I 
113TH CONGRESS 
2D SESSION 
H. R. 5103 
To impose sanctions on Chinese state-owned enterprises and any person 
who is a member of the board of directors, an executive officer, or 
a senior official of a Chinese state-owned enterprise for benefitting from 
cyber and economic espionage against the United States. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 14, 2014 
Mr. ROHRABACHER (for himself and Mr. RYAN of Ohio) introduced the fol-
lowing bill; which was referred to the Committee on Foreign Affairs, and 
in addition to the Committees on the Judiciary and Financial Services, 
for a period to be subsequently determined by the Speaker, in each case 
for consideration of such provisions as fall within the jurisdiction of the 
committee concerned 
A BILL 
To impose sanctions on Chinese state-owned enterprises and 
any person who is a member of the board of directors, 
an executive officer, or a senior official of a Chinese 
state-owned enterprise for benefitting from cyber and 
economic espionage against the United States. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Chinese Communist 
Economic Espionage Sanctions Act’’. 
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SEC. 2. FINDINGS. 
Congress finds the following: 
(1) The Chinese Communist Party (CCP) has 
made it its policy to engage in economic warfare 
against the United States. 
(2) The CCP uses the resources of the People’s 
Liberation Army (PLA) and the Chinese State to 
drain the United States of economic might, includ-
ing by means of economic espionage and cyber espio-
nage, unfair trade practices, unfair labor practices, 
and currency manipulation. 
(3) Chinese state-owned enterprises (SOE) and 
the PLA are the main beneficiary of the CCP’s cam-
paign of theft against the United States. 
(4) Although many SOEs are listed on stock ex-
changes or officially privatized, the Chinese govern-
ment retains at least one-half of equity in those 
companies. 
(5) SOEs come under the control of the min-
isterial-level State-owned Assets Supervision and Ad-
ministration Commission. 
(6) Members of the boards of directors and sen-
ior management of SOEs are appointed by the 
State-owned Assets Supervision and Administration 
Commission in consultation with the Communist 
Party’s Department of Organization. 
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(7) More than two-thirds of board members and 
three-quarters of senior executives of SOEs are ei-
ther Communist Party members or officials. 
(8) Corruption within the CCP is widespread 
and endemic. 
(9) CCP officials use their positions of control 
and influence within and over SOE’s to enrich them-
selves and their families. 
(10) The vast majority of the Chinese people do 
not benefit from the corruption of the CCP. 
(11) On May 19, 2014, the United States De-
partment of Justice announced charges against five 
members of the PLA, accusing them of stealing 
trade secrets from United States companies and 
marking the first time the United States has 
charged foreign government employees with eco-
nomic espionage. 
(12) The indictment charged that members of 
the PLA worked to ‘‘steal information’’ from United 
States companies ‘‘that would be useful to their 
competitors in China, including state-owned enter-
prises’’. 
(13) Chinese SOEs are reported to have bene-
fitted directly from their actions, including the State 
Nuclear Power Technology Corporation, the Baosteel 
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Group, and the Aluminum Corporation of China 
(Chinalco). 
(14) The chairman of the board and the major-
ity of the boards for the State Nuclear Power Tech-
nology Corporation, the Baosteel Group, and the 
Aluminum Corporation of China (Chinalco) are 
members of the CCP. 
(15) On May 21, 2014, Assistant Attorney 
General John Carlin said that criminal charges can 
justify economic sanctions. 
(16) The indictment named members of Unit 
61398 which is publicly identified as a Shanghai- 
based cyber unit of the PLA also known as APT1. 
(17) Unit 61398 is part of the 2nd Bureau of 
the PLA, 3rd Department of the General Staff. 
(18) Unit 61398 was first publically identified 
in 2013 as APT1 by Mandiant, a United States 
cyber security firm and leader in cyber incident re-
sponse industry. 
(19) Mandiant exposed a timeline of Unit 
61398’s economic espionage conducted since 2006 
against 141 victims across multiple industries. 
