No Contracts with Foreign Adversaries Act
This bill prohibits institutions of higher education (IHEs) from entering into contracts with a foreign country of concern (e.g., North Korea, China, Russia, or Iran) or with a foreign entity of concern (e.g., a foreign entity that is owned or controlled by North Korea, China, Russia, or Iran) without obtaining a waiver.
The bill outlines the process by which an IHE may receive a waiver from the Department of Education (ED) to enter into a contract with a foreign country of concern or with a foreign entity of concern. Specifically, an IHE that desires to enter into such a contract may submit to ED, not later than 120 days before the IHE enters into such a contract, a request to waive the prohibition with respect to the contract. Generally, a waiver issued under this bill shall only waive the prohibition for a one-year period (subject to renewals). Additionally, the bill requires ED to notify Congress of the intent to issue a waiver, including a justification for the waiver.
The bill also requires an IHE that has already entered into a contract prior to the bill's enactment to submit a waiver request to ED within 30 days of the bill's enactment.
The bill requires ED to investigate possible violations of this bill and outlines the various penalties for each violation. Penalties may include losing eligibility for federal student financial aid.
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 938 Introduced in House (IH)]
<DOC>
119th CONGRESS
1st Session
H. R. 938
To amend the Higher Education Act of 1965 to restrict contracts with
foreign countries of concern and foreign entities of concern.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 4, 2025
Mr. Harris of North Carolina (for himself and Mr. Owens) introduced the
following bill; which was referred to the Committee on Education and
Workforce
_______________________________________________________________________
A BILL
To amend the Higher Education Act of 1965 to restrict contracts with
foreign countries of concern and foreign entities of concern.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``No Contracts with Foreign
Adversaries Act''.
SEC. 2. PROHIBITION ON CONTRACTS WITH CERTAIN FOREIGN ENTITIES AND
COUNTRIES.
(a) In General.--Part B of title I of the Higher Education Act of
1965 (20 U.S.C. 1011 et seq.) is amended by inserting after section 117
the following:
``SEC. 117A. PROHIBITION ON CONTRACTS WITH CERTAIN FOREIGN ENTITIES AND
COUNTRIES.
``(a) In General.--An institution shall not enter into a contract
with a foreign country of concern or a foreign entity of concern.
``(b) Waivers.--
``(1) In general.--A waiver issued under this section to an
institution with respect to a contract shall only--
``(A) waive the prohibition under subsection (a)
for a 1-year period; and
``(B) apply to the terms and conditions of the
proposed contract submitted as part of the request for
such waiver.
``(2) Submission.--
``(A) First waiver requests.--
``(i) In general.--An institution that
desires to enter into a contract with a foreign
entity of concern or a foreign country of
concern may submit to the Secretary, not later
than 120 days before the institution enters
into such a contract, a request to waive the
prohibition under subsection (a) with respect
to such contract.
``(ii) Contents of waiver request.--A
waiver request submitted by an institution
under clause (i) shall include--
``(I) the complete and unredacted
text of the proposed contract for which
the waiver is being requested, and if
such original contract is not in
English, a translated copy of the text
into English by a person that is not an
affiliated entity or agent of the
foreign source involved with such
contract; and
``(II) a statement that--
``(aa) is certified by the
compliance officer of the
institution designated in
accordance with subsection (e);
and
``(bb) includes information
that demonstrates that such
contract--
``(AA) is for the
benefit of the
institution's mission
and students; and
``(BB) will promote
the security,
stability, and economic
vitality of the United
States.
``(B) Renewal waiver requests.--
``(i) In general.--An institution that,
pursuant to a waiver issued under this section,
has entered into a contract, the term of which
is longer than the 1-year waiver period and the
terms and conditions of which remain the same
as the proposed contract submitted as part of
the request for such waiver may submit, not
later than 120 days before the expiration of
such waiver period, a request for a renewal of
such waiver for an additional 1-year period
(which shall include any information requested
by the Secretary).
``(ii) Termination.--If the institution
fails to submit a request under clause (i) or
is not granted a renewal under such clause,
such institution shall terminate such contract
on the last day of the original 1-year waiver
period.
