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[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 1610 Placed on Calendar Senate (PCS)]

                                                       Calendar No. 197
110th CONGRESS
  1st Session
                                S. 1610

                          [Report No. 110-80]

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.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             June 13, 2007

 Mr. Dodd, from the Committee on Banking, Housing, and Urban Affairs, 
 reported the following original bill; which was read twice and placed 
                            on the calendar

_______________________________________________________________________

                                 A BILL

 
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.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Foreign Investment 
and National Security Act of 2007''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. United States security improvement amendments; clarification of 
                            review and investigation process.
Sec. 3. Statutory establishment of the Committee on Foreign Investment 
                            in the United States.
Sec. 4. Additional factors for consideration.
Sec. 5. Mitigation, tracking, and postconsummation monitoring and 
                            enforcement.
Sec. 6. Action by the President.
Sec. 7. Increased oversight by Congress.
Sec. 8. Certification of notices and assurances.
Sec. 9. Regulations.
Sec. 10. Effect on other law.
Sec. 11. Effective date.

SEC. 2. UNITED STATES SECURITY IMPROVEMENT AMENDMENTS; CLARIFICATION OF 
              REVIEW AND INVESTIGATION PROCESS.

    Section 721 of the Defense Production Act of 1950 (50 U.S.C. App. 
2170) is amended by striking subsections (a) and (b) and inserting the 
following:
    ``(a) Definitions.--For purposes of this section, the following 
definitions shall apply:
            ``(1) Committee; chairperson.--The terms `Committee' and 
        `chairperson' mean the Committee on Foreign Investment in the 
        United States and the chairperson thereof, respectively.
            ``(2) Control.--The term `control' has the meaning given to 
        such term in regulations which the Committee shall prescribe.
            ``(3) Covered transaction.--The term `covered transaction' 
        means any merger, acquisition, or takeover, by or with any 
        foreign person which could result in foreign control of any 
        person engaged in interstate commerce in the United States.
            ``(4) Foreign government-controlled transaction.--The term 
        `foreign government-controlled transaction' means any covered 
        transaction that could result in the control of any person 
        engaged in interstate commerce in the United States by a 
        foreign government or an entity controlled by or acting on 
        behalf of a foreign government.
            ``(5) Clarification.--The term `national security' shall be 
        construed so as to include those issues relating to `homeland 
        security', including its application to critical 
        infrastructure.
            ``(6) Critical infrastructure.--The term `critical 
        infrastructure' means, subject to rules issued under this 
        section, any systems and assets, whether physical or cyber-
        based, so vital to the United States that the degradation or 
        destruction of such systems or assets would have a debilitating 
        impact on national security, including national economic 
        security and national public health or safety.
            ``(7) Critical technologies.--The term `critical 
        technologies' means technologies identified under title VI of 
        the National Science and Technology Policy, Organization, and 
        Priorities Act of 1976, or other critical technology, critical 
        components, or critical technology items essential to national 
        defense identified pursuant to this section.
            ``(8) Lead agency.--The term `lead agency' means the 
        agency, or agencies, designated as the lead agency or agencies 
        pursuant to subsection (k)(4) for the review of a transaction.
    ``(b) National Security Reviews and Investigations.--
            ``(1) National security reviews.--
                    ``(A) In general.--Upon receiving written 
                notification under subparagraph (C) of any covered 
                transaction, or pursuant to a unilateral notification 
                initiated under subparagraph (D) with respect to any 
                covered transaction, the President, acting through the 
                Committee--
                            ``(i) shall review the covered transaction 
                        to determine the effects of the transaction on 
                        the national security of the United States; and
                            ``(ii) shall consider the factors specified 
                        in subsection (f) for such purpose, as 
                        appropriate.
                    ``(B) Control by foreign government.--If the 
                Committee determines that the covered transaction is a 
                foreign government-controlled transaction, the 
                Committee shall conduct an investigation of the 
                transaction under paragraph (2).
                    ``(C) Written notice.--
                            ``(i) In general.--Any party or parties to 
                        any covered transaction may initiate a review 
                        of the transaction under this paragraph by 
                        submitting a written notice of the transaction 
                        to the Chairperson of the Committee.
                            ``(ii) Withdrawal of notice.--No covered 
                        transaction for which a notice was submitted 
                        under clause (i) may be withdrawn from review, 
                        unless a written request for such withdrawal is 
                        submitted to the Committee by any party to the 
                        transaction and approved by the Committee.
                            ``(iii) Continuing discussions.--A request 
                        for withdrawal under clause (ii) shall not be 
                        construed to preclude any party to the covered 
                        transaction from continuing informal 
                        discussions with the Committee or any member 
                        thereof regarding possible resubmission for 
                        review pursuant to this paragraph.
                    ``(D) Unilateral initiation of review.--Subject to 
                subparagraph (F), the President or the Committee may 
                initiate a review under subparagraph (A) of--
                            ``(i) any covered transaction;
                            ``(ii) any covered transaction that has 
                        previously been reviewed or investigated under 
                        this section, if any party to the transaction 
                        submitted false or misleading material 
                        information to the Committee in connection with 
                        the review or investigation or omitted material 
                        information, including material documents, from 
                        information submitted to the Committee; or
                            ``(iii) any covered transaction that has 
                        previously been reviewed or investigated under 
                        this section, if--
                                    ``(I) any party to the transaction 
                                or the entity resulting from 
                                consummation of the transaction 
                                intentionally materially breaches a 
                                mitigation agreement or condition 
                                described in subsection (l)(1)(A);
                                    ``(II) such breach is certified to 
                                the Committee by the lead department or 
                                agency monitoring and enforcing such 
                                agreement or condition as an 
                                intentional material breach; and
                                    ``(III) the Committee determines 
