II 118th CONGRESS 1st Session S. 1997 IN THE SENATE OF THE UNITED STATES June 14, 2023 Mr. Rubio introduced the following bill; which was read twice and referred to the Committee on Foreign Relations A BILL To promote peace through strength in Taiwan, and for other purposes.

1. Short title This Act may be cited as the Taiwan Peace through Strength Act of 2023 . 2. Anticipatory policy planning and annual review of United States war plans to defend Taiwan (a) In general Not later than 180 days after the date of the enactment of this Act, and annually thereafter, the Secretary of Defense shall conduct a classified review of United States war plans to defend Taiwan and share the results of the review with the Chairman and Ranking Member of the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives. (b) Elements The review conducted under subsection (a) shall include the following elements: (1) An assessment of Taiwan's current and near-term capabilities and United States force readiness and the adequacy of United States conflict contingency plans. (2) A comprehensive assessment of risks to the United States and United States interests, including readiness shortfalls that pose strategic risk. (3) A review of indicators of the near-term likelihood of the use of force by the People's Liberation Army against Taiwan. (4) The compilation of a pre-approved list of military capabilities, including both asymmetric and traditional capabilities selected to suit the operational environment and to allow Taiwan to respond effectively to a variety of contingencies across all phases of conflict involving the People’s Liberation Army, that the Secretary of Defense has pre-cleared for Taiwan to acquire, and that would reduce the threat of conflict, thwart an invasion, and mitigate other risks to the United States and Taiwan. 3. Fast-tracking sales to Taiwan under Foreign Military Sales program (a) Preclearance of certain foreign military sales items (1) In general Not later than one year after the date of the enactment of this Act, and annually thereafter, the Secretary of State, in coordination with the Secretary of Defense and in conjunction with relevant coordinating entities, such as the National Disclosure Policy Committee and the Arms Transfer and Technology Release Senior Steering Group, shall— (A) compile and submit to the relevant congressional committees a list of available and emerging military platforms, technologies, and equipment; and (B) upon listing such platforms, technologies, and equipment, pre-clear and prioritize for sale and release to Taiwan through the Foreign Military Sales program such platforms, technologies, and equipment. (2) Selection of items The items pre-cleared for sale pursuant to paragraph (1)— (A) shall represent a full-range of asymmetric capabilities as well as the conventional capabilities informed by United States readiness and risk assessments and determined by Taiwan to be required for various wartime scenarios and peacetime duties; and (B) shall include each item on the list of approved items compiled by the Secretary of Defense pursuant to section 2(b)(4). (3) Exception The Secretary of State may exclude an item from the list described in paragraph (1)(A) if the Secretary of State submits to the appropriate congressional committees a determination that the costs of providing such items, including the potential costs of technology slippage, exceeds the costs to the United States of failing to arm Taiwan with such items, including the likelihood of being drawn into conflict with the People’s Republic of China. (4) Rule of construction The list compiled pursuant to section 2(b)(4) shall not be construed as limiting the type, timing, or quantity of items that may be requested by, or sold to, Taiwan under the Foreign Military Sales program. (5) Final determination of disputes The Department of Defense shall serve as the lead Federal agency for purposes of making final determinations when disputes arise between agencies about the appropriateness of specific items for sale to Taiwan. (b) Prioritized processing of Foreign Military Sales requests from Taiwan (1) Requirement The Secretary of Defense and the Secretary of State shall prioritize and expedite the processing of requests from Taiwan under the Foreign Military Sales program, and may not delay the processing of requests for bundling purposes. (2) Duration The requirement under paragraph (1) shall continue until the Secretary of Defense determines and certifies to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives that the threat to Taiwan has significantly abated. (3) Annual report Not later than 180 days after the date of the enactment of this Act, and annually thereafter for 10 years, the Secretary of Defense shall submit to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives a report describing steps taken to implement the requirement under paragraph (1). (c) Priority