(20) Mandiant’s conclusions have been sup-
ported by CrowdStrike, another cyber security com-
pany, which publicly revealed the existence of Unit 
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61486, a related PLA unit dedicated to cyber espio-
nage. 
(21) 
George 
Kurts, 
the 
co-founder 
of 
CrowdStrike, stated that ‘‘If you look at all the 
groups that we track in China, the indictments are 
just the very tip of the iceberg.’’. 
(22) Units 61398 and 61486 are only two of at 
least 20 cyber threat groups in Communist China 
and are considered by multiple experts to have stolen 
vast amounts of valuable information from the 
United States. 
(23) The 2011 annual report to Congress from 
the Office of the Secretary of Defense, titled ‘‘Mili-
tary and Security Developments Involving the Peo-
ple’s Republic of China’’, states, ‘‘The PRC also uti-
lizes a large, well-organized network of enterprises, 
defense factories, affiliated research institutes, and 
computer network operations to facilitate the collec-
tion of sensitive information and export-controlled 
technology, as well as basic research and science 
that supports U.S. defense system modernization.’’. 
(24) A 2011 report by the Office of the Na-
tional Counterintelligence Executive found that 
‘‘Chinese actors are the world’s most active and per-
sistent perpetrators of economic espionage.’’. 
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(25) The 2012 annual report to Congress from 
the Office of the Secretary of Defense, titled ‘‘Mili-
tary and Security Developments Involving the Peo-
ple’s Republic of China’’, found that ‘‘Chinese at-
tempts to collect U.S. technological and economic in-
formation will continue at a high level and will rep-
resent a growing and persistent threat to U.S. eco-
nomic security.’’. 
(26) James Clapper, the Director of National 
Intelligence, stated, ‘‘Among significant foreign 
threats . . . China remain[s] the most capable and 
persistent intelligence threats and are aggressive 
practitioners of economic espionage against the 
United States.’’. 
(27) Retired General Michael Hayden, former 
Director of the Central Intelligence Agency and Di-
rector of the National Security Agency, stated, ‘‘The 
intensity of Chinese espionage is certainly greater 
than that what we saw between the U.S. and the So-
viets during the Cold War. The problem is China’s 
view is that industrial espionage by the state against 
relatively vulnerable private enterprise is a com-
monly accepted state practice,’’. 
(28) The annual report by the congressional 
United States–China Economic and Security Review 
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Commission stated in 2013, ‘‘strong evidence 
emerged that the Chinese government is directing 
and executing a large-scale cyber espionage cam-
paign against the United States’’. 
(29) Retired Lieutenant General Ronald Bur-
gess, Jr., former Director of the Defense Intelligence 
Agency, stated, ‘‘China has used its intelligence 
services to gather information via a significant net-
work of agents and contacts using a variety of meth-
ods . . . In recent years, multiple cases of economic 
espionage and theft of dual-use and military tech-
nology have uncovered pervasive Chinese collection 
efforts,’’. 
(30) Congressman Mike Rogers, Chairman of 
the Permanent Select Committee on Intelligence of 
the House of Representatives, stated, ‘‘China’s eco-
nomic espionage has reached an intolerable level and 
I believe that the United States and our allies in Eu-
rope and Asia have an obligation to confront Beijing 
and demand that they put a stop to this piracy. Bei-
jing is waging a massive trade war on us all, and we 
should band together to pressure them to stop. Com-
bined, the United States and our allies in Europe 
and Asia have significant diplomatic and economic 
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leverage over China, and we should use this to our 
advantage to put an end to this scourge,’’. 
(31) The threat of Chinese espionage is so large 
that Senator Sheldon Whitehouse, D–Rhode Island, 
who chaired the Cyber Task Force of the Select 
Committee on Intelligence, proclaimed it to be part 
of ‘‘the biggest transfer of wealth through theft and 
piracy in the history of mankind’’. 
(32) Massive cyber and economic espionage or-
ganized, directed, and carried out by the CCP and 
the 
PLA 
has 
contributed 
to 
creating 
a 
$318,000,000,000 United States trade deficit with 
Communist China in 2013, which equals 1.89 per-
cent of total United States gross domestic product 
(GDP). 