``(3) Waiver issuance.--The Secretary--
``(A) not later than 60 days before an institution
enters into a contract pursuant to a waiver request
under paragraph (2)(A), or before a contract described
in paragraph (2)(B)(i) is renewed pursuant to a renewal
request under such paragraph, shall notify the
institution--
``(i) if the waiver or renewal will be
issued by the Secretary; and
``(ii) in a case in which the waiver or
renewal will be issued, the date on which the
1-year waiver period starts; and
``(B) may only issue a waiver under this section to
an institution if the Secretary determines, in
consultation with the Director of the Federal Bureau of
Investigation, the Director of National Intelligence,
the Director of the Central Intelligence Agency, the
Secretary of State, the Secretary of Defense, the
Attorney General, the Secretary of Commerce, the
Secretary of Homeland Security, the Secretary of
Energy, the Director of the National Science
Foundation, and the Director of the National Institutes
of Health, that the contract for which the waiver is
being requested--
``(i) is for the benefit of the
institution's mission and students; and
``(ii) will promote the security,
stability, and economic vitality of the United
States.
``(4) Disclosure.--Not less than 2 weeks prior to issuing a
waiver under paragraph (2), the Secretary shall notify the--
``(A) the Committee on Education and Workforce of
the House of Representatives; and
``(B) the Committee on Health, Education, Labor,
and Pensions of the Senate,
of the intent to issue the waiver, including a justification
for the waiver.
``(c) Designation During Contract Term.--In the case of an
institution that enters into a contract with a foreign source that is
not a foreign country of concern or a foreign entity of concern but
which, during the term of such contract, is designated as a foreign
country of concern or foreign entity of concern, such institution shall
terminate such contract not later than 60 days after the Secretary
notifies the institution of such designation.
``(d) Contracts Prior to Date of Enactment.--
``(1) In general.--In the case of an institution that has
entered into a contract with a foreign country of concern or
foreign entity of concern prior to the date of enactment of the
No Contracts with Foreign Adversaries Act--
``(A) the institution shall as soon as practicable,
but not later than 30 days after such date of
enactment, submit to the Secretary a waiver request in
accordance with clause (ii) of subsection (b)(2)(A);
and
``(B) the Secretary shall, upon receipt of the
request submitted under such clause, issue a waiver to
the institution for a period beginning on the date on
which the waiver is issued and ending on the sooner
of--
``(i) the date that is 1 year after the
date of enactment of the No Contracts with
Foreign Adversaries Act; or
``(ii) the date on which the contract
terminates.
``(2) Renewal.--An institution that has entered into a
contract described in paragraph (1), the term of which is
longer than the waiver period described in subparagraph (B) of
such paragraph and the terms and conditions of which remain the
same as the contract submitted as part of the request required
under subparagraph (A) of such paragraph, may submit a request
for renewal of the waiver issued under such paragraph in
accordance with subsection (b)(2)(B).
``(e) Compliance Officer.--Any institution that submits a waiver
under this section shall designate, before the submission of such
waiver, and maintain, a compliance officer, who shall--
``(1) be a current employee or legally authorized agent of
such institution; and
``(2) be responsible, on behalf of the institution, for
personally certifying accurate compliance with the waiver
requirements under this section.
``(f) Enforcement.--
``(1) Investigation.--The Secretary (acting through the
General Counsel of the Department) shall conduct investigations
of possible violations of this section by institutions and,
whenever it appears that an institution has knowingly or
willfully failed to comply with a requirement of this section
(including any rule or regulation promulgated under this
section), shall request that the Attorney General bring a civil
action in accordance with paragraph (2).
``(2) Civil action.--Whenever it appears that an
institution has knowingly or willfully failed to comply with a
requirement of this section (including any rule or regulation
promulgated under this section) based on an investigation under
such paragraph, a civil action shall be brought by the Attorney
General, at the request of the Secretary, in an appropriate
district court of the United States, or the appropriate United
States court of any territory or other place subject to the
jurisdiction of the United States, to request such court to
compel compliance with the requirement of this section that has
been violated.
