II 

Calendar No. 538 

109TH CONGRESS 

2D SESSION H. R. 5337 

IN THE SENATE OF THE UNITED STATES 

JULY 27 (legislative day, JULY 26), 2006 

Received; read twice and placed on the calendar 

AN ACT 

To ensure national security while promoting foreign investment and the creation and maintenance of jobs, to reform the process by which such investments are examined for any effect they may have on national security, 

to establish the Committee on Foreign Investment in 

the United States, 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 ‘‘National Security For5 eign Investment Reform and Strengthened Transparency 

6 Act of 2006’’. 


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1 SEC. 2. UNITED STATES SECURITY IMPROVEMENT AMEND2 MENTS; CLARIFICATION OF REVIEW AND IN3 VESTIGATION PROCESS. 

4 Section 721 of the Defense Production Act of 1950 

5 (50 U.S.C. App. 2170) is amended by striking subsections 

6 (a) and (b) and inserting the following new subsections: 

7 ‘‘(a) DEFINITIONS.—For purposes of this section, the 

8 following definitions shall apply: 

9 ‘‘(1) COMMITTEE.—The term ‘Committee’ 

10 means the Committee on Foreign Investment in the 

11 United States. 

12 ‘‘(2) CONTROL.—The term ‘control’ has the 

13 meaning given to such term in regulations which the 

14 Committee shall prescribe. 

15 ‘‘(3) COVERED TRANSACTION.—The term ‘cov16 ered transaction’ means any merger, acquisition, or 

17 takeover by or with any foreign person which could 

18 result in foreign control of any person engaged in 

19 interstate commerce in the United States. 

20 ‘‘(4) FOREIGN GOVERNMENT-CONTROLLED

21 TRANSACTION.—The term ‘foreign government-con22 trolled transaction’ means any covered transaction 

23 that could result in the control of any person en24 gaged in interstate commerce in the United States 

25 by a foreign government or an entity controlled by 

26 or acting on behalf of a foreign government. 


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1 ‘‘(5) CLARIFICATION.—The term ‘national secu2 rity’ shall be construed so as to include those issues 

3 relating to ‘homeland security’, including its applica4 tion to critical infrastructure. 

5 ‘‘(b) NATIONAL SECURITY REVIEWS AND INVESTIGA6 TIONS.— 

7 ‘‘(1) NATIONAL SECURITY REVIEWS.— 

8 ‘‘(A) IN GENERAL.—Upon receiving writ9 ten notification under subparagraph (C) of any 

10 covered transaction, or on a motion made under 

11 subparagraph (D) with respect to any covered 

12 transaction, the President, acting through the 

13 Committee, shall review the covered transaction 

14 to determine the effects on the national security 

15 of the United States. 

16 ‘‘(B) CONTROL BY FOREIGN GOVERN17 MENT.—If the Committee determines that the 

18 covered transaction is a foreign government19 controlled transaction, the Committee shall con20 duct an investigation of the transaction under 

21 paragraph (2). 

22 ‘‘(C) WRITTEN NOTICE.— 

23 ‘‘(i) IN GENERAL.—Any party to any 

24 covered transaction may initiate a review 

25 of the transaction under this paragraph by 


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1 submitting a written notice of the trans2 action to the Chairperson of the Com3 mittee. 

4 ‘‘(ii) WITHDRAWAL OF NOTICE.—No 

5 covered transaction for which a notice was 

6 submitted under clause (i) may be with7 drawn from review unless— 

8 ‘‘(I) a written request for such 

9 withdrawal is submitted by any party 

10 to the transaction; and 

11 ‘‘(II) the request is approved in 

12 writing by the Chairperson, in con13 sultation with the Vice Chairpersons, 

14 of the Committee. 

15 ‘‘(iii) CONTINUING DISCUSSIONS.— 

16 The approval of a withdrawal request 

17 under clause (ii) shall not be construed as 

18 precluding any party to the covered trans19 action from continuing informal discus20 sions with the Committee or any Com21 mittee member regarding possible resub22 mission for review pursuant to this para23 graph. 

