HR6058-119

2. Sense of Congress It is the sense of Congress that— the global semiconductor technology supply chain is critical to United States and allied national security, economic competitiveness, and technological leadership; the Chinese Communist Party is pursuing strategies to dominate the semiconductor technology industry to assist in its military modernization efforts and human rights abuses through non-market practices, export control violation and avoidance, economic espionage, military-civil fusion, and predatory investment; the integrity of the global semiconductor technology supply chain requires coordinated action with allied and partner nations to prevent technological capture by the Chinese Communist Party and other foreign adversaries; unilateral export controls for protecting critical semiconductor technologies can be amplified with multilateral coordination; and fully utilizing certain unilateral United States export control authorities, including the Foreign Direct Product Rule, has proven effective at preventing circumvention or avoidance of United States export controls through third-country production.

4. Multilateral semiconductor technology supply chain coordination The Secretary of State shall coordinate with governments of countries that maintain significant capabilities in semiconductor technology research, design, manufacturing, materials, equipment, or equipment subsystems and components to establish coordinated and expanded approaches for protecting critical semiconductor technologies from acquisition by the Chinese Communist Party and other foreign adversaries of the United States and its allies and partners. In carrying out subsection (a), the Secretary of State shall seek to achieve— alignment of export control policies regarding semiconductor technology manufacturing equipment, including lithography systems, deposition equipment, etching tools, thermocompression bonding equipment, resist processing tools, chemical mechanical planarization tools, cleaning tools, handling tools, assembly, packaging, and test tools, and inspection systems and the critical subcomponents needed to produce such equipment; expanded restrictions on semiconductor technology design tools, intellectual property transfers, equipment servicing, and technical assistance that could enable indigenous semiconductor technology development capabilities in countries of concern; harmonized approaches to controlling dual-use semiconductor technology materials, including photoresists, specialty gases, and advanced substrates; joint monitoring, enforcement, and administration mechanisms to prevent circumvention of semiconductor technology controls through third-country entities as well as prevent foreign backfilling of restricted items; information sharing regarding semiconductor technology transfer risks, end-user verification, and supply chain security threats; and establishment of trusted supplier networks for critical semiconductor technology components and manufacturing services. The Secretary of State, in consultation with the Secretary of Commerce, shall regularly assess the extent to which countries engaged pursuant to subsection (a) are implementing measures consistent with United States policy described in section 3. If the Secretary of State determines that a country engaged with pursuant to subsection (a) is not implementing security measures sufficient to fully prevent semiconductor technology transfer to countries of concern, the Secretary shall— provide a detailed explanation of the specific deficiencies in the country’s semiconductor technology protection measures; request the Secretary of Commerce to convene a meeting of the Export Advisory Review Board to identify and execute a plan of action to address the insufficient security measures within 21 days of the Secretary of State’s determination of inadequate cooperation; and notify the appropriate congressional committees of such determination not later than 30 days after making such determination and provide routine updates on the Export Advisory Review Board meeting request and plan of action described in subparagraph (B). In carrying out the process described in paragraph (2)(B), the Secretary of State shall provide to Export Advisory Review Board— recommendations for the application of Foreign Direct Product Rule restrictions to semiconductor technology produced in the non-cooperating country that incorporate United States-origin technology, software, or equipment; recommended entities for the expansion of Entity List designations for semiconductor technology supply chain companies or research institutions in the non-cooperating country that pose technology transfer risks; and guidance on what additional steps may be needed to prevent foreign backfilling of U.S. technology in restricted sectors or entities in countries of concern. Not later than 90 days after the date of enactment of this Act, and every 90 days thereafter, the Secretary of State shall submit to the appropriate congressional committees a report on— the status of diplomatic engagement with key semiconductor technology-producing countries; progress toward achieving the coordination objectives specified in subsection (b); any determinations of inadequate cooperation made under subsection (c); and the effectiveness of multilateral coordination in preventing semiconductor technology transfer to countries of concern. The report required by this subsection shall be submitted in unclassified form but may include a classified annex. In this section: The term appropriate congressional committees means— the Committee on Foreign Affairs of the House of Representatives; and the Committee on Foreign Relations and the Committee on Banking, Housing, and Urban Affairs of the Senate. The term countries of concern has the meaning given the term covered nation in section 4872(f) of title 10, United States Code. The term Entity List means the list maintained by the Bureau of Industry and Security of the Department of Commerce and set forth in Supplement No. 4 to part 744 of title 15, Code of Federal Regulations, or successor regulations. The term Foreign Direct Product Rule means the rule exercising United States export controls on an item produced in a foreign country for shipment or transmission to another foreign country or foreign person, if the item— is produced using technology or software that is otherwise subject to the jurisdiction of the United States; is produced with the use of a plant or major component of a plant that— is located outside the United States; and has been created using the technology or software described in subparagraph (A); or contains, is commingled with, is bundled with, is drawn from, or is produced by an item described in subparagraph (A) or (B). The term semiconductor technology includes— integrated circuits, microprocessors, and memory devices; semiconductor manufacturing equipment and tools, including subsystems and components; semiconductor design software and intellectual property; semiconductor materials and specialty chemicals; testing, assembly, and packaging equipment; and any technology, component, or service that is essential to semiconductor design, manufacturing, or testing processes.