[Federal Register Volume 87, Number 32 (Wednesday, February 16, 2022)]
[Rules and Regulations]
[Pages 8735-8740]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-03378]


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DEPARTMENT OF THE TREASURY

Office of Foreign Assets Control

31 CFR Part 586


Chinese Military-Industrial Complex Sanctions Regulations

AGENCY: Office of Foreign Assets Control, Treasury.

ACTION: Final rule.

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SUMMARY: The Department of the Treasury's Office of Foreign Assets 
Control (OFAC) is adding regulations to implement a November 12, 2020 
Executive order related to securities investments that finance 
Communist Chinese military companies, as amended by a June 3, 2021 
Executive order related to the Chinese military-industrial complex and 
Chinese surveillance technology. OFAC intends to supplement these 
regulations with a more comprehensive set of regulations, which may 
include additional interpretive guidance and definitions, general 
licenses, and other regulatory provisions.

DATES: This rule is effective February 16, 2022.

FOR FURTHER INFORMATION CONTACT: OFAC: Assistant Director for 
Licensing, 202-622-2480; Assistant Director for Regulatory Affairs, 
202-622-4855; or Assistant Director for Sanctions Compliance & 
Evaluation, 202-622-2490.

SUPPLEMENTARY INFORMATION:

Electronic Availability

    This document and additional information concerning OFAC are 
available on OFAC's website: www.treasury.gov/ofac.

Background

    On November 12, 2020, the President, invoking the authority of, 
inter alia, the International Emergency Economic Powers Act (50 U.S.C. 
1701-1706) (IEEPA), issued Executive Order (E.O.) 13959, ``Addressing 
the Threat From Securities Investments That Finance Communist Chinese 
Military Companies'' (85 FR 73185, November 17, 2020).
    In E.O. 13959, the President found, among other things, that the 
People's Republic of China (PRC) is increasingly exploiting United 
States capital to resource and to enable the development and 
modernization of its military, intelligence, and other security 
apparatuses, which continues to allow the PRC to directly threaten the 
United States homeland and United States forces overseas, including by 
developing and deploying weapons of mass destruction, advanced 
conventional weapons, and malicious cyber-enabled actions against the 
United States and its people, and that key to the development of the 
PRC's military, intelligence, and other security apparatuses is the 
country's large, ostensibly private economy. The President therefore 
found that the PRC's military-industrial complex, by directly 
supporting the efforts of the PRC's military, intelligence, and other 
security apparatuses, constitutes an unusual and extraordinary threat, 
which has its source in substantial part outside the United States, to 
the national security, foreign policy, and economy of the United States 
and declared a national emergency with respect to that threat.
    On January 13, 2021, the President issued E.O. 13974, ``Amending 
Executive Order 13959--Addressing the Threat From Securities 
Investments That Finance Communist Chinese Military Companies'' (86 FR 
4875, January 19, 2021), which amended E.O. 13959. Further, on June 3, 
2021, the President issued E.O. 14032, ``Addressing the Threat From 
Securities Investments That Finance Certain Companies of the People's 
Republic of China'' (86 FR 30145, June 7, 2021), which amended E.O. 
13959 and revoked E.O. 13974 in its entirety.
    In E.O. 14032, the President found that additional steps are 
necessary to address the national emergency declared in E.O. 13959, 
including the threat posed by the military-industrial complex of the 
PRC and its involvement in military, intelligence, and security 
research and development programs, and weapons and related equipment 
production under the PRC's Military-Civil Fusion strategy. In addition, 
he found that the use of Chinese surveillance technology outside the 
PRC and the development or use of Chinese surveillance technology to 
facilitate repression or serious human rights abuse constitute unusual 
and extraordinary threats, which have their source in whole or 
substantial part outside the United States, to the national security, 
foreign policy, and economy of the United States and expanded the scope 
of the national emergency declared in E.O. 13959 to address those 
threats.
    OFAC is issuing the Chinese Military-Industrial Complex Sanctions

[[Page 8736]]

Regulations, 31 CFR part 586 (the ``Regulations''), to implement E.O. 
13959, as amended by E.O. 14032, pursuant to authorities delegated to 
the Secretary of the Treasury in E.O. 13959, as amended. Copies of E.O. 
13959 and E.O. 14032 appear in appendix A and appendix B to this part, 
respectively. Because E.O. 13974 has been revoked in its entirety, it 
does not appear in an appendix to this part.
    The Regulations are being published in abbreviated form at this 
time for the purpose of providing immediate guidance to the public. 
OFAC intends to supplement this part 586 with a more comprehensive set 
of regulations, which may include additional interpretive guidance and 
definitions, general licenses, and other regulatory provisions. The 
appendices to the Regulations will be removed when OFAC supplements 
this part with a more comprehensive set of regulations.

