II 

116TH CONGRESS 

1ST SESSION S. 152 

To direct the President to impose penalties pursuant to denial orders with 

respect to certain Chinese telecommunications companies that are in 

violation of the export control or sanctions laws of the United States, 

and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 16, 2019 

Mr. COTTON (for himself and Mr. VAN HOLLEN) introduced the following bill; 

which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To direct the President to impose penalties pursuant to denial orders with respect to certain Chinese telecommunications companies that are in violation of the export 

control or sanctions laws of 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 ‘‘Telecommunications 

5 Denial Order Enforcement Act’’. 


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1 SEC. 2. STATEMENT OF POLICY. 

2 It shall be the policy of the United States to enforce 

3 denial orders on covered telecommunications companies 

4 (as defined in section 3(d)) found to have violated the ex5 port control or sanctions laws of the United States. 

6 SEC. 3. IMPOSITION AND ENFORCEMENT OF DENIAL OR7 DERS WITH RESPECT TO COVERED TELE8 COMMUNICATIONS COMPANIES. 

9 (a) IMPOSITION OF DENIAL ORDERS.— 

10 (1) IN GENERAL.—Not later than 180 days 

11 after the date of the enactment of this Act, and an12 nually thereafter— 

13 (A) the President shall determine and re14 port to the appropriate congressional commit15 tees if any covered telecommunications company 

16 is in violation of an export control or sanctions 

17 law of the United States; and 

18 (B) if the President makes an affirmative 

19 determination with respect to a covered tele20 communications company under subparagraph 

21 (A), the President shall impose penalties pursu22 ant to a denial order with respect to the com23 pany or its agents or affiliates as described in 

24 paragraph (2). 

25 (2) PENALTIES DESCRIBED.—The penalties de26 scribed in this paragraph are the following: 


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1 (A) The covered telecommunications com2 pany and when acting for or on their behalf, 

3 their successors, assigns, directors, officers, em4 ployees, representatives, or agents (hereinafter 

5 each a ‘‘denied person’’), may not, directly or 

6 indirectly, participate in any way in any trans7 action involving any commodity, software, or 

8 technology (hereinafter collectively referred to 

9 as ‘‘item’’) exported or to be exported from the 

10 United States that is subject to the Export Ad11 ministration Regulations (as codified in sub12 chapter C of chapter VII of title 15, Code of 

13 Federal Regulations, or any successor regula14 tions), or in any other activity subject to the 

15 Export Administration Regulations. 

16 (B) No person may, directly or indirectly, 

17 do any of the following: 

18 (i) Export or reexport to or on behalf 

19 of a denied person any item subject to the 

20 Export Administration Regulations. 

21 (ii) Take any action that facilitates 

22 the acquisition or attempted acquisition by 

23 a denied person of the ownership, posses24 sion, or control of any item subject to the 

25 Export Administration Regulations that 


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1 has been or will be exported from the 

2 United States, including financing or other 

3 support activities related to a transaction 

4 whereby a denied person acquires or at5 tempts to acquire such ownership, posses6 sion, or control. 

7 (iii) Take any action to acquire from 

8 or to facilitate the acquisition or attempted 

9 acquisition from a denied person of any 

10 item subject to the Export Administration 

11 Regulations that has been exported from 

12 the United States. 

13 (iv) Obtain from a denied person in 

14 the United States any item subject to the 

15 Export Administration Regulations with 

16 knowledge or reason to know that the item 

17 will be, or is intended to be, exported from 

18 the United States. 

19 (v) Engage in any transaction to serv20 ice any item subject to the Export Admin21 istration Regulations that has been or will 

22 be exported from the United States and 

23 which is owned, possessed, or controlled by 

24 a denied person, or service any item, of 

25 whatever origin, that is owned, possessed, 


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1 or controlled by a denied person if such 

2 service involves the use of any item subject 

3 to the Export Administration Regulations 

4 that has been or will be exported from the 

5 United States. 

6 (3) REPORT.—The President shall submit to 

7 the appropriate congressional committees an annual 

8 report on the implementation of this subsection. 

9 (b) PROHIBITION ON MODIFICATION OF PEN10 ALTIES.—Notwithstanding any other provision of law, no 

11 official of an executive agency may modify any penalty, 

12 including a penalty imposed pursuant to a denial order, 

13 implemented by the Government of the United States with 

14 respect to a covered telecommunications company or its 

15 agents or affiliates pursuant to a determination that the 

16 company has violated an export control or sanctions law 

17 of the United States until the date that is 30 days after 

18 the President certifies to the appropriate congressional 

19 committees that the company— 

20 (1) has not, for a period of one year, conducted 

21 activities in violation of the laws of the United 

22 States; and 

23 (2) is fully cooperating with investigations into 

24 the activities of the company conducted by the Gov25 ernment of the United States, if any. 


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1 (c) REGULATIONS.—The President is authorized to 

2 prescribe such regulations as may be necessary to carry 

3 out this section. 

4 (d) DEFINITIONS.—In this section: 

5 (1) APPROPRIATE CONGRESSIONAL COMMIT6 TEES.—The term ‘‘appropriate congressional com7 mittees’’ means— 

8 (A) the Committee on Financial Services 

9 and the Committee on Foreign Affairs of the 

10 House of Representatives; and 

11 (B) the Committee on Banking, Housing, 

12 and Urban Affairs and the Committee on For13 eign Relations of the Senate. 

14 (2) COVERED TELECOMMUNICATIONS COM15 PANY.—The term ‘‘covered telecommunications com16 pany’’ means any of the following: 

17 (A) Huawei Technologies Company or 

18 ZTE Corporation (or any subsidiary or affiliate 

19 of such entities). 

20 (B) Any other telecommunications com21 pany domiciled in the People’s Republic of 

22 China (or any subsidiary or affiliate of such en23 tities), excluding any subsidiary of a foreign 

24 company domiciled in the People’s Republic of 

25 China. 


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1 (3) EXECUTIVE AGENCY.—The term ‘‘executive 

2 agency’’ means— 

3 (A) an executive department specified in 

4 section 101 of title 5, United States Code; 

5 (B) a military department specified in sec6 tion 102 of title 5, United States Code; 

7 (C) an independent establishment as de8 fined in section 104(1) of title 5, United States 

9 Code; and 

10 (D) a wholly owned Government corpora11 tion fully subject to chapter 91 of title 31, 

12 United States Code. 

Æ 


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