                                that there are no other remedies or 
                                enforcement tools available to address 
                                such breach.
                    ``(E) Timing.--Any review under this paragraph 
                shall be completed before the end of the 30-day period 
                beginning on the date of the acceptance of written 
                notice under subparagraph (C) by the chairperson, or 
                beginning on the date of the initiation of the review 
                in accordance with subparagraph (D), as applicable.
                    ``(F) Limit on delegation of certain authority.--
                The authority of the Committee to initiate a review 
                under subparagraph (D) may not be delegated to any 
                person, other than the Deputy Secretary or an 
                appropriate Under Secretary of the department or agency 
                represented on the Committee.
            ``(2) National security investigations.--
                    ``(A) In general.--In each case described in 
                subparagraph (B) the President, acting through the 
                Committee, shall immediately conduct an investigation 
                of the effects of a covered transaction on the national 
                security of the United States, and take any necessary 
                actions in connection with the transaction to protect 
                the national security of the United States.
                    ``(B) Applicability.--Subparagraph (A) shall apply 
                in each case in which--
                            ``(i) a review of a covered transaction 
                        under paragraph (1) results in a determination 
                        that--
                                    ``(I) the transaction threatens to 
                                impair the national security of the 
                                United States and that threat has not 
                                been mitigated during or prior to the 
                                review of a covered transaction under 
                                paragraph (1);
                                    ``(II) the transaction is a foreign 
                                government-controlled transaction; or
                                    ``(III) the transaction would 
                                result in control of any critical 
                                infrastructure of or within the United 
                                States by, with, or on behalf of any 
                                foreign person, if the Committee 
                                determines that the transaction could 
                                impair national security, and that such 
                                impairment to national security has not 
                                been mitigated by assurances provided 
                                or renewed with the approval of the 
                                Committee, as described in subsection 
                                (l), during the review period under 
                                paragraph (1); or
                            ``(ii) the lead agency recommends, and the 
                        Committee concurs, that an investigation be 
                        undertaken.
                    ``(C) Timing.--Any investigation under subparagraph 
                (A) shall be completed before the end of the 45-day 
                period beginning on the date on which the investigation 
                commenced.
                    ``(D) Exception.--
                            ``(i) In general.--Notwithstanding 
                        subparagraph (B)(i), an investigation of a 
                        foreign government-controlled transaction 
                        described in subclause (II) of subparagraph 
                        (B)(i) or a transaction involving critical 
                        infrastructure described in subclause (III) of 
                        subparagraph (B)(i) shall not be required under 
                        this paragraph, if the Secretary of the 
                        Treasury and the head of the lead agency 
                        jointly determine, on the basis of the review 
                        of the transaction under paragraph (1), that 
                        the transaction will not impair the national 
                        security of the United States.
                            ``(ii) Nondelegation.--The authority of the 
                        Secretary or the head of an agency referred to 
                        in clause (i) may not be delegated to any 
                        person, other than the Deputy Secretary of the 
                        Treasury or the deputy head (or the equivalent 
                        thereof) of the lead agency, respectively.
                    ``(E) Guidance on certain transactions with 
                national security implications.--The Chairperson shall, 
                not later than 180 days after the date of enactment of 
                the Foreign Investment and National Security Act of 
                2007, publish in the Federal Register guidance on the 
                types of transactions that the Committee has reviewed 
                and that have presented national security 
                considerations, including transactions that may 
                constitute covered transactions that would result in 
                control of critical infrastructure relating to United 
                States national security by a foreign government or an 
                entity controlled by or acting on behalf of a foreign 
                government.
            ``(3) Certifications to congress.--
                    ``(A) Certified notice at completion of review.--
                Upon completion of a review under subsection (b) that 
                concludes action under this section, the chairperson 
                and the head of the lead agency shall transmit a 
                certified notice to the members of Congress specified 
                in subparagraph (C)(iii).
                    ``(B) Certified report at completion of 
                investigation.--As soon as is practicable after 
                completion of an investigation under subsection (b) 
                that concludes action under this section, the 
                chairperson and the head of the lead agency shall 
                transmit to the members of Congress specified in 
                subparagraph (C)(iii) a certified written report 
                (consistent with the requirements of subsection (c)) on 
                the results of the investigation, unless the matter 
                under investigation has been sent to the President for 
                decision.
                    ``(C) Certification procedures.--
                            ``(i) In general.--Each certified notice 
                        and report required under subparagraphs (A) and 
                        (B), respectively, shall be submitted to the 
                        members of Congress specified in clause (iii), 
                        and shall include--
                                    ``(I) a description of the actions 
                                taken by the Committee with respect to 
                                the transaction; and
                                    ``(II) identification of the 
                                determinative factors considered under 
                                subsection (f).
                            ``(ii) Content of certification.--Each 
                        certified notice and report required under 
                        subparagraphs (A) and (B), respectively, shall 
                        be signed by the chairperson and the head of 
                        the lead agency, and shall state that, in the 
                        determination of the Committee, there are no 
                        unresolved national security concerns with the 
                        transaction that is the subject of the notice 
                        or report.
                            ``(iii) Members of congress.--Each 
                        certified notice and report required under 
                        subparagraphs (A) and (B), respectively, shall 
