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agency of the Government and which should be sold, leased, or otherwise disposed of.
(3) The term "plant equipment package" means a complement of active and idle machine tools and other industrial manufacturing equipment held by and under the control of the Department of Defense and approved by the Secretary for retention to produce particular defense materiel or defense supporting items at a specific level of output in the event of emergency.
(Added P.L. 102-484, §4235, Oct. 23, 1992, 106 Stat. 2690 [transferred from sections 2, 3, and 4 of Defense Industrial Reserve Act (50 U.S.C. 452 et seq.), and amended P.L. 103-35, §201(c)(8), May 31, 1993, 107 Stat. 98; P.L. 103-337, §379(a), Oct. 5, 1994, 108 Stat. 2737.) § 2536. Award of certain contracts to entities controlled by a foreign government: prohibition
(a) IN GENERAL.-A Department of Defense contract or Department of Energy contract under a national security program may not be awarded to an entity controlled by a foreign government if it is necessary for that entity to be given access to information in a proscribed category of information in order to perform the contract.
(b) WAIVER AUTHORITY.-The Secretary concerned may waive the application of subsection (a) to a contract award if the Secretary concerned determines that the waiver is essential to the national security interests of the United States.
(c) DEFINITIONS.-In this section:
(1) The term "entity controlled by a foreign government" includes
(A) any domestic or foreign organization or corporation that is effectively owned or controlled by a foreign government; and
(B) any individual acting on behalf of a foreign government,
as determined by the Secretary concerned. Such term does not include an organization or corporation that is owned, but is not controlled, either directly or indirectly, by a foreign government if the ownership of that organization or corporation by that foreign government was effective before October 23, 1992. (2) The term "proscribed category of information" means a category of information that
(A) with respect to Department of Defense contracts(i) includes special access information;
(ii) is determined by the Secretary of Defense to include information the disclosure of which to an entity controlled by a foreign government is not in the national security interests of the United States; and
(iii) is defined in regulations prescribed by the Secretary of Defense for the purposes of this section; and
(B) with respect to Department of Energy contracts(i) is determined by the Secretary of Energy to include information described in subparagraph (A)(ii); and
(ii) is defined in regulations prescribed by the Secretary of Energy for the purposes of this section. (3) The term "Secretary concerned" means—
(A) the Secretary of Defense, with respect to Department of Defense contracts; and
(B) the Secretary of Energy, with respect to Department of Energy contracts.
(Added P.L. 102-484, 8836(a)(1), Oct. 23, 1992, 106 Stat. 2462, and amended P.L. 103–35, §201(d)(4), May 31, 1993, 107 Stat. 99; P.L. 103–160, § 842, Nov. 30, 1993, 107 Stat. 1719.)
§ 2537. Improved national defense control of technology di
(a) COLLECTION OF INFORMATION ON FOREIGN-CONTROLLED CONTRACTORS.-The Secretary of Defense and the Secretary of Energy shall each collect and maintain a data base containing a list of, and other pertinent information on, all contractors with the Department of Defense and the Department of Energy, respectively, that are controlled by foreign persons. The data base shall contain information on such contractors for 1988 and thereafter in all cases where they are awarded contracts exceeding $100,000 in any single year by the Department of Defense or the Department of Energy. (b) ANNUAL REPORT TO CONGRESS.-The Secretary of Defense, the Secretary of Energy, and the Secretary of Commerce shall submit to the Congress, by March 31 of each year, beginning in 1994, a report containing a summary and analysis of the information collected under subsection (a) for the year covered by the report. The report shall include an analysis of accumulated foreign ownership of United States firms engaged in the development of defense critical technologies.
(c) TECHNOLOGY RISK ASSESSMENT REQUIREMENT.-(1) If the Secretary of Defense is acting as a designee of the President under section 721(a) of the Defense Production Act of 1950 (50 U.S.C. App. 2170(a)) and if the Secretary determines that a proposed or pending merger, acquisition, or takeover may involve a firm engaged in the development of a defense critical technology or is otherwise important to the defense industrial and technology base, then the Secretary shall require the appropriate entity or entities from the list set forth in paragraph (2) to conduct an assessment of the risk of diversion of defense critical technology posed by such proposed or pending action.
(2) The entities referred to in paragraph (1) are the following: (A) The Defense Intelligence Agency.
(B) The Army Foreign Technology Science Center.
(C) The Naval Maritime Intelligence Center.
(D) The Air Force Foreign Aerospace Science and Technology Center.
(Added P.L. 102-484, §838(a), Oct. 23, 1992, 106 Stat. 2465, and amended P.L. 103-35, 201(d)(5), (h)(2), May 31, 1993, 107 Stat. 99, 100.)
§ 2538. Industrial mobilization: orders; priorities; possession of manufacturing plants; violations
(a) ORDERING AUTHORITY.—In time of war or when war is imminent, the President, through the head of any department, may order from any person or organized manufacturing industry nec
essary products or materials of the type usually produced or capable of being produced by that person or industry.
(b) COMPLIANCE WITH ORDER REQUIRED.-A person or industry with whom an order is placed under subsection (a), or the responsible head thereof, shall comply with that order and give it precedence over all orders not placed under that subsection.