24 ‘‘(D) UNILATERAL INITIATION OF RE25 VIEW.—The President, the Committee, or any 


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1 member of the Committee may move to initiate 

2 a review under subparagraph (A) of— 

3 ‘‘(i) any covered transaction; 

4 ‘‘(ii) any covered transaction that has 

5 previously been reviewed or investigated 

6 under this section, if any party to the 

7 transaction submitted false or misleading 

8 material information to the Committee in 

9 connection with the review or investigation 

10 or omitted material information, including 

11 material documents, from information sub12 mitted to the Committee; or 

13 ‘‘(iii) any covered transaction that has 

14 previously been reviewed or investigated 

15 under this section, if any party to the 

16 transaction or the entity resulting from 

17 consummation of the transaction inten18 tionally materially breaches a mitigation 

19 agreement or condition described in sub20 section (l)(1)(A), and— 

21 ‘‘(I) such breach is certified by 

22 the lead department or agency moni23 toring and enforcing such agreement 

24 or condition as an intentional material 

25 breach; and 


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1 ‘‘(II) such department or agency 

2 certifies that there is no other remedy 

3 or enforcement tool available to ad4 dress such breach. 

5 ‘‘(E) TIMING.—Any review under this 

6 paragraph shall be completed before the end of 

7 the 30-day period beginning on the date of the 

8 receipt of written notice under subparagraph 

9 (C) by the Chairperson of the Committee, or 

10 the date of the initiation of the review in ac11 cordance with a motion under subparagraph 

12 (D). 

13 ‘‘(2) NATIONAL SECURITY INVESTIGATIONS.— 

14 ‘‘(A) IN GENERAL.—In each case in 

15 which— 

16 ‘‘(i) a review of a covered transaction 

17 under paragraph (1) results in a deter18 mination that— 

19 ‘‘(I) the transaction threatens to 

20 impair the national security of the 

21 United States and that threat has not 

22 been mitigated during or prior to the 

23 review of a covered transaction under 

24 paragraph (1); or 


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1 ‘‘(II) the transaction is a foreign 

2 government-controlled transaction; 

3 ‘‘(ii) a roll call vote pursuant to para4 graph (3)(A) in connection with a review 

5 under paragraph (1) of any covered trans6 action results in at least 1 vote by a Com7 mittee member against approving the 

8 transaction; or 

9 ‘‘(iii) the Director of National Intel10 ligence identifies particularly complex intel11 ligence concerns that could threaten to im12 pair the national security of the United 

13 States and Committee members were not 

14 able to develop and agree upon measures 

15 to mitigate satisfactorily those threats dur16 ing the initial review period under para17 graph (1), 

18 the President, acting through the Committee, 

19 shall immediately conduct an investigation of 

20 the effects of the transaction on the national se21 curity of the United States and take any nec22 essary actions in connection with the trans23 action to protect the national security of the 

24 United States. 

25 ‘‘(B) TIMING.— 


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1 ‘‘(i) IN GENERAL.—Any investigation 

2 under subparagraph (A) shall be completed 

3 before the end of the 45-day period begin4 ning on the date of the investigation com5 menced. 

6 ‘‘(ii) EXTENSIONS OF TIME.—The pe7 riod established under subparagraph (B) 

8 for any investigation of a covered trans9 action may be extended with respect to any 

10 particular investigation by the President or 

11 by a rollcall vote of at least 2/3 of the 

12 members of the Committee involved in the 

13 investigation by the amount of time speci14 fied by the President or the Committee at 

15 the time of the extension, not to exceed 45 

16 days, as necessary to collect and fully 

17 evaluate information relating to— 

18 ‘‘(I) the covered transaction or 

19 parties to the transaction; and 

20 ‘‘(II) any effect of the trans21 action that could threaten to impair 

22 the national security of the United 

23 States. 

24 ‘‘(3) APPROVAL OF CHAIRPERSON AND VICE

25 CHAIRPERSONS REQUIRED.— 


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1 ‘‘(A) IN GENERAL.—A review or investiga2 tion under this subsection of a covered trans3 action shall not be treated as final or complete 

4 until the findings and the report resulting from 

5 such review or investigation are approved by a 

6 majority of the members of the Committee in a 

7 roll call vote and signed by the Secretary of the 

8 Treasury, the Secretary of Homeland Security, 

9 and the Secretary of Commerce (and such au10 thority of each such Secretary may not be dele11 gated to any person other than the Deputy Sec12 retary of the Treasury, the Deputy Secretary of 

13 Homeland Security, or the Deputy Secretary of 

14 Commerce, respectively). 

15 ‘‘(B) ADDITIONAL ACTION REQUIRED IN

16 CERTAIN CASES.—In the case of any roll call 

17 vote pursuant to subparagraph (A) in connec18 tion with an investigation under paragraph (2) 

19 of any foreign government-controlled trans20 action in which there is at least 1 vote by a 

21 Committee member against approving the 

22 transaction, the investigation shall not be treat23 ed as final or complete until the findings and 