production (1) Requirement The Secretary of Defense shall require that contractors awarded Department of Defense contracts to provide items for sale to Taiwan under the Foreign Military Sales program shall, as a condition of receiving such contracts, expedite and prioritize the production of such items above the production of other Foreign Military Sales items regardless of the order in which contracts were signed. (2) Duration The requirement under paragraph (1) shall continue until the Secretary of Defense determines and certifies to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives that the threat to Taiwan has significantly abated. (3) Annual report Contractors covered under paragraph (1) shall be required to report annually to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives on efforts to expedite and prioritize production as required under such paragraph. (d) Interagency policy The Secretary of State and the Secretary of Defense shall jointly review and update interagency policies and implementation guidance related to Foreign Military Sales requests from Taiwan, including incorporating the preclearance and prioritization provisions of this section. 4. Amendments to Taiwan Relations Act (a) Policy Section 2(b)(5) of the Taiwan Relations Act ( 22 U.S.C. 3301(b)(5) ) is amended by striking arms of a defensive character and inserting arms conducive to the deterrence of acts of aggression by the People’s Liberation Army . (b) Provision of defense articles and services Section 3(a) of the Taiwan Relations Act ( 22 U.S.C. 3302(a) ) is amended by striking such defense articles and defense services in such quantity as may be necessary to enable Taiwan to maintain a sufficient self-defense capability and inserting such defense articles and defense services in such quantity as may be necessary to enable Taiwan to implement a strategy to deter acts of aggression by the People’s Liberation Army and to deny an invasion of Taiwan by the People’s Liberation Army . (c) Rule of construction Section 4 of the Taiwan Relations Act ( 22 U.S.C. 3303 ) is amended by adding at the end the following new subsection: (e) Security cooperation and deterrence of use of force by People's Liberation Army Nothing in this Act, nor the facts of the President’s action in extending diplomatic recognition to the People’s Republic of China, the absence of diplomatic relations between the people of Taiwan and the United States, or the lack of formal recognition by the United States, and attendant circumstances thereto, shall be construed to constitute a legal or practical obstacle to any otherwise lawful action of the President or of any United States Government agency that is needed to advance or protect United States interests pertaining to Taiwan, including actions intended to strengthen security cooperation between the United States and Taiwan or to otherwise deter the use of force against Taiwan by the People’s Liberation Army. . 5. Military planning mechanism The Secretary of Defense shall establish a high-level military planning mechanism between the United States and Taiwan to oversee a Joint and Combined Exercise Program and coordinate International Military Education and Training assistance and professional exchanges aimed at determining and coordinating the acquisition of capabilities for both United States and Taiwan military forces to address the needs of currently anticipated and future contingencies. The mechanism may be modeled after the Joint United States Military Advisory Group Thailand, or any such similar existing arrangement, as determined by the Secretary of Defense. 6. Prohibition on doing business in China (a) Requirement The Secretary of Defense shall require any contractor awarded a Department of Defense contract, as a condition of receiving such contract, not to conduct any business in the People’s Republic of China with any entity that is owned by or controlled by the Government of the People’s Republic of China or the Chinese Communist Party, or any subsidiary of such a company. (b) Determination of noncompliance If the Secretary of Defense determines that a Department of Defense contractor is noncompliant with the requirement in subsection (a)— (1) such noncompliance shall be considered grounds for termination of the contract; and (2) the Secretary of Defense shall terminate the contract. 