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115th Congress    }                                  {     Rept. 115-98
                        HOUSE OF REPRESENTATIVES
 1st Session      }                                  {           Part 1

======================================================================



 
         KOREAN INTERDICTION AND MODERNIZATION OF SANCTIONS ACT

                                _______
                                

 April 28, 2017.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

    Mr. Royce, from the Committee on Foreign Affairs, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 1644]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Foreign Affairs, to whom was referred the 
bill (H.R. 1644) to enhance sanctions with respect to 
transactions relating to North Korea, and for other purposes, 
having considered the same, reports favorably thereon with an 
amendment and recommends that the bill as amended do pass.

                           TABLE OF CONTENTS

                                                                   Page
The Amendment....................................................     1
Summary and Purpose of Legislation...............................    11
Background and Need for Legislation..............................    12
Hearings/Briefings...............................................    16
Committee Consideration..........................................    16
Committee Oversight Findings.....................................    16
New Budget Authority, Tax Expenditures, and Federal Mandates.....    16
Congressional Budget Office Cost Estimate........................    17
Directed Rule Making.............................................    20
Non-Duplication of Federal Programs..............................    20
Performance Goals and Objectives.................................    20
Congressional Accountability Act.................................    20
New Advisory Committees..........................................    21
Earmark Identification...........................................    21
Letters of Jurisdiction..........................................    21
Section-by-Section Analysis......................................    31
Changes in Existing Law Made by the Bill, as Reported............    34

                             The Amendment

    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Korean Interdiction and Modernization 
of Sanctions Act''.

SEC. 2. TABLE OF CONTENTS.

  The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Definitions.

  TITLE I--SANCTIONS TO ENFORCE AND IMPLEMENT UNITED NATIONS SECURITY 
                 COUNCIL SANCTIONS AGAINST NORTH KOREA

Sec. 101. Modification and expansion of requirements for the 
designation of persons.
Sec. 102. Prohibition on indirect correspondent accounts.
Sec. 103. Limitations on foreign assistance to noncompliant 
governments.
Sec. 104. Amendments to enhance inspection authorities.
Sec. 105. Enforcing compliance with United Nations shipping sanctions 
against North Korea.
Sec. 106. Report on cooperation between North Korea and Iran.
Sec. 107. Report on implementation of United Nations Security Council 
resolutions by other governments.
Sec. 108. Briefing on measures to deny specialized financial messaging 
services to designated North Korean financial institutions.

    TITLE II--SANCTIONS WITH RESPECT TO HUMAN RIGHTS ABUSES BY THE 
                       GOVERNMENT OF NORTH KOREA

Sec. 201. Sanctions for forced labor and slavery overseas of North 
Koreans.
Sec. 202. Modifications to sanctions suspension and waiver authorities.
Sec. 203. Reward for informants.
Sec. 204. Determination on designation of North Korea as a state 
sponsor of terrorism.

                     TITLE III--GENERAL AUTHORITIES

Sec. 301. Authority to consolidate reports.
Sec. 302. Rule of construction.
Sec. 303. Regulatory authority.
Sec. 304. Limitation on funds.

SEC. 3. DEFINITIONS.

  (a) Amendments to Definitions in the North Korea Sanctions and Policy 
Enhancement Act of 2016.--
          (1) Applicable executive order.--Section 3(1)(A) of the North 
        Korea Sanctions and Policy Enhancement Act of 2016 (22 U.S.C. 
        9202(1)(A)) is amended--
                  (A) by striking ``or Executive Order 13694'' and 
                inserting ``Executive Order 13694''; and
                  (B) by inserting ``or Executive Order 13722 (50 
                U.S.C. 1701 note; relating to blocking the property of 
                the Government of North Korea and the Workers' Party of 
                Korea, and Prohibiting Certain Transactions With 
                Respect to North Korea),'' before ``to the extent''.
          (2) Applicable united nations security council resolution.--
        Section 3(2)(A) of the North Korea Sanctions and Policy 
        Enhancement Act of 2016 (22 U.S.C. 9202(2)(A)) is amended by 
        striking ``or 2094 (2013)'' and inserting ``2094 (2013), 2270 
        (2016), or 2321 (2016)''.
          (3) Foreign person.--Section 3 of the North Korea Sanctions 
        and Policy Enhancement Act of 2016 (22 U.S.C. 9202) is 
        amended--
                  (A) by redesignating paragraphs (5) through (14) as 
                paragraphs (6) through (15), respectively; and
                  (B) by inserting after paragraph (4) the following 
                new paragraph:
          ``(5) Foreign person.--The term `foreign person' means--
                  ``(A) an individual who is not a United States 
                citizen or an alien lawfully admitted for permanent 
                residence to the United States; or
                  ``(B) an entity that is not a United States 
                person.''.
          (4) Luxury goods.--Paragraph (9) of section 3 of the North 
        Korea Sanctions and Policy Enhancement Act of 2016 (22 U.S.C. 
        9202), as redesignated by paragraph (3) of this subsection, is 
        amended--
                  (A) in subparagraph (A), by striking ``and'' at the 
                end;
                  (B) in subparagraph (B), by striking the period at 
                the end and inserting ``; and''; and
                  (C) by adding at the end the following new 
                subparagraph:
                  ``(C) also includes any items so designated under an 
                applicable United Nations Security Council 
                resolution.''.
          (5) North korean person.--Section 3 of the North Korea 
        Sanctions and Policy Enhancement Act of 2016 (22 U.S.C. 9202), 
        as amended by paragraph (3) of this subsection, is further 
        amended--
                  (A) by redesignating paragraphs (13) through (15) as 
                paragraphs (14) through (16), respectively; and
                  (B) by inserting after paragraph (12) the following 
                new paragraph:
          ``(13) North korean person.--The term `North Korean person' 
        means--
                  ``(A) a North Korean citizen or national; or
                  ``(B) an entity owned or controlled by the Government 
                of North Korea or by a North Korean citizen or 
                national.''.
  (b) Definitions for Purposes of This Act.--In this Act:
          (1) Applicable united nations security council resolution; 
        luxury goods.--The terms ``applicable United Nations Security 
        Council resolution'' and ``luxury goods'' have the meanings 
        given those terms, respectively, in section 3 of the North 
        Korea Sanctions and Policy Enhancement Act of 2016 (22 U.S.C. 
        9202), as amended by subsection (a).
          (2) Appropriate congressional committees; government of north 
        korea; united states person.--The terms ``appropriate 
        congressional committees'', ``Government of North Korea'', and 
        ``United States person'' have the meanings given those terms, 
        respectively, in section 3 of the North Korea Sanctions and 
        Policy Enhancement Act of 2016 (22 U.S.C. 9202).
          (3) Foreign person; north korean person.--The terms ``foreign 
        person'' and ``North Korean person'' have the meanings given 
        those terms, respectively, in paragraph (5) and paragraph (13) 
        of section 3 of the North Korea Sanctions and Policy 
        Enhancement Act of 2016 (22 U.S.C. 9202(5) and 9202(13)), as 
        added by subsection (a).
          (4) Prohibited weapons program.--The term ``prohibited 
        weapons program'' means--
                  (A) any program related to the development of 
                nuclear, chemical, or biological weapons, and their 
                means of delivery, including ballistic missiles; and
                  (B) any program to develop any related materials with 
                respect to a program described in subparagraph (A).