24 report resulting from such investigation are 

25 signed by the President (in addition to the 


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1 Chairperson and the Vice Chairpersons of the 

2 Committee under subparagraph (A)). 

3 ‘‘(4) ANALYSIS BY DIRECTOR OF NATIONAL IN4 TELLIGENCE.— 

5 ‘‘(A) IN GENERAL.—The Director of Na6 tional Intelligence shall expeditiously carry out 

7 a thorough analysis of any threat to the na8 tional security of the United States of any cov9 ered transaction, including making requests for 

10 information to the Director of the Office of 

11 Foreign Assets Control within the Department 

12 of the Treasury and the Director of the Finan13 cial Crimes Enforcement Network. The Direc14 tor of National Intelligence also shall seek and 

15 incorporate the views of all affected or appro16 priate intelligence agencies. 

17 ‘‘(B) 30-DAY MINIMUM.—The Director of 

18 National Intelligence shall be provided no less 

19 than 30 days to complete the analysis required 

20 under subparagraph (A), except in any instance 

21 described in paragraph (2)(A)(iii). 

22 ‘‘(C) INDEPENDENT ROLE OF DIRECTOR.— 

23 The Director of National Intelligence shall not 

24 be a member of the Committee and shall serve 

25 no policy role with the Committee other than to 


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1 provide analysis under subparagraph (A) in 

2 connection with a covered transaction. 

3 ‘‘(5) RESUBMITTALS OF NOTICE AND REQUESTS

4 FOR ADDITIONAL REVIEW OR INVESTIGATION.— 

5 ‘‘(A) IN GENERAL.—No provision of this 

6 subsection shall be construed as prohibiting any 

7 party to a covered transaction from— 

8 ‘‘(i) submitting additional information 

9 concerning the transaction, including any 

10 proposed restructuring of the transaction 

11 or any modifications to any agreements in 

12 connection with the transaction, while any 

13 review or investigation of the transaction is 

14 on-going; or 

15 ‘‘(ii) requesting a review or investiga16 tion of the transaction after any previous 

17 review or investigation of the same or a 

18 similar transaction has become final if in19 formation material to the prior review or 

20 investigation and not previously submitted 

21 to the Committee becomes known or if any 

22 material change in circumstances to the 

23 covered transaction has occurred since the 

24 review or investigation. 


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1 ‘‘(B) APPROVAL OF REQUEST.—In the 

2 case of a request referred to in subparagraph 

3 (A)(ii), the Committee shall determine by con4 sensus whether to grant a request. 

5 ‘‘(6) REGULATIONS.—Regulations prescribed 

6 under this section shall include standard procedures 

7 for— 

8 ‘‘(A) submitting any notice of a proposed 

9 or pending covered transaction to the Com10 mittee; 

11 ‘‘(B) submitting a request to withdraw a 

12 proposed or pending covered transaction from 

13 review; and 

14 ‘‘(C) resubmitting a notice of proposed or 

15 pending covered transaction that was previously 

16 withdrawn from review.’’. 

17 SEC. 3. STATUTORY ESTABLISHMENT OF THE COMMITTEE 

18 ON FOREIGN INVESTMENT IN THE UNITED 

19 STATES. 

20 (a) IN GENERAL.—Section 721 of the Defense Pro21 duction Act of 1950 (50 U.S.C. App. 2170) is amended 

22 by striking subsection (k) and inserting the following new 

23 subsection: 

24 ‘‘(k) COMMITTEE ON FOREIGN INVESTMENT IN THE

25 UNITED STATES.— 


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1 ‘‘(1) ESTABLISHMENT.—The Committee on 

2 Foreign Investment in the United States established 

3 pursuant to Executive Order No. 11858 shall be a 

4 multi-agency committee to carry out this section and 

5 such other assignments as the President may des6 ignate. 

7 ‘‘(2) MEMBERSHIP.—The Committee shall be 

8 comprised of the following members or the designee 

9 of any such member: 

10 ‘‘(A) The Secretary of the Treasury. 

11 ‘‘(B) The Secretary of Homeland Security. 

12 ‘‘(C) The Secretary of Commerce. 

13 ‘‘(D) The Secretary of Defense. 

14 ‘‘(E) The Secretary of State. 

15 ‘‘(F) The Attorney General. 

16 ‘‘(G) The Secretary of Energy. 

17 ‘‘(H) The Chairman of the Council of Eco18 nomic Advisors. 

19 ‘‘(I) The United States Trade Representa20 tive. 

