Cage the Paper Tiger Act of 2020

To prohibit the listing of certain firms on national securities exchanges, to provide for expensing of costs directly connected with moving manufacturing from China to the United States, to establish a counterintelligence vetting task force, and for other purposes. 1. Short title This Act may be cited as the Cage the Paper Tiger Act of 2020 2. Prohibition against the listing of certain firms on national securities exchanges (a) In general Section 6(b) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78f(b) (11) (A) The rules of the exchange prohibit the initial listing, after the date of enactment of this paragraph, of any security of an issuer if the registration statement filed with the Commission for such security includes an audit report prepared by a covered foreign public accounting firm. (B) Nothing in subparagraph (A) may be construed to prevent an exchange from listing a security on the exchange on or after the date of enactment of this paragraph if that security was listed on the exchange or a national securities exchange before the date of enactment of this paragraph. (C) In this paragraph— (i) the term audit report 15 U.S.C. 7201(a) (ii) the term covered foreign public accounting firm 15 U.S.C. 7201 (iii) the term foreign public accounting firm 15 U.S.C. 7216(g) . (b) Rules (1) Proposals Not later than 90 days after the date of enactment of this Act, each national securities exchange shall file with the Commission any proposed change to the rules of the exchange that is required as a result of the amendments made by this section. (2) Adoption Not later than 1 year after the date of enactment of this Act, each national securities exchange shall have each proposed change described in paragraph (1) approved by the Commission. 3. Expensing of costs directly connected with moving manufacturing from China to the United States (a) In general Part VI of subchapter B of chapter 1 179F. Election to expense certain assets directly connected to moving manufacturing from China to the United States (a) In general A specified taxpayer may elect to treat amounts paid or incurred for repatriation property as an expense which is not chargeable to capital account. Any cost so treated shall be allowed as a deduction for the taxable year in which such repatriation property is placed in service. (b) Specified taxpayer For purposes of this section, the term specified taxpayer (1) as of the date of the enactment of this section, such taxpayer manufactured such product in China, and (2) as of the date which is 3 years after the date that the repatriation property is placed in service— (A) such taxpayer does not manufacture such product in China, and (B) the quantity of such product manufactured in the United States by such taxpayer has increased (relative to such quantity determined as of the date of the enactment of this section) by an amount not less than the quantity of such product manufactured in China as of the date of the enactment of this section. (c) Repatriation property For purposes of this section, the term repatriation property (1) such property is used by the taxpayer in the United States to manufacture the product referred to in subsection (b), (2) the acquisition of such property by the taxpayer is directly connected to replacing the productive capacity lost by the taxpayer by reason of ceasing manufacturing of such product in China (as described in subsection (b)(2)(A)), and (3) such property is of a character which is subject to the allowance for depreciation provided in section 167. (d) Application of certain rules Rules similar to the rules of subsection (c), and paragraphs (4) and (10) of subsection (d), of section 179 shall apply for purposes of this section. . (b) Clerical amendment The table of sections for part VI of subchapter B of chapter 1 of such Code is amended by inserting after the item relating to section 179E the following new item: Sec. 179F. Election to expense certain assets directly connected to moving manufacturing from China to the United States. . (c) Effective date The amendments made by this section shall apply to property placed in service after the date of the enactment of this Act, in taxable years ending after such date. 4. Department of Homeland Security counterintelligence vetting task force (a) Establishment Not later than 180 days after the date of the enactment of this Act, the Secretary of Homeland Security shall assign personnel of the Department of Homeland Security to participate in a counterintelligence vetting task force to make recommendations to improve counterintelligence vetting for appropriate departmental programs. (b) Personnel In carrying out subsection (a), the Secretary of Homeland Security may assign personnel from any component of the Department of Homeland Security the Secretary determines necessary to participate in the task force established pursuant to such subsection. (c) Coordination In carrying out subsection (a), the Secretary of Homeland Security may request participation in the task force established pursuant to such subsection from other appropriate Federal agencies. (d) Report Not later than one year after the date of the enactment of this Act, the Secretary of Homeland Security shall submit to the Committee on Homeland Security of the House of Representatives and the Committee on Homeland Security and Governmental Affairs of the Senate a report on the recommendations made by the task force established pursuant to subsection (a). 5. Counterintelligence training and vetting (a) In general Not later than 180 days after the date of the enactment of this Act, in carrying out the program administered pursuant to section 442(a)(4) of the Homeland Security Act ( 6 U.S.C. 252(a)(4) 6 U.S.C. 451 (b) Program enhancements Not later than one year after the date of enactment of this Act, the Secretary of Homeland Security shall make the following enhancements to the program administered pursuant to section 442(a)(4) of the Homeland Security Act ( 6 U.S.C. 252(a)(4) (1) Identify degrees and fields of study determined to be sensitive for homeland security and counterintelligence purposes. (2) Update the information to be collected to include any changes to the degree programs, if applicable, and fields of study. (3) Make any other enhancements determined appropriate by the Secretary to improve counterintelligence vetting capabilities. (c) Consultation In carrying out the identification required pursuant to subsection (b)(1), the Secretary of Homeland Security shall consult with the Secretary of State to ensure the degrees and field of study determined to be sensitive for homeland security and counterintelligence purposes referred to in such subsection are aligned, to the greatest extent practicable, between the Department of Homeland Security and the Department of State. (d) Definitions (1) Approved institution of higher education The term approved institution of higher education 8 U.S.C. 1372 (2) Designated exchange visitor program The term designated exchange visitor program 8 U.S.C. 1372 (3) Other approved educational institution The term other approved educational institution 8 U.S.C. 1372 6. Homeland Security Academic Advisory Council (a) In general Not later than 30 days after the date of the enactment of this Act, the Secretary of Homeland Security shall convene a meeting of the Homeland Security Academic Advisory Council to seek advice and recommendations from the Council on the counterintelligence awareness training and appropriate faculty designated to receive such training required under section 5. (b) Notification Not later than September 1, 2020, the Secretary of Homeland Security shall notify the Committee on Homeland Security of the House of Representatives and the Committee on Homeland Security and Governmental Affairs of the Senate if the Secretary determines to not extend the existence of the Homeland Security Academic Advisory Council.

Summary: Cage the Paper Tiger Act of 2020 This bill directs the Department of Homeland Security to take various actions related to counterintelligence activities, such as identifying academic fields that are sensitive for homeland security and counterintelligence purposes. The bill also requires a national securities exchange to prohibit the initial listing of a security if the issuer files with the Securities and Exchange Commission an audit report prepared by a foreign public accounting firm that the Public Accounting Oversight Board is unable to inspect or investigate. In addition, the bill allows an eligible taxpayer to expense certain costs associated with moving manufacturing capacity from China to the United States.