I 
115TH CONGRESS 
2D SESSION 
H. R. 6001 
To safeguard certain technology and intellectual property in the United States 
from export to or influence by the People’s Republic of China and 
to protect United States industry from unfair competition by the People’s 
Republic of China, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 5, 2018 
Mr. CONAWAY (for himself and Mr. RYAN of Ohio) introduced the following 
bill; which was referred to the Committee on Ways and Means, and in 
addition to the Committees on Financial Services, the Judiciary, Foreign 
Affairs, and Oversight and Government Reform, for a period to be subse-
quently determined by the Speaker, in each case for consideration of such 
provisions as fall within the jurisdiction of the committee concerned 
A BILL 
To safeguard certain technology and intellectual property 
in the United States from export to or influence by 
the People’s Republic of China and to protect United 
States industry from unfair competition by the People’s 
Republic of China, 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; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Fair Trade with China Enforcement Act’’. 
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(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title; table of contents. 
Sec. 2. Sense of Congress. 
Sec. 3. Statement of policy. 
TITLE 
I—SAFEGUARDS 
AGAINST 
FOREIGN 
INFLUENCE 
IN 
UNITED STATES NATIONAL AND ECONOMIC SECURITY BY THE 
PEOPLE’S REPUBLIC OF CHINA 
Sec. 101. Establishment of list of certain products receiving support from Gov-
ernment of People’s Republic of China pursuant to Made in 
China 2025 policy. 
Sec. 102. Prohibition on export to People’s Republic of China of national secu-
rity sensitive technology and intellectual property. 
Sec. 103. Imposition of shareholder cap on Chinese investors in United States 
corporations. 
Sec. 104. Prohibition on use of certain telecommunications services or equip-
ment. 
TITLE II—FAIR TRADE ENFORCEMENT ACTIONS WITH RESPECT 
TO THE PEOPLE’S REPUBLIC OF CHINA 
Sec. 201. Countervailing duties with respect to certain industries in the Peo-
ple’s Republic of China. 
Sec. 202. Repeal of reduced withholding rates for residents of China. 
Sec. 203. Taxation of obligations of the United States held by the Government 
of the People’s Republic of China. 
Sec. 204. Surtax on certain income derived from China. 
TITLE III—STOPPING FOREIGN BUSINESSES SANCTUARY ACT OF 
2018 
Sec. 301. Short title. 
Sec. 302. Jurisdiction over certain foreign entities. 
Sec. 303. Commercial activity of affiliate entities. 
SEC. 2. SENSE OF CONGRESS. 
It is the sense of Congress that— 
(1) since joining the World Trade Organization 
in 2001, the People’s Republic of China has offered 
the United States a contradictory bargain, which 
promised openness in the global trade order, but 
through state mercantilism delivered a severely im-
balanced trading relationship; 
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(2) it was erroneous for the United States Gov-
ernment to have ignored the contradictions and risks 
of free trade with the People’s Republic of China on 
the assumption that the People’s Republic of China 
would liberalize economically and politically; 
(3) benefitting enormously from a more open 
global economy to drive its own industries, the Gov-
ernment of the People’s Republic of China and the 
Communist Party of the People’s Republic of China 
have only tightened their grip on power, brutally 
suppressing dissent at home and pursuing policies 
abroad that are a far cry from being a responsible 
global stakeholder; 
(4) malevolent economic behavior by persons in 
the People’s Republic of China is made clear by the 
theft of intellectual property from the United States, 
as Chinese theft of United States intellectual prop-
erty 
alone 
costs 
the 
United 
States 
nearly 
$600,000,000,000 annually, according to the United 
States Trade Representative; 
(5) stealing United States intellectual property 
advances the ‘‘Made in China 2025’’ initiative of the 
Government of the People’s Republic of China to 
eventually dominate global exports in 10 critical sec-
tors, namely artificial intelligence and next-genera-
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tion information technology, robotics, new-energy ve-
hicles, biotechnology, energy and power generation, 
aerospace, high-tech shipping, advanced railway, new 
materials, and agricultural machinery, among oth-
ers; 
(6) the targets of the Made in China 2025 ini-
tiative reveal the goal of the People’s Republic of 
China for the near-total displacement of advanced 
manufacturing in the United States; and 
(7) the United States Government should act to 
strengthen the position of the United States in its 
policy toward the People’s Republic of China in 
order to create a more balanced economic relation-
ship by safeguarding strategic assets from Chinese 
influence, reducing Chinese involvement in the 
United States economy, and encouraging United 
States companies to produce domestically, instead of 
in the People’s Republic of China. 