21 ‘‘(J) The Director of the Office of Manage22 ment and Budget. 

23 ‘‘(K) The Director of the National Eco24 nomic Council. 


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1 ‘‘(L) The Director of the Office of Science 

2 and Technology Policy. 

3 ‘‘(M) The President’s Assistant for Na4 tional Security Affairs. 

5 ‘‘(N) Any other designee of the President 

6 from the Executive Office of the President. 

7 ‘‘(3) CHAIRPERSON; VICE CHAIRPERSONS.—The 

8 Secretary of the Treasury shall be the Chairperson 

9 of the Committee. The Secretary of Homeland Secu10 rity and the Secretary of Commerce shall be the Vice 

11 Chairpersons of the Committee. 

12 ‘‘(4) OTHER MEMBERS.—Subject to subsection 

13 (b)(4)(B), the Chairperson of the Committee shall 

14 involve the heads of such other Federal departments, 

15 agencies, and independent establishments in any re16 view or investigation under subsection (b) as the 

17 Chairperson, after consulting with the Vice Chair18 persons, determines to be appropriate on the basis 

19 of the facts and circumstances of the transaction 

20 under investigation (or the designee of any such de21 partment or agency head). 

22 ‘‘(5) MEETINGS.—The Committee shall meet 

23 upon the direction of the President or upon the call 

24 of the Chairperson of the Committee without regard 


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1 to section 552b of title 5, United States Code (if 

2 otherwise applicable). 

3 ‘‘(6) COLLECTION OF EVIDENCE.—Subject to 

4 subsection (c), the Committee may, for the purpose 

5 of carrying out this section— 

6 ‘‘(A) sit and act at such times and places, 

7 take such testimony, receive such evidence, ad8 minister such oaths; and 

9 ‘‘(B) require the attendance and testimony 

10 of such witnesses and the production of such 

11 books, records, correspondence, memoranda, pa12 pers, and documents as the Chairperson of the 

13 Committee may determine advisable. 

14 ‘‘(7) AUTHORIZATION OF APPROPRIATIONS.— 

15 There are authorized to be appropriated to the Sec16 retary of the Treasury for each of fiscal years 2007, 

17 2008, 2009, and 2010, expressly and solely for the 

18 operations of the Committee that are conducted by 

19 the Secretary, the sum of $10,000,000.’’. 

20 (b) TECHNICAL AND CONFORMING AMENDMENT.— 

21 The first sentence of section 721(c) of the Defense Pro22 duction Act of 1950 (50 U.S.C. App. 2170(c)) is amend23 ed— 


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1 (1) by striking ‘‘material filed with’’ and insert2 ing ‘‘material, including proprietary business infor3 mation, filed with, or testimony presented to,’’; and 

4 (2) by striking ‘‘or documentary material’’ the 

5 2nd place such term appears and inserting ‘‘, docu6 mentary material, or testimony’’. 

7 SEC. 4. ADDITIONAL FACTORS REQUIRED TO BE CONSID8 ERED. 

9 Section 721(f) of the Defense Production Act of 1950 

10 (50 U.S.C. App. 2170(f)) is amended— 

11 (1) in the matter preceding paragraph (1)— 

12 (A) by striking ‘‘may’’ and inserting 

13 ‘‘shall’’; and 

14 (B) by striking ‘‘among other factors’’; 

15 (2) by striking ‘‘and’’ at the end of paragraph 

16 (4); 

17 (3) by striking the period at the end of para18 graph (5) and inserting a semicolon; and 

19 (4) by adding at the end the following new 

20 paragraphs: 

21 ‘‘(6) whether the covered transaction has a se22 curity-related impact on critical infrastructure in the 

23 United States; 

24 ‘‘(7) whether the covered transaction is a for25 eign government-controlled transaction; and 


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1 ‘‘(8) such other factors as the President or the 

2 President’s designee may determine to be appro3 priate, generally or in connection with a specific re4 view or investigation.’’. 

5 SEC. 5. NONWAIVER OF SOVEREIGN IMMUNITY. 

6 Section 721(d) of the Defense Production Act of 

7 1950 (50 U.S.C. App. 2170(d)) is amended by adding at 

8 the end the following new sentence: ‘‘The United States 

9 shall not be held liable for any losses or other expenses 

10 incurred by any party to a covered transaction as a result 

11 of actions taken under this section after a covered trans12 action has been consummated if the party did not submit 

13 a written notice of the transaction to the Chairperson of 

14 the Committee under subsection (b)(1)(C) or did not wait 

15 until the completion of any review or investigation under 

16 subsection (b), or the end of the 15-day period referred 

17 to in this subsection, before consummating the trans18 action.’’. 