  TITLE I--SANCTIONS TO ENFORCE AND IMPLEMENT UNITED NATIONS SECURITY 
                 COUNCIL SANCTIONS AGAINST NORTH KOREA

SEC. 101. MODIFICATION AND EXPANSION OF REQUIREMENTS FOR THE 
                    DESIGNATION OF PERSONS.

  (a) Expansion of Mandatory Designations.--Section 104(a) of the North 
Korea Sanctions and Policy Enhancement Act of 2016 (22 U.S.C. 9214(a)) 
is amended--
          (1) in paragraph (9), by striking ``; or'' and inserting ``or 
        any defense article or defense service (as such terms are 
        defined in section 47 of the Arms Export Control Act (22 U.S.C. 
        2794));'';
          (2) by redesignating paragraph (10) as paragraph (15);
          (3) by inserting after paragraph (9) the following new 
        paragraphs:
          ``(10) knowingly, directly or indirectly, purchases or 
        otherwise acquires from North Korea any significant amounts of 
        gold, titanium ore, vanadium ore, copper, silver, nickel, zinc, 
        or rare earth minerals;
          ``(11) knowingly, directly or indirectly, sells or transfers 
        to North Korea any significant amounts of rocket, aviation, or 
        jet fuel (except for use by a civilian passenger aircraft 
        outside North Korea, exclusively for consumption during its 
        flight to North Korea or its return flight);
          ``(12) knowingly, directly or indirectly, provides fuel, 
        supplies, or bunkering services to, or facilitates a 
        significant transaction or transactions to operate or maintain, 
        a vessel or aircraft that is designated under an applicable 
        Executive order or an applicable United Nations Security 
        Council resolution, or that is owned or controlled by a person 
        designated under an applicable Executive order or applicable 
        United Nations Security Council resolution;
          ``(13) knowingly, directly or indirectly, insures, registers, 
        facilitates the registration of, or maintains insurance or a 
        registration for, a vessel owned or controlled by the 
        Government of North Korea, except as specifically approved by 
        the United Nations Security Council;
          ``(14) knowingly, directly or indirectly, maintains a 
        correspondent account (as defined in section 201A(d)(1)) with 
        any North Korean financial institution, except as specifically 
        approved by the United Nations Security Council; or''; and
          (4) in paragraph (15), as so redesignated, by striking 
        ``(9)'' and inserting ``(14)''.
  (b) Expansion of Additional Discretionary Designations.--Section 
104(b)(1) of the North Korea Sanctions and Policy Enhancement Act of 
2016 (22 U.S.C. 9214(b)(1)) is amended--
          (1) in subparagraph (A), by striking ``pursuant to an 
        applicable United Nations Security Council resolution;'' and 
        inserting the following: ``pursuant to--
                          ``(i) an applicable United Nations Security 
                        Council resolution;
                          ``(ii) any regulation promulgated under 
                        section 404; or
                          ``(iii) any applicable Executive order;'';
          (2) in subparagraph (B)(iii), by striking ``or'' at the end;
          (3) in subparagraph (C), by striking the period at the end 
        and inserting a semicolon; and
          (4) by adding at the end the following new subparagraphs:
                  ``(D) knowingly, directly or indirectly, purchased or 
                otherwise acquired from the Government of North Korea 
                significant quantities of coal, iron, or iron ore, in 
                excess of the limitations provided in applicable United 
                Nations Security Council resolutions;
                  ``(E) knowingly, directly or indirectly, purchased or 
                otherwise acquired significant types or amounts of 
                textiles from the Government of North Korea;
                  ``(F) knowingly facilitated any transfer of funds or 
                property of the Government of North Korea that 
                materially contributes to any violation of an 
                applicable United National Security Council resolution;
                  ``(G) knowingly, directly or indirectly, facilitated 
                a significant transfer to or from the Government of 
                North Korea of bulk cash, precious metals, gemstones, 
                or other stores of value not described under subsection 
                (a)(10);
                  ``(H) knowingly, directly or indirectly, sold, 
                transferred, or otherwise provided significant amounts 
                of crude oil, condensates, refined petroleum, other 
                types of petroleum or petroleum byproducts, liquified 
                natural gas, or other natural gas resources to the 
                Government of North Korea (except for heavy fuel oil, 
                gasoline, or diesel fuel for humanitarian use or as 
                excepted under subsection (a)(11));
                  ``(I) knowingly, directly or indirectly, engaged in, 
                facilitated, or was responsible for the online 
                commercial activities of the Government of North Korea, 
                including online gambling;
                  ``(J) knowingly, directly or indirectly, purchased or 
                otherwise acquired fishing rights from the Government 
                of North Korea;
                  ``(K) knowingly, directly or indirectly, provided 
                significant telephonic, telegraphic, telecommunications 
                or other data services, in whole or in part, into or 
                out of North Korea, in excess of services needed for 
                humanitarian or diplomatic purposes (other than 
                services that are excepted under section 203(b)(1) of 
                the International Emergency Economic Powers Act (50 
                U.S.C. 1702(b)(1)));
                  ``(L) knowingly, directly or indirectly, purchased or 
                otherwise acquired significant types or amounts of food 
                or agricultural products from the Government of North 
                Korea;
                  ``(M) knowingly, directly or indirectly, engaged in, 
                facilitated, or was responsible for the exportation of 
                workers from North Korea in a manner intended to 
                generate significant revenue, directly or indirectly, 
                for use by the Government of North Korea or by the 
                Workers' Party of Korea;
                  ``(N) knowingly conducted a significant transaction 
                or transactions in North Korea's transportation, 
                mining, energy, or financial services industries; or
                  ``(O) except as specifically approved by the United 
                Nations Security Council, and other than through a 
                correspondent account as described in subsection 
                (a)(14), knowingly facilitated the operation of any 
                branch, subsidiary, or office of a North Korean 
                financial institution.''.
  (c) Mandatory and Discretionary Asset Blocking.--Section 104(c) of 
the North Korea Sanctions and Policy Enhancement Act of 2016 (22 U.S.C. 
9214(c)) is amended--
          (1) by striking ``of a designated person'' and inserting ``of 
        a person designated under subsection (a)'';
          (2) by striking ``The President'' and inserting the 
        following:
          ``(1) Mandatory asset blocking.--The President''; and
          (3) by adding at the end the following new paragraph:
          ``(2) Discretionary asset blocking.--The President may also 
        exercise such powers, in the same manner and to the same extent 
        described in paragraph (1), with respect to a person designated 
        under subsection (b).''.
  (d) Designation of Additional Persons.--
          (1) In general.--Not later than 180 days after the date of 
        the enactment of this Act, the President shall submit to the 
        appropriate congressional committees a report including a 
        determination as to whether reasonable grounds exist, and an 
        explanation of the reasons for any determination that such 
        grounds do not exist, to designate, pursuant to section 104 of 
        the North Korea Sanctions and Policy Enhancement Act of 2016 
        (22 U.S.C. 9214), as amended by this section, each of the 
        following:
                  (A) The Korea Shipowners' Protection and Indemnity 
                Association, a North Korean insurance company, with 
                respect to facilitating imports, exports, and reexports 
                of arms and related materiel to and from North Korea, 
                or for other activities prohibited by such section 104.
                  (B) Chinpo Shipping Company (Private) Limited, a 
                Singapore corporation, with respect to facilitating 
                imports, exports, and reexports of arms and related 
                materiel to and from North Korea.
                  (C) The Central Bank of the Democratic People's 
                Republic of Korea, with respect to the sale of gold to, 
                the receipt of gold from, or the import or export of 
                gold by the Government of North Korea.
                  (D) Kumgang Economic Development Corporation (KKG), 
                with respect to being an entity controlled by Bureau 39 
                of the Workers' Party of the Government of North Korea.
                  (E) Sam Pa, also known as Xu Jinghua, Xu Songhua, Sa 
                Muxu, Samo, Sampa, or Sam King, and any entities owned 
                or controlled by such individual, with respect to 
                transactions with KKG.
                  (F) The Chamber of Commerce of the Democratic 
                People's Republic of Korea, with respect to the 
                exportation of workers in violation of section 
                104(a)(5) or of section 104(b)(1)(M) of such Act, as 
                amended by subsection (b) of this section.
          (2) Form.--The report submitted under paragraph (1) may 
        contain a classified annex.