                        be transmitted to--
                                    ``(I) the Majority Leader and the 
                                Minority Leader of the Senate;
                                    ``(II) the chair and ranking member 
                                of the Committee on Banking, Housing, 
                                and Urban Affairs of the Senate and of 
                                any committee of the Senate having 
                                oversight over the lead agency;
                                    ``(III) the Speaker and the 
                                Minority Leader of the House of 
                                Representatives; and
                                    ``(IV) the chair and ranking member 
                                of the Committee on Financial Services 
                                of the House of Representatives and of 
                                any committee of the House of 
                                Representatives having oversight over 
                                the lead agency.
                            ``(iv) Transmittal to other members of 
                        congress.--The Majority Leader or the Minority 
                        Leader, in the case of the Senate, and the 
                        Speaker or the Minority Leader, in the case of 
                        the House of Representatives, may provide the 
                        certified notices and reports required under 
                        subparagraphs (A) and (B), respectively, 
                        regarding a transaction involving critical 
                        infrastructure--
                                    ``(I) in the case of the Senate, to 
                                members of the Senate from the State in 
                                which such critical infrastructure is 
                                located; and
                                    ``(II) in the case of the House of 
                                Representatives, to a member from a 
                                Congressional District in which such 
                                critical infrastructure is located.
                            ``(v) Signatures; limit on delegation.--
                                    ``(I) In general.--Each certified 
                                notice and report required under 
                                subparagraphs (A) and (B), 
                                respectively, shall be signed by the 
                                chairperson and the head of the lead 
                                agency, which signature requirement may 
                                only be delegated in accordance with 
                                subclause (II).
                                    ``(II) Limitation on delegation of 
                                certifications.--The chairperson and 
                                the head of the lead agency may 
                                delegate the signature requirement 
                                under subclause (I)--
                                            ``(aa) only to an employee 
                                        of the Department of the 
                                        Treasury (in the case of the 
                                        Secretary of the Treasury) or 
                                        to an employee of the lead 
                                        agency (in the case of the lead 
                                        agency) who was appointed by 
                                        the President, by and with the 
                                        advice and consent of the 
                                        Senate, with respect to any 
                                        notice provided under paragraph 
                                        (1) following the completion of 
                                        a review under this section; or
                                            ``(bb) only to a Deputy 
                                        Secretary of the Treasury (in 
                                        the case of the Secretary of 
                                        the Treasury) or a person 
                                        serving in the Deputy position 
                                        or the equivalent thereof at 
                                        the lead agency (in the case of 
                                        the lead agency), with respect 
                                        to any report provided under 
                                        subparagraph (B) following an 
                                        investigation under this 
                                        section.
            ``(4) Analysis by director of national intelligence.--
                    ``(A) In general.--The Director of National 
                Intelligence shall expeditiously carry out a thorough 
                analysis of any threat to the national security of the 
                United States posed by any covered transaction. The 
                Director of National Intelligence shall also seek and 
                incorporate the views of all affected or appropriate 
                intelligence agencies with respect to the transaction.
                    ``(B) Timing.--The analysis required under 
                subparagraph (A) shall be provided by the Director of 
                National Intelligence to the Committee not later than 
                20 days after the date on which notice of the 
                transaction is accepted by the Committee under 
                paragraph (1)(C), but the Director may begin the 
                analysis at any time prior to receipt of the notice, in 
                accordance with otherwise applicable law.
                    ``(C) Interaction with intelligence community.--The 
                Director of National Intelligence shall ensure that the 
                intelligence community remains engaged in the 
                collection, analysis, and dissemination to the 
                Committee of any additional relevant information that 
                may become available during the course of any 
                investigation conducted under subsection (b) with 
                respect to a transaction.
                    ``(D) Independent role of director.--The Director 
                of National Intelligence shall be an ex officio member 
                of the Committee, and shall be provided with all 
                notices received by the Committee under paragraph 
                (1)(C) regarding covered transactions, but shall serve 
                no policy role on the Committee, other than to provide 
                analysis under subparagrapha (A) and (C) in connection 
                with a covered transaction.
            ``(5) Submission of additional information.--No provision 
        of this subsection shall be construed as prohibiting any party 
        to a covered transaction from submitting additional information 
        concerning the transaction, including any proposed 
        restructuring of the transaction or any modifications to any 
        agreements in connection with the transaction, while any review 
        or investigation of the transaction is ongoing.
            ``(6) Notice of results to parties.--The Committee shall 
        notify the parties to a covered transaction of the results of a 
        review or investigation under this section, promptly upon 
        completion of all action under this section.
            ``(7) Regulations.--Regulations prescribed under this 
        section shall include standard procedures for--
                    ``(A) submitting any notice of a covered 
                transaction to the Committee;
                    ``(B) submitting a request to withdraw a covered 
                transaction from review;
                    ``(C) resubmitting a notice of a covered 
                transaction that was previously withdrawn from review; 
                and
                    ``(D) providing notice of the results of a review 
                or investigation to the parties to the covered 
                transaction, upon completion of all action under this 
                section.''.