19 SEC. 6. MITIGATION, TRACKING, AND POST-CONSUMMA20 TION MONITORING AND ENFORCEMENT. 

21 Section 721 of the Defense Production Act of 1950 

22 (50 U.S.C. App. 2170) is amended by inserting after sub23 section (k) (as amended by section 3 of this Act) the fol24 lowing new subsection: 


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1 ‘‘(l) MITIGATION, TRACKING, AND

2 POSTCONSUMMATION MONITORING AND ENFORCE3 MENT.— 

4 ‘‘(1) MITIGATION.— 

5 ‘‘(A) IN GENERAL.—The Committee or any 

6 agency designated by the Chairperson and Vice 

7 Chairpersons may negotiate, enter into or im8 pose, and enforce any agreement or condition 

9 with any party to a covered transaction in order 

10 to mitigate any threat to the national security 

11 of the United States. 

12 ‘‘(B) RISK-BASED ANALYSIS REQUIRED.— 

13 Any agreement entered into or condition im14 posed under subparagraph (A) shall be based 

15 on a risk-based analysis of the threat to na16 tional security of the covered transaction. 

17 ‘‘(2) TRACKING AUTHORITY FOR WITHDRAWN

18 NOTICES.— 

19 ‘‘(A) IN GENERAL.—If any written notice 

20 of a covered transaction that was submitted to 

21 the Committee under this section is withdrawn 

22 before any review or investigation by the Com23 mittee under subsection (b) is completed, the 

24 Committee shall establish, as appropriate— 


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1 ‘‘(i) interim protections to address 

2 specific concerns with such transaction 

3 that have been raised in connection with 

4 any such review or investigation pending 

5 any resubmission of any written notice 

6 under this section with respect to such 

7 transaction and further action by the 

8 President under this section; 

9 ‘‘(ii) specific timeframes for resubmit10 ting any such written notice; and 

11 ‘‘(iii) a process for tracking any ac12 tions that may be taken by any party to 

13 the transaction, in connection with the 

14 transaction, before the notice referred to in 

15 clause (ii) is resubmitted. 

16 ‘‘(B) DESIGNATION OF AGENCY.—The 

17 Committee may designate an appropriate Fed18 eral department or agency, other than any enti19 ty of the intelligence community (as defined in 

20 the National Security Act of 1947), as the lead 

21 agency to carry out the requirements of sub22 paragraph (A) with respect to any covered 

23 transaction that is subject to such subpara24 graph. 


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1 ‘‘(3) NEGOTIATION, MODIFICATION, MONI2 TORING, AND ENFORCEMENT.— 

3 ‘‘(A) DESIGNATION OF AGENCY.—The 

4 Committee shall designate a Federal depart5 ment or agency as the lead agency to negotiate, 

6 modify, monitor, and enforce any agreement en7 tered into or condition imposed under para8 graph (1) with respect to a covered transaction 

9 based on the expertise with and knowledge of 

10 the issues related to such transaction on the 

11 part of the designated department or agency. 

12 ‘‘(B) REPORTING BY DESIGNATED AGEN13 CY.— 

14 ‘‘(i) IMPLEMENTATION REPORTS.— 

15 The Federal department or agency des16 ignated by the Committee as a lead agency 

17 under subparagraph (A) in connection with 

18 any agreement entered into or condition 

19 imposed under paragraph (1) with respect 

20 to a covered transaction shall— 

21 ‘‘(I) provide periodic reports to 

22 the Chairperson and Vice Chair23 persons of the Committee on the im24 plementation of such agreement or 

25 condition; and 


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1 ‘‘(II) require, as appropriate, any 

2 party to the covered transaction to re3 port to the head of such department 

4 or agency (or the designee of such de5 partment or agency head) on the im6 plementation or any material change 

7 in circumstances. 

8 ‘‘(ii) MODIFICATION REPORTS.—The 

9 Federal department or agency designated 

10 by the Committee as a lead agency under 

11 subparagraph (A) in connection with any 

12 agreement entered into or condition im13 posed with respect to a covered transaction 

14 shall— 

15 ‘‘(I) provide periodic reports to 

16 the Chairperson and Vice Chair17 persons of the Committee on any 

18 modification to any such agreement or 

19 condition imposed with respect to the 

20 transaction; and 

21 ‘‘(II) ensure that any significant 

22 modification to any such agreement or 

23 condition is reported to the Director 

24 of National Intelligence and to any 

25 other Federal department or agency 


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1 that may have a material interest in 

2 such modification.’’. 

