CPA on NDAA: Bill Includes Important Provisions and Missed Opportunities

WASHINGTON — The Coalition for a Prosperous America (CPA) praised certain provisions of the National Defense Authorization Act (NDAA), which was passed by both houses of Congress and is expected to be signed into law by President Biden shortly. Those provisions included measures that will increase procurement of domestically manufactured goods and address the growing threats posed to U.S. security by China, as well as the Chinese Communist Party’s (CCP) genocide against Uyghur Muslims and other ethnic and religious groups in China.

However, CPA believes that Congress missed an opportunity to include meaningful capital markets sanctions against Chinese companies that are already listed by the Pentagon in a report on Chinese Military Companies (CMCs) to Congress and those implicated in genocide, forced labor, and supporting the People’s Liberation Army and Navy — among other malign activities. Earlier this year, CPA urged the House Rules Committee to support sanctions amendments that would effectively stop Wall Street financial firms from funneling billions of U.S. investor dollars to Chinese companies that are officially deemed to engage in malign behavior that harms U.S. national security interests or China’s human rights abuses.

“CPA welcomes provisions in the NDAA that seek to increase procurement of domestically manufactured goods and that help counter the threat the CCP poses to U.S. economic and national security,” said Michael Stumo, CEO of CPA. “Importantly, this year’s defense authorization bill reinforces the U.S. government’s determination that the CCP is committing genocide in Xinjiang. However, Congress missed an opportunity to impose capital markets sanctions on Chinese companies that are complicit in Beijing’s atrocities. There is bipartisan support to end the CCP’s exploitation of U.S. capital markets and tens of millions of American investors. Congress failed to act.”

Specifically, CPA supports the following provisions included in the final FY 2022 NDAA:

SEC. 808: BRIEFING ON TRANSPARENCY FOR CERTAIN DOMESTIC PROCUREMENT WAIVERS: within six months of enactment, the Secretary of Defense shall brief the congressional defense committees on the extent to which information relating to the use of domestic procurement waivers by the Department of Defense is publicly available.

SEC. 809: REPORT ON VIOLATIONS OF CERTAIN DOMESTIC PREFERENCE LAWS: by February 1 of each year, 2023, 2024, and 2025, the Secretary of Defense in coordination with each Secretary of a military department, shall submit to the congressional defense committees a report on violations of certain domestic preference laws reported to the Department of Defense and the military departments. Each report shall include such violations that occurred during the previous fiscal year covered by the report. Key elements: Each report shall include the following for each reported violation: (1) The name of the contractor. (2) The contract number. (3) The nature of the violation, including which of the certain domestic preference laws was violated. (4) The origin of the report of the violation. (5) Actions taken or pending by the Secretary concerned in response to the violation. (6) Other related matters deemed appropriate by the Secretary concerned.

SEC. 6511. UNITED STATES GRAND STRATEGY WITH RESPECT TO CHINA: within less than a year of the submission of the next National Security Strategy from the President  to Congress, the President shall establish and submit a classified China strategy, with an unclass summary. The section also allows for an advisory board to be created for the purposes of establishing such a strategy.  

SEC. 848. PROHIBITION ON CERTAIN PROCUREMENTS FROM THE XINJIANG UYGHUR AUTONOMOUS REGION: None of the funds authorized to be appropriated by this Act or otherwise made available for fiscal year 2022 for the Department of Defense may be obligated or expended to knowingly procure any products mined, produced, or manufactured wholly or in part by forced labor from XUAR or from an entity that has used labor from within or transferred from XUAR as part of a ‘‘poverty alleviation’’ or ‘‘pairing assistance’’ program. Additionally, Not later than 90 days after the date of the enactment of this Act, the Secretary of Defense shall issue rules to require a certification from offerors for contracts with the Department of Defense stating the offeror has made a good faith effort to determine that forced labor from XUAR, as described in subsection (a), was not or will not be used in the performance of such contract.

SEC. 735. PROHIBITION ON AVAILABILITY OF FUNDS FOR CERTAIN RESEARCH CONNECTED TO CHINA: None of the funds authorized to be appropriated by this Act or otherwise made available for fiscal year 2022 for the Department of Defense may be obligated or expended to fund any work to be performed by EcoHealth Alliance, Inc. in China on research supported by the government of China. However, there is a waiver — The Secretary of Defense may waive the prohibition under subsection (a) if the Secretary—  (1) determines that the waiver is in the national security interests of the United States; and (2) not later than 14 days after granting the waiver, submits to the congressional defense committees a detailed justification for the waiver, including— (A) an identification of the Department of Defense entity obligating or expending the funds; B) an identification of the amount of such funds; (C) an identification of the intended purpose of such funds; (D) an identification of the recipient or 24 prospective recipient of such funds (including any third-party entity recipient, as applicable); (E) an explanation for how the waiver is in the national security interests of the United States; and (F) any other information the Secretary determines appropriate.


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