SEC. 3. STATUTORY ESTABLISHMENT OF THE COMMITTEE ON FOREIGN INVESTMENT 
              IN THE UNITED STATES.

    Section 721 of the Defense Production Act of 1950 (50 U.S.C. App. 
2170) is amended by striking subsection (k) and inserting the 
following:
    ``(k) Committee on Foreign Investment in the United States.--
            ``(1) Establishment.--The Committee on Foreign Investment 
        in the United States, established pursuant to Executive Order 
        No. 11858, shall be a multi agency committee to carry out this 
        section and such other assignments as the President may 
        designate.
            ``(2) Membership.--The Committee shall be comprised of the 
        following members or the designee of any such member:
                    ``(A) The Secretary of the Treasury.
                    ``(B) The Secretary of Homeland Security.
                    ``(C) The Secretary of Commerce.
                    ``(D) The Secretary of Defense.
                    ``(E) The Secretary of State.
                    ``(F) The Attorney General of the United States.
                    ``(G) The Secretary of Energy.
                    ``(H) The Secretary of Labor (ex officio).
                    ``(I) The Director of National Intelligence (ex 
                officio).
                    ``(J) The heads of any other executive department, 
                agency, or office, as the President determines 
                appropriate, generally or on a case-by-case basis.
            ``(3) Chairperson.--The Secretary of the Treasury shall 
        serve as the chairperson of the Committee.
            ``(4) Designation of lead agency.--The Secretary of the 
        Treasury shall designate another member or members, as 
        appropriate, of the Committee to be the lead agency or agencies 
        on behalf of the Committee--
                    ``(A) for each covered transaction, and for 
                negotiating any mitigation agreements or other 
                conditions necessary to protect national security; and
                    ``(B) for all matters related to the monitoring of 
                the completed transaction, to ensure compliance with 
                such agreements or conditions and with this section.
            ``(5) Other members.--The chairperson shall consult with 
        the heads of such other Federal departments, agencies, and 
        independent establishments in any review or investigation under 
        subsection (a), as the chairperson determines to be 
        appropriate, on the basis of the facts and circumstances of the 
        covered transaction under review or investigation (or the 
        designee of any such department or agency head).
            ``(6) Meetings.--The Committee shall meet upon the 
        direction of the President or upon the call of the chairperson, 
        without regard to section 552b of title 5, United States Code 
        (if otherwise applicable).''.