3 SEC. 7. INCREASED OVERSIGHT BY THE CONGRESS. 

4 (a) REPORT ON ACTIONS.—Section 721(g) of the De5 fense Production Act of 1950 (50 U.S.C. App. 2170) is 

6 amended to read as follows: 

7 ‘‘(g) REPORTS TO THE CONGRESS.— 

8 ‘‘(1) REPORTS ON COMPLETED COMMITTEE IN9 VESTIGATIONS.— 

10 ‘‘(A) IN GENERAL.—Not later than 5 days 

11 after the completion of a Committee investiga12 tion of a covered transaction under subsection 

13 (b)(2), or, if the President indicates an intent 

14 to take any action authorized under subsection 

15 (d) with respect to the transaction, after the 

16 end of 15-day period referred to in subsection 

17 (d), the Chairperson or a Vice Chairperson of 

18 the Committee shall submit a written report on 

19 the findings or actions of the Committee with 

20 respect to such investigation, the determination 

21 of whether or not to take action under sub22 section (d), an explanation of the findings 

23 under subsection (e), and the factors considered 

24 under subsection (f), with respect to such trans25 action, to— 


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1 ‘‘(i) the Majority Leader and the Mi2 nority Leader of the Senate; 

3 ‘‘(ii) the Speaker and the Minority 

4 Leader of the House of Representatives; 

5 and 

6 ‘‘(iii) the chairman and ranking mem7 ber of each committee of the House of 

8 Representatives and the Senate with juris9 diction over any aspect of the covered 

10 transaction and its possible effects on na11 tional security, including the Committee on 

12 International Relations, the Committee on 

13 Financial Services, and the Committee on 

14 Energy and Commerce of the House of 

15 Representatives. 

16 ‘‘(B) NOTICE AND BRIEFING REQUIRE17 MENT.—If a written request for a briefing on a 

18 covered transaction is submitted to the Com19 mittee by any Senator or Member of Congress 

20 who receives a report on the transaction under 

21 subparagraph (A), the Chairperson or a Vice 

22 Chairperson (or such other person as the Chair23 person or a Vice Chairperson may designate) 

24 shall provide 1 classified briefing to each House 

25 of the Congress from which any such briefing 


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1 request originates in a secure facility of appro2 priate size and location that shall be open only 

3 to the Majority Leader and the Minority Leader 

4 of the Senate, the Speaker and the Minority 

5 Leader of the House of Representatives, (as the 

6 case may be) the chairman and ranking mem7 ber of each committee of the House of Rep8 resentatives or the Senate (as the case may be) 

9 with jurisdiction over any aspect of the covered 

10 transaction and its possible effects on national 

11 security, including the Committee on Inter12 national Relations, the Committee on Financial 

13 Services, and the Committee on Energy and 

14 Commerce of the House of Representatives, and 

15 appropriate staff members who have security 

16 clearance. 

17 ‘‘(2) APPLICATION OF OTHER PROVISION.— 

18 ‘‘(A) IN GENERAL.—The disclosure of in19 formation under this subsection shall be con20 sistent with the requirements of subsection (c). 

21 Members of Congress and staff of either House 

22 or any committee of the Congress shall be sub23 ject to the same limitations on disclosure of in24 formation as are applicable under such sub25 section. 


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1 ‘‘(B) PROPRIETARY INFORMATION.—Pro2 prietary information which can be associated 

3 with a particular party to a covered transaction 

4 shall be furnished in accordance with subpara5 graph (A) only to a committee of the Congress 

6 and only when the committee provides assur7 ances of confidentiality, unless such party oth8 erwise consents in writing to such disclosure.’’. 

9 (b) SEMI-ANNUAL REPORT.—Section 721 of the De10 fense Production Act of 1950 (50 U.S.C. App. 2170) is 

11 amended by inserting after subsection (l) (as added by sec12 tion 6 of this Act) the following new subsection: 

13 ‘‘(m) SEMI-ANNUAL REPORT TO THE CONGRESS.— 

14 ‘‘(1) IN GENERAL.—The Chairperson of the 

15 Committee shall transmit a report to the chairman 

16 and ranking member of each committee of the 

17 House of Representatives and the Senate with juris18 diction over any aspect of the report, including the 

19 Committee on International Relations, the Com20 mittee on Financial Services, and the Committee on 

21 Energy and Commerce of the House of Representa22 tives, before January 31 and July 31 of each year 

23 on all the reviews and investigations of covered 

24 transactions conducted under subsection (b) during 

25 the 6-month period covered by the report. 