SEC. 102. PROHIBITION ON INDIRECT CORRESPONDENT ACCOUNTS.

  (a) In General.--Title II of the North Korea Sanctions and Policy 
Enhancement Act of 2016 (22 U.S.C. 9221 et seq.) is amended by 
inserting after section 201 the following new section:

``SEC. 201A. PROHIBITION ON INDIRECT CORRESPONDENT ACCOUNTS.

  ``(a) In General.--Except as provided in subsection (b), if a United 
States financial institution has or obtains knowledge that a 
correspondent account established, maintained, administered, or managed 
by that institution for a foreign financial institution is being used 
by the foreign financial institution to provide financial services 
indirectly to any person, foreign government, or financial institution 
designated under section 104, the United States financial institution 
shall ensure that such correspondent account is no longer used to 
provide such services.
  ``(b) Exception.--A United States financial institution is authorized 
to process transfers of funds to or from North Korea, or for the direct 
or indirect benefit of any person, foreign government, or financial 
institution that is designated under section 104, only if the 
transfer--
          ``(1) arises from, and is ordinarily incident and necessary 
        to give effect to, an underlying transaction that has been 
        authorized by a specific or general license issued by the 
        Secretary of the Treasury; and
          ``(2) does not involve debiting or crediting a North Korean 
        account.
  ``(c) Definitions.--In this section:
          ``(1) Correspondent account.--The term `correspondent 
        account' has the meaning given that term in section 5318A of 
        title 31, United States Code.
          ``(2) United states financial institution.--The term `United 
        States financial institution' means has the meaning given that 
        term in section 510.310 of title 31, Code of Federal 
        Regulations, as in effect on the date of the enactment of this 
        section.
          ``(3) Foreign financial institution.--The term `foreign 
        financial institution' has the meaning given that term in 
        section 1010.605 of title 31, Code of Federal Regulations, as 
        in effect on the date of the enactment of this section.''.
  (b) Clerical Amendment.--The table of contents in section 1(b) of the 
North Korea Sanctions and Policy Enhancement Act of 2016 is amended by 
inserting after the item relating to section 201 the following new 
item:

``Sec. 201A. Prohibition on indirect correspondent accounts.''.

SEC. 103. LIMITATIONS ON FOREIGN ASSISTANCE TO NONCOMPLIANT 
                    GOVERNMENTS.

  Section 203 of the North Korea Sanctions and Policy Enhancement Act 
of 2016 (22 U.S.C. 9223) is amended--
          (1) in subsection (b)--
                  (A) in the heading, by striking ``Transactions in 
                Lethal Military Equipment'' and inserting 
                ``Transactions in Defense Articles or Defense 
                Services'';
                  (B) in paragraph (1), by striking ``that provides 
                lethal military equipment to the Government of North 
                Korea'' and inserting ``that provides to or receives 
                from the Government of North Korea a defense article or 
                defense service, as such terms are defined in section 
                47 of the Arms Export Control Act (22 U.S.C. 2794)''; 
                and
                  (C) in paragraph (2), by striking ``1 year'' and 
                inserting ``2 years'';
          (2) in subsection (d), by striking ``or emergency'' and 
        inserting ``maternal and child health, disease prevention and 
        response, or''; and
          (3) by adding at the end the following new subsection:
  ``(e) Report on Arms Trafficking Involving North Korea.--
          ``(1) In general.--Not later than 180 days after the date of 
        the enactment of this subsection, and every 180 days thereafter 
        for 5 years, the Secretary of State shall submit to the 
        appropriate congressional committees a report that specifically 
        describes the compliance of foreign countries and other foreign 
        jurisdictions with the requirement to curtail the trade 
        described in subsection (b)(1).
          ``(2) Form.--The report required under paragraph (1) shall be 
        submitted in unclassified form but may contain a classified 
        annex.''.

SEC. 104. AMENDMENTS TO ENHANCE INSPECTION AUTHORITIES.

  Title II of the North Korea Sanctions and Policy Enhancement Act of 
2016 (22 U.S.C. 9221 et seq.), as amended by section 102 of this Act, 
is further amended by striking section 205 and inserting the following:

``SEC. 205. ENHANCED INSPECTION AUTHORITIES.

