CPA Urges Senate, House Leaders to Include National Critical Capabilities Defense Act in Final China Competition Bill

WASHINGTON — The Coalition for a Prosperous America, along with Main Street Alliance and the National Council of Textile Organizations, sent a letter to the leaders of the House and Senate in support of the bipartisan, bicameral National Critical Capabilities Defense Act (NCCDA) being included in the final conference report of the China competition bill. NCCDA would require companies to disclose proposed offshoring of critical supply chains and capabilities to foreign adversaries, like China and Russia. NCCDA was introduced in the Senate by Senators Bob Casey (D-PA) and John Cornyn (R-TX). It was introduced in the House by Representatives Bill Pascrell (D-NJ), Rosa DeLauro (D-CT), Victoria Spartz (R-IN), and Brian Fitzpatrick (R-PA). Earlier this year, CPA called on Congress to include NCCDA in any China competitiveness bill.

Specifically, the bill would help prevent American supply chains from being offshored by establishing an outbound investment review, which covers production, development, manufacturing, or fabrication of identified critical national capabilities to countries, like China and Russia, that are deemed foreign adversaries.

The bipartisan, independent U.S.-China Economic and Security Review Commission’s 2021 Annual Report to Congress noted that “China has shown willingness to weaponize and politicize supply chains” where “U.S. companies may struggle to avoid critical shortages without domestic…alternatives.” Additionally, the report highlights that “U.S. and foreign investors have poured into China’s capital markets” despite the Chinese government and Communist Party’s strict control over their economy. Among the Commission’s top recommendations is to pass legislation that accomplishes the goals of the National Critical Capabilities Defense Act by creating the “authority to screen the offshoring of critical supply chains and production capabilities to the People’s Republic of China to protect U.S. national and economic security interests.”

“Despite the strong bipartisan and bicameral support, however, we are concerned this provision will be excluded in the conference process. Keeping this legislation intact is of critical importance to protect American interests, American national security, American economic prosperity, and long-term assurances for American global leadership,” the letter states.

“This bill is incredibly important for domestic producers and manufacturers but even more important for our country’s national security interests,” the letter continues. “If enacted, this bill will require companies to disclose proposed offshoring of critical supply chains and capabilities to foreign adversaries, such as China and Russia. It establishes a whole-of-government process to screen outbound investments and the offshoring of critical capacities and will result in bolstering the resiliency of critical supply chains. The provision will ensure the U.S. has greater visibility of supply chain vulnerabilities and that we can respond to the needs of our nation and those who may call on us in times of crisis.”

Read the full letter here.

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