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1 ‘‘(2) CONTENTS OF REPORT RELATING TO COV2 ERED TRANSACTIONS.—The report under paragraph 

3 (1) shall contain the following information with re4 spect to each covered transaction: 

5 ‘‘(A) A list of all notices filed and all re6 views or investigations conducted during the pe7 riod with basic information on each party to the 

8 transaction, the nature of the business activities 

9 or products of all pertinent persons, along with 

10 information about the status of the review or 

11 investigation, information on any withdrawal 

12 from the process, any rollcall votes by the Com13 mittee under this section, any extension of time 

14 for any investigation, and any presidential deci15 sion or action under this section. 

16 ‘‘(B) Specific, cumulative, and, as appro17 priate, trend information on the numbers of fil18 ings, investigations, withdrawals, and presi19 dential decisions or actions under this section. 

20 ‘‘(C) Cumulative and, as appropriate, 

21 trend information on the business sectors in22 volved in the filings which have been made, and 

23 the countries from which the investments have 

24 originated. 


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1 ‘‘(D) Information on whether companies 

2 that withdrew notices to the Committee in ac3 cordance with subsection (b)(1)(C)(ii) have 

4 later re-filed such notices, or, alternatively, 

5 abandoned the transaction. 

6 ‘‘(E) The types of security arrangements 

7 and conditions the Committee has used to miti8 gate national security concerns about a trans9 action. 

10 ‘‘(F) A detailed discussion of all perceived 

11 adverse effects of covered transactions on the 

12 national security or critical infrastructure of the 

13 United States that the Committee will take into 

14 account in its deliberations during the period 

15 before delivery of the next such report, to the 

16 extent possible. 

17 ‘‘(3) CONTENTS OF REPORT RELATING TO

18 CRITICAL TECHNOLOGIES.— 

19 ‘‘(A) IN GENERAL.—In order to assist the 

20 Congress in its oversight responsibilities with 

21 respect to this section, the President and such 

22 agencies as the President shall designate shall 

23 include in the semi-annual report submitted 

24 under paragraph (1) the following: 


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1 ‘‘(i) An evaluation of whether there is 

2 credible evidence of a coordinated strategy 

3 by 1 or more countries or companies to ac4 quire United States companies involved in 

5 research, development, or production of 

6 critical technologies for which the United 

7 States is a leading producer. 

8 ‘‘(ii) An evaluation of whether there 

9 are industrial espionage activities directed 

10 or directly assisted by foreign governments 

11 against private United States companies 

12 aimed at obtaining commercial secrets re13 lated to critical technologies. 

14 ‘‘(B) CRITICAL TECHNOLOGIES DE15 FINED.—For purposes of this paragraph, the 

16 term ‘critical technologies’ means technologies 

17 identified under title VI of the National Science 

18 and Technology Policy, Organization, and Pri19 orities Act of 1976 or other critical technology, 

20 critical components, or critical technology items 

21 essential to national defense or national security 

22 identified pursuant to this section. 

23 ‘‘(C) RELEASE OF UNCLASSIFIED

24 STUDY.—That portion of the semi-annual re25 port under paragraph (1) that is required by 


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1 this paragraph may be classified. An unclassi2 fied version of that portion of the report shall 

3 be made available to the public.’’. 

4 (c) INVESTIGATION BY INSPECTOR GENERAL.— 

5 (1) IN GENERAL.—The Inspector General of 

6 the Department of the Treasury shall conduct an 

7 independent investigation to determine all of the 

8 facts and circumstances concerning each failure of 

9 the Department of the Treasury to make any report 

10 to the Congress that was required under section 

11 721(k) of the Defense Production Act of 1950 (as 

12 in effect before the date of the enactment of this 

13 Act). 

14 (2) REPORT TO THE CONGRESS.—Before the 

15 end of the 270-day period beginning on the date of 

16 the enactment of this Act, the Inspector General of 

17 the Department of the Treasury shall submit a re18 port to the chairman and ranking member of each 

19 committee of the House of Representatives and the 

20 Senate with jurisdiction over any aspect of the re21 port, including the Committee on International Rela22 tions, the Committee on Financial Services, and the 

23 Committee on Energy and Commerce of the House 

24 of Representatives, on the investigation under paraVerDate Aug 31 2005 01:53 Jul 28, 2006 Jkt 049200 PO 00000 Frm 00029 Fmt 6652 Sfmt 6201 E:\BILLS\H5337.PCS H5337

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1 graph (1) containing the findings and conclusions of 

2 the Inspector General. 