  ``(a) Report Required.--
          ``(1) In general.--Not later than 180 days after the date of 
        the enactment of this section, and annually thereafter for 5 
        years, the President shall submit to the appropriate 
        congressional committees a report--
                  ``(A) identifying the operators of foreign sea ports 
                and airports that have knowingly--
                          ``(i) failed to implement or enforce 
                        regulations to inspect ships, aircraft, cargo, 
                        or conveyances in transit to or from North 
                        Korea, as required by applicable United Nations 
                        Security Council resolutions;
                          ``(ii) facilitated the transfer, 
                        transshipment, or conveyance of significant 
                        types or quantities of cargo, vessels, or 
                        aircraft owned or controlled by persons 
                        designated under applicable United Nations 
                        Security Council resolutions; or
                          ``(iii) facilitated any of the activities 
                        described in section 104(a);
                  ``(B) describing the extent to which the requirements 
                of applicable United Nations Security Council 
                resolutions to de-register any vessel owned, 
                controlled, or operated by the Government of North 
                Korea have been implemented by other foreign countries;
                  ``(C) describing the compliance of the Islamic 
                Republic of Iran with the sanctions mandated in 
                applicable United Nations Security Council resolutions;
                  ``(D) identifying vessels, aircraft, and conveyances 
                owned or controlled by the Reconnaissance General 
                Bureau of the Workers' Party of Korea; and
                  ``(E) describing the diplomatic and enforcement 
                efforts by the President to secure the full 
                implementation of the applicable United Nations 
                Security Council resolutions, as described in 
                subparagraphs (A) through (C).
          ``(2) Form.--The report required under paragraph (1) shall be 
        submitted in unclassified form but may contain a classified 
        annex.
  ``(b) Specific Findings.--Each report required under subsection (a) 
shall include specific findings with respect to the following ports and 
airports:
          ``(1) The ports of Dandong, Dalian, and any other port in the 
        People's Republic of China that the President deems 
        appropriate.
          ``(2) The ports of Abadan, Bandar-e-Abbas, Chabahar, Bandar-
        e-Khomeini, Bushehr Port, Asaluyeh Port, Kish, Kharg Island, 
        Bandar-e-Lenge, and Khorramshahr, and Tehran Imam Khomeini 
        International Airport, in the Islamic Republic of Iran.
          ``(3) The ports of Nakhodka, Vanino, and Vladivostok, in the 
        Russian Federation.
          ``(4) The ports of Latakia, Banias, and Tartous, and Damascus 
        International Airport, in the Syrian Arab Republic.
  ``(c) Enhanced Security Targeting Requirements.--
          ``(1) In general.--Except as provided in paragraph (2), the 
        Secretary of Homeland Security may, using the Automated 
        Targeting System operated by the National Targeting Center of 
        U.S. Customs and Border Protection, require enhanced screening 
        procedures to determine whether physical inspections are 
        warranted of any cargo bound for or landed in the United States 
        that--
                  ``(A) has been transported through a sea port or 
                airport the operator of which has been identified by 
                the President in accordance with subsection (a)(1) as 
                having repeatedly failed to comply with applicable 
                United Nations Security Council resolutions;
                  ``(B) is aboard a vessel or aircraft, or within a 
                conveyance that has, within the last 365 days, entered 
                the territory, waters, or airspace of North Korea, or 
                landed in any of the sea ports or airports of North 
                Korea; or
                  ``(C) is registered by a country or jurisdiction 
                whose compliance has been identified by the President 
                as deficient pursuant to subsection (a)(2).
          ``(2) Exception for food, medicine, and humanitarian 
        shipments.--Paragraph (1) shall not apply to any vessel, 
        aircraft, or conveyance that has entered the territory, waters, 
        or airspace of North Korea, or landed in any of the sea ports 
        or airports of North Korea, exclusively for the purposes 
        described in section 208(b)(3)(B), or to import food, medicine, 
        or supplies into North Korea to meet the humanitarian needs of 
        the North Korean people.
  ``(d) Seizure and Forfeiture.--A vessel, aircraft, or conveyance used 
to facilitate any of the activities described in section 104(a) under 
the jurisdiction of the United States may be seized and forfeited 
under--
          ``(1) chapter 46 of title 18, United States Code; or
          ``(2) part V of title IV of the Tariff Act of 1930 (19 U.S.C. 
        1581 et seq.).''.

SEC. 105. ENFORCING COMPLIANCE WITH UNITED NATIONS SHIPPING SANCTIONS 
                    AGAINST NORTH KOREA.

  (a) In General.--The Ports and Waterways Safety Act (33 U.S.C. 1221 
et seq.) is amended by adding at the end the following new section:

``SEC. 16. PROHIBITION ON ENTRY AND OPERATION.

  ``(a) Prohibition.--
          ``(1) In general.--Except as otherwise provided in this 
        section, no vessel described in subsection (b) may enter or 
        operate in the navigable waters of the United States or 
        transfer cargo in any port or place under the jurisdiction of 
        the United States.
          ``(2) Limitation on application.--
                  ``(A) Determination by secretary of state.--Paragraph 
                (1) shall not apply with respect to a vessel described 
                in subsection (b)(2) if the Secretary of State 
                determines that the vessel is no longer registered as 
                described in that subsection.
                  ``(B) Notice.--The Secretary of State shall publish a 
                notice in the Federal Register of each determination 
                made under subparagraph (A).
  ``(b) Vessels Described.--A vessel referred to in subsection (a) is a 
foreign vessel for which a notice of arrival is required to be filed 
under section 4(a)(5), and that--
          ``(1) is on the most recent list of vessels published in 
        Federal Register under subsection (c)(2); or
          ``(2) more than 180 days after the publication of such list, 
        is knowingly registered, pursuant to the 1958 Convention on the 
        High Seas entered into force on September 30, 1962, by a 
        government the agents or instrumentalities of which are 
        maintaining a registration of a vessel that is included on such 
        list.
  ``(c) Information and Publication.--The Secretary of the department 
in which the Coast Guard is operating, in consultation with the 
Secretary of State, shall--
          ``(1) maintain timely information on the registrations of all 
        foreign vessels over 300 gross tons that are--
                  ``(A) owned or operated by or on behalf of the 
                Government of North Korea or a North Korean person;
                  ``(B) owned or operated by or on behalf of any 
                country in which a sea port or airport is located, the 
                operator of which the President has identified in the 
                most recent report submitted under section 205(a)(1) of 
                the North Korea Sanctions and Policy Enhancement Act of 
                2016; or
                  ``(C) owned or operated by or on behalf of any 
                country identified by the President as a country that 
                has not complied with the applicable United Nations 
                Security Council resolutions (as such term is defined 
                in section 3 of such Act); and
          ``(2) not later than 180 days after the date of the enactment 
        of this section, and periodically thereafter, publish in the 
        Federal Register a list of the vessels described in paragraph 
        (1).
  ``(d) Notification of Governments.--
          ``(1) In general.--The Secretary of State shall notify each 
        government, the agents or instrumentalities of which are 
        maintaining a registration of a foreign vessel that is included 
        on a list published under subsection (c)(2), not later than 30 
        days after such publication, that all vessels registered under 
        such government's authority are subject to the prohibition 
        under subsection (a).
          ``(2) Additional notification.--In the case of a government 
        that continues to maintain a registration for a vessel that is 
        included on such list after receiving an initial notification 
        under paragraph (1), the Secretary shall issue an additional 
        notification to such government not later than 120 days after 
        the publication of a list under subsection (c)(2).
  ``(e) Notification of Vessels.--Upon receiving a notice of arrival 
under section 4(a)(5) from a vessel described in subsection (b), the 
Secretary of the department in which the Coast Guard is operating shall 
notify the master of such vessel that the vessel may not enter or 
operate in the navigable waters of the United States or transfer cargo 
in any port or place under the jurisdiction of the United States, 
unless--
          ``(1) the Secretary of State has made a determination under 
        subsection (a)(2); or
          ``(2) the Secretary of the department in which the Coast 
        Guard is operating allows provisional entry of the vessel, or 
        transfer of cargo from the vessel, under subsection (f).
  ``(f) Provisional Entry or Cargo Transfer.--Notwithstanding any other 
provision of this section, the Secretary of the department in which the 
Coast Guard is operating may allow provisional entry of, or transfer of 
cargo from, a vessel, if such entry or transfer is necessary for the 
safety of the vessel or persons aboard.
  ``(g) Right of Innocent Passage.--This section shall not be construed 
as authority to restrict the right of innocent passage as recognized 
under international law.
  ``(h) Foreign Vessel Defined.--In this section, the term `foreign 
vessel' has the meaning given that term in section 110 of title 46, 
United States Code.''.
  (b) Conforming Amendments.--
          (1) Special powers.--Section 4(b)(2) of the Ports and 
        Waterways Safety Act (33 U.S.C. 1223(b)(2)) is amended by 
        inserting ``or 16'' after ``section 9''.
          (2) Denial of entry.--Section 13(e) of the Ports and 
        Waterways Safety Act (33 U.S.C. 1232(e)) is amended by striking 
        ``section 9'' and inserting ``section 9 or 16''.