SEC. 4. ADDITIONAL FACTORS FOR CONSIDERATION.

    Section 721(f) of the Defense Production Act of 1950 (50 U.S.C. 
App. 2170(f)) is amended--
            (1) in the matter preceding paragraph (1), by striking 
        ``among other factors'';
            (2) in paragraph (4)--
                    (A) in subparagraph (A) by striking ``or'' at the 
                end;
                    (B) by redesignating subparagraph (B) as 
                subparagraph (C);
                    (C) by inserting after subparagraph (A) the 
                following:
                    ``(B) identified by the Secretary of Defense as 
                posing a potential regional military threat to the 
                interests of the United States; or''; and
                    (D) by striking ``and'' at the end;
            (3) in paragraph (5), by striking the period at the end and 
        inserting a semicolon; and
            (4) by adding at the end the following:
            ``(6) whether the covered transaction has a security-
        related impact on critical infrastructure in the United States;
            ``(7) the potential effects on United States critical 
        infrastructure, including major energy assets;
            ``(8) the potential effects on United States critical 
        technologies;
            ``(9) whether the covered transaction is a foreign 
        government-controlled transaction, as determined under 
        subsection (b)(1)(B);
            ``(10) with respect to transactions requiring an 
        investigation under subsection (b)(1)(B) only, a review of the 
        current assessment of--
                    ``(A) the adherence of the subject country to 
                nonproliferation control regimes, including treaties 
                and multilateral supply guidelines, which shall draw 
                on, but not be limited to, the annual report on 
                `Adherence to and Compliance with Arms Control, 
                Nonproliferation and Disarmament Agreements and 
                Commitments' required by section 403 of the Arms 
                Control and Disarmament Act;
                    ``(B) the relationship of such country with the 
                United States, specifically on its record on 
                cooperating in counter-terrorism efforts, which shall 
                draw on, but not be limited to, the report of the 
                President to Congress under section 7120 of the 
                Intelligence Reform and Terrorism Prevention Act of 
                2004; and
                    ``(C) the potential for transshipment or diversion 
                of technologies with military applications, including 
                an analysis of national export control laws and 
                regulations;
            ``(11) the long-term projection of United States 
        requirements for sources of energy and other critical resources 
        and material; and
            ``(12) such other factors as the President or the Committee 
        may determine to be appropriate, generally or in connection 
        with a specific review or investigation.''.

SEC. 5. MITIGATION, TRACKING, AND POSTCONSUMMATION MONITORING AND 
              ENFORCEMENT.

