Sec. 1718. ACTIONS BY THE COMMITTEE TO ADDRESS NATIONAL SECURITY RISKS
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## SEC. 1718 ACTIONS BY THE COMMITTEE TO ADDRESS NATIONAL SECURITY RISKS Section 721(l) of the Defense Production Act of 1950 (50 U.S.C. 4565(l)) is amended— ####
(1)in the subsection heading, by striking “Mitigation, Tracking, and Postconsummation Monitoring and Enforcement” and inserting “Actions by the Committee to Address National Security Risks”; ####
(2)by redesignating paragraphs (1), (2), and
(3)as paragraphs (3), (5), and (6), respectively; ####
(3)by inserting before paragraph (3), as redesignated by paragraph (2), the following: > > #### “(1) Suspension of transactions > > The Committee, acting through the chairperson, may suspend a proposed or pending covered transaction that may pose a risk to the national security of the United States for such time as the covered transaction is under review or investigation under subsection (b). > > > #### “(2) Referral to president > > The Committee may, at any time during the review or investigation of a covered transaction under subsection (b), complete the action of the Committee with respect to the transaction and refer the transaction to the President for action pursuant to subsection (d).” > ; ####
(4)in paragraph (3), as redesignated by paragraph (2)— #####
(A)in subparagraph (A)— ######
(i)in the subparagraph heading, by striking “In general” and inserting “Agreements and conditions”; ######
(ii)by striking “ The Committee ” and inserting the following: > > ###### “(i) In general > > The Committee” > ; ######
(iii)by striking “threat” and inserting “risk”; and ######
(iv)by adding at the end the following: > > ###### “(ii) Abandonment of transactions > > If a party to a covered transaction has voluntarily chosen to abandon the transaction, the Committee or lead agency, as the case may be, may negotiate, enter into or impose, and enforce any agreement or condition with any party to the covered transaction for purposes of effectuating such abandonment and mitigating any risk to the national security of the United States that arises as a result of the covered transaction. > > > ###### “(iii) Agreements and conditions relating to completed transactions > > The Committee or lead agency, as the case may be, may negotiate, enter into or impose, and enforce any agreement or condition with any party to a completed covered transaction in order to mitigate any interim risk to the national security of the United States that may arise as a result of the covered transaction until such time that the Committee has completed action pursuant to subsection
(b)or the President has taken action pursuant to subsection
(d)with respect to the transaction.” > ; and #####
(B)by striking subparagraph
(B)and inserting the following: > > ##### “(B) Treatment of outdated agreements or conditions > > The chairperson and the head of the lead agency shall periodically review the appropriateness of an agreement or condition imposed under subparagraph
(A)and terminate, phase out, or otherwise amend the agreement or condition if a threat no longer requires mitigation through the agreement or condition. > > > ##### “(C) Limitations > > An agreement may not be entered into or condition imposed under subparagraph
(A)with respect to a covered transaction unless the Committee determines that the agreement or condition resolves the national security concerns posed by the transaction, taking into consideration whether the agreement or condition is reasonably calculated to— > > > ###### “(i) > > be effective; > > > ###### “(ii) > > allow for compliance with the terms of the agreement or condition in an appropriately verifiable way; and > > > ###### “(iii) > > enable effective monitoring of compliance with and enforcement of the terms of the agreement or condition. > > > ##### “(D) Jurisdiction > > The provisions of section 706(b) shall apply to any mitigation agreement entered into or condition imposed under subparagraph (A).” > ; ####
(5)by inserting after paragraph (3), as redesignated by paragraph (2), the following: > > #### “(4) Risk-based analysis required > > > ##### “(A) In general > > Any determination of the Committee to suspend a covered transaction under paragraph (1), to refer a covered transaction to the President under paragraph (2), or to negotiate, enter into or impose, or enforce any agreement or condition under paragraph (3)(A) with respect to a covered transaction, shall be based on a risk-based analysis, conducted by the Committee, of the effects on the national security of the United States of the covered transaction, which shall include an assessment of the threat, vulnerabilities, and consequences to national security related to the transaction. > > > ##### “(B) Actions of members of the committee > > > ###### “(i) In general > > Any member of the Committee who concludes that a covered transaction poses an unresolved national security concern shall recommend to the Committee that the Committee suspend the transaction under paragraph (1), refer the transaction to the President under paragraph (2), or negotiate, enter into or impose, or enforce any agreement or condition under paragraph (3)(A) with respect to the transaction. In making that recommendation, the member shall propose or contribute to the risk-based analysis required by subparagraph (A). > > > ###### “(ii) Failure to reach consensus > > If the Committee fails to reach consensus with respect to a recommendation under clause
