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Subtitle B—Nonproliferation 
Matters and Countries of Concern 
SEC. 1211. PROCUREMENT RESTRICTIONS AGAINST FOR-
EIGN PERSONS THAT TRANSFER CERTAIN 
DEFENSE ARTICLES AND SERVICES TO THE 
PEOPLE’S REPUBLIC OF CHINA. 
(a) DECLARATION OF POLICY.—Congress declares 
that it is the policy of the United States to deny the Peo-
ple’s Republic of China such defense goods and defense 
technology that could be used to threaten the United 
States or undermine the security of Taiwan or the stability 
of the Western Pacific region. 
(b) PROCUREMENT SANCTION.—(1) The Secretary of 
Defense may not procure, by contract or otherwise, any 
goods or services from— 
(A) any foreign person the Secretary of Defense 
determines has, with actual knowledge, on or after 
the date of the enactment of this Act, exported, 
transferred, or otherwise provided to governmental 
or nongovernmental entities of the People’s Republic 
of China any item or class of items on the United 
States Munitions List (or any item or class of items 
that are identical, substantially identical, or directly 
competitive to an item or class of items on the 
United States Munitions List); or 
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(B) any foreign person the Secretary of 
Defense determines— 
(i) is a successor entity to a person 
referred to in paragraph (1): 
(ii) is a parent or subsidiary of a per-
son referred to in paragraph (1); or 
(iii) is an affiliate of a person referred 
to in paragraph (1) if that affiliate is con-
trolled in fact by such person. 
(2) The prohibition under paragraph (1) with 
respect to a foreign person shall last for a period of 
five years after a determination is made by the Sec-
retary of Defense with respect to that person under 
paragraph (1)(A). 
(c) PUBLIC AVAILABILITY OF LIST OF SANCTIONED 
PERSONS.—(1) The Secretary of Defense shall annually 
publish in the Federal Register a current list of any for-
eign persons sanctioned under subsection (b). The removal 
of foreign persons from, and the addition of foreign per-
sons to, the list shall also be published. 
(2) The Secretary shall maintain the list pub-
lished under paragraph (1) on the internet website 
of the Department of Defense. 
(c) REMOVAL FROM LIST
OF SANCTIONED PER-
SONS.—The Secretary of Defense may remove a person 
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from the list of sanctioned persons referred to in sub-
section (c) only after the five-year prohibition period im-
posed under subsection (b) with respect to the person has 
expired. 
(d) EXCEPTIONS.—(1) Subsection (b) shall not apply 
(A) to contracts, or subcontracts under 
such contracts, in existence on the date of the 
enactment of this Act, including options under 
such contracts; 
(B) if the Secretary of Defense determines 
in writing that the person to which the sanc-
tions would otherwise be applied is a sole source 
supplier of the goods or services being procured, 
that the goods or services are essential, and 
that alternative sources are not readily or rea-
sonably available; 
(C) in the case of a contract for routine 
servicing and maintenance, if the Secretary of 
Defense determines in writing alternative 
sources for performing the contract are not 
readily or reasonably available; or 
(D) if the Secretary of Defense determines 
in writing that goods or services proposed to be 
procured under the contract are essential to the 
national security of the United States. 
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(2) Determinations under paragraph (1) shall 
be published in the Federal Register. 
(f) DEFINITIONS.—In this section: 
(1) The term ‘‘foreign person’’ has the meaning 
given the term in section 14 of the Iran and Libya 
Sanctions Act of 1996 (50 U.S.C. 1701 note). 
(2) The term ‘‘United States Munitions List’’ 
means the list referred to in section 38(a)(1) of the 
Arms Export Control Act (22 U.S.C. 2778 (a)(1)). 
Subtitle C—Other Matters 
SEC. 1221. EXECUTION OF THE PRESIDENT’S POLICY TO 
MAKE AVAILABLE TO TAIWAN DIESEL ELEC-
TRIC SUBMARINES. 
(a) FINDINGS.—Congress makes the following find-
ings: 
(1) It is the policy of the United States under 
the Taiwan Relations Act of 1979 to ‘‘make avail-
able to Taiwan such defense articles and defense 
services in such quantity as may be necessary to en-
able Taiwan to maintain a sufficient self-defense ca-
pability’’. 
(2) In April 2001, the President of the United 
States approved for sale eight diesel electric sub-
marines to the Republic of China on Taiwan. 
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(3) The buildup of attack submarines by the 
People’s Republic of China threatens the stability in 
the Taiwan Strait and longstanding United States 
national security interests in the Western Pacific. 
(4) Taiwan has a legitimate defense need for 
diesel electric submarines. 
(5) The sale of diesel electric submarines to 
Taiwan supports stability in the Taiwan Strait and 
Western Pacific. 
(6) The Legislative Yuan of the Republic of 
China on Taiwan should make every effort to sup-
port the President of Taiwan to fund the acquisition 
of diesel electric submarines from the United States. 
(7) The sale of diesel electric submarines to 
Taiwan is beneficial to the health and wellbeing of 
the United States shipbuilding industrial base and, 
therefore, United States national security. 
(b) POLICY OF THE UNITED STATES.—It shall be the 
policy of the United States to make available to Taiwan 
plans and options for design work and construction work 
on future diesel electric submarines under the United 
States foreign military sales process. The availability of 
such design work and construction work shall be made in 
a manner consistent with United States national disclo-
sure policy and is subject to the provisions of the Arms 
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Export Control Act (22 U.S.C. 2751 et seq.) and any 
other export control law of the United States. 
(c) REPORT.—Not later than 30 days after the date 
of the enactment of this Act, the Secretary of Defense 
shall submit to the congressional defense committees a re-
port on the present and future efforts of the Department 
of the Navy to execute the policy of the President to sell 
diesel electric submarines to the Republic of China on Tai-
wan. The report shall include the following: 
(1) Ongoing activities by the Navy Inter-
national Programs Office, in consultation with the 
Defense Security and Cooperation Agency, to make 
the Government of Taiwan aware of available For-
eign Military Sales options. 
(2) Future activities planned by the Navy Inter-
national Programs Office, in consultation with the 
Defense Security and Cooperation Agency, to make 
the Government of Taiwan aware of available For-
eign Military Sales options to acquire diesel electric 
submarines from the United States. 
(d) DEFINITIONS.—In this section: 
(1) The term ‘‘design work’’ means the process 
by which a submarine is designed. 
(2) The term ‘‘construction work’’ means the 
process by which a submarine is constructed. 
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