SEC. 3. SENSE OF CONGRESS. 
It is the sense of Congress that the Chinese Com-
munist Party and the Government of the People’s Repub-
lic of China should be condemned for sponsoring, plan-
ning, ordering, conducting, and benefitting from cyber and 
economic espionage against the United States. 
SEC. 4. FINANCIAL MEASURES. 
(a) FREEZING OF ASSETS.—The President shall ex-
ercise all powers granted by the International Emergency 
Economic Powers Act (50 U.S.C. 1701 et seq.) (except 
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needed to require each financial institution that is a 
United States person and has within its possession 
or control assets that are property or interests in 
property of a covered Chinese state-owned enterprise 
or a person who is a member of the board of direc-
tors, an executive officer, or a senior official of a 
covered Chinese state-owned enterprise if such prop-
erty and interests in property are in the United 
States to certify to the Secretary that, to the best 
of the knowledge of the financial institution, the fi-
nancial institution has frozen all assets within the 
possession or control of the financial institution that 
are required to be frozen pursuant to subsection (a). 
(c) REGULATORY AUTHORITY.—The Secretary of the 
Treasury shall issue such regulations, licenses, and orders 
as are necessary to carry out this section. 
(d) DEFINITIONS.—In this section: 
(1) COVERED CHINESE STATE-OWNED ENTER-
PRISE.—The term ‘‘covered Chinese state-owned en-
terprise’’ means an enterprise that— 
(A) is organized under the laws of the Peo-
ple’s Republic of China, including a foreign 
branch of such enterprise; and 
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(B) is owned or controlled by the Govern-
ment of the People’s Republic of China or the 
Chinese Communist Party. 
(2) 
UNITED
STATES
PERSON.—The 
term 
‘‘United States person’’ means— 
(A) a United States citizen or an alien law-
fully admitted for permanent residence to the 
United States; or 
(B) an entity organized under the laws of 
the United States or any jurisdiction within the 
United States, including a foreign branch of 
such an entity. 
SEC. 5. INADMISSIBILITY OF CERTAIN ALIENS. 
(a) INELIGIBILITY FOR VISAS.—An alien is ineligible 
to receive a visa to enter the United States and ineligible 
to be admitted to the United States if the alien is a person 
who is a member of the board of directors, an executive 
officer, or a senior official of a covered Chinese state- 
owned enterprise. 
(b) CURRENT VISAS REVOKED.—The Secretary of 
State shall revoke, in accordance with section 221(i) of 
the Immigration and Nationality Act (8 U.S.C. 1201(i)), 
the visa or other documentation of any alien who would 
be ineligible to receive such a visa or documentation under 
subsection (a) of this section. 
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(c) REGULATORY AUTHORITY.—The Secretary of 
State shall prescribe such regulations as are necessary to 
carry out this section. 
SEC. 6. REPORT TO CONGRESS. 
(a) IN GENERAL.—Not later than 180 days after the 
date of the enactment of this Act, and annually thereafter, 
the Secretary of State and the Secretary of the Treasury 
shall submit to the appropriate congressional committees 
a report on— 
(1) the actions taken to carry out this Act, in-
cluding the number of covered Chinese state-owned 
enterprises and persons who are members of the 
board of directors, executive officers, or senior offi-
cials of covered Chinese state-owned enterprises 
sanctioned during the year preceding the report; and 
(2) efforts by the executive branch to encourage 
the governments of other countries to impose sanc-
tions that are similar to the sanctions imposed under 
this Act. 
(b) FORM.—The report required by subsection (a) 
shall be submitted in unclassified form, but may contain 
a classified annex. 
(c) DEFINITION.—In this section, the term ‘‘appro-
priate congressional committees’’ means— 
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(1) the Committee on Foreign Affairs, the Per-
manent Select Committee on Intelligence, and the 
Committee on Ways and Means of the House of 
Representatives; and 
(2) the Committee on Foreign Relations, the 
Select Committee on Intelligence, the Committee on 
Finance, and the Committee on Banking, Housing, 
and Urban Affairs of the Senate. 
Æ 
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