    Section 721 of the Defense Production Act of 1950 (50 U.S.C. App. 
2170) is amended by adding at the end the following:
    ``(l) Mitigation, Tracking, and Postconsummation Monitoring and 
Enforcement.--
            ``(1) Mitigation.--
                    ``(A) In general.--The Committee or a lead agency 
                may, on behalf of the Committee, negotiate, enter into 
                or impose, and enforce any agreement or condition with 
                any party to the covered transaction in order to 
                mitigate any threat to the national security of the 
                United States that arises as a result of the covered 
                transaction.
                    ``(B) Risk-based analysis required.--Any agreement 
                entered into or condition imposed under subparagraph 
                (A) shall be based on a risk-based analysis, conducted 
                by the Committee, of the threat to national security of 
                the covered transaction.
            ``(2) Tracking authority for withdrawn notices.--
                    ``(A) In general.--If any written notice of a 
                covered transaction that was submitted to the Committee 
                under this section is withdrawn before any review or 
                investigation by the Committee under subsection (b) is 
                completed, the Committee shall establish, as 
                appropriate--
                            ``(i) interim protections to address 
                        specific concerns with such transaction that 
                        have been raised in connection with any such 
                        review or investigation pending any 
                        resubmission of any written notice under this 
                        section with respect to such transaction and 
                        further action by the President under this 
                        section;
                            ``(ii) specific time frames for 
                        resubmitting any such written notice; and
                            ``(iii) a process for tracking any actions 
                        that may be taken by any party to the 
                        transaction, in connection with the 
                        transaction, before the notice referred to in 
                        clause (ii) is resubmitted.
                    ``(B) Designation of agency.--The lead agency, 
                other than any entity of the intelligence community (as 
                defined in the National Security Act of 1947), shall, 
                on behalf of the Committee, ensure that the 
                requirements of subparagraph (A) with respect to any 
                covered transaction that is subject to such 
                subparagraph are met.
            ``(3) Negotiation, modification, monitoring, and 
        enforcement.--
                    ``(A) Designation of lead agency.--The lead agency 
                shall negotiate, modify, monitor, and enforce, on 
                behalf of the Committee, any agreement entered into or 
                condition imposed under paragraph (1) with respect to a 
                covered transaction, based on the expertise with and 
                knowledge of the issues related to such transaction on 
                the part of the designated department or agency. 
                Nothing in this paragraph shall prohibit other 
                departments or agencies in assisting the lead agency in 
                carrying out the purposes of this paragraph.
                    ``(B) Reporting by designated agency.--
                            ``(i) Modification reports.--The lead 
                        agency in connection with any agreement entered 
                        into or condition imposed with respect to a 
                        covered transaction shall--
                                    ``(I) provide periodic reports to 
                                the Committee on any material 
                                modification to any such agreement or 
                                condition imposed with respect to the 
                                transaction; and
                                    ``(II) ensure that any material 
                                modification to any such agreement or 
                                condition is reported to the Director 
                                of National Intelligence, the Attorney 
                                General of the United States, and any 
                                other Federal department or agency that 
                                may have a material interest in such 
                                modification.
                            ``(ii) Compliance.--The Committee shall 
                        develop and agree upon methods for evaluating 
                        compliance with any agreement entered into or 
                        condition imposed with respect to a covered 
                        transaction that will allow the Committee to 
                        adequately assure compliance, without--
                                    ``(I) unnecessarily diverting 
                                Committee resources from assessing any 
                                new covered transaction for which a 
                                written notice has been filed pursuant 
                                to subsection (b)(1)(C), and if 
                                necessary, reaching a mitigation 
                                agreement with or imposing a condition 
                                on a party to such covered transaction 
                                or any covered transaction for which a 
                                review has been reopened for any 
                                reason; or
                                    ``(II) placing unnecessary burdens 
                                on a party to a covered transaction.''.

SEC. 6. ACTION BY THE PRESIDENT.

    Section 721 of the Defense Production Act of 1950 (50 U.S.C. App. 
2170) is amended by striking subsections (d) and (e) and inserting the 
following:
    ``(d) Action by the President.--
            ``(1) In general.--Subject to paragraph (4), the President 
        may take such action for such time as the President considers 
        appropriate to suspend or prohibit any covered transaction by 
        or with a foreign person or government that threatens to impair 
        the national security of the United States.
            ``(2) Announcement by the president.--The President shall 
        announce the decision on whether or not to take action pursuant 
        to paragraph (1) not later than 15 days after the date on which 
        an investigation described in subsection (b) is completed.
            ``(3) Enforcement.--The President may direct the Attorney 
        General of the United States to seek appropriate relief, 
        including divestment relief, in the district courts of the 
        United States, in order to implement and enforce this 
        subsection.
            ``(4) Findings of the president.--The President may 
        exercise the authority conferred by paragraph (1), only if the 
        President finds that--
                    ``(A) there is credible evidence that leads the 
                President to believe that the foreign interest 
                exercising control might take action that threatens to 
                impair the national security; and
                    ``(B) provisions of law, other than this section 
                and the International Emergency Economic Powers Act, do 
                not, in the judgment of the President, provide adequate 
                and appropriate authority for the President to protect 
                the national security in the matter before the 
                President.
            ``(5) Factors to be considered.--For purposes of 
        determining whether to take action under paragraph (1), the 
        President shall consider, among other factors each of the 
        factors described in subsection (f).
    ``(e) Actions and Findings Nonreviewable.--The actions of the 
President under paragraph (1) of subsection (d) and the findings of the 
President under paragraph (4) of subsection (d) shall not be subject to 
judicial review.''.

SEC. 7. INCREASED OVERSIGHT BY CONGRESS.

