124 
Secretary shall periodically transmit summaries of 
the information contained in such reports to the Sec-
retary of State for such action as the Secretary of 
State, in consultation with the Secretary, considers 
appropriate for carrying out the policies set forth in 
section 832. 
(c) PREEMPTION.—The provisions of this section and 
the regulations issued pursuant thereto shall preempt any 
law, rule, or regulation of any of the several States or the 
District of Columbia, or any of the territories or posses-
sions of the United States, or of any governmental subdivi-
sion thereof, which law, rule, or regulation pertains to par-
ticipation in, compliance with, implementation of, or the 
furnishing of information regarding restrictive trade prac-
tices or boycotts fostered or imposed by foreign countries 
against other countries friendly to the United States. 
SEC. 834. ENFORCEMENT. 
(a) CRIMINAL PENALTY.—A person who willfully 
commits, willfully attempts to commit, or willfully con-
spires to commit, or aids or abets in the commission of, 
an unlawful act section 833— 
(1) shall, upon conviction, be fined not more 
than $1,000,000; or 
(2) if a natural person, may be imprisoned for 
not more than 20 years, or both. 
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(b) CIVIL PENALTIES.—The President may impose 
the following civil penalties on a person who violates sec-
tion 833 or any regulation issued under this subtitle: 
(1) A fine of not more than $300,000 or an 
amount that is twice the value of the transaction 
that is the basis of the violation with respect to 
which the penalty is imposed, whichever is greater. 
(2) Revocation of a license issued under title I 
to the person. 
(3) A prohibition on the person’s ability to ex-
port, reexport, or transfer any items controlled 
under subtitle A. 
(c) PROCEDURES.—Any civil penalty or administra-
tive sanction (including any suspension or revocation of 
authority to export) under this section may be imposed 
only after notice and opportunity for an agency hearing 
on the record in accordance with sections 554 through 557 
of title 5, United States Code, and shall be subject to judi-
cial review in accordance with chapter 7 of such title. 
(d) STANDARDS FOR LEVELS OF CIVIL PENALTY.— 
The President may by regulation provide standards for es-
tablishing levels of civil penalty under this section based 
upon factors such as the seriousness of the violation, the 
culpability of the violator, and the violator’s record of co-
operation with the Government in disclosing the violation. 
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Subtitle C—Sanctions Regarding 
Missile Proliferation and Chem-
ical 
and 
Biological 
Weapons 
Proliferation 
SEC. 841. MISSILE PROLIFERATION CONTROL VIOLATIONS. 
(a) VIOLATIONS BY UNITED STATES PERSONS.— 
(1) SANCTIONS.— 
(A) SANCTIONABLE ACTIVITY.—The Presi-
dent shall impose the applicable sanctions de-
scribed in subparagraph (B) if the President 
determines that a United States person know-
ingly— 
(i) exports, reexports, or transfers of 
any item on the MTCR Annex, in violation 
of the provisions of section 38 (22 U.S.C. 
2778) or chapter 7 of the Arms Export 
Control Act, subtitle A, or any regulations 
or orders issued under any such provisions; 
or 
(ii) conspires to or attempts to engage 
in such export, reexport, or transfer. 
(B) SANCTIONS.—The sanctions that apply 
to a United States person under subparagraph 
(A) are the following: 
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(i) If the item on the MTCR Annex 
involved in the export, reexport, or transfer 
is missile equipment or technology within 
category II of the MTCR Annex, then the 
President shall deny to such United States 
person, for a period of 2 years, licenses for 
the transfer of missile equipment or tech-
nology controlled under subtitle A. 
(ii) If the item on the MTCR Annex 
involved in the export, reexport, or transfer 
is missile equipment or technology within 
category I of the MTCR Annex, then the 
President shall deny to such United States 
person, for a period of not less than 2 
years, all licenses for items the transfer of 
which is controlled under subtitle A. 