SEC. 3. STATEMENT OF POLICY. 
It is the policy of the United States— 
(1) to impose restrictions on Chinese invest-
ment in the United States in strategic industries 
targeted by the Made in China 2025 initiative set 
forth by the Government of the People’s Republic of 
China; 
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(2) to tax Chinese investment in the United 
States due to its negative effect on the United 
States trade deficit and wages of workers in the 
United States; 
(3) to increase the cost of transnational produc-
tion operations in the People’s Republic of China in 
a manner consistent with the economic cost of the 
risk of loss of unique access by the United States to 
intellectual property, technology, and industrial base; 
and 
(4) to support democratization in and the 
human rights of the people of Hong Kong, including 
the findings and declarations set forth under section 
2 of the United States-Hong Kong Policy Act of 
1992 (22 U.S.C. 5701). 
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TITLE I—SAFEGUARDS AGAINST 
FOREIGN 
INFLUENCE 
IN 
UNITED 
STATES 
NATIONAL 
AND ECONOMIC SECURITY BY 
THE PEOPLE’S REPUBLIC OF 
CHINA 
SEC. 101. ESTABLISHMENT OF LIST OF CERTAIN PRODUCTS 
RECEIVING SUPPORT FROM GOVERNMENT 
OF PEOPLE’S REPUBLIC OF CHINA PURSU-
ANT TO MADE IN CHINA 2025 POLICY. 
(a) IN GENERAL.—Chapter 8 of title I of the Trade 
Act of 1974 (19 U.S.C. 2241 et seq.) is amended by add-
ing at the end the following: 
‘‘SEC. 183. LIST OF CERTAIN PRODUCTS RECEIVING SUP-
PORT FROM GOVERNMENT OF PEOPLE’S RE-
PUBLIC OF CHINA. 
‘‘(a) IN GENERAL.—Not later than 120 days after 
the date of the enactment of the Fair Trade with China 
Enforcement Act, and every year thereafter, the United 
States Trade Representative shall set forth a list of prod-
ucts manufactured or produced in, or exported from, the 
People’s Republic of China that are determined by the 
Trade Representative to receive support from the Govern-
ment of the People’s Republic of China pursuant to the 
Made in China 2025 industrial policy of that Government. 
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‘‘(b) CRITERIA FOR LIST.— 
‘‘(1) IN GENERAL.—The Trade Representative 
shall include in the list required by subsection (a) 
the following products: 
‘‘(A) Any product specified in the following 
documents set forth by the Government of the 
People’s Republic of China: 
‘‘(i) Notice on Issuing Made in China 
2025. 
‘‘(ii) China Manufacturing 2025. 
‘‘(iii) Notice on Issuing the 13th Five- 
year National Strategic Emerging Indus-
tries Development Plan. 
‘‘(iv) Guiding Opinion on Promoting 
International 
Industrial 
Capacity 
and 
Equipment Manufacturing Cooperation. 
‘‘(v) Any other document that ex-
presses a national strategy or stated goal 
in connection with the Made in China 2025 
industrial policy set forth by the Govern-
ment of the People’s Republic of China, 
the Communist Party of China, or another 
entity or individual capable of impacting 
the national strategy of the People’s Re-
public of China. 
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‘‘(B) Any product receiving support from 
the Government of the People’s Republic of 
China that has or will in the future displace net 
exports of like products by the United States, 
as determined by the Trade Representative. 
‘‘(2) INCLUDED
PRODUCTS.—In addition to 
such products as the Trade Representative shall in-
clude pursuant to paragraph (1) in the list required 
by subsection (a), the Trade Representative shall in-
clude products in the following industries: 
‘‘(A) Civil aircraft. 
‘‘(B) Motor car and vehicle. 
‘‘(C) Advanced medical equipment. 
‘‘(D) Advanced construction equipment. 
‘‘(E) Agricultural machinery. 
‘‘(F) Railway equipment. 
‘‘(G) Diesel locomotive. 
‘‘(H) Moving freight. 
‘‘(I) Semiconductor. 
‘‘(J) Lithium battery manufacturing. 
‘‘(K) Artificial intelligence. 
‘‘(L) High-capacity computing. 
‘‘(M) Quantum computing. 
‘‘(N) Robotics. 
