I
105TH CONGRESS
2D SESSION
H. R. 4433
To ensure that any entity owned, operated, or controlled by the People’s
Liberation Army or the People’s Armed Police of China does not conduct
certain business with United States persons, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
AUGUST 6, 1998
Mr. GEPHARDT (for himself, Mr. BONIOR, and Ms. PELOSI) introduced the
following bill; which was referred to the Committee on Commerce, and
in addition to the Committees on International Relations, Ways and
Means, and National Security, 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 any entity owned, operated, or controlled
by the People’s Liberation Army or the People’s Armed
Police of China does not conduct certain business with
United States persons, and for other purposes.
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 ‘‘Trading With the
Communist Chinese Military Act of 1998’’.
SEC. 2. FINDINGS AND 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 massacring an un-
known number of students, workers, and other dem-
onstrators for democracy in Tiananmen Square on
June 4, 1989.
(2) The People’s Liberation Army is responsible
for occupying Tibet since 1950 and implementing
the official policy of the People’s Republic of China
to eliminate the unique cultural, linguistic, and reli-
gious heritage of the Tibetan people.
(3) The People’s Liberation Army has oper-
ational control of the People’s Armed Police, an in-
ternal security force of over 1,000,000 troops, whose
primary purpose is to suppress the legitimate pro-
tests of Chinese workers.
(4) The People’s Liberation Army is engaged in
a massive effort to modernize its military capabili-
ties.
(5) The People’s Liberation Army owns and op-
erates hundreds of companies and thousands of fac-
tories the profits from which in some measure are
used to support military activities.
(6) Companies owned by the People’s Libera-
tion Army and the People’s Armed Police export to
the United States such products as toys, clothing,
frozen fish, lighting fixtures, garlic, glassware, yarn,
footwear, chemicals, machinery, metal products, fur-
niture, decorations, gloves, tents, and tools.
(7) Companies owned by the People’s Libera-
tion Army and People’s Armed Police regularly so-
licit investment in joint ventures with United States
companies.
(8) The People’s Liberation Army and People’s
Armed Police have established in the United States
over the past decade at least 23 different companies.
(9) The people of the United States are un-
aware that certain products they are purchasing in
retail stores are produced by companies owned and
operated by the People’s Liberation Army or the
People’s Armed Police of China.
(10) The purchase of these products by Amer-
ican consumers places them in the position of unwit-
tingly subsidizing the operations of the People’s Lib-
eration Army and the People’s Armed Police.
(11) The Government of the People’s Republic
of China, with the assistance of the People’s Libera-
tion Army and the People’s Armed Police, continues
to deny its citizens basic human rights enumerated
in the Universal Declaration of Human Rights, per-
secutes those who seek to freely practice their reli-
gion, and denies workers the right to establish free
and independent trade unions.
(b) POLICY.—It is the policy of the United States to
prohibit any entity owned, operated, or controlled by the
People’s Liberation Army of China or the People’s Armed
Police of China from operating in the United States or
conducting certain business with persons subject to the ju-
risdiction of the United States.
SEC. 3. DETERMINATION OF COMMUNIST CHINESE MILI-
TARY COMPANIES.
(a) IN GENERAL.—Not later than 90 days after the
date of the enactment of this Act, the Secretary of De-
fense, in consultation with the Secretary of the Treasury,
the Attorney General, the Director of Central Intelligence,
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 indi-
rectly in the United States or any of its territories and
possessions, and shall publish the list of such persons in
the Federal Register. Every 6 months, the Secretary of
Defense, in consultation with the Secretary of the Treas-
ury, the Attorney General, the Director of Central Intel-
ligence, and the Director of the Federal Bureau of Inves-
tigation, shall make such additions to or deletions from
the list as are necessary, based on the latest information
available.
(b) COMMUNIST CHINESE MILITARY COMPANY.—For
purposes of making the determination required by sub-
section (a), the term ‘‘Communist Chinese military com-
pany’’—
(1) means a person that is—
(A) engaged in providing commercial serv-
ices, manufacturing, producing, or exporting;
and
(B) owned, operated, or controlled by the
People’s Liberation Army of China or the Peo-
ple’s Armed Police of China; and
(2) includes, but is not limited to, any person
identified in the United States Defense Intelligence
Agency publication numbered VP–1920–271–90,
dated September 1990, or PC–1921–57–95, dated
October 1995, and any updates of such report under
subsection (c).
(c) UPDATING OF REPORTS.—The United States De-
fense Intelligence Agency shall update the report described
in subsection (b)(2) by not later than 90 days after the
date of the enactment of this Act and not later than every
6 months thereafter, for purposes of identifying Com-
munist Chinese military companies.
SEC. 4. PROHIBITIONS.
(a) OFFICERS, DIRECTORS, ETC.—It shall be unlaw-
ful for any person to serve as an officer, director, or other
manager of any office or business anywhere in the United
States or its territories or possessions that is owned, oper-
ated, or controlled by a Communist Chinese military com-
pany.
(b) DIVESTITURE.—The President shall by regula-
tion require the closing and divestiture of any office or
business in the United States or its territories or posses-
sions that is owned, operated, or controlled by a Com-
munist Chinese military company.
(c) IMPORTATION.—No goods or services that are the
growth, product, or manufacture of a Communist Chinese
military company may enter the customs territory of the
United States.
(d) CONTRACTS, LOANS, OWNERSHIP INTERESTS.—
It shall be unlawful for any person subject to the jurisdic-
tion of the United States knowingly—
(1) to make any loan or other extension of cred-
it to any Communist Chinese military company; or
(2) to acquire an ownership interest in any
Communist Chinese military company.
(e) EXPORTS.—It shall be unlawful for any person
subject to the jurisdiction of the United States to export
any item on the United States Munitions List to a Com-
munist Chinese military company.
(f) EXCEPTION FOR HUMANITARIAN ITEMS.—Sub-
sections (a) through (e) shall not apply with respect to
a transaction if the President determines that the trans-
action involves the transfer of food, clothing, medicine, or
emergency supplies intended to relieve human suffering,
and the President transmits that determination to the
Congress.
SEC. 5. REGULATORY AUTHORITY.
The President shall issue such regulations as are nec-
essary to carry out this Act.
SEC. 6. PENALTIES.
Any person who knowingly violates section 4 or any
regulation issued thereunder—
(1) in the case of the first offense, shall be
fined not more the $100,000, or imprisoned not
more than 1 year, or both; and
(2) in the case of any subsequent offense, shall
be fined not more than $1,000,000, or imprisoned
not more than 4 years, or both.
SEC. 7. DEFINITION.
For purposes of this Act—
(1) the term ‘‘People’s Liberation Army’’ means
the land, naval, and air military services and the
military intelligence services of the Communist Gov-
ernment of the People’s Republic of China, and any
member of any such service; and
(2) the term ‘‘People’s Armed Police’’ means
the paramilitary service of the Communist Govern-
ment of the People’s Republic of China, whether or
not such service is subject to the control of the Peo-
ple’s Liberation Army, the Public Security Bureau
of that government, or any other governmental en-
tity of the People’s Republic of China.
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