(2) DISCRETIONARY SANCTIONS.—In the case 
of any determination referred to in paragraph (1), 
the President may pursue any other appropriate 
penalties under section 820. 
(3) WAIVER.—The President may waive the im-
position of sanctions under paragraph (1) on a per-
son with respect to a product or service if the Presi-
dent certifies to the Congress that— 
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(A) the product or service is essential to 
the national security of the United States; and 
(B) such person is a sole source supplier of 
the product or service, the product or service is 
not available from any alternative reliable sup-
plier, and the need for the product or service 
cannot be met in a timely manner by improved 
manufacturing processes or technological devel-
opments. 
(b) TRANSFERS OF MISSILE EQUIPMENT OR TECH-
NOLOGY BY FOREIGN PERSONS.— 
(1) SANCTIONS.— 
(A) SANCTIONABLE ACTIVITY.—Subject to 
paragraphs (3) through (7), the President shall 
impose the applicable sanctions under subpara-
graph (B) on a foreign person if the Presi-
dent— 
(i) determines that a foreign person 
knowingly— 
(I) exports, reexports, or trans-
fers any MTCR equipment or tech-
nology that contributes to the design, 
development, or production of missiles 
in a country that is not an MTCR ad-
herent and would be, if it were United 
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States-origin equipment or technology, 
subject to the jurisdiction of the 
United States under subtitle A; 
(II) conspires to or attempts to 
engage in such export, reexport, or 
transfer; or 
(III) facilitates such export, reex-
port, or transfer by any other person; 
or 
(ii) has made a determination with re-
spect to the foreign person under section 
73(a) of the Arms Export Control Act. 
(B) SANCTIONS.—The sanctions that apply 
to a foreign person under subparagraph (A) are 
the following: 
(i) If the item involved in the export, 
reexport, or transfer is within category II 
of the MTCR Annex, then the President 
shall deny, for a period of 2 years, licenses 
for the transfer to such foreign person of 
missile equipment or technology the trans-
fer of which is controlled under subtitle A. 
(ii) If the item involved in the export, 
reexport, or transfer is within category I of 
the MTCR Annex, then the President shall 
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deny, for a period of not less than 2 years, 
licenses for the transfer to such foreign 
person of items the transfer of which is 
controlled under subtitle A. 
(2) INAPPLICABILITY WITH RESPECT TO MTCR 
ADHERENTS.—Paragraph (1) does not apply with 
respect to— 
(A) any export, reexport, or transfer that 
is authorized by the laws of an MTCR adher-
ent, if such authorization is not obtained by 
misrepresentation or fraud; or 
(B) any export, reexport, or transfer of an 
item to an end user in a country that is an 
MTCR adherent. 
(3) EFFECT
OF
ENFORCEMENT
ACTIONS
BY 
MTCR ADHERENTS.—Sanctions set forth in para-
graph (1) may not be imposed under this subsection 
on a person with respect to acts described in such 
paragraph or, if such sanctions are in effect against 
a person on account of such acts, such sanctions 
shall be terminated, if an MTCR adherent is taking 
judicial or other enforcement action against that 
person with respect to such acts, or that person has 
been found by the government of an MTCR adher-
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131 
ent to be innocent of wrongdoing with respect to 
such acts. 
(4) WAIVER AND REPORT TO CONGRESS.— 
(A) WAIVER AUTHORITY.—The President 
may waive the application of paragraph (1) to 
a foreign person if the President determines 
that such waiver is essential to the national se-
curity of the United States. 
(B) NOTIFICATION AND REPORT TO CON-
GRESS.—In the event that the President decides 
to apply the waiver described in subparagraph 
(A), the President shall so notify the appro-
priate congressional committees not less than 
20 working days before issuing the waiver. 
Such notification shall include a report fully ar-
ticulating the rationale and circumstances 
which led the President to apply the waiver. 