‘‘(O) Biotechnology.’’. 
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(b) CLERICAL AMENDMENT.—The table of contents 
for the Trade Act of 1974 is amended by inserting after 
the item relating to section 182 the following: 
‘‘Sec. 183. List of certain products receiving support from Government of Peo-
ple’s Republic of China.’’. 
SEC. 102. PROHIBITION ON EXPORT TO PEOPLE’S REPUB-
LIC OF CHINA OF NATIONAL SECURITY SEN-
SITIVE TECHNOLOGY AND INTELLECTUAL 
PROPERTY. 
(a) IN GENERAL.—The Secretary of Commerce shall 
prohibit the export to the People’s Republic of China of 
any national security sensitive technology or intellectual 
property subject to the jurisdiction of the United States 
or exported by any person subject to the jurisdiction of 
the United States. 
(b) DEFINITIONS.—In this section: 
(1) INTELLECTUAL PROPERTY.—The term ‘‘in-
tellectual property’’ includes patents, copyrights, 
trademarks, or trade secrets. 
(2) NATIONAL
SECURITY
SENSITIVE
TECH-
NOLOGY OR INTELLECTUAL PROPERTY.—The term 
‘‘national security sensitive technology or intellectual 
property’’ includes the following: 
(A) Technology or intellectual property 
that would make a significant contribution to 
the military potential of the People’s Republic 
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of China that would prove detrimental to the 
national security of the United States. 
(B) Technology or intellectual property 
necessary to protect the economy of the United 
States from the excessive drain of scarce mate-
rials and to reduce the serious inflationary im-
pact of demand from the People’s Republic of 
China. 
(C) Technology or intellectual property 
that is a component of the production of prod-
ucts included in the most recent list required 
under section 183 of the Trade Act of 1974, as 
added by section 101(a), determined in con-
sultation with the United States Trade Rep-
resentative. 
(3) TECHNOLOGY.—The term ‘‘technology’’ in-
cludes goods or services relating to information sys-
tems, internet-based services, production-enhancing 
logistics, 
robotics, 
artificial 
intelligence, 
bio-
technology, or computing. 
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SEC. 103. IMPOSITION OF SHAREHOLDER CAP ON CHINESE 
INVESTORS IN UNITED STATES CORPORA-
TIONS. 
Section 13(d) of the Securities Exchange Act of 1934 
(15 U.S.C. 78m(d)) is amended by adding at the end the 
following: 
‘‘(7)(A) In this paragraph, the term ‘covered issuer’ 
means any issuer that produces components that may be 
used in the production of goods manufactured or produced 
in, or exported from, the People’s Republic of China and 
included in the most recent list required under section 183 
of the Trade Act of 1974, determined in consultation with 
the United States Trade Representative. 
‘‘(B) No covered issuer that is incorporated under the 
laws of a State, or whose principal place of business is 
within a State, may be majority-owned by a person whose 
principal place of business is in the People’s Republic of 
China. 
‘‘(C) The prohibition in subparagraph (B) shall apply 
to any acquisition on or after the date of enactment of 
this paragraph.’’. 
SEC. 104. PROHIBITION ON USE OF CERTAIN TELE-
COMMUNICATIONS 
SERVICES 
OR 
EQUIP-
MENT. 
(a) FINDINGS.—Congress makes the following find-
ings: 
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(1) In its 2011 ‘‘Annual Report to Congress on 
Military and Security Developments Involving the 
People’s Republic of China’’, the Department of De-
fense stated, ‘‘China’s defense industry has benefited 
from integration with a rapidly expanding civilian 
economy and science and technology sector, particu-
larly elements that have access to foreign technology. 
Progress within individual defense sectors appears 
linked to the relative integration of each, through 
China’s civilian economy, into the global production 
and R&D chain . . . Information technology compa-
nies in particular, including Huawei, Datang, and 
Zhongxing, maintain close ties to the PLA.’’. 
(2) In a 2011 report titled ‘‘The National Secu-
rity Implications of Investments and Products from 
the People’s Republic of China in the Telecommuni-
cations Sector’’, the United States China Economic 
and Security Review Commission stated that 
‘‘[n]ational security concerns have accompanied the 
dramatic growth of China’s telecom sector. . . . Ad-
ditionally, large Chinese companies—particularly 
those ‘national champions’ prominent in China’s 
‘going out’ strategy of overseas expansion—are di-
rectly subject to direction by the Chinese Communist 
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Party, to include support for PRC state policies and 
goals.’’. 
