Title: Stop Sanctions Violators Act
Policy area: Foreign Trade and International Finance

Summary:
Stop Sanctions Violators Act
This bill prohibits the President from modifying civil penalties as applied to a Chinese telecommunications firm for violations of export controls or sanctions laws unless certain requirements are met.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6053 Introduced in House (IH)]

<DOC>






115th CONGRESS
  2d Session
                                H. R. 6053

 To prohibit the modification of civil penalties under export control 
    and sanctions laws of the United States with respect to Chinese 
                      telecommunication companies.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              June 8, 2018

Mr. Deutch (for himself and Ms. Ros-Lehtinen) introduced the following 
      bill; which was referred to the Committee on Foreign Affairs

_______________________________________________________________________

                                 A BILL


 
 To prohibit the modification of civil penalties under export control 
    and sanctions laws of the United States with respect to Chinese 
                      telecommunication companies.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Stop Sanctions Violators Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) In March 2016 Chinese electronics company Zhongxing 
        Telecommunications Equipment (ZTE) was found to have breached 
        United States sanctions laws by exporting products with 
        American-made components to Iran in violation of the Export 
        Administration Regulations (15 C.F.R. part 730 et seq.) and the 
        Iranian Transactions and Sanctions Regulations (31 C.F.R. part 
        560).
            (2) In March 2017 the Department of Commerce announced that 
        ZTE also shipped 283 microprocessors, servers, and routers to 
        North Korea in violation of United States law.
            (3) The Department of Commerce found that ZTE had knowingly 
        made false statements and misled investigators about its 
        business with Iran and North Korea, with Secretary of Commerce, 
        Wilbur L. Ross, Jr., stating, ``The results of this 
        investigation and the unprecedented penalty reflects ZTE's 
        egregious scheme to evade U.S. law and systematically mislead 
        investigators.''.
            (4) The Department of Commerce found that ZTE employees had 
        ``destroyed, removed, or sanitized all materials concerning 
        transactions or other activities relating to ZTE's Iran 
        business that post-dated March 2012; deleted on a nightly basis 
        all of the team's emails to conceal the team's activities; and 
        required each of the team members to sign a non-disclosure 
        agreement covering the ZTE transactions and activities the team 
        was tasked with hiding.''.
            (5) The Department of Commerce further disclosed a 2011 
        internal ZTE document detailing its ongoing business in Iran, 
        North Korea, Syria, Sudan, and Cuba, at the time all listed by 
        the United States as state sponsors of terrorism and subject to 
        embargoes.
            (6) ZTE plead guilty to the charges and the Department of 
        Commerce fined ZTE $1.19 billion, the largest-ever combined 
        civil and criminal penalty.
            (7) In announcing the plea and subsequent fine, Secretary 
        of Commerce, Wilbur L. Ross, Jr., stated, ``Those who flout our 
        economic sanctions and export control laws will not go 
        unpunished--they will suffer the harshest of consequences.''.
            (8) As part of ZTE's plea agreement with the United States, 
        ZTE would be subject to a seven-year suspended denial of export 
        privileges, which could be quickly activated if any aspect of 
        the deal was not met.
            (9) On April 16, 2018, the Department of Commerce announced 
        it had imposed a denial of export privileges against ZTE due to 
        its determination that ``ZTE made false statements to [the 
        Bureau of Industry and Security of the Department of Commerce] 
        in 2016, during settlement negotiations, and 2017, during the 
        probationary period, related to senior employee disciplinary 
        actions the company said it was taking or had already taken.''.
            (10) In 2012, a report of the Permanent Select Committee on 
        Intelligence of the House of Representatives entitled, 
        ``Investigative Report on the United States National Security 
        Issues Posed by Chinese Telecommunication Companies Huawei and 
        ZTE'', it was recommended that ``U.S. government systems, 
        particularly sensitive systems, should not include Huawei or 
        ZTE equipment, including in component parts. Similarly, 
        government contractors--particularly those working on contracts 
        for sensitive U.S. programs--should exclude ZTE or Huawei 
        equipment in their systems.''.
            (11) The Federal Bureau of Investigation, in a February 
        2015 Counterintelligence Strategy Partnership Intelligence Note 
        stated that, ``Chinese Government-supported telecommunications 
        equipment on U.S. networks may be exploited through Chinese 
        cyber activity, with China's intelligence services operating as 
        an advanced persistent threat to U.S. networks.''.

SEC. 3. PROHIBITION ON MODIFICATION OF CIVIL PENALTIES UNDER EXPORT 
              CONTROL AND SANCTIONS LAWS WITH RESPECT TO CHINESE 
              TELECOMMUNICATION COMPANIES.

    (a) In General.--Notwithstanding any other provision of law, the 
President may not modify any civil penalties, including denial orders, 
implemented by the Government of the United States with respect to a 
Chinese telecommunication company pursuant to a determination that the 
company has violated an export control or sanctions law of the United 
States until the date that is 30 days after the President certifies to 
the appropriate committees of Congress that--
            (1) the company--
                    (A) is fully cooperating with investigations 
                conducted by the Government of the United States, if 
                any, of activities relating to the violation of the 
                export control or sanctions law of the United States; 
                and
                    (B) has not, for a period of at least one year 
                after the date on which the civil penalties were 
                imposed, conducted any other activities in violation of 
                an export control or sanctions law of the United 
                States; and
            (2) the modification of the civil penalties is in the vital 
        national security interest of the United States and the 
        President includes in the certification a specific and detailed 
        rationale for such modification.
    (b) Appropriate Committees of Congress Defined.--In this section, 
the term ``appropriate committees of Congress'' means--
            (1) the Committee on Banking, Housing, and Urban Affairs 
        and the Committee on Foreign Relations of the Senate; and
            (2) the Committee on Financial Services and the Committee 
        on Foreign Affairs of the House of Representatives.
                                 <all>