I
105TH CONGRESS
1ST SESSION
H. R. 2188
To ensure that commercial activities of the People’s Liberation Army of
China or any Communist Chinese military company are not extended
normal tariff treatment by the United States or treated as normal
commercial intercourse with the United States.
IN THE HOUSE OF REPRESENTATIVES
JULY 17, 1997
Mrs. FOWLER (for herself, Mr. COX of California, Mr. GIBBONS, Mr. GILMAN,
Mr. SAM JOHNSON of Texas, Mr. MCINTOSH, Mr. ROHRABACHER, Mr.
SHADEGG, Mr. SMITH of New Jersey, Mr. SPENCE, Mr. SOLOMON, and
Mr. ROYCE) introduced the following bill; which was referred to the Com-
mittee on Ways and Means, and in addition to the Committees on Inter-
national Relations, National Security, and Banking and Financial Serv-
ices, 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 ensure that commercial activities of the People’s Libera-
tion Army of China or any Communist Chinese military
company are not extended normal tariff treatment by
the United States or treated as normal commercial inter-
course with 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. CONGRESSIONAL FINDINGS AND DECLARA-
TION OF POLICY.
(a) FINDINGS.—The Congress makes the following
findings:
(1) The People’s Liberation Army is the prin-
cipal instrument of repression within the People’s
Republic of China, responsible for occupying Tibet
since 1950, massacring hundreds of students and
demonstrators for democracy in Tiananmen Square
on June 4, 1989, and running the Laogai (‘‘reform
through labor’’) slave labor camps.
(2) The People’s Liberation Army is engaged in
a massive military buildup, which has involved a
doubling since 1992 of announced official figures for
military spending by the People’s Republic of China.
(3) The People’s Liberation Army is engaging
in a major ballistic missile modernization program
which could undermine peace and stability in East
Asia, including 2 new intercontinental missile pro-
grams, 1 submarine-launched missile program, a
new class of compact but long-range cruise missiles,
and an upgrading of medium- and short-range bal-
listic missiles.
(4) The People’s Liberation Army is working to
coproduce the SU–27 fighter with Russia, and is in
the process of purchasing several substantial weap-
ons systems from Russia, including the 633 model of
the Kilo-class submarine and the SS–N–22 Sunburn
missile system specifically designed to incapacitate
United States aircraft carriers and Aegis cruisers.
(5) The People’s Liberation Army has carried
out acts of aggression in the South China Sea, in-
cluding the February 1995 seizure of the Mischief
Reef in the Spratley Islands, which is claimed by the
Philippines.
(6) In July 1995 and in March 1996, the Peo-
ple’s Liberation Army conducted missile tests to in-
timidate Taiwan when Taiwan held historic free elec-
tions, and those tests effectively blockaded Taiwan’s
2 principal ports of Keelung and Kaohsiung.
(7) The People’s Liberation Army has contrib-
uted to the proliferation of technologies relevant to
the refinement of weapons-grade nuclear material,
including transferring ring magnets to Pakistan.
(8) The People’s Liberation Army and associ-
ated defense companies have provided ballistic mis-
sile components, cruise missiles, and chemical weap-
ons ingredients to Iran, a country that the executive
branch has repeatedly reported to Congress is the
greatest sponsor of terrorism in the world.
(9) In May 1996, United States authorities
caught the People’s Liberation Army enterprise Poly
Technologies and the civilian defense industrial com-
pany Norinco attempting to smuggle 2,000 AK–47s
into Oakland, California, and offering to sell urban
gangs shoulder-held missile launchers capable of
‘‘taking out a 747’’ (which the affidavit of the Unit-
ed States Customs Service of May 21, 1996, indi-
cated that the representative of Poly Technologies
and Norinco claimed), and Communist Chinese au-
thorities punished only 4 low-level arms merchants
by sentencing them on May 17, 1997, to brief prison
terms.
