House Passes Bill Requiring Report on FDI, Digital Trade Barriers
The Global Investment in American Jobs Act, a bill that directs the administration to produce a report on the effect of trade barriers to U.S. digital exports and on the extent of foreign direct investment in U.S. companies by state-owned enterprises, passed the House of Representatives by a 386-22 vote July 17. There is no similar bill introduced in the Senate.
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The bill, led by Rep. Greg Pence, R-Ind., directs the Commerce Department secretary to conduct an interagency review on foreign direct investment, including how FDI affects jobs and outsourcing in manufacturing or services. It also asks the interagency group to evaluate "the extent to which foreign direct investment from any source, including the Chinese Communist Party, results in displacement, offshoring, or outsourcing, including the impact of such investment on supply chains." The administration also would be required to detail "efforts" by China to "circumvent existing laws to gain access to United States markets, foreign direct investment responsible private-sector entities based in trusted countries, or intellectual property."
However, the report "may not address laws or policies relating to" the Committee on Foreign Investment in the United States, nor is it to look into CFIUS policies.
In addition to the issues around FDI, the report should address "the impact that protectionist policies by other countries, including forced data localization rules, forced localization of production, industrial subsidies, and the infringement of intellectual property rights, have on the advanced technology economy of the United States and the ability for United States located firms to develop innovative technologies," the bill's text says. It also asks the report to examine non-tariff barriers for digital trade, such as country-specific standards for products.