``(3) Costs and other fines.--An institution that is
compelled to comply with a requirement of this section pursuant
to paragraph (2) shall--
``(A) pay to the Treasury of the United States the
full costs to the United States of obtaining compliance
with such requirement, including all associated costs
of investigation and enforcement; and
``(B) be subject to the applicable fines described
in paragraph (4).
``(4) Fines for violations.--The Secretary shall impose a
fine on an institution that is compelled to comply with a
requirement of this section pursuant to paragraph (2) as
follows:
``(A) First-time violations.--In the case of an
institution that knowingly or willfully fails to comply
with a requirement of this section for the first time,
the Secretary shall impose a fine on the institution in
an amount that is not less than 5 percent and not more
than 10 percent of the total amount of Federal funds
received by the institution under this Act for the most
recent fiscal year.
``(B) Subsequent violations.--In the case of an
institution that has been fined pursuant to
subparagraph (A), the Secretary shall impose a fine on
the institution for each subsequent time the
institution knowingly or willfully fails to comply with
a requirement of this section in an amount that is not
less than 20 percent of the total amount of Federal
funds received by the institution under this Act for
the most recent fiscal year.
``(C) Ineligibilty for waiver.--In the case of an
institution that has been fined pursuant to
subparagraph (A) with respect to a calendar year, and
that knowingly or willfully fails to comply with a
requirement of this section with respect to any 2
additional calendar years, the Secretary shall prohibit
the institution from obtaining a waiver, or a renewal
of a waiver, under this section.
``(g) Definitions.--In this section:
``(1) Contract.--The term `contract'--
``(A) means--
``(i) any agreement for the acquisition by
purchase, lease, or barter of property or
services by the foreign source;
``(ii) any affiliation, agreement, or
similar transaction with a foreign source that
involves the use or exchange of an
institution's name, likeness, time, services,
or resources; and
``(iii) any agreement for the acquisition
by purchase, lease, or barter, of property or
services from a foreign source (other than an
arms-length agreement for such acquisition from
a foreign source that is not a foreign country
of concern or a foreign entity of concern); and
``(B) does not include an agreement made between an
institution and a foreign source regarding any payment
of one or more elements of a student's cost of
attendance (as such term is defined in section 472),
unless such an agreement is made for more than 15
students or is made under a restricted or conditional
contract.
``(2) Foreign country of concern.--The term `foreign
country of concern' means the following:
``(A) Any covered nation defined in section 4872 of
title 10, United States Code.
``(B) Any country the Secretary, in consultation
with the Secretary of Defense, the Secretary of State,
and the Director of National Intelligence, determines,
for purposes of section 117 or this section, to be
engaged in conduct that is detrimental to the national
security or foreign policy of the United States.
``(3) Foreign entity of concern.--The term `foreign entity
of concern' has the meaning given such term in section 10612(a)
of the Research and Development, Competition, and Innovation
Act (42 U.S.C. 19221(a)) and includes a foreign entity that is
identified on the list published under section 1286(c)(8)(A) of
the John S. McCain National Defense Authorization Act for
Fiscal Year 2019 (10 U.S.C. 22 4001 note; Public Law 115-232).
``(4) Institution.--The term `institution' means an
institution of higher education (as such term is defined in
section 102, other than an institution described in subsection
(a)(1)(C) of such section).''.
(b) Program Participation Agreement.--Section 487(a) of the Higher
Education Act of 1965 (20 U.S.C. 1094) is amended by adding at the end
the following:
``(30)(A) An institution will comply with the requirements
of section 117A.
``(B) An institution that, for 3 consecutive institutional
fiscal years, violates any requirement of section 117A shall--
``(i) be ineligible to participate in the programs
authorized by this title for a period of not less than
2 institutional fiscal years; and
``(ii) in order to regain eligibility to
participate in such programs, demonstrate compliance
with all requirements of each such section for not less
than 2 institutional fiscal years after the
institutional fiscal year in which such institution
became ineligible.''.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Education and Workforce.
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