# Economic Espionage Prevention Act: What You Need to Know

This bill gives the President new power to punish foreign companies and individuals—particularly from China—that steal American trade secrets, help enemy militaries, or break U.S. export control laws. The bill is triggered by concerns that Chinese companies have been sending advanced computer chips to Russia to help rebuild its military after the Ukraine invasion, potentially violating U.S. sanctions. The government wants to crack down on this activity and similar espionage threats.

Here's what the bill actually does: First, it requires the State Department to investigate and report back to Congress within 90 days about which Chinese companies or individuals are supplying critical military components to Russia or helping Russia's defense and intelligence sectors. Then, the President gets the authority to impose serious penalties on any foreign company or person caught stealing American business secrets, providing support to enemy militaries, or breaking export control rules. These penalties include freezing their assets in the United States, blocking them from doing business here, and preventing their employees from entering the country. Anyone who violates these sanctions could face significant fines and criminal penalties.

The bill affects American businesses most directly by giving them potential protection against foreign espionage and creating consequences for companies that help our adversaries. It also affects foreign companies and their employees—particularly those from countries deemed "foreign adversaries"—by potentially cutting them off from the U.S. market and blocking their access to America. The President can waive these penalties if he decides it's in the national interest, and there are narrow exceptions for intelligence activities, international obligations like UN headquarters agreements, and law enforcement needs. The bill requires annual reports on espionage threats unless sanctions have already been imposed that year.

Economic Espionage Prevention Act

McCormick, Richard

Economic Espionage Prevention ActThis bill authorizes the President to impose visa- and property-blocking sanctions on foreign adversary entities that knowingly engage in (1) economic and industrial espionage with respect to trade secrets and proprietary information owned by U.S. persons, (2) the provision of material support or services to a foreign adversaries' national security entities, or (3) the violation of U.S. export control laws. The bill cites regulations that define China, Russia, Iran, North Korea, Cuba, and the Maduro regime of Venezuela as foreign adversaries. &nbsp; The bill also limits certain&nbsp;exemptions from&nbsp;the President's authority under the International Emergency Economic Powers Act (IEEPA). IEEPA provides the President broad authority to regulate a variety of economic transactions following a declaration of national emergency, but&nbsp;exempts from this authority activities such as (1) the import or export of information or informational materials; (2) transactions ordinarily incident to international travel, such as the importation of personal baggage; and (3) personal communications, such as postal or telephonic communications, that do not transfer anything of value. Under the bill, the first two of these exemptions are not applicable if the President determines such imports and exports would seriously impair the ability to deal with a declared national emergency. Additionally, the bill specifies that the first and third exemptions listed above do not apply to bulk sensitive personal data or source code used in a connected software application.