7. Taiwan critical munitions acquisition fund (a) Establishment There shall be established in the Treasury of the United States a revolving fund to be known as the Taiwan Critical Munitions Acquisition Fund (in this section referred to as the Fund ). (b) Purpose Subject to the availability of appropriations, amounts in the Fund shall be made available by the Secretary of Defense— (1) to ensure that adequate stocks of critical munitions necessary for a denial defense are available to allies and partners of the United States in advance of a potential operation to defend the autonomy and territory of Taiwan; and (2) to finance the acquisition of critical munitions necessary for a denial defense in advance of the transfer of such munitions to foreign countries for such a potential operation. (c) Additional authority Subject to the availability of appropriations, the Secretary of Defense may also use amounts made available to the Fund— (1) to keep on continuous order munitions that the Secretary of Defense considers critical due to a reduction in current stocks as a result of the drawdown of stocks provided to the government of one or more foreign countries; or (2) with the concurrence of the Secretary of State, to procure munitions identified as having a high-use rate. (d) Deposits (1) In general The Fund shall consist of each of the following: (A) Collections from sales made under letters of offer (or transfers made under the Foreign Assistance Act of 1961 ( 22 U.S.C. 2151 et seq. )) of munitions acquired using amounts made available from the Fund pursuant to this section, representing the value of such items calculated, as applicable, in accordance with— (i) subparagraph (B) or (C) of section 21(a)(1) of the Arms Export Control Act ( 22 U.S.C. 2761(a)(1) ); (ii) section 22 of the Arms Export Control Act ( 22 U.S.C. 2762 ); or (iii) section 644(m) of the Foreign Assistance Act of 1961 ( 22 U.S.C. 2403(m) ). (B) Such amounts as may be appropriated pursuant to the authorization under this section or otherwise made available for the purposes of the Fund. (C) Not more than $2,000,000,000 may be transferred to the Fund for any fiscal year, in accordance with subsection (e), from amounts authorized to be appropriated for the Department of Defense in such amounts as the Secretary of Defense determines necessary to carry out the purposes of this section, which shall remain available until expended. The transfer authority provided under this subparagraph is in addition to any other transfer authority available to the Secretary of Defense. (2) Contributions from foreign governments (A) In general Subject to subparagraph (B), the Secretary of Defense may accept contributions of amounts to the Fund from any foreign government or international organization. Any amounts so accepted shall be credited to the Taiwan Critical Munitions Acquisition Fund and shall be available for use as authorized under subsection (b). (B) Limitation The Secretary of Defense may not accept a contribution under this paragraph if the acceptance of the contribution would compromise, or appear to compromise, the integrity of any program of the Department of Defense. (C) Notification If the Secretary of Defense accepts any contribution under this paragraph, the Secretary shall notify the appropriate committees of Congress. The notice shall specify the source and amount of any contribution so accepted and the use of any amount so accepted. (e) Notification (1) In general No amount may be transferred pursuant to subsection (d)(1)(C) until the date that is 15 days after the date on which the Secretary of Defense submits to the appropriate committees of Congress— (A) notice in writing of the amount and purpose of the proposed transfer; and (B) in the case of an authorization pursuant to subsection (f)(1)(A), a description of the manner in which the use of critical munitions is necessary to meet national defense requirements. (2) Ammunition purchases No amounts in the Fund may be used to purchase ammunition, as authorized by this section, until the date that is 15 days after the date on which the Secretary of Defense notifies the appropriate committees of Congress in writing of the amount and purpose of the proposed purchase. (3) Foreign transfers No munition purchased using amounts in the Fund may be transferred to a foreign country until the date that is 15 days after the date on which the Secretary of Defense notifies the appropriate committees of Congress in writing of the proposed transfer. (f) Limitations (1) Limitation on transfer No munition acquired by the Secretary of Defense using amounts made available from the Fund pursuant to this section may be transferred to any foreign country unless such transfer is authorized by the Arms Export Control Act ( 22 U.S.C. 2751 et seq. ), the Foreign Assistance Act of 1961 ( 22 U.S.C. 2151 et seq. ), or other applicable law, except as follows: (A) The Secretary of Defense, with the concurrence of the Secretary of State, may authorize the use by the Department of Defense of munitions acquired under this section prior to transfer to a foreign country, if such use is necessary to meet national defense requirements and the Department bears the costs of replacement and transport, maintenance, storage, and other such associated costs of such munitions. (B) Except as required by subparagraph (A), amounts made available to the Fund may be used to pay for storage, maintenance, and other costs related