(10) The People’s Liberation Army contributes
to the People’s Republic of China’s failure to meet
the standards of the 1995 Memorandum of Under-
standing with the United States on intellectual prop-
erty rights by running factories which pirate videos,
compact discs, and computer software that are prod-
ucts of the United States.
(11) The People’s Liberation Army contributes
to the People’s Republic of China’s failing to meet
the standards of the February 1997 Memorandum
of Understanding with the United States on textiles
by operating enterprises engaged in the trans-
shipment of textile products to the United States
through third countries.
(12) The estimated $2 billion to $3 billion in
annual earnings of People’s Liberation Army enter-
prises subsidize the expansion and activities of the
People’s Liberation Army described in this sub-
section.
(13) The commercial activities of the People’s
Liberation Army are frequently conducted on non-
commercial terms, or for noncommercial purposes
such as military or foreign policy considerations.
(b) POLICY.—It is the policy of the United States
that commercial activities of the People’s Liberation Army
of China or any Communist Chinese military company are
not extended normal tariff treatment by the United States
or treated as normal commercial intercourse with the
United States.
SEC. 2. PROHIBITION ON MFN TREATMENT FOR IMPORTS
FROM THE PEOPLE’S LIBERATION ARMY.
(a) DETERMINATION OF COMMUNIST CHINESE MILI-
TARY COMPANIES.—
(1) IN GENERAL.—Subject to paragraphs (2)
and (3), not later than 90 days after the date of the
enactment of this Act, the Secretary of Defense, in
consultation with the Secretary of the Treasury, the
Attorney General, the Director of Central Intel-
ligence, and the Director of the Federal Bureau of
Investigation, shall compile a list of persons who are
Communist Chinese military companies and who are
operating directly or indirectly in the United States
or any of its territories and possessions, and shall
publish the list of such persons in the Federal Reg-
ister. On an ongoing basis, the Secretary of Defense,
in consultation with the Secretary of the Treasury,
the Attorney General, the Director of Central Intel-
ligence, and the Director of the Federal Bureau of
Investigation, shall make additions or deletions to
the list based on the latest information available.
(2) COMMUNIST
CHINESE
MILITARY
COM-
PANY.—For purposes of making the determination
required by paragraph (1), the term ‘‘Communist
Chinese military company’’—
(A) means a person that is—
(i) engaged in providing commercial
services, manufacturing, producing, or ex-
porting, and
(ii) owned or controlled by the Peo-
ple’s Liberation Army, and
(B) includes, but is not limited to, any per-
son identified in the United States Defense In-
telligence Agency publication numbered VP–
1920–271–90, dated September 1990, or PC–
1921–57–95, dated October 1995, and any up-
date of such reports for the purposes of this
Act.
(b) TARIFFS.—Notwithstanding any other provision
of law, nondiscriminatory treatment (most-favored-nation
treatment) shall not apply to goods that are produced,
manufactured, or exported by the People’s Liberation
Army or a Communist Chinese military company.
(c) TREASURY AUTHORITY.—
(1) AUTHORITY.—The Secretary of the Treas-
ury may exercise the authorities set forth in section
203(a) of the International Emergency Economic
Powers Act (50 U.S.C. 1702(a)) with respect to any
commercial activity in the United States by a Com-
munist Chinese military company, without regard to
section 202 of that Act.
(2) PENALTIES.—The penalties set forth in sec-
tion 206 of the International Emergency Economic
Powers Act (50 U.S.C. 1705) shall apply to viola-
tions of any license, order, or regulation issued
under paragraph (1).
(d) EFFECTIVE DATE.—Subsection (a) shall apply
with respect to goods entered, or withdrawn from ware-
house for consumption, on or after the 105th day after
the date of the enactment of this Act.
SEC. 3. DEFINITION.
For purposes of this Act, the term ‘‘People’s Libera-
tion Army’’ means the land, naval, and air military serv-
ices, the police, and the intelligence services of the Com-
munist Government of the People’s Republic of China, and
any member of any such service or of such police.
Æ