Public Participation

    Because the Regulations involve a foreign affairs function, the 
provisions of E.O. 12866 of September 30, 1993, ``Regulatory Planning 
and Review'' (58 FR 51735, October 4, 1993), and the Administrative 
Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, 
opportunity for public participation, and delay in effective date are 
inapplicable. Because no notice of proposed rulemaking is required for 
this rule, the Regulatory Flexibility Act (5 U.S.C. 601-612) does not 
apply.

Paperwork Reduction Act

    The collections of information related to the Regulations are 
contained in 31 CFR part 501 (the ``Reporting, Procedures and Penalties 
Regulations''). Pursuant to the Paperwork Reduction Act of 1995 (44 
U.S.C. 3507), those collections of information have been approved by 
the Office of Management and Budget under control number 1505-0164. An 
agency may not conduct or sponsor, and a person is not required to 
respond to, a collection of information unless the collection of 
information displays a valid control number.

List of Subjects in 31 CFR Part 586

    Administrative practice and procedure, Banks, banking, Penalties, 
People's Republic of China, Reporting and recordkeeping requirements, 
Sanctions, Securities.


0
For the reasons set forth in the preamble, OFAC adds part 586 to 31 CFR 
chapter V to read as follows:

PART 586--CHINESE MILITARY-INDUSTRIAL COMPLEX SANCTIONS REGULATIONS

Subpart A--Relation of This Part to Other Laws and Regulations

Sec.
586.101 Relation of this part to other laws and regulations.
Subpart B--Prohibitions
586.201 Prohibited transactions.
Subpart C--General Definitions
586.300 Applicability of definitions.
586.301 Entity.
586.302 Licenses; general and specific.
586.303 OFAC.
586.304 Person.
586.305 Publicly traded securities.
586.306 United States.
586.307 United States person; U.S. person.
586.308 U.S. financial institution.
Subpart D--Interpretations
586.401 [Reserved]
586.402 Effect of amendment.
586.403 Transactions ordinarily incident to a licensed transaction.
586.404 Subsidiary entities.
Subpart E--Licenses, Authorizations, and Statements of Licensing Policy
586.501 General and specific licensing procedures.
586.502 [Reserved]
586.503 Exclusion from licenses.
Subpart F--Reports
586.601 Records and reports.
Subpart G--Penalties and Findings of Violation
586.701 Penalties and Findings of Violation.
Subpart H--Procedures
586.801 Procedures.
586.802 Delegation of certain authorities of the Secretary of the 
Treasury.
Subpart I--Paperwork Reduction Act
586.901 Paperwork Reduction Act notice.
Appendix A to Part 586--Executive Order 13959 of November 12, 2020
Appendix B to Part 586--Executive Order 14032 of June 3, 2021


    Authority:  3 U.S.C. 301; 31 U.S.C. 321(b); 50 U.S.C. 1601-1651, 
1701-1706; Pub. L. 101-410, 104 Stat. 890, as amended (28 U.S.C. 
2461 note); E.O. 13959, 85 FR 73185, 3 CFR, 2020 Comp., p. 475; E.O. 
14032, 86 FR 30145.

Subpart A--Relation of This Part to Other Laws and Regulations


Sec.  586.101   Relation of this part to other laws and regulations.

    This part is separate from, and independent of, the other parts of 
this chapter, with the exception of part 501 of this chapter, the 
recordkeeping and reporting requirements and license application and 
other procedures of which apply to this part. Actions taken pursuant to 
part 501 of this chapter with respect to the prohibitions contained in 
this part are considered actions taken pursuant to this part. Differing 
foreign policy and national security circumstances may result in 
differing interpretations of similar language among the parts of this 
chapter. No license or authorization contained in or issued pursuant to 
those other parts authorizes any transaction prohibited by this part. 
No license or authorization contained in or issued pursuant to any 
other provision of law or regulation authorizes any transaction 
prohibited by this part. No license or authorization contained in or 
issued pursuant to this part relieves the involved parties from 
complying with any other applicable laws or regulations.

    Note 1 to Sec.  586.101.  This part has been published in 
abbreviated form for the purpose of providing immediate guidance to 
the public. OFAC intends to supplement this part with a more 
comprehensive set of regulations, which may include additional 
interpretive and definitional guidance, general licenses, and other 
regulatory provisions.

Subpart B--Prohibitions


Sec.  586.201  Prohibited transactions.

    (a) All transactions prohibited pursuant to Executive order (E.O.) 
13959 of November 12, 2020, as amended by E.O. 14032 of June 3, 2021 
(``E.O. 13959, as amended''), are prohibited pursuant to this part.
    (b) All transactions prohibited pursuant to any further Executive 
orders issued pursuant to the national emergency declared in E.O. 
13959, as amended, are prohibited pursuant to this part.

    Note 1 to Sec.  586.201. The names of persons identified in or 
pursuant to E.O. 13959, as amended, are published in the Federal 
Register and incorporated into OFAC's Non-SDN Chinese Military-
Industrial Complex Companies List (NS-CMIC List) using the following 
identifier formulation: ``[CMIC-EO13959].'' The NS-CMIC List is 
accessible through the following page on OFAC's website: 
www.treasury.gov/ofac.


