II 

117TH CONGRESS 

1ST SESSION S. 39 

To ensure the continued strength and leadership of the United States in 

the research and development of key technologies for future wireless 

telecommunications standards and infrastructure by providing additional 

authority for sanctions against certain foreign entities that pose a threat 

to national security, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 25, 2021 

Mr. INHOFE introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To ensure the continued strength and leadership of the 

United States in the research and development of key 

technologies for future wireless telecommunications 

standards and infrastructure by providing additional authority for sanctions against certain foreign entities that 

pose a threat to national security, 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 ‘‘Protecting American 

5 Innovation and Development Act of 2021’’. 


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1 SEC. 2. ADDRESSING THREATS TO NATIONAL SECURITY 

2 WITH RESPECT TO WIRELESS COMMUNICA3 TIONS RESEARCH AND DEVELOPMENT. 

4 Chapter 4 of title II of the Trade Expansion Act of 

5 1962 (19 U.S.C. 1862 et seq.) is amended by adding at 

6 the end the following: 

7 ‘‘SEC. 234. STATEMENT OF POLICY. 

8 ‘‘It is the policy of the United States— 

9 ‘‘(1) to ensure the continued strength and lead10 ership of the United States with respect to the re11 search and development of key technologies for fu12 ture wireless telecommunications standards and in13 frastructure; 

14 ‘‘(2) that the national security of the United 

15 States requires the United States to maintain its 

16 leadership in the research and development of key 

17 technologies for future wireless telecommunications 

18 standards and infrastructure; and 

19 ‘‘(3) that the national security and foreign pol20 icy of the United States requires that the importa21 tion of items that use, without a license, a claimed 

22 invention protected by a patent that is essential for 

23 the implementation of a wireless communications 

24 standard and is held by a United States person, be 

25 controlled to ensure the achievement of the policies 

26 described in paragraphs (1) and (2). 


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1 ‘‘SEC. 235. LIST OF FOREIGN ENTITIES THAT THREATEN NA2 TIONAL SECURITY WITH RESPECT TO WIRE3 LESS COMMUNICATIONS RESEARCH AND DE4 VELOPMENT. 

5 ‘‘(a) IN GENERAL.—The Secretary of Commerce (in 

6 this section referred to as the ‘Secretary’) shall establish 

7 and maintain a list of each foreign entity that the Sec8 retary determines— 

9 ‘‘(1)(A) uses, without a license, a claimed in10 vention protected by a patent that is essential for 

11 the implementation of a wireless communications 

12 standard and is held by a covered person; and 

13 ‘‘(B) is a person of concern or has as its ulti14 mate parent a person of concern; or 

15 ‘‘(2) is a successor to an entity described in 

16 paragraph (1). 

17 ‘‘(b) WATCH LIST.— 

18 ‘‘(1) IN GENERAL.—The Secretary shall estab19 lish and maintain a watch list of each foreign enti20 ty— 

21 ‘‘(A)(i) that is a person of concern or has 

22 as its ultimate parent a person of concern; and 

23 ‘‘(ii) with respect to which a covered per24 son has made the demonstration described in 

25 paragraph (2) in a petition submitted to the 


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1 Secretary for the inclusion of the entity on the 

2 list; or 

3 ‘‘(B) that is a successor to an entity de4 scribed in subparagraph (A). 

5 ‘‘(2) DEMONSTRATION DESCRIBED.— 

6 ‘‘(A) IN GENERAL.—A covered person has 

7 made a demonstration described in this para8 graph if the person has reasonably dem9 onstrated to the Secretary that— 

10 ‘‘(i) the person owns at least one un11 expired patent that is essential for the im12 plementation of a wireless communications 

13 standard; 

14 ‘‘(ii) a foreign entity that is a person 

15 of concern, or has as its ultimate parent a 

16 person of concern, has been, for a period 

17 of more than 180 days, selling wireless 

18 communications devices in or into the 

19 United States, directly or indirectly, that 

20 are claimed, labeled, marketed, or adver21 tised as complying with that standard; 

22 ‘‘(iii) the covered person has offered 

23 to the foreign entity or any of its affili24 ates— 


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1 ‘‘(I) a license to the person’s 

2 portfolio of patents that are essential 

3 to that standard; or 

4 ‘‘(II) to enter into binding arbi5 tration to resolve the terms of such a 

6 license; and 

7 ‘‘(iv) the foreign entity has not exe8 cuted a license agreement or an agreement 

9 to enter into such arbitration, as the case 

10 may be, by the date that is 180 days after 

11 the covered person made such an offer. 

12 ‘‘(B) DEMONSTRATION OF ESSEN13 TIALITY.—A covered person may demonstrate 

14 under subparagraph (A)(i) that the person 

15 owns at least one unexpired patent that is es16 sential for the implementation of a wireless 

17 communications standard by providing to the 

18 Secretary any of the following: 

19 ‘‘(i) A decision by a court or arbitral 

20 tribunal that a patent owned by the person 

21 is essential for the implementation of that 

22 standard. 