    (a) Report on Actions.--Section 721(g) of the Defense Production 
Act of 1950 (50 U.S.C. App. 2170(g)) is amended to read as follows:
    ``(g) Additional Information to Congress; Confidentiality.--
            ``(1) Briefing requirement on request.--The Committee 
        shall, upon request from any Member of Congress specified in 
        subsection (b)(3)(C)(iii), promptly provide briefings on a 
        covered transaction for which all action has concluded under 
        this section, or on compliance with a mitigation agreement or 
        condition imposed with respect to such transaction, on a 
        classified basis, if deemed necessary by the sensitivity of the 
        information. Briefings under this paragraph may be provided to 
        the congressional staff of such a Member of Congress having 
        appropriate security clearance.
            ``(2) Application of confidentiality provisions.--
                    ``(A) In general.--The disclosure of information 
                under this subsection shall be consistent with the 
                requirements of subsection (c). Members of Congress and 
                staff of either House of Congress or any committee of 
                Congress, shall be subject to the same limitations on 
                disclosure of information as are applicable under 
                subsection (c).
                    ``(B) Proprietary information.--Proprietary 
                information which can be associated with a particular 
                party to a covered transaction shall be furnished in 
                accordance with subparagraph (A) only to a committee of 
                Congress, and only when the committee provides 
                assurances of confidentiality, unless such party 
                otherwise consents in writing to such disclosure.''.
    (b) Annual Report.--Section 721 of the Defense Production Act of 
1950 (50 U.S.C. App. 2170) is amended by adding at the end the 
following:
    ``(m) Annual Report to Congress.--
            ``(1) In general.--The chairperson shall transmit a report 
        to the chairman and ranking member of the committee of 
        jurisdiction in the Senate and the House of Representatives, 
        before July 31 of each year on all of the reviews and 
        investigations of covered transactions completed under 
        subsection (b) during the 12-month period covered by the 
        report.
            ``(2) Contents of report relating to covered 
        transactions.--The annual report under paragraph (1) shall 
        contain the following information with respect to each covered 
        transaction for the reporting period:
                    ``(A) A list of all notices filed and all reviews 
                or investigations completed during the period, with 
                basic information on each party to the transaction, the 
                nature of the business activities or products of all 
                pertinent persons, along with information about any 
                withdrawal from the process, and any decision or action 
                by the President under this section.
                    ``(B) Specific, cumulative, and, as appropriate, 
                trend information on the numbers of filings, 
                investigations, withdrawals, and decisions or actions 
                by the President under this section.
                    ``(C) Cumulative and, as appropriate, trend 
                information on the business sectors involved in the 
                filings which have been made, and the countries from 
                which the investments have originated.
                    ``(D) Information on whether companies that 
                withdrew notices to the Committee in accordance with 
                subsection (b)(1)(C)(ii) have later refiled such 
                notices, or, alternatively, abandoned the transaction.
                    ``(E) The types of security arrangements and 
                conditions the Committee has used to mitigate national 
                security concerns about a transaction, including a 
                discussion of the methods that the Committee and any 
                lead agency are using to determine compliance with such 
                arrangements or conditions.
                    ``(F) A detailed discussion of all perceived 
                adverse effects of covered transactions on the national 
                security or critical infrastructure of the United 
                States that the Committee will take into account in its 
                deliberations during the period before delivery of the 
                next report, to the extent possible.
            ``(3) Contents of report relating to critical 
        technologies.--
                    ``(A) In general.--In order to assist Congress in 
                its oversight responsibilities with respect to this 
                section, the President and such agencies as the 
                President shall designate shall include in the annual 
                report submitted under paragraph (1)--
                            ``(i) an evaluation of whether there is 
                        credible evidence of a coordinated strategy by 
                        1 or more countries or companies to acquire 
                        United States companies involved in research, 
                        development, or production of critical 
                        technologies for which the United States is a 
                        leading producer; and
                            ``(ii) an evaluation of whether there are 
                        industrial espionage activities directed or 
                        directly assisted by foreign governments 
                        against private United States companies aimed 
                        at obtaining commercial secrets related to 
                        critical technologies.
                    ``(B) Release of unclassified study.--That portion 
                of the annual report under paragraph (1) that is 
                required by this paragraph may be classified. An 
                unclassified version of the report, as appropriate, 
                consistent with safeguarding national security and 
                privacy, shall be made available to the public.''.
    (c) Study and Report.--
            (1) Study required.--Before the end of the 120-day period 
        beginning on the date of enactment of this Act and annually 
        thereafter, the Secretary of the Treasury, in consultation with 
        the Secretary of State and the Secretary of Commerce, shall 
        conduct a study on foreign direct investments in the United 
        States, especially investments in critical infrastructure and 
        industries affecting national security, by--
                    (A) foreign governments, entities controlled by or 
                acting on behalf of a foreign government, or persons of 
                foreign countries which comply with any boycott of 
                Israel; or
                    (B) foreign governments, entities controlled by or 
                acting on behalf of a foreign government, or persons of 
                foreign countries which do not ban organizations 
                designated by the Secretary of State as foreign 
                terrorist organizations.
            (2) Report.--Before the end of the 30-day period beginning 
        upon the date of completion of each study under paragraph (1), 
        or in the next annual report under section 721(m) of the 
        Defense Production Act of 1950 (as added by this section), the 
        Secretary of the Treasury shall submit a report to the 
        Congress, for transmittal to all appropriate committees of the 
        Senate and the House of Representatives, containing the 
        findings and conclusions of the Secretary with respect to the 
        study described in paragraph (1), together with an analysis of 
        the effects of such investment on the national security of the 
        United States and on any efforts to address those effects.
    (d) Investigation by Inspector General.--
            (1) In general.--The Inspector General of the Department of 
        the Treasury shall conduct an independent investigation to 
        determine all of the facts and circumstances concerning each 
        failure of the Department of the Treasury to make any report to 
        the Congress that was required under section 721(k) of the 
        Defense Production Act of 1950, as in effect on the day before 
        the date of enactment of this Act.
            (2) Report to the congress.--Before the end of the 270-day 
        period beginning on the date of enactment of this Act, the 
        Inspector General of the Department of the Treasury shall 
        submit a report on the investigation under paragraph (1) 
        containing the findings and conclusions of the Inspector 
        General, to the chairman and ranking member of each committee 
        of the Senate and the House of Representatives having 
        jurisdiction over any aspect of the report, including, at a 
        minimum, the Committee on Foreign Relations, the Committee on 
        Banking, Housing, and Urban Affairs, and the Committee on 
        Commerce, Science, and Transportation of the Senate, and the 
        Committee on Foreign Affairs, the Committee on Financial 
        Services, and the Committee on Energy and Commerce of the House 
        of Representatives.