(3) The Commission further stated in its report 
that ‘‘[f]rom this point of view, the clear economic 
benefits of foreign investment in the U.S. must be 
weighed against the potential security concerns re-
lated to infrastructure components coming under the 
control of foreign entities. This seems particularly 
applicable in the telecommunications industry, as 
Chinese companies continue systematically to ac-
quire significant holdings in prominent global and 
U.S. telecommunications and information technology 
companies.’’. 
(4) In its 2011 Annual Report to Congress, the 
United States China Economic and Security Review 
Commission stated that ‘‘[t]he extent of the state’s 
control of the Chinese economy is difficult to quan-
tify . . . There is also a category of companies that, 
though claiming to be private, are subject to state 
influence. Such companies are often in new markets 
with no established SOE leaders and enjoy favorable 
government policies that support their development 
while posing obstacles to foreign competition. Exam-
ples include Chinese telecoms giant Huawei and 
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such automotive companies as battery maker BYD 
and vehicle manufacturers Geely and Chery.’’. 
(5) In the bipartisan ‘‘Investigative Report on 
the United States National Security Issues Posed by 
Chinese Telecommunication Companies Huawei and 
ZTE’’ released in 2012 by the Permanent Select 
Committee on Intelligence of the House of Rep-
resentatives, it was recommended that ‘‘U.S. govern-
ment systems, particularly sensitive systems, should 
not include Huawei or ZTE equipment, including in 
component parts. Similarly, government contrac-
tors—particularly those working on contracts for 
sensitive U.S. programs—should exclude ZTE or 
Huawei equipment in their systems.’’. 
(6) General Michael Hayden, who served as Di-
rector of the Central Intelligence Agency and Direc-
tor of the National Security Agency, stated in July 
2013 that Huawei had ‘‘shared with the Chinese 
state intimate and extensive knowledge of foreign 
telecommunications systems it is involved with’’. 
(7) The Federal Bureau of Investigation, in a 
February 2015 Counterintelligence Strategy Part-
nership Intelligence Note stated that, ‘‘[w]ith the ex-
panded use of Huawei Technologies Inc. equipment 
and services in U.S. telecommunications service pro-
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vider networks, the Chinese Government’s potential 
access to U.S. business communications is dramati-
cally increasing. Chinese Government-supported tele-
communications equipment on U.S. networks may be 
exploited through Chinese cyber activity, with Chi-
na’s intelligence services operating as an advanced 
persistent threat to U.S. networks.’’. 
(8) The Federal Bureau of Investigation fur-
ther stated in its February 2015 counterintelligence 
note that ‘‘China makes no secret that its cyber war-
fare strategy is predicated on controlling global com-
munications network infrastructure’’. 
(9) At a hearing before the Committee on 
Armed Services of the House of Representatives on 
September 30, 2015, Deputy Secretary of Defense 
Robert Work, responding to a question about the 
use of Huawei telecommunications equipment, stat-
ed, ‘‘In the Office of the Secretary of Defense, abso-
lutely not. And I know of no other—I don’t believe 
we operate in the Pentagon, any [Huawei] systems 
in the Pentagon.’’. 
(10) At that hearing, the Commander of the 
United States Cyber Command, Admiral Mike Rog-
ers, responding to a question about why such 
Huawei telecommunications equipment is not used, 
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stated, ‘‘As we look at supply chain and we look at 
potential vulnerabilities within the system, that it is 
a risk we felt was unacceptable.’’. 
(11) In March 2017, ZTE Corporation pled 
guilty to conspiring to violate the International 
Emergency Economic Powers Act by illegally ship-
ping United States-origin items to Iran, paying the 
United 
States 
Government 
a 
penalty 
of 
$892,360,064 for activity between January 2010 
and January 2016. 
(12) The Office of Foreign Assets Control of 
the Department of the Treasury issued a subpoena 
to Huawei as part of a Federal investigation of al-
leged violations of trade restrictions on Cuba, Iran, 
and Sudan. 
(b) PROHIBITION ON AGENCY USE OR PROCURE-
MENT.—The head of an agency may not procure or obtain, 
may not extend or renew a contract to procure or obtain, 
and may not enter into a contract (or extend or renew 
a contract) with an entity that uses, or contracts with any 
other entity that uses, any equipment, system, or service 
that uses covered telecommunications equipment or serv-
ices as a substantial or essential component of any system, 
or as critical technology as part of any system. 
