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TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED MATTERS

Subtitle E  — Industrial Base Matters

P. L. 115-

House Conference Report. 115-874

(a) In General.—Effective October 1, 2020, a covered NTIB entity operating under a special security agreement pursuant to the National Industrial Security Program shall not be required to obtain a national interest determination as a condition for access to proscribed information.

(b) Acceleration Authorized.—Notwithstanding the effective date of this section, the Secretary of Defense, in consultation with the Director of the Information Security Oversight Office, may waive the requirement to obtain a national interest determination for a covered NTIB entity operating under such a special security agreement that has—

(1) a demonstrated successful record of compliance with the National Industrial Security Program; and

(2) previously been approved for access to proscribed information.

(c) Definitions.—In this section:

(1) COVERED NTIB ENTITY.—The term “covered NTIB entity” means a person that is a subsidiary located in the United States—

(A) for which the ultimate parent company and any intermediate parent companies of such subsidiary are located in a country that is part of the national technology and industrial base (as defined in section 2500 of title 10, United States Code); and

(B) that is subject to the foreign ownership, control, or influence requirements of the National Industrial Security Program.

(2) PROSCRIBED INFORMATION.—The term “proscribed information” means information that is—

(A) classified at the level of top secret;

(B) communications security information (excluding controlled cryptographic items when un-keyed or utilized with unclassified keys);

(C) restricted data (as defined in section 11 of the Atomic Energy Act of 1954 (42 U.S.C. 2014));

(D) special access program information under section 4.3 of Executive Order No. 13526 (75 Fed. Reg. 707; 50 U.S.C. 3161 note) or successor order; or

(E) designated as sensitive compartmented information.

The House bill contained a provision (sec. 843) that would streamline the National Industrial Security Program by removing the regulatory requirements relating to National Interest Determinations (NIDs). It would build on section 1712 of the National Defense Authorization Act for Fiscal Year 2018 (Public Law 115-91), which required a review of whether certain companies "should be exempted from one or more of the foreign ownership, control, or influence [FOCI] requirements of the National Industrial Security Program.” This section would address NIDs as a particularly urgent problem within that set of FOCI requirements authorized for exemption. It would also authorize the Secretary of Defense to accelerate implementation of this policy for contracting entities that have already demonstrated a longstanding commitment to industrial security and have previously been approved for access to proscribed information.

The Senate amendment contained no similar provision.

The Senate recedes.