SEC. 106. REPORT ON COOPERATION BETWEEN NORTH KOREA AND IRAN.

  (a) In General.--Not later than 90 days after the date of the 
enactment of this Act, and annually thereafter for 5 years, the 
President shall submit to the appropriate congressional committees a 
report that includes--
          (1) an assessment of the extent of cooperation (including 
        through the transfer of goods, services, or technology) between 
        North Korea and Iran relating to their respective nuclear, 
        ballistic missile development, chemical or biological weapons 
        development, or conventional weapons programs;
          (2) the names of any Iranian or North Korean persons that 
        have knowingly engaged in or directed--
                  (A) the provision of material support to such 
                programs; or
                  (B) the exchange of information between North Korea 
                and Iran with respect to such programs; and
          (3) a determination whether any of the activities described 
        in paragraphs (1) and (2) violate United Nations Security 
        Council Resolution 2231 (2015).
  (b) Form.--The report required under subsection (a) shall be 
submitted in unclassified form but may contain a classified annex.

SEC. 107. REPORT ON IMPLEMENTATION OF UNITED NATIONS SECURITY COUNCIL 
                    RESOLUTIONS BY OTHER GOVERNMENTS.

  (a) In General.--Not later than 180 days after the date of the 
enactment of this Act, and every 180 days thereafter for 5 years, the 
President shall submit to the appropriate congressional committees a 
report that evaluates the degree to which the governments of other 
countries have knowingly failed to--
          (1) close the representative offices of persons designated 
        under applicable United Nations Security Council resolutions;
          (2) expel any North Korean nationals, including diplomats, 
        working on behalf of such persons;
          (3) prohibit the opening of new branches, subsidiaries, or 
        representative offices of North Korean financial institutions 
        within the jurisdictions of such governments; or
          (4) expel any representatives of North Korean financial 
        institutions.
  (b) Form.--The report required under subsection (a) shall be 
submitted in unclassified form but may contain a classified annex.

SEC. 108. BRIEFING ON MEASURES TO DENY SPECIALIZED FINANCIAL MESSAGING 
                    SERVICES TO DESIGNATED NORTH KOREAN FINANCIAL 
                    INSTITUTIONS.

  (a) In General.--Not later than 180 days after the date of the 
enactment of this Act, and every 180 days thereafter for 5 years, the 
President shall provide to the appropriate congressional committees a 
briefing that includes the following information:
          (1) A list of each person or foreign government the President 
        has identified that directly provides specialized financial 
        messaging services to, or enables or facilitates direct or 
        indirect access to such messaging services for, any North 
        Korean financial institution (as such term is defined in 
        section 3 of the North Korea Sanctions and Policy Enhancement 
        Act of 2016 (22 U.S.C. 9202)) designated under an applicable 
        United Nations Security Council resolution.
          (2) A detailed assessment of the status of efforts by the 
        Secretary of the Treasury to work with the relevant authorities 
        in the home jurisdictions of such specialized financial 
        messaging providers to end such provision or access.
  (b) Form.--The briefing required under subsection (a) may be 
classified.

    TITLE II--SANCTIONS WITH RESPECT TO HUMAN RIGHTS ABUSES BY THE 
                       GOVERNMENT OF NORTH KOREA

SEC. 201. SANCTIONS FOR FORCED LABOR AND SLAVERY OVERSEAS OF NORTH 
                    KOREANS.

  (a) Sanctions for Trafficking in Persons.--
          (1) In general.--Section 302(b) of the North Korea Sanctions 
        and Policy Enhancement Act of 2016 (22 U.S.C. 9241(b)) is 
        amended--
                  (A) in paragraph (1), by striking ``and'' at the end;
                  (B) in paragraph (2), by striking the period at the 
                end and inserting ``; and''; and
                  (C) by adding at the end the following new paragraph:
          ``(3) a list of foreign persons that employ North Korean 
        laborers.''.
          (2) Additional determinations; reports.--With respect to any 
        country identified in section 302(b)(2) of the North Korea 
        Sanctions and Policy Enhancement Act of 2016 (22 U.S.C. 
        9241(b)(2)), as amended by paragraph (1), the report required 
        under section 302(a) of such Act shall--
                  (A) include a determination whether each person 
                identified in section 302(b)(3) of such Act (as amended 
                by paragraph (1)) who is a national or a citizen of 
                such identified country meets the criteria for 
                sanctions under--
                          (i) section 111 of the Trafficking Victims 
                        Protection Act of 2000 (22 U.S.C. 7108) 
                        (relating to the prevention of trafficking in 
                        persons); or
                          (ii) section 104(a) or 104(b)(1) of the North 
                        Korea Sanctions and Policy Enhancement Act of 
                        2016 (22 U.S.C. 9214(a)), as amended by section 
                        101 of this Act;
                  (B) be included in the report required under section 
                110(b) of the Trafficking Victims Protection Act of 
                2000 (22 U.S.C. 7107(b)) (relating to the annual report 
                on trafficking in persons); and
                  (C) be considered in any determination that the 
                government of such country has made serious and 
                sustained efforts to eliminate severe forms of 
                trafficking in persons, as such term is defined for 
                purposes of the Trafficking Victims Protection Act of 
                2000.
  (b) Sanctions on Foreign Persons That Employ North Korean Labor.--
          (1) In general.--Title III of the North Korea Sanctions and 
        Policy Enhancement Act of 2016 (22 U.S.C. 9241 et seq.) is 
        amended by inserting after section 302 the following new 
        sections:

``SEC. 302A. REBUTTABLE PRESUMPTION APPLICABLE TO GOODS MADE WITH NORTH 
                    KOREAN LABOR.

  ``(a) In General.--Except as provided in subsection (b), any goods, 
wares, articles, and merchandise mined, produced, or manufactured 
wholly or in part by the labor of North Korean nationals or citizens 
shall be deemed to be prohibited under section 307 of the Tariff Act of 
1930 (19 U.S.C. 1307) and shall not be entitled to entry at any of the 
ports of the United States.
  ``(b) Exception.--The prohibition described in subsection (a) shall 
not apply if the Commissioner of U.S. Customs and Border Protection 
finds, by clear and convincing evidence, that the goods, wares, 
articles, or merchandise described in such paragraph were not produced 
with convict labor, forced labor, or indentured labor under penal 
sanctions.

