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[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3723 Introduced in House (IH)]

104th CONGRESS
  2d Session
                                H. R. 3723

To amend title 18, United States Code, to protect proprietary economic 
                  information, and for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                             June 26, 1996

  Mr. McCollum (for himself and Mr. Schumer) introduced the following 
       bill; which was referred to the Committee on the Judiciary

_______________________________________________________________________

                                 A BILL

 
To amend title 18, United States Code, to protect proprietary economic 
                  information, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Economic Espionage Act of 1996''.

SEC. 2. PROTECTION OF PROPRIETARY ECONOMIC INFORMATION.

    (a) In General.--Chapter 31 of title 18, United States Code, is 
amended by adding at the end the following:
``Sec. 669. Protection of proprietary economic information
    ``(a) Offense.--Whoever--
            ``(1) with the intent to, or with reason to believe that 
        the offense will, benefit any foreign government, foreign 
        instrumentality, or foreign agent; or
            ``(2) with the intent to divert that information to the use 
        or benefit of anyone other than the owner thereof, and with the 
        intent to, or with reason to believe that the offense will, 
        disadvantage any owner of proprietary economic information that 
        is related to or is included in a product that is produced for 
        or placed in interstate or foreign commerce;
wrongfully copies or otherwise controls any economic proprietary 
information, or attempts or conspires to do so shall be punished as 
provided in subsection (b).
    ``(b) Punishment.--
            ``(1) Generally.--The punishment for an offense under this 
        section is--
                    ``(A) in the case of an offense under subsection 
                (a)(1), a fine under this title or imprisonment for not 
                more than 25 years, or both; and
                    ``(B) in the case of an offense under subsection 
                (a)(2), a fine under this title or imprisonment for not 
                more than 15 years.
            ``(2) Increased maximum fine for organizations.--If an 
        organization commits an offense--
                    ``(A) under subsection (a)(1), the maximum fine, if 
                not otherwise larger, that may be imposed is 
                $10,000,000; and
                    ``(B) under subsection (a)(2), the maximum fine, if 
                not otherwise larger, that may be imposed is 
                $5,000,000.
    ``(c) Definitions.--As used in this section--
            ``(1) the term `foreign instrumentality' means any agency, 
        bureau, ministry, component, institution, association, or any 
        legal, commercial, or business organization, corporation, firm, 
        or entity that is substantially owned, controlled, sponsored, 
        commanded, managed, or dominated by a foreign government or 
        subdivision thereof;
            ``(2) the term `foreign agent' means any officer, employee, 
        proxy, servant, delegate, or representative of a foreign nation 
        or government;
            ``(3) the term `proprietary economic information' means all 
        forms and types of financial, business, scientific, technical, 
        economic, or engineering information including data, plans, 
        tools, mechanisms, compounds, formulas, designs, prototypes, 
        processes, procedures, programs, codes, or commercial 
        strategies, whether tangible or intangible, and whether stored, 
        compiled, or memorialized physically, electronically, 
        graphically, photographically, or in writing if--
                    ``(A) the owner thereof has taken reasonable 
                measures to keep such information confidential; and
                    ``(B) the information derives independent economic 
                value, actual or potential, from not being generally 
                known to, and not being readily ascertainable through 
                proper means by, the public;
            ``(4) the term `owner' means the person in whom, or United 
        States Government component, department, or agency in which, 
        rightful legal, beneficial, or equitable title to, or license 
        in, proprietary economic information is reposed; and
            ``(5) the term `United States person' means--
                    ``(A) in the case of a natural person, a United 
                States citizen or permanent resident alien; and
                    ``(B) in the case of an organization, an entity 
                substantially owned or controlled by United States 
                citizens or permanent resident aliens, or incorporated 
                in the United States.
    ``(d) Criminal Forfeiture.--
            ``(1) Notwithstanding any other provision of State law, any 
        person convicted of a violation under this chapter shall 
        forfeit to the United States--
                    ``(A) any property constituting, or derived from, 
                any proceeds the person obtained, directly or 
                indirectly, as the result of such violation; and
                    ``(B) any of the person's property used, or 
                intended to be used, in any manner or part, to commit 
                or facilitate the commission of such violation, if the 
                court in its discretion so determines, taking into 
                consideration the nature, scope, and proportionality of 
                the use of the property in the offense.
            ``(2) The court, in imposing sentence on such person, shall 
        order, in addition to any other sentence imposed pursuant to 
        this section, that the person forfeit to the United States all 
        property described in this section.
            ``(3) Property subject to forfeiture under this section, 
        any seizure and disposition thereof, and any administrative or 
        judicial proceeding in relation thereto, shall be governed by 
        the provisions of section 413 of the Comprehensive Drug Abuse 
        Prevention and Control Act of 1970 (21 U.S.C. 853), except for 
        subsection 413(d) which shall not apply to forfeitures under 
        this section.
    ``(e) Territorial Application.--
            ``(1) This section applies to conduct occurring within the 
        United States.
            ``(2) This section also applies to conduct occurring 
        outside the United States if--
                    ``(A) the offender is a United States person; or
                    ``(B) an act in furtherance of the offense was 
                committed in the United States.
    ``(f) Nonpreemption of Other Remedies.--This section shall not be 
construed to preempt or displace any other remedies, whether civil or 
criminal, provided by United States Federal, State, commonwealth, 
possession, or territory law for the misappropriation of proprietary 
economic information.
    ``(g) Orders To Preserve Confidentiality.--In any prosecution or 
other proceeding under this section, the court shall enter such orders 
and take such other action as may be necessary and appropriate to 
preserve the confidentiality of proprietary economic information, 
consistent with the requirements of the Federal Rules of Criminal and 
Civil Procedure, the Federal Rules of Evidence, and all other 
applicable laws. An interlocutory appeal by the United States shall lie 
from a decision or order of a district court authorizing or directing 
the disclosure of proprietary economic information.
    ``(h) Exceptions to Prohibition.--
            ``(1) This section does not prohibit and shall not impair 
        any otherwise lawful activity conducted by an agency or 
        instrumentality of the United States, a State, or a political 
        subdivision of a State.
            ``(2) This section does not prohibit the reporting of any 
        suspected criminal activity to any law enforcement agency or 
        instrumentality of the United States, a State, or a political 
        subdivision of a State, to any intelligence agency of the 
        United States, or to Congress.''.

SEC. 3. WIRE AND ELECTRONIC COMMUNICATIONS INTERCEPTION AND 
              INTERCEPTION OF ORAL COMMUNICATIONS.

    Section 2516(1)(c) of title 18, United States Code, is amended by 
inserting ``section 669 (relating to economic espionage),'' after 
``(bribery in sporting contests),''.
                                 <all>
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