23 ‘‘(ii) A determination by an inde24 pendent patent evaluator not hired by the 

25 person that a patent owned by the person 


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1 is essential for the implementation of that 

2 standard. 

3 ‘‘(iii) A showing that wireless commu4 nications device manufacturers together 

5 accounting for a significant portion of the 

6 United States or world market for such de7 vices have entered into agreements for li8 censes to the person’s portfolio of patents 

9 that are essential for the implementation 

10 of that standard. 

11 ‘‘(iv) A showing that the person has 

12 previously granted licenses to the foreign 

13 entity described in subparagraph (A)(ii) or 

14 any of its affiliates with respect to a rea15 sonably similar portfolio of the person’s 

16 patents that are essential for the imple17 mentation of that standard. 

18 ‘‘(C) ACCOUNTING OF WIRELESS COMMU19 NICATIONS DEVICE MARKET.—A showing de20 scribed in subparagraph (B)(iii) may be made 

21 either by including or excluding wireless com22 munications device manufacturers that are per23 sons of concern. 

24 ‘‘(3) PROCEDURES.— 


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1 ‘‘(A) ADDING A FOREIGN ENTITY TO THE

2 WATCH LIST.— 

3 ‘‘(i) IN GENERAL.—The Secretary 

4 may add a foreign entity to the watch list 

5 under paragraph (1) only after notice and 

6 opportunity for an agency hearing on the 

7 record in accordance with (except as pro8 vided in clause (ii)) sections 554 through 

9 557 of title 5, United States Code. 

10 ‘‘(ii) MATTERS CONSIDERED AT HEAR11 ING.—An agency hearing conducted under 

12 clause (i)— 

13 ‘‘(I) shall be limited to consider14 ation of— 

15 ‘‘(aa) whether the dem16 onstration described in paragraph 

17 (2) has been reasonably made; 

18 and 

19 ‘‘(bb) the amount of bond to 

20 be required in accordance with 

21 section 236; and 

22 ‘‘(II) may not include the presen23 tation or consideration of legal or eq24 uitable defenses or counterclaims. 


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1 ‘‘(B) ADMINISTRATIVE PROCEDURE.—Ex2 cept as provided in subparagraph (A), the func3 tions exercised under this section and section 

4 236 shall not be subject to sections 551, 553 

5 through 559, or 701 through 706 of title 5, 

6 United States Code. 

7 ‘‘(c) MOVEMENT BETWEEN LISTS.—A foreign entity 

8 on the watch list required by subsection (b)(1) may be 

9 moved to the list required by subsection (a), pursuant to 

10 procedures established by the Secretary, on or after the 

11 date that is one year after being included on the watch 

12 list if the foreign entity is not able to reasonably dem13 onstrate that it has entered into a patent license agree14 ment or a binding arbitration agreement with each covered 

15 person that has made the demonstration described in sub16 section (b)(2) with respect to the entity. 

17 ‘‘(d) REMOVAL FROM LISTS.—A foreign entity on the 

18 list required by subsection (a) or on the watch list required 

19 by subsection (b)(1) may petition the Secretary to be re20 moved from that list on the basis that the conditions that 

21 led to the inclusion of the foreign entity on the list no 

22 longer exist. The burden of proof shall be on the foreign 

23 entity. 

24 ‘‘(e) DEFINITIONS.—In this section: 


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1 ‘‘(1) AFFILIATE.—The term ‘affiliate’, with re2 spect to an entity, means any entity that owns or 

3 controls, is owned or controlled by, or is under com4 mon ownership or control with, the entity. 

5 ‘‘(2) COUNTRY OF CONCERN.—The term ‘coun6 try of concern’ means a country with respect to 

7 which the Secretary determines that— 

8 ‘‘(A) persons in the country persistently 

9 use, without obtaining a license, patents— 

10 ‘‘(i) essential to the implementation of 

11 wireless communications standards; and 

12 ‘‘(ii) held by a covered person; and 

13 ‘‘(B) that use of patents poses a threat 

14 to— 

15 ‘‘(i) the ability of the United States to 

16 maintain a wireless communications re17 search and development infrastructure; 

18 and 

19 ‘‘(ii) the national security of the 

20 United States, pursuant to the policy set 

21 forth in section 234. 

22 ‘‘(3) COVERED PERSON.—The term ‘covered 

23 person’ means— 

24 ‘‘(A) a covered United States person; or 


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1 ‘‘(B) an affiliate of a covered United 

2 States person— 

3 ‘‘(i) headquartered in, or organized 

4 under the laws of, a country that is a 

5 member of the European Union or the 

6 North Atlantic Treaty Organization; and 

7 ‘‘(ii) engaged in wireless communica8 tions research and development. 

9 ‘‘(4) COVERED UNITED STATES PERSON.—The 

10 term ‘covered United States person’ means a United 

11 States person engaged in wireless communications 

12 research and development in the United States. 

13 ‘‘(5) PERSON OF CONCERN.—The term ‘person 

14 of concern’ means a person that is— 

15 ‘‘(A) an individual who is a citizen or na16 tional (as defined in section 101(a) of the Im17 migration and Nationality Act (8 U.S.C. 