3 (d) STUDY AND REPORT.— 

4 (1) STUDY REQUIRED.—Before the end of the 

5 120-day period beginning on the date of the enact6 ment of this Act, the Secretary of the Treasury, in 

7 consultation with the Secretary of State and the 

8 Secretary of Commerce, shall conduct a study on in9 vestments in the United States, especially invest10 ments in critical infrastructure and industries affect11 ing national security, by— 

12 (A) foreign governments, entities controlled 

13 by or acting on behalf of a foreign government, 

14 or persons of foreign countries which comply 

15 with any boycott of Israel; or 

16 (B) foreign governments, entities con17 trolled by or acting on behalf of a foreign gov18 ernment, or persons of foreign countries which 

19 do not ban organizations designated by the Sec20 retary of State as foreign terrorist organiza21 tions. 

22 (2) REPORT.—Before the end of the 30-day pe23 riod beginning upon completion of the study under 

24 paragraph (1) or in the next semi-annual report 

25 under section 721(m) of the Defense Production Act 


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1 of 1950 (as added by subsection (b)), the Secretary 

2 of the Treasury shall submit a report to the Con3 gress, for transmittal to all appropriate committees 

4 of the Senate and the House of Representatives, 

5 containing the findings and conclusions of the Sec6 retary with respect to the study, together with an 

7 analysis of the effects of such investment on the na8 tional security of the United States and on any ef9 forts to address those effects. 

10 SEC. 8. CERTIFICATION OF NOTICES AND ASSURANCES. 

11 Section 721 of the Defense Production Act of 1950 

12 (50 U.S.C. App. 2170) is amended by inserting after sub13 section (m) (as added by section 7(b) of this Act) the fol14 lowing new subsection: 

15 ‘‘(n) CERTIFICATION OF NOTICES AND ASSUR16 ANCES.—Each notice required to be submitted, by a party 

17 to a covered transaction, to the President or the Presi18 dent’s designee under this section and regulations pre19 scribed under such section, and any information submitted 

20 by any such party in connection with any action for which 

21 a report is required pursuant to paragraph (3)(B)(ii) of 

22 subsection (l) with respect to the implementation of any 

23 mitigation agreement or condition described in paragraph 

24 (1)(A) of such subsection, or any material change in cir25 cumstances, shall be accompanied by a written statement 


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1 by the chief executive officer or the designee of the person 

2 required to submit such notice or information certifying 

3 that, to the best of the person’s knowledge and belief— 

4 ‘‘(1) the notice or information submitted fully 

5 complies with the requirements of this section or 

6 such regulation, agreement, or condition; and 

7 ‘‘(2) the notice or information is accurate and 

8 complete in all material respects.’’. 

9 SEC. 9. REGULATIONS. 

10 Section 721(h) of the Defense Production Act of 

11 1950 (50 U.S.C. App. 2170(h)) is amended to read as 

12 follows: 

13 ‘‘(h) REGULATIONS.—The President shall direct the 

14 issuance of regulations to carry out this section. Such reg15 ulations shall, to the extent possible, minimize paperwork 

16 burdens and shall to the extent possible coordinate report17 ing requirements under this section with reporting re18 quirements under any other provision of Federal law.’’. 

19 SEC. 10. EFFECT ON OTHER LAW. 

20 Section 721(i) of the Defense Production Act of 1950 

21 (50 U.S.C. App. 2170(i)) is amended to read as follows: 

22 ‘‘(i) EFFECT ON OTHER LAW.—No provision of this 

23 section shall be construed as altering or affecting any 

24 other authority, process, regulation, investigation, enforce25 ment measure, or review provided by or established under 


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1 any other provision of Federal law, including the Inter2 national Emergency Economic Powers Act, or any other 

3 authority of the President or the Congress under the Con4 stitution of the United States.’’. 

Passed the House of Representatives July 26, 2006. 

Attest: KAREN L. HAAS, 

Clerk. 


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Calendar No. 538 

109TH CONGRESS 

2D SESSION H. R. 5337 

AN ACT 

To ensure national security while promoting foreign 

for other purposes. on Foreign Investment in the United States, and on national security, to establish the Committee ments are examined for any effect they may have jobs, to reform the process by which such investinvestment and the creation and maintenance of 

JULY 27 (legislative day, JULY 26), 2006 

Received; read twice and placed on the calendar 


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