    Note 2 to Sec.  586.201. Section 501.807 of this chapter 
describes the procedures to be followed by persons seeking 
administrative reconsideration of their status as persons subject to 
the prohibitions of this section.

Subpart C--General Definitions


Sec.  586.300  Applicability of definitions.

    The definitions in this subpart apply throughout the entire part.

[[Page 8737]]

Sec.  586.301  Entity.

    The term entity means a partnership, association, trust, joint 
venture, corporation, group, subgroup, or other organization.


Sec.  586.302  Licenses; general and specific.

    (a) Except as otherwise provided in this part, the term license 
means any license or authorization contained in or issued pursuant to 
this part.
    (b) The term general license means any license or authorization the 
terms of which are set forth in subpart E of this part or made 
available on OFAC's website: www.treasury.gov/ofac.
    (c) The term specific license means any license or authorization 
issued pursuant to this part but not set forth in subpart E of this 
part or made available on OFAC's website: www.treasury.gov/ofac.

    Note 1 to Sec.  586.302. See Sec.  501.801 of this chapter on 
licensing procedures.

Sec.  586.303  OFAC.

    The term OFAC means the Department of the Treasury's Office of 
Foreign Assets Control.


Sec.  586.304  Person.

    The term person means an individual or entity.


Sec.  586.305  Publicly traded securities.

    The term publicly traded securities includes any security, as 
defined in section 3(a)(10) of the Securities Exchange Act of 1934, 
Public Law 73-291 (as codified as amended at 15 U.S.C. 78c(a)(10)), 
denominated in any currency that trades on a securities exchange or 
through the method of trading that is commonly referred to as over-the-
counter, in any jurisdiction.


Sec.  586.306  United States.

    The term United States means the United States, its territories and 
possessions, and all areas under the jurisdiction or authority thereof.


Sec.  586.307  United States person; U.S. person.

    The term United States person or U.S. person means any United 
States citizen, lawful permanent resident alien, entity organized under 
the laws of the United States or any jurisdiction within the United 
States (including foreign branches), or any person in the United 
States.


Sec.  586.308  U.S. financial institution.

    The term U.S. financial institution means any U.S. entity 
(including its foreign branches) 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, futures or options, or procuring purchasers and sellers 
thereof, as principal or agent. It includes depository institutions, 
banks, savings banks, money services businesses, trust companies, 
insurance companies, securities brokers and dealers, futures and 
options brokers and dealers, forward contract and foreign exchange 
merchants, securities and commodities exchanges, clearing corporations, 
investment companies, employee benefit plans, dealers in precious 
metals, stones, or jewels, and U.S. holding companies, U.S. affiliates, 
or U.S. subsidiaries of any of the foregoing. This term includes those 
branches, offices, and agencies of foreign financial institutions that 
are located in the United States, but not such institutions' foreign 
branches, offices, or agencies.

Subpart D--Interpretations


Sec.  586.401   [Reserved]


Sec.  586.402  Effect of amendment.

    Unless otherwise specifically provided, any amendment, 
modification, or revocation of any provision in or appendix to this 
part or chapter or of any order, regulation, ruling, instruction, or 
license issued by OFAC does not affect any act done or omitted, or any 
civil or criminal proceeding commenced or pending, prior to such 
amendment, modification, or revocation. All penalties, forfeitures, and 
liabilities under any such order, regulation, ruling, instruction, or 
license continue and may be enforced as if such amendment, 
modification, or revocation had not been made.


Sec.  586.403  Transactions ordinarily incident to a licensed 
transaction.

    Any transaction ordinarily incident to a licensed transaction and 
necessary to give effect thereto is also authorized.


Sec.  586.404  Subsidiary entities.

    The prohibitions in Sec.  586.201(a) apply to a subsidiary of an 
entity identified in or pursuant to Executive Order (E.O.) 13959 of 
November 12, 2020, as amended by E.O. 14032 of June 3, 2021 (``E.O. 
13959, as amended''), only if the subsidiary itself is identified in or 
pursuant to E.O. 13959, as amended.

Subpart E--Licenses, Authorizations, and Statements of Licensing 
Policy


Sec.  586.501  General and specific licensing procedures.

    For provisions relating to licensing procedures, see part 501, 
subpart E, of this chapter. Licensing actions taken pursuant to part 
501 of this chapter with respect to the prohibitions contained in this 
part are considered actions taken pursuant to this part. General 
licenses and statements of licensing policy relating to this part also 
may be available through the Chinese Military-Industrial Complex 
sanctions page on OFAC's website: www.treasury.gov/ofac.


Sec.  586.502  [Reserved]


Sec.  586.503  Exclusion from licenses.

