S. 1053 — FIGHT China Act of 2025

This section authorizes the President to exercise all powers under the International Emergency Economic Powers Act (IEEPA, 50 U.S.C. 1701 et seq.) to block and prohibit all transactions in property and interests in property of covered foreign persons—designated by the Secretary of the Treasury, in consultation with the Secretary of State—if such property is in the United States, comes within the United States, or is in the possession or control of a U.S. person. (As background, IEEPA authorizes the President to declare a national emergency in response to an unusual and extraordinary threat and impose economic sanctions, including asset blocking.) It applies IEEPA civil and criminal penalties (50 U.S.C. 1705(b), (c)); provides exceptions for U.S. intelligence, law enforcement, and official government activities; authorizes use of IEEPA investigative and consultation authorities (50 U.S.C. 1702, 1704); and requires the President to delegate implementation to the Secretary of the Treasury. This section further requires the Secretary to submit to appropriate congressional committees, not later than 365 days after enactment and annually thereafter for seven years, an unclassified report (with classified annex option) stating whether each foreign person on the Non-SDN Chinese Military-Industrial Complex Companies List is a covered foreign person. In making designations, the President may consider credible information from other countries, nongovernmental organizations, congressional committees, or other relevant sources.

This section defines terms for purposes of this title, including (1) appropriate congressional committees (i.e., specified House and Senate committees on financial services, banking, and foreign affairs); (2) country of concern (i.e., the People's Republic of China, including Hong Kong and Macau); (3) covered foreign person (i.e., a foreign person incorporated in, controlled by, or owned 50% or more by a country of concern that knowingly engages in significant operations in that country's defense and related materiel sector or surveillance technology sector); (4) foreign person (i.e., any non-U.S. person, country, state, or government); (5) Non-SDN Chinese Military-Industrial Complex Companies List (i.e., the Treasury Department's list under Executive Orders 13959 and 14032); and (6) United States person (i.e., U.S. citizens, permanent residents, U.S.-organized entities, or persons in the United States).

This section amends the Defense Production Act of 1950 (50 U.S.C. 4501 et seq.) by adding a new title VIII to authorize the Secretary of the Treasury to prohibit U.S. persons from knowingly engaging in covered national security transactions involving prohibited technology (with evasion also prohibited), subject to regulations issued under the Administrative Procedure Act that include processes for non-binding feedback requests, self-disclosure with opportunity to cure, public notice and comment, low-burden compliance measures, civil penalties up to $250,000 or twice the transaction value, divestment orders, and burden of proof on the Secretary. It further authorizes the President, in consultation with specified officials, to waive such prohibitions in the national interest (with notification to congressional committees within 5 business days) and requires regulations, issued within 450 days of enactment, mandating U.S. persons to notify the Secretary within 30 days of completing covered national security transactions in prohibited or notifiable technology (unless prohibited).

This section requires the Secretary to submit to the appropriate congressional committees, not later than 365 days after enactment and biennially thereafter for six years, a report assessing whether certain PRC persons—those on the Department of Commerce's Military End-User List, listed under section 1260H of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021 (10 U.S.C. 113 note), or on the Commerce Entity List—qualify for inclusion on the Non-SDN Chinese Military-Industrial Complex Companies List maintained by the Treasury Department's Office of Foreign Assets Control (OFAC) under Executive Orders 13959 and 14032. (The Non-SDN CMIC List identifies Chinese companies linked to the PRC military-industrial complex to restrict U.S. investment.) The section further requires the President to (1) establish an interagency process for sharing information used to identify entities on those lists; (2) promulgate rules, effective 365 days after enactment, prohibiting U.S. persons from knowingly holding securities of Non-SDN CMIC List entities (with a 365-day divestment window for pre-existing holdings); and (3) include in reports overviews of listing criteria for the Non-SDN CMIC List and the assessed lists, allowing subsequent reports to summarize prior findings without re-review and permitting a risk-based prioritization framework for initial assessments. Finally, this section authorizes the President to waive the investment prohibition on a case-by-case basis per entity for national security or foreign policy reasons, with advance notice and a briefing within 30 days to the appropriate congressional committees, and defines key terms including "appropriate congressional committees," "country of concern" (PRC, including Hong Kong and Macau), "Non-SDN Chinese Military-Industrial Complex Companies List," and "PRC person."