``SEC. 302B. SANCTIONS ON FOREIGN PERSONS EMPLOYING NORTH KOREAN LABOR.

  ``(a) In General.--Except as provided in subsection (c), the 
President shall designate any person identified under section 302(b)(3) 
for the imposition of sanctions under subsection (b).
  ``(b) Imposition of Sanctions.--
          ``(1) In general.--The President shall impose the sanctions 
        described in paragraph (2) with respect to any person 
        designated under subsection (a).
          ``(2) Sanctions described.--The sanctions described in this 
        paragraph are sanctions pursuant to the International Emergency 
        Economic Powers Act (50 U.S.C. 1701 et seq.) to block and 
        prohibit all transactions in property and interests in property 
        of a person designated under subsection (a), if such property 
        and interests in property are in the United States, come within 
        the United States, or are or come within the possession or 
        control of a United States person.
  ``(c) Exception.--
          ``(1) In general.--A person may not be designated under 
        subsection (a) if the President certifies to the appropriate 
        congressional committees that the President has received 
        reliable assurances from such person that--
                  ``(A) the employment of North Korean laborers does 
                not result in the direct or indirect transfer of 
                convertible currency, luxury goods, or other stores of 
                value to the Government of North Korea;
                  ``(B) all wages and benefits are provided directly to 
                the laborers, and are held, as applicable, in accounts 
                within the jurisdiction in which they reside in locally 
                denominated currency; and
                  ``(C) the laborers are subject to working conditions 
                consistent with international standards.
          ``(2) Recertification.--Not later than 180 days after the 
        date on which the President transmits to the appropriate 
        congressional committees an initial certification under 
        paragraph (1), and every 180 days thereafter, the President 
        shall--
                  ``(A) transmit a recertification stating that the 
                conditions described in such paragraph continue to be 
                met; or
                  ``(B) if such recertification cannot be transmitted, 
                impose the sanctions described in subsection (b) 
                beginning on the date on which the President determines 
                that such recertification cannot be transmitted.''.
          (2) Clerical amendment.--The table of contents in section 
        1(b) of the North Korea Sanctions and Policy Enhancement Act of 
        2016 is amended by inserting after the item relating to section 
        302 the following new items:

``Sec. 302A. Rebuttable presumption applicable to goods made with North 
Korean labor.
``Sec. 302B. Sanctions on foreign persons employing North Korean 
labor.''.

SEC. 202. MODIFICATIONS TO SANCTIONS SUSPENSION AND WAIVER AUTHORITIES.

  (a) Exemptions, Waivers, and Removals of Designation.--
          (1) Exemptions.--Section 208(a) of the North Korea Sanctions 
        and Policy Enhancement Act of 2016 (22 U.S.C. 9228(a)) is 
        amended in the matter preceding paragraph (1)--
                  (A) by inserting ``201A,'' after ``104,''; and
                  (B) by inserting ``302A, 302B,'' after ``209,''.
          (2) Humanitarian waiver.--Section 208(b) of the North Korea 
        Sanctions and Policy Enhancement Act of 2016 (22 U.S.C. 
        9228(b)(1)) is amended--
                  (A) by inserting ``201A,'' after ``104,'' in each 
                place it appears; and
                  (B) by inserting ``302A, 302B,'' after ``209(b),'' in 
                each place it appears.
          (3) Waiver.--Section 208(c) of the North Korea Sanctions and 
        Policy Enhancement Act of 2016 (22 U.S.C. 9228(c)) is amended 
        in the matter preceding paragraph (1)--
                  (A) by inserting ``201A,'' after ``104,''; and
                  (B) by inserting ``302A, 302B,'' after ``209(b),''.
  (b) Support for Family Reunification for Korean-Americans.--Section 
402(2) of the North Korea Sanctions and Policy Enhancement Act of 2016 
(22 U.S.C. 9252(2)) is amended--
          (1) in subparagraph (D), by striking ``and'' at the end;
          (2) in subparagraph (E), by striking the period at the end 
        and inserting ``; and''; and
          (3) by adding at the end the following new subparagraph:
                  ``(F) planning for unrestricted family reunification 
                meetings, including for those individuals in the 
                Korean-American community who maintain family ties with 
                relatives in North Korea.''.

SEC. 203. REWARD FOR INFORMANTS.

  Section 36(b) of the State Department Basic Authorities Act of 1956 
(22 U.S.C. 2708(b)), is amended--
          (1) in paragraph (9), by striking ``or'' at the end;
          (2) in paragraph (10), by striking the period at the end and 
        inserting a semicolon; and
          (3) by adding at the end the following new paragraphs:
          ``(11) the identification or location of any person who, 
        while acting at the direction of or under the control of a 
        foreign government, aids or abets a violation of section 1030 
        of title 18, United States Code; or
          ``(12) the disruption of financial mechanisms of any person 
        who has engaged in the conduct described in sections 104(a) or 
        104(b)(1) of the North Korea Sanctions and Policy Enhancement 
        Act of 2016 (22 U.S.C. 2914(a) or (b)(1)).''.

SEC. 204. DETERMINATION ON DESIGNATION OF NORTH KOREA AS A STATE 
                    SPONSOR OF TERRORISM.

  (a) Determination.--
          (1) In general.--Not later than 90 days after the date of the 
        enactment of this Act, the Secretary of State shall submit to 
        the appropriate congressional committees a determination 
        whether North Korea meets the criteria for designation as a 
        state sponsor of terrorism.
          (2) Form.--The determination required by paragraph (1) shall 
        be submitted in unclassified form but may include a classified 
        annex, if appropriate.
  (b) State Sponsor of Terrorism Defined.--For purposes of this 
section, the term ``state sponsor of terrorism'' means a country the 
government of which the Secretary of State has determined, for purposes 
of section 6(j) of the Export Administration Act of 1979 (50 U.S.C. 
4605(j)) (as in effect pursuant to the International Emergency Economic 
Powers Act), section 620A of the Foreign Assistance Act of 1961 (22 
U.S.C. 2371), section 40 of the Arms Export Control Act (22 U.S.C. 
2780), or any other provision of law, is a government that has 
repeatedly provided support for acts of international terrorism.

                     TITLE III--GENERAL AUTHORITIES

SEC. 301. AUTHORITY TO CONSOLIDATE REPORTS.

  Any reports required to be submitted to the appropriate congressional 
committees under this Act or any amendment made by this Act that are 
subject to deadlines for submission consisting of similar units of time 
may be consolidated into a single report that is submitted to 
appropriate congressional committees pursuant to the earlier of such 
deadlines. The consolidated reports must contain all information 
required under this Act or any amendment made by this Act, in addition 
to all other elements mandated by previous law.

SEC. 302. RULE OF CONSTRUCTION.

  Nothing in this Act shall be construed to limit the authority or 
obligation of the President to apply the sanctions described in section 
104 of the North Korea Sanctions and Policy Enhancement Act of 2016 (22 
U.S.C. 9214), as amended by section 101 of this Act, with regard to 
persons who meet the criteria for designation under such section, or in 
any other provision of law.