    OFAC reserves the right to exclude any person, property, 
transaction, or class thereof from the operation of any license or from 
the privileges conferred by any license. OFAC also reserves the right 
to restrict the applicability of any license to particular persons, 
property, transactions, or classes thereof. Such actions are binding 
upon actual or constructive notice of the exclusions or restrictions.

Subpart F--Reports


Sec.  586.601  Records and reports.

    For provisions relating to required records and reports, see part 
501, subpart C, of this chapter. Recordkeeping and reporting 
requirements imposed by part 501 of this chapter with respect to the 
prohibitions contained in this part are considered requirements arising 
pursuant to this part.

Subpart G--Penalties and Findings of Violation


Sec.  586.701  Penalties and Findings of Violation.

    (a) The penalties available under section 206 of the International 
Emergency Economic Powers Act (50 U.S.C. 1701-1706) (IEEPA), as 
adjusted annually pursuant to the Federal Civil Penalties Inflation 
Adjustment Act of 1990 (Pub. L. 101-410, as amended, 28 U.S.C. 2461 
note) or, in the case of criminal violations, as adjusted pursuant to 
18 U.S.C. 3571, are applicable to violations of the provisions of this 
part.
    (b) OFAC has the authority, pursuant to IEEPA, to issue Pre-Penalty 
Notices, Penalty Notices, and Findings of Violation; impose monetary 
penalties; engage in settlement discussions and enter into settlements; 
refer matters to the United States Department of Justice for 
administrative collection; and, in appropriate circumstances, refer 
matters to appropriate law enforcement agencies for criminal 
investigation and/or prosecution. For more information, see appendix A 
to part 501 of this chapter, which provides a general framework for the 
enforcement of all economic

[[Page 8738]]

sanctions programs administered by OFAC, including enforcement-related 
definitions, types of responses to apparent violations, general factors 
affecting administrative actions, civil penalties for failure to comply 
with a requirement to furnish information or keep records, and other 
general civil penalties information.

Subpart H--Procedures


Sec.  586.801  Procedures.

    For license application procedures and procedures relating to 
amendments, modifications, or revocations of licenses; administrative 
decisions; rulemaking; and requests for documents pursuant to the 
Freedom of Information and Privacy Acts (5 U.S.C. 552 and 552a), see 
part 501, subpart E, of this chapter.


Sec.  586.802  Delegation of certain authorities of the Secretary of 
the Treasury.

    Any action that the Secretary of the Treasury is authorized to take 
pursuant to Executive Order (E.O.) 13959 of November 12, 2020, as 
amended by E.O. 14032 of June 3, 2021, and any further Executive orders 
issued pursuant to the national emergency declared therein, may be 
taken by the Director of OFAC or by any other person to whom the 
Secretary of the Treasury has delegated authority so to act.

Subpart I--Paperwork Reduction Act


Sec.  586.901  Paperwork Reduction Act notice.

    For approval by the Office of Management and Budget (OMB) under the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3507) of information 
collections relating to recordkeeping and reporting requirements, 
licensing procedures, and other procedures, see Sec.  501.901 of this 
chapter. An agency may not conduct or sponsor, and a person is not 
required to respond to, a collection of information unless it displays 
a valid control number assigned by OMB.

Appendix A to Part 586--Executive Order 13959 of November 12, 2020 
Addressing the Threat From Securities Investments That Finance 
Communist Chinese Military Companies

