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.

SECTION 1. CONGRESSIONAL FINDINGS AND DECLARATION OF POLICY.

    (a) Findings.--The Congress makes the following findings:
            (1) The People's Liberation Army is the principal 
        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 programs, 1 submarine-launched missile 
        program, a new class of compact but long-range cruise missiles, 
        and an upgrading of medium- and short-range ballistic 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 weapons 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, including 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 People's Liberation 
        Army conducted missile tests to intimidate Taiwan when Taiwan 
        held historic free elections, and those tests effectively 
        blockaded Taiwan's 2 principal ports of Keelung and Kaohsiung.
            (7) The People's Liberation Army has contributed 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 associated defense 
        companies have provided ballistic missile components, cruise 
        missiles, and chemical weapons 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 company 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 United States 
        Customs Service of May 21, 1996, indicated that the 
        representative of Poly Technologies and Norinco claimed), and 
        Communist Chinese authorities 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 Understanding with the United States on 
        intellectual property rights by running factories which pirate 
        videos, compact discs, and computer software that are products 
        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 
        transshipment 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 enterprises subsidize the 
        expansion and activities of the People's Liberation Army 
        described in this subsection.
            (13) The commercial activities of the People's Liberation 
        Army are frequently conducted on noncommercial 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 Military 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 
        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 indirectly in the United States or any of its 
        territories and possessions, and shall publish the list of such 
        persons in the Federal Register. On an ongoing basis, the 
        Secretary of Defense, 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 make additions or deletions to the list 
        based on the latest information available.
            (2) Communist chinese military company.--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 
                        exporting, and
                            (ii) owned or controlled by the People's 
                        Liberation Army, and
                    (B) 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 update 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 Treasury 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 Communist Chinese military company, without regard to section 
        202 of that Act.
            (2) Penalties.--The penalties set forth in section 206 of 
        the International Emergency Economic Powers Act (50 U.S.C. 
        1705) shall apply to violations 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 warehouse 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 Liberation Army'' 
means the land, naval, and air military services, the police, and the 
intelligence services of the Communist Government of the People's 
Republic of China, and any member of any such service or of such 
police.

Summary: Directs the Secretary of Defense to compile and publish in the Federal Register a list of Communist Chinese military companies that are operating directly or indirectly in the United States or its territories and possessions. 
Prohibits the extension of nondiscriminatory treatment (most-favored-nation treatment) to goods that are produced, manufactured, or exported by the People's Liberation Army or a Communist Chinese military company.