SEC. 303. REGULATORY AUTHORITY.

  (a) In General.--The President shall, not later than 180 days after 
the date of the enactment of this Act, promulgate regulations as 
necessary for the implementation of this Act and the amendments made by 
this Act.
  (b) Notification to Congress.--Not fewer than 10 days before the 
promulgation of a regulation under subsection (a), the President shall 
notify and provide to the appropriate congressional committees the 
proposed regulation, specifying the provisions of this Act or the 
amendments made by this Act that the regulation is implementing.

SEC. 304. LIMITATION ON FUNDS.

  No additional funds are authorized to carry out the requirements of 
this Act or of the amendments made by this Act. Such requirements shall 
be carried out using amounts otherwise authorized.

                   Summary and Purpose of Legislation

    H.R. 1644, the ``Korean Interdiction and Modernization of 
Sanctions Act,'' is a response to the urgent threat North Korea 
poses to the United States and its allies. The legislation 
builds upon the ``North Korea Sanctions and Policy Enhancement 
Act'' (P.L. 114-122) to further restrict Pyongyang's access to 
revenue which funds the regime's nuclear and missile programs 
to protect the national security of the United States.
    Experts believe that North Korea is developing an 
intercontinental ballistic missile that could strike the United 
States with a nuclear warhead. North Korea continues to produce 
fissile material for nuclear weapons. Some non-governmental 
studies have estimated that North Korea will accumulate enough 
nuclear material to build up to 100 warheads over the next few 
years. North Korea conducted two nuclear weapons tests and 
launched a record 26 ballistic missiles in 2016. These actions 
violate multiple U.N. Security Council resolutions.
    In response the ``North Korea Sanctions and Policy 
Enhancement Act'' was passed and signed into law last Congress. 
P.L. 114-122 provides the executive branch with basis to target 
North Korea's money laundering and other illicit activities 
including arms and narcotics trafficking, and counterfeiting of 
U.S. currency. This has helped to restrict the regime's access 
to hard currency. The law's passage and signature into law was 
followed by two comprehensive U.N. Security Council resolutions 
being put into place.
    Yet North Korea has worked over the past year to evade 
international sanctions with the help of a vast network of 
front companies and governments that span the globe. H.R. 1644, 
the ``Korean Interdiction and Modernization of Sanctions Act'' 
works to counter these developments by deterring those who 
continue to do business with North Korea and depriving North 
Korea of the resources it requires to develop weapons that 
threaten the United States. It enhances U.S. sanctions against 
North Korea in order to end the regime's misuse of global 
shipping to transport illicit materials; its exploitation of 
the financial system to launder money; its severe human rights 
abuses including the use of forced labor; and other activities 
that violate applicable U.N. Security Council resolutions.

                  Background and Need for Legislation


North Korea's Escalating Threat to the United States

    North Korea continues to threaten the United States and its 
allies by rapidly developing its nuclear and ballistic missile 
program in violation of numerous U.N. Security Council 
resolutions. As of January 2017, Kim Jong Un has tested more 
missiles than the two previous dictators of North Korea, Kim 
Jong Il and Kim Il Sung, combined. North Korea conducted two 
nuclear weapons tests and launched a record 26 ballistic 
missiles in 2016. It most recently conducted a missile test on 
April 4, 2017, its fourth missile test in 2017. North Korea has 
tested a nuclear explosive device four other times since 2006. 
These actions violate multiple U.N. Security Council 
resolutions, pose a direct threat to U.S. allies and U.S. 
forces stationed in Northeast Asia and left unchecked, will 
soon pose a direct threat to the homeland of the United States.
    The North Korean Government publicly acknowledges it 
continues to develop nuclear weapons and has stated it is 
willing to conduct preemptive strikes against the United States 
and its allies as a means of self-defense. The North Korean 
Government announcement of a September 9, 2016, nuclear test 
claimed that North Korea has ``standardized'' its nuclear 
warhead and would continue to advance the quality and quantity 
of its ``nuclear force.'' The announcement stated ``the 
standardization of the nuclear warhead will enable the DPRK to 
produce at will . . . a variety of smaller, lighter and 
diversified nuclear warheads of higher strike power.'' In his 
2017 New Year's address, North Korean leader Kim Jong Un stated 
that North Korea had ``achieved the status of a nuclear power'' 
and pledged to continue to ``build up our self-defense 
capability . . . and the capability for preemptive strike . . . 
to defend the peace and security of our state.'' Thae Yong Ho, 
a high-ranking North Korean official who defected to Seoul last 
year, has publicly stated Kim Jong Un is determined to complete 
development of his nuclear weapons program by the end of 2017.
    The speed with which North Korea's ballistic missile 
program is advancing poses an immediate threat to our national 
security. If left unchecked, North Korea will soon be able to 
target all 50 States and our Asian allies with a nuclear 
warhead. This poses a direct threat to the American people and 
has a significant destabilizing effect on the world.
    On February 7, 2016, North Korea used a modified version of 
the Taepodong-2 ballistic missile to launch a satellite into 
space. On August 24, 2016, North Korea successfully tested a 
submarine-launched ballistic missile, firing the missile over 
300 miles from a submerged submarine. In the wake of these and 
other tests of their missile technology, the North Korean 
Government announced on January 8, 2017, that it is ready to 
test-launch an intercontinental ballistic missile capable of 
striking the United States.

Legislative Response

    The collapse of North Korea's industrial economy in the 
early 1990s left it highly dependent on external sources of 
hard currency to sustain a population of approximately 23 
million, a mechanized military of 1 million men and women, the 
military-industrial sector that supplies it, its weapons of 
mass destruction programs, and luxury items imported for senior 
regime officials. Because of the impracticality of transferring 
large sums of cash in bulk, North Korea continues to rely on 
the international financial system, and maintains large 
offshore foreign exchange reserves and other assets in China 
and Europe.
    In September 2005, the Department of the Treasury invoked 
the authority of Section 311 of the USA PATRIOT Act of 2001, 
(P.L.107-56), and blocked the accounts of Banco Delta Asia, a 
small Macau-based bank. According to the Treasury Department, 
Banco Delta Asia acted as ``a willing pawn'' of North Korean 
agents laundering the proceeds of illicit activity, including 
the counterfeiting of U.S. currency. Treasury's designation 
disconnected Banco Delta Asia from the international dollar-
based financial system and caused a run on the bank. The 
Government of Macau intervened and blocked $25 million in North 
Korean deposits to prevent the bank from collapse. Indirectly, 
the action caused other banks to block other North Korean 
accounts, or to reject North Korean transactions.
    The effect on the regime's finances was devastating. 
Seventeen months after the sanction was imposed on Banco Delta 
Asia, North Korea agreed to dismantle its nuclear weapons 
program, but first insisted that the United States return the 
$25 million in blocked North Korean funds, effectively 
nullifying the Section 311 sanction as it applied to North 
Korea. Of course, North Korea reneged on its commitments.
    Congress passed the ``North Korea Sanctions and Policy 
Enhancement Act of 2016'' in an effort to replicate the impact 
of Banco Delta Asia-like sanctions. The Act, the only 
comprehensive North Korean sanctions bill to be signed into 
law, provided the administration with tools to begin seriously 
tackling this threat.
    It has helped to constrain the regime's access to hard 
currency. Since the enactment of the law, the Obama 
administration sanctioned North Korean leader Kim Jong Un and 
at least 10 other regime officials and five North Korean state-
run entities for human rights abuses against the North Korean 
people. This was the first time the United States had 
sanctioned Kim Jong Un personally. On March 16, 2016, the 
Department of the Treasury formally determined that the 
transportation, mining, energy, and financial services 
industries in the North Korean economy shall be subject to U.S. 
sanctions. Pursuant to a requirement in P.L. 114-122, in June 
2016, the Department of the Treasury designated North Korea a 
``primary money laundering concern'' under the Patriot Act. 
That designation will require U.S. banks to ``implement 
additional due diligence measures'' to make sure North Korean 
banks don't get access--even through third parties.