18 1101(a))) of a country of concern; or 

19 ‘‘(B) an entity that is headquartered in, or 

20 organized under the laws of, a country of con21 cern. 

22 ‘‘(6) UNITED STATES PERSON.—The term 

23 ‘United States person’ means— 


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1 ‘‘(A) an individual who is a United States 

2 citizen or an alien lawfully admitted for perma3 nent residence to the United States; 

4 ‘‘(B) an entity organized under the laws of 

5 the United States or any jurisdiction within the 

6 United States, including a foreign branch of 

7 such an entity; or 

8 ‘‘(C) any person in the United States. 

9 ‘‘(7) WIRELESS COMMUNICATIONS STAND10 ARD.—The term ‘wireless communications standard’ 

11 means— 

12 ‘‘(A) a cellular wireless telecommunications 

13 standard, including such a standard promul14 gated by the 3rd Generation Partnership 

15 Project (commonly known as ‘3GPP’) or the 

16 3rd Generation Partnership Project 2 (com17 monly known as ‘3GPP2’); or 

18 ‘‘(B) a wireless local area network stand19 ard, including such a standard designated as 

20 IEEE 802.11 as developed by the Institute of 

21 Electrical and Electronics Engineers (commonly 

22 known as the ‘IEEE’). 


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1 ‘‘SEC. 236. IMPORT SANCTIONS WITH RESPECT TO CERTAIN 

2 FOREIGN ENTITIES THAT THREATEN NA3 TIONAL SECURITY. 

4 ‘‘(a) IN GENERAL.—Any foreign entity on the list re5 quired by section 235(a) may be subject to such controls 

6 on the importing of goods or technology into the United 

7 States as the President may prescribe. 

8 ‘‘(b) ENTRY UNDER BOND.— 

9 ‘‘(1) IN GENERAL.—Unless otherwise prescribed 

10 by the President, a product described in paragraph 

11 (2) may not enter the United States except under 

12 bond prescribed by the Secretary of Commerce in an 

13 amount determined by the Secretary to be sufficient 

14 to protect from injury a covered United States per15 son that made the demonstration described in sec16 tion 235(b)(2) with respect to the entity that has 

17 been selling the product directly or indirectly in or 

18 into the United States. 

19 ‘‘(2) PRODUCTS DESCRIBED.—A product de20 scribed in this paragraph is a wireless communica21 tions device— 

22 ‘‘(A) produced or sold by— 

23 ‘‘(i) a foreign entity on the watch list 

24 required by section 235(b); 

25 ‘‘(ii) a successor of such an entity; or 


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1 ‘‘(iii) an affiliate of an entity de2 scribed in clause (i) or (ii); and 

3 ‘‘(B) that is claimed, labeled, marketed, or 

4 advertised as complying with a wireless commu5 nications standard that was the basis for the in6 clusion of the foreign entity on the watch list. 

7 ‘‘(c) FORFEITURE OF BOND.— 

8 ‘‘(1) IN GENERAL.—If a foreign entity on the 

9 watch list required by section 235(b) is moved to the 

10 list required by section 235(a) and becomes subject 

11 to controls under subsection (a), a bond paid under 

12 subsection (b) shall be forfeited to a covered United 

13 States person that made the demonstration de14 scribed in section 235(b)(2) with respect to the enti15 ty. 

16 ‘‘(2) TERMS AND CONDITIONS.—The Secretary 

17 of Commerce shall prescribe the procedures and any 

18 terms or conditions under which bonds will be for19 feited under paragraph (1). 

20 ‘‘(d) DEFINITIONS.—In this section, the terms ‘affil21 iate’ and ‘covered United States person’ have the mean22 ings given those terms in section 235(d).’’. 


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1 SEC. 3. CONTROLS ON IMPORTS OF GOODS OR TECH2 NOLOGY AGAINST PERSONS THAT RAISE NA3 TIONAL SECURITY CONCERNS. 

4 Section 233 of the Trade Expansion Act of 1962 (19 

5 U.S.C. 1864) is amended to read as follows: 

6 ‘‘SEC. 233. IMPORT SANCTIONS FOR EXPORT VIOLATIONS. 

7 ‘‘(a) IN GENERAL.—A person described in subsection 

8 (b) may be subject to such controls on the importing of 

9 goods or technology into the United States as the Presi10 dent may prescribe. 

11 ‘‘(b) PERSONS DESCRIBED.—A person described in 

12 this subsection is a person that— 

13 ‘‘(1) violates any national security export con14 trol imposed under section 1755 of the Export Con15 trol Reform Act of 2018 (50 U.S.C. 4814) or any 

16 regulation, order, or license issued under that sec17 tion; or 

18 ‘‘(2) raises a national security concern under— 

19 ‘‘(A) section 235 or any regulation, order, 

20 or license issued under that section; or 

21 ‘‘(B) the Export Control Reform Act of 

22 2018 (50 U.S.C. 4801 et seq.) or any regula23 tion, order, or license issued under that Act.’’. 

Æ 


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