    By the authority vested in me as President by the Constitution 
and the laws of the United States of America, including the 
International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) 
(IEEPA), the National Emergencies Act (50 U.S.C. 1601 et seq.), and 
section 301 of title 3, United States Code,
    I, DONALD J. TRUMP, President of the United States of America, 
find that the People's Republic of China (PRC) is increasingly 
exploiting United States capital to resource and to enable the 
development and modernization of its military, intelligence, and 
other security apparatuses, which continues to allow the PRC to 
directly threaten the United States homeland and United States 
forces overseas, including by developing and deploying weapons of 
mass destruction, advanced conventional weapons, and malicious 
cyber-enabled actions against the United States and its people.
    Key to the development of the PRC's military, intelligence, and 
other security apparatuses is the country's large, ostensibly 
private economy. Through the national strategy of Military-Civil 
Fusion, the PRC increases the size of the country's military-
industrial complex by compelling civilian Chinese companies to 
support its military and intelligence activities. Those companies, 
though remaining ostensibly private and civilian, directly support 
the PRC's military, intelligence, and security apparatuses and aid 
in their development and modernization.
    At the same time, those companies raise capital by selling 
securities to United States investors that trade on public exchanges 
both here and abroad, lobbying United States index providers and 
funds to include these securities in market offerings, and engaging 
in other acts to ensure access to United States capital. In that 
way, the PRC exploits United States investors to finance the 
development and modernization of its military.
    I therefore further find that the PRC's military-industrial 
complex, by directly supporting the efforts of the PRC's military, 
intelligence, and other security apparatuses, constitutes an unusual 
and extraordinary threat, which has its source in substantial part 
outside the United States, to the national security, foreign policy, 
and economy of the United States. To protect the United States 
homeland and the American people, I hereby declare a national 
emergency with respect to this threat.
    Accordingly, I hereby order:
    Section 1. (a) The following actions are prohibited:
    (i) Beginning 9:30 a.m. eastern standard time on January 11, 
2021, any transaction in publicly traded securities, or any 
securities that are derivative of, or are designed to provide 
investment exposure to such securities, of any Communist Chinese 
military company as defined in section 4(a)(i) of this order, by any 
United States person; and
    (ii) beginning 9:30 a.m. eastern standard time on the date that 
is 60 days after a person is determined to be a Communist Chinese 
military company pursuant to section (4)(a)(ii) or (iii) of this 
order, any transaction in publicly traded securities, or any 
securities that are derivative of, or are designed to provide 
investment exposure to such securities, of that person, by any 
United States person.
    (b) Notwithstanding subsection (a)(i) of this section, purchases 
for value or sales made on or before 11:59 p.m. eastern standard 
time on November 11, 2021, solely to divest, in whole or in part, 
from securities that any United States person held as of 9:30 a.m. 
eastern standard time on January 11, 2021, in a Communist Chinese 
military company as defined in section 4(a)(i) of this order, are 
permitted.
    (c) Notwithstanding subsection (a)(ii) of this section, for a 
person determined to be a Communist Chinese military company 
pursuant to section 4(a)(ii) or (iii) of this order, purchases for 
value or sales made on or before 365 days from the date of such 
determination, solely to divest, in whole or in part, from 
securities that any United States person held in such person, as of 
the date 60 days from the date of such determination, are permitted.
    (d) The prohibitions in subsection (a) of this section apply 
except to the extent provided by statutes, or in regulations, 
orders, directives, or licenses that may be issued pursuant to this 
order, and notwithstanding any contract entered into or any license 
or permit granted before the date of this order.
    Sec. 2. (a) Any transaction by a United States person or within 
the United States that evades or avoids, has the purpose of evading 
or avoiding, causes a violation of, or attempts to violate the 
prohibitions set forth in this order is prohibited.
    (b) Any conspiracy formed to violate any of the prohibitions set 
forth in this order is prohibited.
    Sec. 3. (a) The Secretary of the Treasury, after consultation 
with the Secretary of State, the Secretary of Defense, the Director 
of National Intelligence, and the heads of other executive 
departments and agencies (agencies) as deemed appropriate by the 
Secretary of the Treasury, is hereby authorized to take such 
actions, including the promulgation of rules and regulations, and to 
employ all powers granted to the President by IEEPA, to carry out 
the purposes of this order. The Secretary of the Treasury may, 
consistent with applicable law, redelegate any of these functions 
within the Department of the Treasury. All agencies shall take all 
appropriate measures within their authority to carry out the 
provisions of this order.
    (b) Rules and regulations issued pursuant to this order may, 
among other things, establish procedures to license transactions 
otherwise prohibited pursuant to this order. But prior to issuing 
any license under this order, the Secretary of the Treasury shall 
consult with the Secretary of State, the Secretary of Defense, and 
the Director of National Intelligence.
    Sec. 4. Definitions. For purposes of this order:
    (a) The term ``Communist Chinese military company'' means
    (i) any person that the Secretary of Defense has listed as a 
Communist Chinese military company operating directly or indirectly 
in the United States or in any of its territories or possessions 
pursuant to section 1237 of Public Law 105-261, as amended by 
section 1233 of Public Law 106-398 and section 1222 of Public Law 
108-375, as of the date of this order, and as set forth in the Annex 
to this order, until such time as the Secretary of Defense removes 
such person from such list;
    (ii) any person that the Secretary of Defense, in consultation 
with the Secretary of the Treasury, determines is a Communist

[[Page 8739]]