Countering North Korea's Evasion of Sanctions

    A February 2017 report by the United Nations Panel of 
Experts stated that the Government of North Korea is using 
``increasingly sophisticated'' techniques to evade existing 
sanctions, including through dealings with middlemen and other 
countries that are willing to trade in money, arms, and slave 
labor that in turn funds the North Korean regime. That report 
highlighted evidence of North Korea's ability to manufacture 
and trade in sophisticated military technologies using overseas 
networks and to mask the identity of ships to gain access to 
restricted ports. It noted how ``designated entities and banks 
have continued to operate in the sanctioned environment by 
using agents who are highly experienced and well trained in 
moving money, people and goods . . . across borders.'' House 
Committee on Foreign Affairs Report 114-392 documented previous 
efforts by North Korea to evade sanctions. This legislation 
will provide additional tools to target the North Korean 
regime's efforts to evade sanctions.
    Specifically, this legislation further restricts North 
Korea's access to money and materials for its weapons programs 
by significantly expanding existing sanctions against the 
regime. It mandates sanctions against any foreign person who 
buys certain metals or minerals from the country or provides 
certain types of military use fuel or insurance or reinsurance 
to vessels sanctioned under a U.N. Security Council resolution 
for engaging in illicit trade with North Korea.
    The bill also expands the ability to sanction those who 
import North Korean coal, iron, or iron ore above the limits 
imposed by U.N. Security Council resolutions, buy textiles or 
fishing rights from North Korea, facilitate the online business 
activities of the regime, or fail to comply with U.N. Security 
Council Resolutions targeting the country.
    It also provides tools to target those involved in the 
export or use of North Korean forced labor, which is both a 
significant human rights abuse and another source of hard 
currency for the regime.

Targeting Vital North Korean Commodities

    Targeting exports of North Korean coal could deprive the 
Kim regime of critical hard currency. With China amounting to 
90 percent of all trade with North Korea, coal has long been 
its top export. Some analysts believe that North Korea's 
economy is 35 percent reliant on coal exports. With such a 
heavy reliance on one country and commodity, many believed that 
China's Ministry of Commerce announcement that China would 
suspend all coal trading until the end of 2017 would deal a 
significant blow to the North Korean economy. However, it has 
been reported that coal trading has continued in Rizao Port, in 
Shandong Province. A critical aspect of this legislation 
targets this vital North Korean commodity.

Cracking Down on Overseas North Korean Slave Labor

    According to United Nations reporting, tens of thousands of 
North Koreans are sent to work abroad, earning the regime up to 
$2.3 billion in foreign currency annually. Many of these 
workers toil in extreme and dangerous conditions and only 
receive a small fraction of their wages. Instead, the vast 
majority of their earnings are paid directly to Pyongyang, 
which uses this source of hard currency to advance development 
of its nuclear weapons and intercontinental ballistic missiles. 
Building on reporting requirements in the ``North Korea 
Sanctions and Policy Enhancement Act of 2016,'' which required 
the State Department to report to Congress the list of 
countries where North Korean workers are employed, this 
legislation prohibits goods produced in whole or part by North 
Korean forced labor from entering the United States. It also 
sanctions foreign persons that employ North Koreans who are 
forced to labor in inhumane conditions and are denied access to 
wages and benefits, and will deny Pyongyang a crucial source of 
revenue.

North Korea and International Shipping

    North Korea continues to violate sanctions against its use 
of international shipping to further its weapons programs. This 
legislation cracks down on North Korean shipping and port 
access that violate existing U.N. Security Council Resolutions. 
It prohibits any ships owned by the Government of North Korea 
or those owned or operated on behalf of any country not 
complying with U.N. Security Council resolutions from operating 
in U.S. waters or landing at any U.S. port. It also authorizes 
the Department of Homeland Security to conduct enhanced 
screening for any cargo originating from ports that enable 
North Korea to circumvent the search and seizure of vessels 
that violate applicable sanctions.

North Korea and State Sponsor of Terrorism Designation

    This legislation requires the Secretary of State to 
determine whether North Korea meets the criteria to be 
designated as a State Sponsor of Terrorism (SSOT). In 2008 the 
Bush administration de-listed North Korea from the SSOT list in 
a failed attempt to curb the Kim regimes illegal weapons 
program. Since then, Pyongyang has continued to engage in 
deeply concerning activity with the public assassination of Kim 
Jong Un's brother, Kim Jong Nam, the use of malicious and 
sophisticated cyber-attacks, and the intent to ship weapons to 
Iran. Undertaking an assessment of North Korea's behavior and, 
if warranted, relisting North Korea as a State Sponsor of 
Terrorism would open Pyongyang up to an array of sanctions, 
including a ban on arms-related exports and sales, controls 
over dual-use items, prohibitions on economic assistance, and 
imposition of financial restrictions. In addition to sanctions, 
this designation would send a message to the international 
community that Pyongyang is a pariah state, dissuading entities 
from engaging in activity that continues to facilitate North 
Korea's illegal weapons program.

                           Hearings/Briefings

    During the present Congress, the committee has continued 
its active oversight regarding North Korea policy, including 
one Full Committee and one Asia and the Pacific Subcommittee 
hearing related to the content of H.R. 1644:
    February 7, 2017, Full Committee hearing on ``Countering 
the North Korean Threat: New Steps in U.S. Policy'' (Victor 
Cha, Ph.D., Senior Adviser and Korea Chair, Center for 
Strategic and International Studies; Sue Mi Terry, Ph.D., 
Managing Director, Bower Group Asia; Mr. Anthony Ruggiero, 
Senior Fellow, Foundation for Defense of Democracies; The 
Honorable Robert L. Galluci, Distinguished Professor in the 
Practice of Diplomacy, Walsh School of Foreign Service, 
Georgetown University).
    March 21, 2017, Subcommittee on Asia and the Pacific 
hearing on ``Pressuring North Korea: Evaluating Options'' (Mr. 
Bruce Klingner, Senior Research Fellow for Northeast Asia, The 
Heritage Foundation; