Economic Espionage Prevention Act

Bill Number: H.R. 1486
Origin Chamber: House
Congress: 119th Congress, Session 1
Policy Area: International Affairs
Status: Passed House
Latest Action: 2025-05-06: Received in the Senate and Read twice and referred to the Committee on Foreign Relations.
Last Updated: 2026-07-10T20:28:21Z

AI-Generated Summary

Purpose

The Economic Espionage Prevention Act aims to protect U.S. national security by authorizing sanctions against foreign entities from adversarial countries (such as China) that engage in economic or industrial espionage, provide support to foreign militaries or intelligence operations, or violate U.S. export controls. It specifically addresses concerns about China's role in supplying critical components, like semiconductors, to Russia's defense sector, which supports Russia's war in Ukraine and circumvents existing U.S. export restrictions.

Key Provisions

Findings (Section 2): Outlines evidence from U.S. government sources showing China's increased exports of semiconductors and other components to Russia since 2022, aiding Russia's military reconstitution. These exports include U.S.-branded items and are subject to U.S. export controls due to global supply chain dependencies.
Report Requirement (Section 3): Within 90 days of enactment, the Secretary of State must submit a report to Congress analyzing Chinese individuals or entities (or those controlled by China's government) that knowingly supply critical components to Russia's defense or intelligence sectors, or engage in related transactions. The report will be mostly unclassified and publicly available, with a possible classified annex.
Sanctions Authority (Section 4):
The President may impose sanctions starting 30 days after enactment on "foreign adversary entities" (from countries like China) that knowingly:
Steal U.S. trade secrets or proprietary information (economic/industrial espionage).
Provide material support to adversarial militaries, intelligence, or security entities.
Violate U.S. export control laws.
Sanctions include:
Blocking all U.S.-based property and transactions (under the International Emergency Economic Powers Act, or IEEPA, which allows the President to freeze assets).
Making individuals inadmissible to the U.S., ineligible for visas, and revoking existing visas.
Exceptions: Does not apply to U.S. intelligence activities, international obligations (e.g., UN headquarters agreements), or law enforcement needs. Waivers are possible for up to 180 days if in U.S. national security interests.
Implementation: Uses IEEPA powers; violations carry civil and criminal penalties (fines up to $1 million and imprisonment up to 20 years). Annual reports on espionage activities are required for five years, unless sanctions were imposed recently.
Importation Exception (Section 5): Sanctions do not apply to importing goods into the U.S. (defined as tangible items like products or materials, excluding technical data).
Definitions (Section 6): Clarifies terms like "foreign adversary" (countries listed in federal regulations, e.g., China), "economic or industrial espionage" (stealing trade secrets for foreign benefit), "knowingly" (actual or should-have-known awareness), and "U.S. person" (citizens, residents, or U.S.-based entities).

Significant Changes to Existing Law

Builds on laws like IEEPA and the Countering America's Adversaries Through Sanctions Act by adding targeted sanctions for espionage and export violations by foreign adversaries, with a focus on China's support for Russia.
Introduces a mandatory report on Chinese entities' involvement in Russia's war efforts, which did not previously exist in this specific form.
Expands visa revocation and inadmissibility to cover espionage actors, beyond current immigration penalties.
No direct changes to existing export controls but reinforces enforcement by linking violations to new financial and travel sanctions.

Potential Impacts

Government Agencies: Increases workload for the State Department (reporting and coordination), Treasury (asset blocking), and Commerce (export monitoring). Requires presidential guidelines for enforcement, potentially straining resources.
Citizens and Businesses: U.S. companies with trade secrets gain stronger protection against foreign theft, but may face indirect effects from disrupted global supply chains (e.g., semiconductors). No direct impact on U.S. citizens' rights.
International Relations: Could heighten tensions with China and Russia by targeting their entities, signaling U.S. commitment to Ukraine and NATO allies. May encourage allies to align on export controls but risk retaliatory measures from adversaries, affecting trade and diplomacy.

Main Stakeholders Affected

U.S. Government: Executive branch (President, State, Treasury, Commerce Departments) for implementation; Congress (Foreign Affairs/Foreign Relations Committees) for oversight and reports.
Foreign Entities: Chinese citizens, companies, or government-controlled actors involved in espionage or supplying Russia; broader "foreign adversaries" (e.g., entities from listed countries like China, Russia, Iran, North Korea).
U.S. Businesses: Tech and defense firms (e.g., semiconductor manufacturers) protected from espionage but potentially impacted by sanctions on global partners.
International Actors: Russia's defense sector (disrupted supply); Ukraine and NATO allies (bolstered support); global trade participants navigating export rules.

Notable Legal, Constitutional, or Political Implications

Legal: Relies on established IEEPA authority, ensuring constitutionality by delegating enforcement to the executive while requiring congressional reports. Penalties align with existing sanctions frameworks, but the espionage focus may lead to challenges over "knowingly" determinations in court.
Constitutional: Balances executive foreign policy powers with congressional oversight (e.g., waiver reports), avoiding separation-of-powers issues. Exceptions for international obligations uphold treaty commitments.
Political: Reinforces bipartisan U.S. stance against Russia's invasion and China's role, potentially influencing midterm elections or alliances. Could prompt diplomatic pushback but strengthens deterrence against espionage without mandating broad tariffs or import bans.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. McCormick, Richard [R-GA-7]

Cosponsors (3)

Rep. Moolenaar, John R. [R-MI-2], Rep. Baumgartner, Michael [R-WA-5], Rep. Lawler, Michael [R-NY-17]

Recent Actions

2025-05-06: Received in the Senate and Read twice and referred to the Committee on Foreign Relations.
2025-05-05: Motion to reconsider laid on the table Agreed to without objection.
2025-05-05: On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote. (text: CR H1828-1829)
2025-05-05: Passed/agreed to in House: On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote. (text: CR H1828-1829: 1)
2025-05-05: DEBATE - The House proceeded with forty minutes of debate on H.R. 1486.
2025-05-05: Considered under suspension of the rules. (consideration: CR H1828-1830)
2025-05-05: Mr. Mast moved to suspend the rules and pass the bill, as amended.
2025-02-21: Referred to the Committee on Foreign Affairs, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
2025-02-21: Referred to the Committee on Foreign Affairs, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
2025-02-21: Introduced in House
2025-02-21: Introduced in House

Bill Versions

Economic Espionage Prevention Act — issued 2025-05-05 — PDF (16 pages)
Economic Espionage Prevention Act — issued 2025-02-21 — PDF (15 pages)
Economic Espionage Prevention Act — issued 2025-05-06 — PDF (14 pages)