(c) SEIZURE OF MANUFACTURING PLANTS UPON NONCOMPLIANCE.-In time of war or when war is imminent, the President, through the head of any department, may take immediate possession of any plant that is equipped to manufacture, or that in the opinion of the head of that department is capable of being readily transformed into a plant for manufacturing, arms or ammunition, parts thereof, or necessary supplies for the armed forces if the person or industry owning or operating the plant, or the responsible head thereof, refuses
(1) to give precedence to the order as prescribed in subsection (b);
(2) to manufacture the kind, quantity, or quality of arms or ammunition, parts thereof, or necessary supplies, as ordered by the head of such department; or
(3) to furnish them at a reasonable price as determined by the head of such department.
(d) USE OF SEIZED PLANT.-The President, through the head of any department, may manufacture products that are needed in time of war or when war is imminent, in any plant that is seized under subsection (c).
(e) COMPENSATION REQUIRED.-Each person or industry from whom products or materials are ordered under subsection (a) is entitled to fair and just compensation. Each person or industry whose plant is seized under subsection (c) is entitled to a fair and just rental.
(f) CRIMINAL PENALTY.-Whoever fails to comply with this section shall be imprisoned for not more than three years and fined under title 18.
(Added P.L. 103–160, §822(a)(1), Nov. 30, 1993, 107 Stat. 1704, and amended P.L. 103–337, §811, Oct. 5, 1994, 108 Stat. 2815.)
§2539. Industrial mobilization: plants; lists
(a) LIST OF PLANTS EQUIPPED TO MANUFACTURE ARMS OR AMMUNITION.-The Secretary of Defense may maintain a list of all privately owned plants in the United States, and the territories, Commonwealths, and possessions of the United States, that are equipped to manufacture for the armed forces arms or ammunition, or parts thereof, and may obtain complete information of the kinds of those products manufactured or capable of being manufactured by each of those plants, and of the equipment and capacity of each of those plants.
(b) LIST OF PLANTS CONVERTIBLE INTO AMMUNITION FACTORIES.-The Secretary of Defense may maintain a list of privately owned plants in the United States, and the territories, Commonwealths, and possessions of the United States, that are capable of being readily transformed into factories for the manufacture of ammunition for the armed forces and that have a capacity sufficient to warrant conversion into ammunition plants in time of war or
when war is imminent, and may obtain complete information as to the equipment of each of those plants.
(c) CONVERSION PLANS.-The Secretary of Defense may prepare comprehensive plans for converting each plant listed pursuant to subsection (b) into a factory for the manufacture of ammunition or parts thereof.
(Added P.L. 103–160, § 822(a)(1), Nov. 30, 1993, 107 Stat. 1704.)
§ 2539a. Industrial mobilization: Board on Mobilization of Industries Essential for Military Preparedness
The President may appoint a nonpartisan Board on Mobilization of Industries Essential for Military Preparedness, and may provide necessary clerical assistance, to organize and coordinate operations under sections 2538 and 2539 of this title.
(Added as $2540 P.L. 103-160, §822(a)(1), Nov. 30, 1993, 107 Stat. 1704; redesignated 2539a P.L. 103-337, § 1070(a)(13)A), Oct. 5, 1994, 108 Stat. 2856.)
§ 2539b. Availability of samples, drawings, information, equipment, materials, and certain services
(a) AUTHORITY.-The Secretary of Defense and the secretaries of the military departments, under regulations prescribed by the Secretary of Defense and when determined by the Secretary of Defense or the Secretary concerned to be in the interest of national defense, may each
(1) sell, rent, lend, or give samples, drawings, and manufacturing or other information (subject to the rights of third parties) to any person or entity;
(2) sell9 rent, or lend government equipment or materials to any person or entity
(A) for use in independent research and development programs, subject to the condition that the equipment or material be used exclusively for such research and development; or
(B) for use in demonstrations to a friendly foreign government; and
(3) make available to any person or entity, at an appropriate fee, the services of any government laboratory, center, range, or other testing facility for the testing of materials, equipment, models, computer software, and other items.
(b) CONFIDENTIALITY OF TEST RESULTS.-The results of tests performed with services made available under subsection (a)(3) are confidential and may not be disclosed outside the Federal Government without the consent of the persons for whom the tests are performed.
(c) FEES.-Fees for services made available under subsection (a)(3) shall be established in the regulations prescribed pursuant to subsection (a). Such fees may not exceed the amount necessary to recoup the direct costs involved, such as direct costs of utilities, contractor support, and salaries of personnel that are incurred by the United States to provide for the testing.
In section 2539b(a)(2), the word "sell" should be followed by a comma. The amendment made by section 3022 of the Federal Acquisition Streamlining Act of 1994 (P.L. 103-355; 108 Stat. 3333), which directed the insertion of "rent," after "sell," was executed by inserting "rent,” after "sell" to reflect the probable intent of Congress.
(d) USE OF FEES.-Fees received for services made available under subsection (a)(3) may be credited to the appropriations or other funds of the activity making such services available.
(Added as $2541 P.L. 103-160, 822(bX1), Nov. 30, 1993, 107 Stat. 1705; redesignated $2539b P.L. 103-337, § 1070(a)13)(A), Oct. 5, 1994, 108 Stat. 2856; amended P.L. 103–355, § 3022, Oct. 13, 1994, 108 Stat. 3333.)