(5) ADDITIONAL WAIVER.—The President may 
waive the imposition of sanctions under paragraph 
(1) on a person with respect to a product or service 
if the President certifies to the appropriate congres-
sional committees that— 
(A) the product or service is essential to 
the national security of the United States; and 
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(B) such person is a sole source supplier of 
the product or service, the product or service is 
not available from any alternative reliable sup-
plier, and the need for the product or service 
cannot be met in a timely manner by improved 
manufacturing processes or technological devel-
opments. 
(6) EXCEPTIONS.—The President shall not 
apply the sanction under this subsection prohibiting 
the importation of the products of a foreign per-
son— 
(A) in the case of procurement of defense 
articles or defense services— 
(i) under existing contracts or sub-
contracts, including the exercise of options 
for production quantities to satisfy require-
ments essential to the national security of 
the United States; 
(ii) if the President determines that 
the person to which the sanctions would be 
applied is a sole source supplier of the de-
fense articles or defense services, that the 
defense articles or defense services are es-
sential to the national security of the 
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United States, and that alternative sources 
are not readily or reasonably available; or 
(iii) if the President determines that 
such articles or services are essential to the 
national security of the United States 
under defense coproduction agreements or 
NATO Programs of Cooperation; 
(B) to products or services provided under 
contracts entered into before the date on which 
the President publishes his intention to impose 
the sanctions; or 
(C) to— 
(i) spare parts; 
(ii) component parts, but not finished 
products, essential to United States prod-
ucts or production; 
(iii) routine services and maintenance 
of products, to the extent that alternative 
sources are not readily or reasonably avail-
able; or 
(iv) information and technology essen-
tial to United States products or produc-
tion. 
(c) DEFINITIONS.—In this section: 
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(1) APPROPRIATE
CONGRESSIONAL
COMMIT-
TEES.—The term ‘‘appropriate congressional com-
mittees’’ means— 
(A) the Committee on Foreign Affairs of 
the House of Representatives; and 
(B) the Committee on Foreign Relations 
and the Committee on Banking, Housing, and 
Urban Affairs of the Senate. 
(2) DEFENSE ARTICLES; DEFENSE SERVICES.— 
The terms ‘‘defense articles’’ and ‘‘defense services’’ 
mean those items on the United States Munitions 
List as defined in section 47(7) of the Arms Export 
Control Act (22 U.S.C. 2794 note). 
(3) MISSILE.—The term ‘‘missile’’ means a cat-
egory I system as defined in the MTCR Annex. 
(4) MISSILE TECHNOLOGY CONTROL REGIME; 
MTCR.—The term ‘‘Missile Technology Control Re-
gime’’ or ‘‘MTCR’’ means the policy statement, be-
tween the United States, the United Kingdom, the 
Federal Republic of Germany, France, Italy, Can-
ada, and Japan, announced on April 16, 1987, to re-
strict sensitive missile-relevant transfers based on 
the MTCR Annex, and any amendments thereto. 
(5) MTCR ADHERENT.—The term ‘‘MTCR ad-
herent’’ means a country that participates in the 
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MTCR or that, pursuant to an international under-
standing to which the United States is a party, con-
trols MTCR equipment or technology in accordance 
with the criteria and standards set forth in the 
MTCR. 
(6) MTCR ANNEX.—The term ‘‘MTCR Annex’’ 
means the Guidelines and Equipment and Tech-
nology Annex of the MTCR, and any amendments 
thereto. 
(7) MISSILE
EQUIPMENT
OR
TECHNOLOGY; 
MTCR
EQUIPMENT
OR
TECHNOLOGY.—The terms 
‘‘missile equipment or technology’’ and ‘‘MTCR 
equipment or technology’’ mean those items listed in 
category I or category II of the MTCR Annex. 
SEC. 842. CHEMICAL AND BIOLOGICAL WEAPONS PRO-
LIFERATION SANCTIONS. 
