Senate Committee Passes China Bill With Amendments That Address Exports, Sanctions

The Senate Foreign Relations Committee passed its comprehensive China bill with several amendments, sending a bill to the Senate floor that could update China-related sanctions, export controls and foreign investment reviews. Senators said they expect the Strategic Competition Act of 2021 -- which would authorize a host of measures to address trade and technology competition issues with China and expand the jurisdiction of the Committee on Foreign Investment in the U.S. (see 2104080066) -- to garner broad bipartisan support before the full Senate.

Committee Chair Bob Menendez, D-N.J., said the bill, which was passed by the committee April 21, is an “unprecedented bipartisan effort” that represents a “unified strategic response” to boost U.S. competitiveness against China. Jim Risch of Idaho, the committee's top Republican, said the bill has the “potential” to draw more than 80 votes in the Senate. “This has got virtually everyone's fingerprints on it,” Risch said, “for better or for worse.”

Risch stressed the importance of a provision in the bill that would give CFIUS the authority to review transactions involving certain gifts to universities valued at more than $1 million (see 2104200056). Universities should be required to disclose those gifts to CFIUS and be held accountable for them, Risch said, adding that it would reduce Chinese influence over U.S. academic research. “We don't allow our politicians to take money from China,” he said. “There's no reason why these important institutions that are producing the future leaders of this country should have that kind of influence, if indeed it is put there for malign purposes.”

Risch said he expects opposition from colleges, which could be subject to a potentially rigorous government review process before accepting certain donations. “Let's let's not be naive. We're going to get pushback from the colleges and universities,” Risch said. “It's their job to generate as much money as they can” but “it is not right to be taking money from the Chinese Communist Party.” Risch added that he would be open to working with U.S. colleges about how they can best approach the CFIUS reviews.

“We hope the colleges and universities will look at this and buy into our arguments that this needs to be substantially more tamped down and regulated than what it is,” he said. “And if they have constructive ways of dealing with this, we certainly have no problem with dealing with that.”

Lawmakers approved several amendments to the bill, including one that would encourage more U.S. exports to Latin America and Africa to counter China’s growing market access and influence in those regions. The amendment, introduced by Sen. Jeanne Shaheen, D-N.H., would “develop a target-driven strategy” to increase trade missions to the continents, she said.

Sen. Cory Booker, D-N.J., said the amendment would help U.S. products better compete with Chinese goods in both markets. “American businesses need more tools to compete with China,” he said. “And this would give us exactly that.”

Senators also approved an amendment that would eliminate the sunset provision from the Human Rights Accountability Act, which authorizes sanctions against human rights violators. The amendment, introduced by Sen. Ben Cardin, D-Md., drew wide bipartisan support.

Senators voted to reject several amendments, including one introduced by Sen. Marco Rubio, R-Fla., that would have imposed more sanctions on Chinese people and entities involved in activities in the South China Sea. The amendment would have specifically targeted entities involved in “development projects” in areas of the sea in which there are territorial disputes between China and members of the Association of Southeast Asian Nations, Rubio said. It would also have blocked U.S. entities from investing in or insuring projects involving any of those sanctioned entities.

The amendment drew opposition from both Republicans and Democrats, who called it too broad. Menendez said the amendment was outside the committee's jurisdiction. “While I share your concerns, and we'd be happy to work with you as we move forward,” he said, “I will have to vote no today based upon those issues to preserve the integrity of the bill on the floor.”