to the storage, preservation, and preparation for transfer of munitions acquired under this section prior to their transfer, and the administrative costs of the Department of Defense incurred in the acquisition of such items, to the extent such costs are not eligible for reimbursement pursuant to section 43(b) of the Arms Export Control Act ( 22 U.S.C. 2792(b) ). (2) Certification requirement (A) In general No amounts in the Fund may be used pursuant to this section unless the President— (i) certifies to the appropriate committees of Congress that the Special Defense Acquisition Fund established pursuant to chapter 5 of the Arms Export Control Act ( 22 U.S.C. 2795 et seq. ) cannot be used to fulfill the same functions and objectives for which such amounts to be made available from the Fund are to be used; and (ii) includes in such certification a justification for the certification, which may be included in a classified annex, if necessary. (B) Nondelegation The President may not delegate any responsibility of the President under subparagraph (A). (g) Termination The authority for the Fund under this section shall expire on December 31, 2040. (h) Appropriate committees of congress defined In this section, the term appropriate committees of Congress means— (1) the Committee on Armed Services, the Committee on Appropriations, and the Committee on Foreign Relations of the Senate; and (2) the Committee on Armed Services, the Committee on Appropriations, and the Committee on Foreign Affairs of the House of Representatives. 8. Increasing production capacity for weapons for united states stockpiles (a) Report requirement relating to increase in contracted entities Section 222c(e) of title 10, United States Code, as amended by section 1701(c) of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 ( Public Law 117–263 ), is further amended by adding at the end the following new paragraph: (4) Steps taken to increase the number of entities contracted to supply each class of weapons described in section 1705(c) of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 ( Public Law 117–263 ) in order to produce redundancy in the supply of such weapons. . (b) Modification to quarterly briefings on replenishment and revitalization of weapons provided to ukraine and taiwan Section 1703 of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 ( Public Law 117–263 ) is amended— (1) in the section heading, by inserting and Taiwan after Ukraine ; (2) in subsection (a), by inserting , the Committee on Foreign Relations of the Senate, and the Committee on Foreign Affairs of the House of Representatives after congressional defense committees ; (3) in subsection (d)(2), by inserting or Taiwan after Ukraine ; (4) in subsection (e), by striking December 31, 2026 and inserting December 31, 2040 ; and (5) by striking subsection (f) and inserting the following: (f) Covered system In this section, the term covered system means— (1) any system provided to the Government of Ukraine or the Government of Taiwan pursuant to— (A) section 506 of the Foreign Assistance Act of 1961 ( 22 U.S.C. 2318 ); or (B) section 614 of the Foreign Assistance Act of 1961 ( 22 U.S.C. 2364 ); (2) any system provided to the Government of Ukraine pursuant to the Ukraine Security Assistance Initiative established under section 1250 of the National Defense Authorization Act for Fiscal Year 2016 ( Public Law 114–92 ), including as amended by this Act, if such system was provided to Ukraine after February 24, 2022; or (3) any system provided to the Government of Taiwan— (A) pursuant to section 5502(b) of this Act; or (B) that is necessary for a denial defense of Taiwan. . (c) Assessment on expanding national technology and industrial base Section 222d(b) of title 10, United States Code, as added by section 1701(d)(1) of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 ( Public Law 117–263 ), is amended by adding at the end the following new paragraph: (13) An assessment of the feasibility and advisability of expanding the national technology and industrial base (as defined in section 4801 of this title) to include entities outside of the United States, Canada, the United Kingdom, New Zealand, Israel, and Australia in order to increase the number of suppliers of weapons described in section 1705(c) of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 ( Public Law 117–263 ), with particular attention to member states of the North Atlantic Treaty Organization, treaty allies of the United States in the Indo-Pacific, and members of the Quadrilateral Security Dialogue. . (d) Minimum annual production levels The Secretary of Defense shall include minimum annual production levels for weapons described in section 1705(c) of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 ( Public Law 117–263 ) in any contract for the procurement of such weapons entered into on or after the date of the enactment of this Act.