SEC. 8. CERTIFICATION OF NOTICES AND ASSURANCES.

    Section 721 of the Defense Production Act of 1950 (50 U.S.C. App. 
2170) is amended by adding at the end the following:
    ``(n) Certification of Notices and Assurances.--Each notice, and 
any followup information, submitted under this section and regulations 
prescribed under this section to the President or the Committee by a 
party to a covered transaction, and any information submitted by any 
such party in connection with any action for which a report is required 
pursuant to paragraph (3)(B) of subsection (l), with respect to the 
implementation of any mitigation agreement or condition described in 
paragraph (1)(A) of subsection (l), or any material change in 
circumstances, shall be accompanied by a written statement by the chief 
executive officer or the designee of the person required to submit such 
notice or information certifying that, to the best of the knowledge and 
belief of that person--
            ``(1) the notice or information submitted fully complies 
        with the requirements of this section or such regulation, 
        agreement, or condition; and
            ``(2) the notice or information is accurate and complete in 
        all material respects.''.

SEC. 9. REGULATIONS.

    Section 721(h) of the Defense Production Act of 1950 (50 U.S.C. 
App. 2170(h)) is amended to read as follows:
    ``(h) Regulations.--
            ``(1) In general.--The President shall direct, subject to 
        notice and comment, the issuance of regulations to carry out 
        this section.
            ``(2) Effective date.--Regulations issued under this 
        section shall become effective not later than 180 days after 
        the effective date of the Foreign Investment and National 
        Security Act of 2007.
            ``(3) Content.--Regulations issued under this subsection 
        shall--
                    ``(A) provide for the imposition of civil penalties 
                for any violation of this section;
                    ``(B) to the extent possible--
                            ``(i) minimize paperwork burdens; and
                            ``(ii) coordinate reporting requirements 
                        under this section with reporting requirements 
                        under any other provision of Federal law; and
                    ``(C) provide for an appropriate role for the 
                Secretary of Labor with respect to mitigation 
                agreements.''.

SEC. 10. EFFECT ON OTHER LAW.

    Section 721(i) of the Defense Production Act of 1950 (50 U.S.C. 
App. 2170(i)) is amended to read as follows:
    ``(i) Effect on Other Law.--No provision of this section shall be 
construed as altering or affecting any other authority, process, 
regulation, investigation, enforcement measure, or review provided by 
or established under any other provision of Federal law, including the 
International Emergency Economic Powers Act, or any other authority of 
the President or the Congress under the Constitution of the United 
States.''.

SEC. 11. EFFECTIVE DATE.

    The amendments made by this Act shall apply after the end of the 
90-day period beginning on the date of enactment of this Act.
                                                       Calendar No. 197

110th CONGRESS

  1st Session

                                S. 1610

                          [Report No. 110-80]

_______________________________________________________________________

                                 A BILL

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.

_______________________________________________________________________

                             June 13, 2007

                 Read twice and placed on the calendar
```