Chinese military company operating directly or indirectly in the 
United States or in any of its territories or possessions and 
therefore lists as such pursuant to section 1237 of Public Law 105-
261, as amended by section 1233 of Public Law 106-398 and section 
1222 of Public Law 108-375, until such time as the Secretary of 
Defense removes such person from such list; or
    (iii) any person that the Secretary of the Treasury publicly 
lists as meeting the criteria in section 1237(b)(4)(B) of Public Law 
105-261, or publicly lists as a subsidiary of a person already 
determined to be a Communist Chinese military company, until the 
Secretary of the Treasury determines that such person no longer 
meets that criteria and removes such person from such list.
    (b) The term ``entity'' means a government or instrumentality of 
such government, partnership, association, trust, joint venture, 
corporation, group, subgroup, or other organization;
    (c) the term ``person'' means an individual or entity;
    (d) the terms ``security'' and ``securities'' include the 
definition of ``security'' in section 3(a)(10) of the Securities 
Exchange Act of 1934, Public Law 73-291, as codified as amended at 
15 U.S.C. 78c(a)(10), except that currency or any note, draft, bill 
of exchange, or banker's acceptance which has a maturity at the time 
of issuance of not exceeding 9 months, exclusive of days of grace, 
or any renewal thereof the maturity of which is likewise limited, 
shall be a security for purposes of this order.
    (e) The term ``transaction'' means the purchase for value of any 
publicly traded security; and
    (f) the term ``United States person'' means any United States 
citizen, permanent resident alien, entity organized under the laws 
of the United States or any jurisdiction within the United States 
(including foreign branches), or any person in the United States.
    Sec. 5. The Secretary of the Treasury, in consultation with the 
Secretary of State and, as appropriate, the Secretary of Defense, is 
hereby authorized to submit the recurring and final reports to the 
Congress on the national emergency declared in this order, 
consistent with section 401(c) of the NEA (50 U.S.C. 1641(c)) and 
section 204(c) of IEEPA (50 U.S.C. 1703(c)).
    Sec. 6. General Provisions. (a) Nothing in this order shall be 
construed to impair or otherwise affect:
    (i) The authority granted by law to an executive department or 
agency, or the head thereof; or
    (ii) the functions of the Director of the Office of Management 
and Budget relating to budgetary, administrative, or legislative 
proposals.
    (b) This order shall be implemented consistent with applicable 
law and subject to the availability of appropriations.
    (c) This order is not intended to, and does not, create any 
right or benefit, substantive or procedural, enforceable at law or 
in equity by any party against the United States, its departments, 
agencies, or entities, its officers, employees, or agents, or any 
other person.

DONALD J. TRUMP
THE WHITE HOUSE,
November 12, 2020

Annex

Aero Engine Corp of China
Aviation Industry Corporation of China, Ltd. (AVIC)
China Academy of Launch Vehicle Technology (CALT)
China Aerospace Science & Technology Corporation (CASC)
China Aerospace Science & Industry Corporation (CASIC)
China Communication Construction Group Company, Ltd.
China Electronics Corporation (CEC)
China Electronics Technology Group Corporation (CETC)
China Mobile Communications
China National Chemical Corporation (ChernChina)
China National Chemical Engineering Group Co., Ltd. (CNCEC)
China National Nuclear
China Nuclear Engineering & Construction Corporation (CNECC)
China General Nuclear Power
China Railway Construction Corporation (CRCC)
China Shipbuilding Industry Corporation (CSIC)
China South Industries Group Corporation (CSGC)
China Spacesat
China State Construction Group Co., Ltd.
China State Shipbuilding Corporation (CSSC)
China Telecommunications
China Three Gorges Corporation Limited
China United Network Communications Group Co Lt d
CRRC Corporation
Dawning Information Industry Co. (Sugon)
Hikvision
Huawei
Inspur Group
Norinco
Panda Electronics
Sinochem Group Co Ltd

Appendix B to Part 586--Executive Order 14032 of June 3, 2021 
Addressing the Threat From Securities Investments That Finance Certain 
Companies of the People's Republic of China

    By the authority vested in me as President by the Constitution 
and the laws of the United States of America, including the 
International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) 
(IEEPA), the National Emergencies Act (50 U.S.C. 1601 et seq.) 
(NEA), and section 301 of title 3, United States Code,
    I, JOSEPH R. BIDEN JR., President of the United States of 
America, find that additional steps are necessary to address the 
national emergency declared in Executive Order 13959 of November 12, 
2020 (Addressing the Threat From Securities Investments That Finance 
Communist Chinese Military Companies), including the threat posed by 
the military-industrial complex of the People's Republic of China 
(PRC) and its involvement in military, intelligence, and security 
research and development programs, and weapons and related equipment 
production under the PRC's Military-Civil Fusion strategy. In 
addition, I find that the use of Chinese surveillance technology 
outside the PRC and the development or use of Chinese surveillance 
technology to facilitate repression or serious human rights abuse 
constitute unusual and extraordinary threats, which have their 
source in whole or substantial part outside the United States, to 
the national security, foreign policy, and economy of the United 
States, and I hereby expand the scope of the national emergency 
declared in Executive Order 13959 to address those threats.
    Accordingly, I hereby order as follows:
    Section 1. Sections 1 through 5 of Executive Order 13959, as 
amended by Executive Order 13974 of January 13, 2021 (Amending 
Executive Order 13959--Addressing the Threat From Securities 
Investments That Finance Communist Chinese Military Companies), are 
hereby replaced and superseded in their entirety to read as follows:
    ``Section 1. (a) The following activities by a United States 
person are prohibited: The purchase or sale of any publicly traded 
securities, or any publicly traded securities that are derivative of 
such securities or are designed to provide investment exposure to 
such securities, of any person listed in the Annex to this order or 
of any person determined by the Secretary of the Treasury, in 
consultation with the Secretary of State, and, as the Secretary of 
the Treasury deems appropriate, the Secretary of Defense:
    (i) To operate or have operated in the defense and related 
materiel sector or the surveillance technology sector of the economy 
of the PRC; or
    (ii) to own or control, or to be owned or controlled by, 
directly or indirectly, a person who operates or has operated in any 
sector described in subsection (a)(i) of this section, or a person 
who is listed in the Annex to this order or who has otherwise been 
determined to be subject to the prohibitions in subsection (a) of 
this section.
    (b) The prohibitions in subsection (a) of this section shall 
take effect:
    (i) Beginning at 12:01 a.m. eastern daylight time on August 2, 
2021, with respect to any person listed in the Annex to this order; 
or
    (ii) beginning at 12:01 a.m. eastern daylight time on the date 
that is 60 days after the date of the determination in subsection 
(a) of this section with respect to any person not listed in the 
Annex to this order.
    (c) The purchase or sale of publicly traded securities described 
in subsection (a) of this section made solely to effect the 
divestment, in whole or in part, of such securities by a United 
States person is permitted prior to:
    (i) 12:01 a.m. eastern daylight time on June 3, 2022, with 
respect to any person listed in the Annex to this order; or
    (ii) 12:01 a.m. eastern daylight time on the date that is 365 
days after the date of the determination in subsection (a) of this 
section with respect to any person not listed in the Annex to this 
order.
    (d) The prohibitions in subsection (a) of this section apply 
except to the extent provided by statutes, or in regulations, 
orders, directives, or licenses that may be issued pursuant to this 
order, and notwithstanding any contract entered into or any license 
or permit granted before the date of this order.