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(c) REPORT.—Not later than one year after the date 
of the enactment of this Act, and annually thereafter, the 
Secretary of Commerce, in consultation with the Secretary 
of Defense and the United States Trade Representative, 
shall submit to Congress a report on sales by the Govern-
ment of the People’s Republic of China of covered tele-
communications equipment or services through partial 
ownership or any other methods. 
(d) DEFINITIONS.—In this section: 
(1) AGENCY.—The term ‘‘agency’’ has the 
meaning given that term in section 551 of title 5, 
United States Code. 
(2) COVERED
TELECOMMUNICATIONS
EQUIP-
MENT
OR
SERVICES.—The term ‘‘covered tele-
communications equipment or services’’ means any 
of the following: 
(A) Telecommunications equipment pro-
duced by Huawei Technologies Company, ZTE 
Corporation, or any other Chinese telecom enti-
ty identified by the Director of National Intel-
ligence, the Secretary of Defense, or the Direc-
tor of the Federal Bureau of Investigation as a 
security concern (or any subsidiary or affiliate 
of any such entity). 
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(B) Telecommunications services provided 
by such entities or using such equipment. 
(C) 
Telecommunications 
equipment 
or 
services produced or provided by an entity that 
the head of the relevant agency reasonably be-
lieves to be an entity owned or controlled by, or 
otherwise connected to, the Government of the 
People’s Republic of China. 
TITLE 
II—FAIR 
TRADE 
EN-
FORCEMENT ACTIONS WITH 
RESPECT TO THE PEOPLE’S 
REPUBLIC OF CHINA 
SEC. 201. COUNTERVAILING DUTIES WITH RESPECT TO 
CERTAIN INDUSTRIES IN THE PEOPLE’S RE-
PUBLIC OF CHINA. 
(a) POLICY.—It is the policy of the United States— 
(1) to reduce the import of finished goods from 
the People’s Republic of China relating to the Made 
in China 2025 plan set forth by the Government of 
the People’s Republic of China; and 
(2) to encourage allies of the United States to 
reduce the import of finished goods from the Peo-
ple’s Republic of China relating to the Made in 
China 2025 plan. 
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(b) INCLUSION OF MADE IN CHINA 2025 PRODUCTS 
IN DEFINITION OF COUNTERVAILABLE SUBSIDY.—Para-
graph (5) of section 771 of the Tariff Act of 1930 (19 
U.S.C. 1677) is amended by adding at the end the fol-
lowing: 
‘‘(G) TREATMENT
OF
CERTAIN
CHINESE 
MERCHANDISE.—Notwithstanding 
any 
other 
provision of this title, if a person presents evi-
dence in a petition filed under section 702(b) 
that merchandise covered by the petition is 
manufactured or produced in, or exported from, 
the People’s Republic of China and included in 
the most recent list required under section 183 
of the Trade Act of 1974, determined in con-
sultation with the United States Trade Rep-
resentative, the administrating authority shall 
determine that a countervailable subsidy is 
being provided with respect to that merchan-
dise.’’. 
(c) INCLUSION OF MADE IN CHINA 2025 PRODUCTS 
IN
DEFINITION
OF
MATERIAL
INJURY.—Paragraph 
(7)(F) of such section is amended by adding at the end 
the following: 
‘‘(iv) TREATMENT OF CERTAIN CHI-
NESE
MERCHANDISE.—Notwithstanding 
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any other provision of this title, if a peti-
tion filed under section 702(b) alleges that 
an industry in the United States is materi-
ally injured or threatened with material in-
jury or that the establishment of an indus-
try in the United States is materially re-
tarded by reason of imports of merchan-
dise manufactured or produced in, or ex-
ported from, the People’s Republic of 
China and included in the most recent list 
required under section 183 of the Trade 
Act of 1974, determined in consultation 
with the United States Trade Representa-
tive, the Commission shall determine that 
material injury or such a threat exists.’’. 
SEC. 202. REPEAL OF REDUCED WITHHOLDING RATES FOR 
RESIDENTS OF CHINA. 
(a) IN GENERAL.—Section 894 of the Internal Rev-
enue Code of 1986 is amended— 
(1) by striking ‘‘The provisions of’’ in sub-
section (a) and inserting ‘‘Except as otherwise pro-
vided in this section, the provisions of’’, and 
(2) by adding at the end the following new sub-
section: 
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