Sponsors (2)
The bill tightens U.S. legal tools against economic espionage tied to specified foreign nations—boosting deterrence and remedies for theft—while imposing new compliance risks, higher costs for cross-border business, and civil‑liberties concerns for entities with foreign links.
Government contractors, financial institutions, and utilities/energy companies gain broader legal protection because economic-espionage rules are extended to cover entities domiciled in specified foreign 'covered' nations, increasing deterrence of foreign trade-secret theft.
Tech workers and firms handling sensitive intellectual property (and affected financial firms) get stronger legal remedies when theft involves entities tied to covered nations, improving incentives and ability to protect and recover proprietary data.
Law enforcement and prosecutors obtain clearer statutory authority to pursue espionage cases involving entities domiciled in specified foreign nations, which can improve enforcement consistency and prosecutorial effectiveness.
Financial institutions, utilities, energy companies, and U.S. businesses with foreign affiliates face increased criminal exposure because affiliates domiciled in covered nations can trigger liability even absent clear evidence of ownership, creating significant compliance uncertainty.
Small businesses and other U.S. companies may curb or complicate legitimate commercial relationships with firms domiciled in covered nations, increasing transaction costs and due-diligence burdens.
Tech workers, government contractors, and others with tenuous ties to covered nations could face broader surveillance or investigations because of the statute's expanded reach, raising privacy and civil‑liberties concerns.
Based on analysis of 2 sections of legislative text.
Expands the definition of "foreign instrumentality" in economic espionage law to include entities domiciled in "covered nations" under 10 U.S.C. § 4872, in addition to entities substantially owned by a foreign government.
Official title: Amend title 18, United States Code, to provide that an entity domiciled in a foreign adversary country is a foreign instrumentality for purposes of the prohibition on economic espionage.
Introduced July 16, 2026 by John Cornyn · Last progress July 16, 2026
Amends the federal economic espionage statute to broaden the definition of “foreign instrumentality.” The change keeps the existing ownership test and adds an alternative test that reaches entities domiciled in “covered nations” as defined in 10 U.S.C. § 4872. This makes it easier for prosecutors to treat such domiciled entities as foreign instrumentalities for economic espionage prosecutions. The bill is narrowly focused: it only changes one statutory definition and does not create new programs, authorize spending, or add procedural requirements. Its primary effect is legal — expanding the category of entities that can fall within existing criminal law on economic espionage and related offenses.