[[Page 8740]]

    Sec. 2. (a) Any transaction that evades or avoids, has the 
purpose of evading or avoiding, causes a violation of, or attempts 
to violate any of the prohibitions set forth in this order is 
prohibited.
    (b) Any conspiracy formed to violate any of the prohibitions set 
forth in this order is prohibited.
    Sec. 3. For the purposes of this order:
    (a) The term ``entity'' means a partnership, association, trust, 
joint venture, corporation, group, subgroup, or other organization;
    (b) the term ``person'' means an individual or entity;
    (c) the term ``publicly traded securities'' includes any 
``security,'' as defined in section 3(a)(10) of the Securities 
Exchange Act of 1934, Public Law 73-291 (as codified as amended at 
15 U.S.C. 78c(a)(10)), denominated in any currency that trades on a 
securities exchange or through the method of trading that is 
commonly referred to as ``over-the-counter,'' in any jurisdiction; 
and
    (d) the term ``United States person'' means any United States 
citizen, lawful permanent resident, entity organized under the laws 
of the United States or any jurisdiction within the United States 
(including foreign branches), or any person in the United States.
    Sec. 4. The Secretary of the Treasury, in consultation with the 
Secretary of State, is hereby authorized to take such actions, 
including the promulgation of rules and regulations, and to employ 
all powers granted to the President by IEEPA, as may be necessary to 
carry out the purposes of this order. The Secretary of the Treasury 
may, consistent with applicable law, redelegate any of these 
functions within the Department of the Treasury. All executive 
departments and agencies (agencies) of the United States shall take 
all appropriate measures within their authority to carry out the 
provisions of this order.
    Sec. 5. The Secretary of the Treasury, in consultation with the 
Secretary of State, is hereby authorized to submit recurring and 
final reports to the Congress on the national emergency declared in 
this order, consistent with section 401(c) of the NEA (50 U.S.C. 
1641(c)) and section 204(c) of IEEPA (50 U.S.C. 1703(c)).
    Sec. 6. The Secretary of the Treasury, in consultation with the 
Secretary of State, and, as the Secretary of the Treasury deems 
appropriate, the Secretary of Defense, is hereby authorized to 
determine that circumstances no longer warrant the application of 
the prohibitions in section 1(a) of this order with respect to a 
person listed in the Annex to this order, and to take necessary 
action to give effect to that determination.''
    Sec. 2. The Annex to Executive Order 13959 is replaced and 
superseded in its entirety by the Annex to this order.
    Sec. 3. Section 6 of Executive Order 13959 is amended to replace 
``Sec. 6.'' with ``Sec. 7.''
    Sec. 4. Executive Order 13974 is hereby revoked in its entirety. 
The Secretary of the Treasury and the heads of agencies shall take 
all necessary steps to rescind any orders or prohibitions issued 
prior to the date of this order implementing or enforcing Executive 
Order 13974 or the versions of sections 1 through 5 of Executive 
Order 13959 replaced and superseded by section 1 of this order.
    Sec. 5. (a) Nothing in this order shall be construed to impair 
or otherwise affect:
    (i) The authority granted by law to an executive department or 
agency, or the head thereof; or
    (ii) the functions of the Director of the Office of Management 
and Budget relating to budgetary, administrative, or legislative 
proposals.
    (b) This order shall be implemented consistent with applicable 
law and subject to the availability of appropriations.
    (c) This order is not intended to, and does not, create any 
right or benefit, substantive or procedural, enforceable at law or 
in equity by any party against the United States, its departments, 
agencies, or entities, its officers, employees, or agents, or any 
other person.