(a) IMPOSITION OF SANCTIONS.— 
(1) DETERMINATION BY THE PRESIDENT.—Ex-
cept as provided in subsection (b)(2), the President 
shall impose the sanction described in subsection (c) 
if the President determines that a foreign person has 
knowingly and materially contributed— 
(A) through the export from the United 
States of any item that is subject to the juris-
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diction of the United States under this subtitle; 
or 
(B) through the export from any other 
country of any item that would be, if they were 
United States goods or technology, subject to 
the jurisdiction of the United States under this 
subtitle, 
to the efforts by any foreign country, project, or en-
tity described in paragraph (2) to use, develop, 
produce, stockpile, or otherwise acquire chemical or 
biological weapons. 
(2) COUNTRIES, PROJECTS, OR ENTITIES RE-
CEIVING ASSISTANCE.—Paragraph (1) applies in the 
case of— 
(A) any foreign country that the President 
determines has, at any time after January 1, 
1980— 
(i) used chemical or biological weap-
ons in violation of international law; 
(ii) used lethal chemical or biological 
weapons against its own nationals; or 
(iii) made substantial preparations to 
engage in the activities described in clause 
(i) or (ii); 
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(B) any foreign country whose government 
is determined for purposes of section 914(c) to 
be a government that has repeatedly provided 
support for acts of international terrorism; or 
(C) any other foreign country, project, or 
entity designated by the President for purposes 
of this section. 
(3) PERSONS AGAINST WHICH SANCTIONS ARE 
TO BE IMPOSED.—A sanction shall be imposed pur-
suant to paragraph (1) on— 
(A) the foreign person with respect to 
which the President makes the determination 
described in that paragraph; 
(B) any successor entity to that foreign 
person; and 
(C) any foreign person that is a parent, 
subsidiary, or affiliate of that foreign person if 
that parent, subsidiary, or affiliate knowingly 
assisted in the activities which were the basis of 
that determination. 
(b) CONSULTATIONS WITH AND ACTIONS BY FOR-
EIGN GOVERNMENT OF JURISDICTION.— 
(1) CONSULTATIONS.—If the President makes 
the determinations described in subsection (a)(1) 
with respect to a foreign person, the Congress urges 
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the President to initiate consultations immediately 
with the government with primary jurisdiction over 
that foreign person with respect to the imposition of 
a sanction pursuant to this section. 
(2) ACTIONS
BY
GOVERNMENT
OF
JURISDIC-
TION.—In order to pursue such consultations with 
that government, the President may delay imposition 
of a sanction pursuant to this section for a period 
of up to 90 days. Following such consultations, the 
President shall impose the sanction unless the Presi-
dent determines and certifies to the appropriate con-
gressional committees that the Government has 
taken specific and effective actions, including appro-
priate penalties, to terminate the involvement of the 
foreign person in the activities described in sub-
section (a)(1). The President may delay imposition 
of the sanction for an additional period of up to 90 
days if the President determines and certifies to the 
Congress that the government is in the process of 
taking the actions described in the preceding sen-
tence. 
(3) REPORT
TO
CONGRESS.—The President 
shall report to the appropriate congressional commit-
tees, not later than 90 days after making a deter-
mination under subsection (a)(1), on the status of 
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consultations with the appropriate government under 
this subsection, and the basis for any determination 
under paragraph (2) of this subsection that such 
government has taken specific corrective actions. 
(c) SANCTION.— 
(1) DESCRIPTION OF SANCTION.—The sanction 
to be imposed pursuant to subsection (a)(1) is, ex-
cept as provided that the United States Government 
shall not procure, or enter into any contract for the 
procurement of, any goods or services from any per-
son described in subsection (a)(3). 