(i)regarding a covered transaction, the members of the Committee who support an alternative recommendation shall produce— > > > ###### “(I) > > a written statement justifying the alternative recommendation; and > > > ###### “(II) > > as appropriate, a risk-based analysis that supports the alternative recommendation. > > > ##### “(C) Definitions > > For purposes of subparagraph (A), the terms ‘threat’, ‘vulnerabilities’, and ‘consequences to national security’ shall have the meanings given those terms by the Committee by regulation.” > ; ####
(6)in paragraph (5)(B), as redesignated by paragraph (2), by striking “(as defined in the National Security Act of 1947)”; and ####
(7)in paragraph (6), as redesignated by paragraph (2)— #####
(A)in subparagraph (A)— ######
(i)by striking “paragraph (1)” and inserting “paragraph (3)”; and ######
(ii)by striking the second sentence and inserting the following: “The lead agency may, at its discretion, seek and receive the assistance of other departments or agencies in carrying out the purposes of this paragraph.”; #####
(B)in subparagraph (B)— ######
(i)by striking “designated agency” and all that follows through “The lead agency in connection” and inserting “designated agency.—The lead agency in connection”; ######
(ii)by striking clause (ii); and ######
(iii)by redesignating subclauses
(I)and
(II)as clauses
(i)and (ii), respectively, and by moving such clauses, as so redesignated, 2 ems to the left; and #####
(C)by adding at the end the following: > > ##### “(C) Compliance plans > > > ###### “(i) In general > > In the case of a covered transaction with respect to which an agreement is entered into under paragraph (3)(A), the Committee or lead agency, as the case may be, shall formulate, adhere to, and keep updated a plan for monitoring compliance with the agreement. > > > ###### “(ii) Elements > > Each plan required by clause
(i)with respect to an agreement entered into under paragraph (3)(A) shall include an explanation of— > > > ###### “(I) > > which member of the Committee will have primary responsibility for monitoring compliance with the agreement; > > > ###### “(II) > > how compliance with the agreement will be monitored; > > > ###### “(III) > > how frequently compliance reviews will be conducted; > > > ###### “(IV) > > whether an independent entity will be utilized under subparagraph
(E)to conduct compliance reviews; and > > > ###### “(V) > > what actions will be taken if the parties fail to cooperate regarding monitoring compliance with the agreement. > > > ##### “(D) Effect of lack of compliance > > If, at any time after a mitigation agreement or condition is entered into or imposed under paragraph (3)(A), the Committee or lead agency, as the case may be, determines that a party or parties to the agreement or condition are not in compliance with the terms of the agreement or condition, the Committee or lead agency may, in addition to the authority of the Committee to impose penalties pursuant to subsection (h)(3) and to unilaterally initiate a review of any covered transaction under subsection (b)(1)(D)(iii)— > > > ###### “(i) > > negotiate a plan of action for the party or parties to remediate the lack of compliance, with failure to abide by the plan or otherwise remediate the lack of compliance serving as the basis for the Committee to find a material breach of the agreement or condition; > > > ###### “(ii) > > require that the party or parties submit a written notice under clause
(i)of subsection (b)(1)(C) or a declaration under clause
(v)of that subsection with respect to a covered transaction initiated after the date of the determination of noncompliance and before the date that is 5 years after the date of the determination to the Committee to initiate a review of the transaction under subsection (b); or > > > ###### “(iii) > > seek injunctive relief. > > > ##### “(E) Use of independent entities to monitor compliance > > If the parties to an agreement entered into under paragraph (3)(A) enter into a contract with an independent entity from outside the United States Government for the purpose of monitoring compliance with the agreement, the Committee shall take such action as is necessary to prevent a conflict of interest from arising by ensuring that the independent entity owes no fiduciary duty to the parties. > > > ##### “(F) Successors and assigns > > Any agreement or condition entered into or imposed under paragraph (3)(A) shall be considered binding on all successors and assigns unless and until the agreement or condition terminates on its own terms or is otherwise terminated by the Committee in its sole discretion. > > > ##### “(G) Additional compliance measures > > Subject to subparagraphs
(A)through (F), the Committee shall develop and agree upon methods for evaluating compliance with any agreement entered into or condition imposed with respect to a covered transaction that will allow the Committee to adequately ensure compliance without unnecessarily diverting Committee resources from assessing any new covered transaction for which a written notice under clause
(i)of subsection (b)(1)(C) or declaration under clause
(v)of that subsection has been filed, and if necessary, reaching a mitigation agreement with or imposing a condition on a party to such covered transaction or any covered transaction for which a review has been reopened for any reason.” > .
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Sec. 1718
ACTIONS BY THE COMMITTEE TO ADDRESS NATIONAL SECURITY RISKS
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