JOSEPH R. BIDEN JR.
THE WHITE HOUSE,
June 3, 2021

Annex

AERO ENGINE CORPORATION OF CHINA
AEROSPACE CH UAV CO., LTD
AEROSPACE COMMUNICATIONS HOLDINGS GROUP COMPANY LIMITED
AEROSUN CORPORATION
ANHUI GREATWALL MILITARY INDUSTRY COMPANY LIMITED
AVIATION INDUSTRY CORPORATION OF CHINA, LTD.
AVIC AVIATION HIGH-TECHNOLOGY COMPANY LIMITED
AVIC HEAVY MACHINERY COMPANY LIMITED
AVIC JONHON OPTRONIC TECHNOLOGY CO., LTD.
AVIC SHENYANG AIRCRAFT COMPANY LIMITED
AVIC XI'AN AIRCRAFT INDUSTRY GROUP COMPANY LTD.
CHANGSHA JINGJIA MICROELECTRONICS COMPANY LIMITED
CHINA ACADEMY OF LAUNCH VEHICLE TECHNOLOGY
CHINA AEROSPACE SCIENCE AND INDUSTRY CORPORATION LIMITED CHINA 
AEROSPACE SCIENCE AND TECHNOLOGY CORPORATION
CHINA AEROSPACE TIMES ELECTRONICS CO., LTD
CHINA AVIONICS SYSTEMS COMPANY LIMITED
CHINA COMMUNICATIONS CONSTRUCTION COMPANY LIMITED
CHINA COMMUNICATIONS CONSTRUCTION GROUP (LIMITED)
CHINA ELECTRONICS CORPORATION
CHINA ELECTRONICS TECHNOLOGY GROUP CORPORATION
CHINA GENERAL NUCLEAR POWER CORPORATION
CHINA MARINE INFORMATION ELECTRONICS COMPANY LIMITED
CHINA MOBILE COMMUNICATIONS GROUP CO., LTD.
CHINA MOBILE LIMITED
CHINA NATIONAL NUCLEAR CORPORATION
CHINA NATIONAL OFFSHORE OIL CORPORATION
CHINA NORTH INDUSTRIES GROUP CORPORATION LIMITED
CHINA NUCLEAR ENGINEERING CORPORATION LIMITED
CHINA RAILWAY CONSTRUCTION CORPORATION LIMITED
CHINA SATELLITE COMMUNICATIONS CO., LTD.
CHINA SHIPBUILDING INDUSTRY COMPANY LIMITED
CHINA SHIPBUILDING INDUSTRY GROUP POWER COMPANY LIMITED
CHINA SOUTH INDUSTRIES GROUP CORPORATION
CHINA SPACESAT CO., LTD.
CHINA STATE SHIPBUILDING CORPORATION LIMITED
CHINA TELECOM CORPORATION LIMITED
CHINA TELECOMMUNICATIONS CORPORATION
CHINA UNICOM (HONG KONG) LIMITED
CHINA UNITED NETWORK COMMUNICATIONS GROUP CO., LTD.
CNOOC LIMITED
COSTAR GROUP CO., LTD.
CSSC OFFSHORE & MARINE ENGINEERING (GROUP) COMPANY LIMITED
FUJIAN TORCH ELECTRON TECHNOLOGY CO., LTD.
GUIZHOU SPACE APPLIANCE CO., LTD
HANGZHOU HIKVISION DIGITAL TECHNOLOGY CO., LTD.
HUAWEI INVESTMENT & HOLDING CO., LTD.
HUAWEI TECHNOLOGIES CO., LTD.
INNER MONGOLIA FIRST MACHINERY GROUP CO., LTD.
INSPUR GROUP CO., LTD.
JIANGXI HONGDU AVIATION INDUSTRY CO., LTD.
NANJING PANDA ELECTRONICS COMPANY LIMITED
NORTH NAVIGATION CONTROL TECHNOLOGY CO., LTD.
PANDA ELECTRONICS GROUP CO., LTD.
PROVEN GLORY CAPITAL LIMITED
PROVEN HONOUR CAPITAL LIMITED
SEMICONDUCTOR MANUFACTURING INTERNATIONAL CORPORATION
SHAANXI ZHONGTIAN ROCKET TECHNOLOGY COMPANY LIMITED
ZHONGHANG ELECTRONIC MEASURING INSTRUMENTS COMPANY LIMITED

    Dated: February 11, 2022.
Andrea M. Gacki,
Director, Office of Foreign Assets Control.
[FR Doc. 2022-03378 Filed 2-15-22; 8:45 am]
BILLING CODE 4810-AL-P