(2) EXCEPTIONS.—The President shall not be 
required to apply or maintain a sanction under this 
section— 
(A) in the case of procurement of defense 
articles or defense services— 
(i) under existing contracts or sub-
contracts, including the exercise of options 
for production quantities to satisfy United 
States operational military requirements; 
(ii) if the President determines that 
the person or other entity to which the 
sanctions would otherwise be applied is a 
sole source supplier of the defense articles 
or defense services, that the defense arti-
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cles or defense services are essential, and 
that alternative sources are not readily or 
reasonably available; or 
(iii) if the President determines that 
such articles or services are essential to the 
national security under defense coproduc-
tion agreements; 
(B) to products or services provided under 
contracts entered into before the date on which 
the President publishes his intention to impose 
sanctions; 
(C) to— 
(i) spare parts; 
(ii) component parts, but not finished 
products, essential to United States prod-
ucts or production; or 
(iii) routine servicing and mainte-
nance of products, to the extent that alter-
native sources are not readily or reason-
ably available; 
(D) to information and technology essen-
tial to United States products or production; or 
(E) to medical or other humanitarian 
items. 
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(d) TERMINATION OF SANCTIONS.—A sanction im-
posed pursuant to this section shall apply for a period of 
at least 12 months following the imposition of one sanction 
and shall cease to apply thereafter only if the President 
determines and certifies to the appropriate congressional 
committees that reliable information indicates that the 
foreign person with respect to which the determination 
was made under subsection (a)(1) has ceased to aid or 
abet any foreign government, project, or entity in its ef-
forts to acquire chemical or biological weapons capability 
as described in that subsection. 
(e) WAIVER.— 
(1) CRITERION
FOR
WAIVER.—The President 
may waive the application of any sanction imposed 
on any person pursuant to this section if the Presi-
dent determines and certifies to the appropriate con-
gressional committees that such waiver is important 
to the national security interests of the United 
States. 
(2) NOTIFICATION OF AND REPORT TO CON-
GRESS.—If the President decides to exercise the 
waiver authority provided in paragraph (1), the 
President shall so notify the appropriate congres-
sional committees not less than 20 days before the 
waiver takes effect. Such notification shall include a 
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142 
report fully articulating the rationale and cir-
cumstances which led the President to exercise the 
waiver authority. 
(f) DEFINITIONS.—In this section: 
(1) APPROPRIATE
CONGRESSIONAL
COMMIT-
TEES.—The term ‘‘appropriate congressional com-
mittees’’ means— 
(A) the Committee on Foreign Affairs of 
the House of Representatives; and 
(B) the Committee on Foreign Relations 
and the Committee on Banking, Housing, and 
Urban Affairs of the Senate. 
(2) DEFENSE ARTICLES; DEFENSE SERVICES.— 
The terms ‘‘defense articles’’ and ‘‘defense services’’ 
mean those items on the United States Munitions 
List or are otherwise controlled under the Arms Ex-
port Control Act. 
Subtitle D—Administrative 
Authorities 
SEC. 851. UNDER SECRETARY OF COMMERCE FOR INDUS-
TRY AND SECURITY. 
(a) APPOINTMENT.— 
(1) IN GENERAL.—The President shall appoint, 
by and with the advice and consent of the Senate, 
an Under Secretary of Commerce for Industry and 
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Security who shall carry out all the functions of the 
Secretary under this title and such other provisions 
of law that relate to the implementation of the dual- 
use export system. 
(2) ASSISTANT SECRETARIES OF COMMERCE.— 
The President shall appoint, by and with the advice 
and consent of the Senate, two Assistant Secretaries 
of Commerce to assist the Under Secretary in car-
rying out the functions described in paragraph (1). 
(b) DELEGATION.— 
(1) TO SECRETARY.—The President shall con-
tinue the delegation of functions to the Secretary to 
administer and enforce the export control system au-
thorized by this title that were delegated to the Sec-
retary as of the day before the date of the enact-
ment of this Act. 
(2) TO
BUREAU
OF
INDUSTRY
AND
SECU-
RITY.—The Secretary shall further delegate imple-
mentation of the authorities set forth in this title to 
the Bureau of Industry and Security within the De-
partment of Commerce. 
Æ 
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