H.R. 1486: Economic Espionage Prevention Act

This bill, titled the Economic Espionage Prevention Act, aims to impose sanctions against foreign entities engaged in economic or industrial espionage that negatively impacts U.S. trade secrets and proprietary information. It is introduced in the context of increasing concerns regarding foreign adversaries, particularly entities from the People's Republic of China, who are believed to be supporting Russia's military capabilities through the provision of critical components like semiconductors.

Key Provisions

• Report Requirement: Within 90 days of the bill's enactment, the Secretary of State must report to Congress on whether any foreign individuals or entities from China are involved in supplying critical materials to Russia's military or defense sectors.
• Sanction Authority: The President gains the authority to impose various sanctions 30 days after the bill's enactment against foreign persons identified as engaging in economic espionage or providing support to foreign military and intelligence entities.
• Criteria for Sanctions: The sanctions could be applied to entities that:
  • Engage in economic or industrial espionage regarding U.S. trade secrets.
  • Provide material support to a foreign adversary's military or intelligence sectors.
  • Violate U.S. export control laws.
• Types of Sanctions: The sanctions may include:
  • Blocking property and interests belonging to the sanctioned entities.
  • Ineligibility for U.S. visas and admission for individuals linked to the sanctioned entities.
  • Revocation of any existing visas or entry documents held by those individuals.
• Exceptions to Sanctions: The sanctions do not apply to activities related to U.S. intelligence, international obligations, or necessary law enforcement activities.
• Waiver Provision: The President can waive sanctions for up to 180 days if deemed necessary for national security interests.
• Annual Reporting: The President is required to submit annual reports on developments in economic or industrial espionage by foreign entities for the next five years, unless sanctions have already been imposed.

Definitions

The bill defines several key terms, including:

• Foreign Person: Any individual or entity that is not a U.S. person.
• Economic or Industrial Espionage: Engaging in activities to acquire trade secrets without consent.
• Foreign Adversary: Specific countries identified as opposing U.S. interests.

Concerns Addressed

The bill acknowledges specific findings about increased semiconductor exports from China to Russia and highlights the threats posed by these transactions to U.S. and allied interests. It indicates a structural response to bolster national security and deter espionage activities by foreign entities.

Implementation and Enforcement

The bill tasks the President with the execution and enforcement of sanctions and establishes penalties for violations consistent with existing U.S. laws regarding economic powers.

Relevant Companies

• NVDA (NVIDIA Corporation): A major player in semiconductor manufacturing that may be directly affected by sanctions against foreign entities involved in semiconductor production and supply chain operations.
• INTC (Intel Corporation): As another key semiconductor manufacturer, Intel could be impacted through supply chain disruptions or regulatory actions resulting from this legislation.
• AMD (Advanced Micro Devices, Inc.): Similar to NVIDIA and Intel, AMD’s operations in semiconductor production and sale could be influenced by the sanctions imposed on foreign adversaries.