US Lawmakers Introduce Bill to Force Lobbyists for Beijing-Linked Chinese Companies to Register as Foreign Agents

October 23, 2020 Updated: October 23, 2020

Two Republican lawmakers will introduce legislation aimed at forcing lobbyists for Chinese companies controlled by the Chinese regime to register as foreign agents under the Foreign Agents Registration Act (FARA).

Sen. Tom Cotton (R-Ark.) and Rep. Mike Gallagher (R-Wis.) said on Oct. 22 that the new bill would “close loopholes” in the FARA that have exempted lobbyists for Chinese companies from having to register as a foreign agent.

“Chinese companies—particularly powerful ones—are all arms of the Chinese Communist Party and remain ultimately under state control. It’s time our laws recognize that reality,” Cotton said in a statement.

The new legislation, named the Chinese Communist Party Influence Transparency Act, would bar lobbyists of Chinese companies controlled by the Chinese Communist Party (CCP) from using two exemptions to registration known as the “commercial exemption” and the “Lobbying Disclosure Act (LDA) exemption.”

FARA, enacted in 1938, requires people who engage in political activities or other activities on behalf of a foreign government or foreign political party to register and disclose those activities to the U.S. Department of Justice (DOJ).

There are exemptions to the FARA, including the “commercial exemption” that rules out registration and disclosure requirements for “private and nonpolitical activities.” Another FARA exemption allows agents and entities engaging in lobbying activities to register and disclose under the LDA instead.

LDA, passed into law in 1995, is more lenient than FARA, requiring the disclosure of substantially less information to the DOJ.

The new legislation would apply to lobbyists of any Chinese business organizations designated by the U.S. Attorney General as “subject to the extrajudicial direction of the Chinese Communist Party.”

“Even nominally private Chinese firms are not like normal companies. All Chinese firms, and especially those significant enough to register lobbyists in Washington, D.C., are subject to the extrajudicial direction of the Chinese Communist Party,” Gallagher said in the press release.

He added: “This bill ensures companies subject to the direction of the CCP face appropriate disclosure standards and Americans better understand how our adversaries seek to use the swamp against us.”

The two lawmakers in September wrote to Attorney General William Barr raising concerns about lobbying registration practices of Chinese companies in the country, after the Pentagon identified 31 Chinese firms, including tech giant Huawei, as either being owned or controlled by the regime’s military.

In the letter, the lawmakers said that lobbyists and firms representing these Chinese military companies have been using the FARA exemptions to register under LDA instead of FARA.

The Pentagon named the 31 Chinese companies after a request made by Cotton based on the requirement under section 1237(b) of  National Defense Authorization Act of 1999, the annual defense spending bill.

The section called on the Pentagon to determine and publish “Communist Chinese military companies operating in the United States,” as well as any entity that is “owned or controlled by the People’s Liberation Army,” which is the official name of the Chinese military.

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