) of this Act.
            ``(C) In this paragraph, the term `defense article' means 
        an item designated by the President pursuant to subsection 
        (a)(1).''.
    (b) Notification and Reporting Requirements for Major Defense 
Equipment Removed From United States Munitions List.--Section 38(f) of 
the Arms Export Control Act (22 U.S.C. 2778(f)), as amended by this 
section, is further amended by adding at the end the following:
            ``(6) The President shall ensure that any major defense 
        equipment that is listed on the 600 series of the Commerce 
        Control List contained in Supplement No. 1 to part 774 of 
        subtitle B of title 15, Code of Federal Regulations, shall 
        continue to be subject to the notification and reporting 
        requirements of the following provisions of law:
                    ``(A) Section 516(f) of the Foreign Assistance Act 
                of 1961 (22 U.S.C. 2321j(f)).
                    ``(B) Section 655 of the Foreign Assistance Act of 
                1961 (22 U.S.C. 2415).
                    ``(C) Section 3(d)(3)(A) of this Act.
                    ``(D) Section 25 of this Act.
                    ``(E) Section 36(b), (c), and (d) of this Act.''.

SEC. 304. AMENDMENT TO DEFINITION OF ``SECURITY ASSISTANCE'' UNDER THE 
              FOREIGN ASSISTANCE ACT OF 1961.

    Section 502B(d) of the Foreign Assistance Act of 1961 (22 U.S.C. 
2304(d)) is amended--
            (1) in paragraph (1), by striking ``and'' at the end; and
            (2) in paragraph (2)(C) to read as follows:
                    ``(C) any license in effect with respect to the 
                export to or for the armed forces, police, 
                intelligence, or other internal security forces of a 
                foreign country of--
                            ``(i) defense articles or defense services 
                        under section 38 of the Armed Export Control 
                        Act; or
                            ``(ii) items listed under the 600 series of 
                        the Commerce Control List contained in 
                        Supplement No. 1 to part 774 of subtitle B of 
                        title 15, Code of Federal Regulations;''.

SEC. 305. AMENDMENTS TO DEFINITIONS OF ``DEFENSE ARTICLE'' AND 
              ``DEFENSE SERVICE'' UNDER THE ARMS EXPORT CONTROL ACT.

    Section 47 of the Arms Export Control Act (22 U.S.C. 2794) is 
amended--
            (1) in the matter preceding subparagraph (A) of paragraph 
        (3), by striking ``includes'' and inserting ``means, with 
        respect to a sale or transfer by the United States under the 
        authority of this Act or any other foreign assistance or sales 
        program of the United States''; and
            (2) in paragraph (4), by striking ``includes'' and 
        inserting ``means, with respect to a sale or transfer by the 
        United States under the authority of this Act or any other 
        foreign assistance or sales program of the United States,''.

SEC. 306. TECHNICAL AMENDMENTS.

    (a) In General.--The Arms Export Control Act (22 U.S.C. 2751 et 
seq.) is amended--
            (1) in sections 3(a), 3(d)(1), 3(d)(3)(A), 3(e), 5(c), 6, 
        21(g), 36(a), 36(b)(1), 36(b)(5)(C), 36(c)(1), 36(f), 38(f)(1), 
        40(f)(1), 40(g)(2)(B), 101(b), and 102(a)(2), by striking ``the 
        Speaker of the House of Representatives and'' each place it 
        appears and inserting ``the Speaker of the House of 
        Representatives, the Committee on Foreign Affairs of the House 
        of Representatives, and'';
            (2) in section 21(i)(1) by inserting after ``the Speaker of 
        the House of Representatives'' the following ``, the Committees 
        on Foreign Affairs and Armed Services of the House of 
        Representatives,'';
            (3) in sections 25(e), 38(f)(2), 38(j)(3), and 38(j)(4)(B), 
        by striking ``International Relations'' each place it appears 
        and inserting ``Foreign Affairs'';
            (4) in sections 27(f) and 62(a), by inserting after ``the 
        Speaker of the House of Representatives,'' each place it 
        appears the following: ``the Committee on Foreign Affairs of 
        the House of Representatives,''; and
            (5) in section 73(e)(2), by striking ``the Committee on 
        National Security and the Committee on International Relations 
        of the House of Representatives'' and inserting ``the Committee 
        on Armed Services and the Committee on Foreign Affairs of the 
        House of Representatives''.
    (b) Other Technical Amendments.--
            (1) Arms export control act.--The Arms Export Control Act 
        (22 U.S.C. 2751 et seq.), as amended by subsection (a), is 
        further amended--
                    (A) in section 38--
                            (i) in subsection (b)(1), by redesignating 
                        the second subparagraph (B) (as added by 
                        section 1255(b) of the Foreign Relations 
                        Authorization Act, Fiscal Years 1988 and 1989 
                        (Public Law 100-204; 101 Stat. 1431)) as 
                        subparagraph (C);
                            (ii) in subsection (g)(1)(A)--
                                    (I) in clause (xi), by striking ``; 
                                or'' and inserting ``, or''; and
                                    (II) in clause (xii)--
                                            (aa) by striking 
                                        ``section'' and inserting 
                                        ``sections''; and
                                            (bb) by striking ``(18 
                                        U.S.C. 175b)'' and inserting 
                                        ``(18 U.S.C. 175c)''; and
                            (iii) in subsection (j)(2), in the matter 
                        preceding subparagraph (A), by inserting ``in'' 
                        after ``to''; and
                    (B) in section 47(2), in the matter preceding 
                subparagraph (A), by striking ``sec. 21(a),,'' and 
                inserting ``section 21(a),''.
            (2) Foreign assistance act of 1961.--Section 502B of the 
        Foreign Assistance Act of 1961 (22 U.S.C. 2304) is amended--
                    (A) in subsection (b), by striking ``Wherever 
                applicable, a description'' and inserting ``Wherever 
                applicable, such report shall include a description''; 
                and
                    (B) in subsection (d)(2)(B), by striking 
                ``credits'' and inserting ``credits)''.

  TITLE IV--APPLICATION OF CERTAIN PROVISIONS OF EXPORT ADMINISTRATION

SEC. 401. APPLICATION OF CERTAIN PROVISIONS OF EXPORT ADMINISTRATION 
              ACT OF 1979.

    (a) Protection of Information.--Section 12(c) of the Export 
Administration Act of 1979 (50 U.S.C. App. 2411(c)) has been in effect 
from August 20, 2001, and continues in effect on and after the date of 
the enactment of this Act, pursuant to the International Emergency 
Economic Powers Act (50 U.S.C. 1701 et seq.) and notwithstanding 
section 20 of the Export Administration Act of 1979 (50 U.S.C. App. 
2419). Section 12(c)(1) of the Export Administration Act of 1979 is a 
statute covered by section 552(b)(3) of title 5, United States Code.
    (b) Termination Date.--Subsection (a) terminates at the end of the 
4-year period beginning on the date of the enactment of this Act.

            Passed the House of Representatives April 7, 2014.

            Attest:

                                                 KAREN L. HAAS,

                                                                 Clerk.
```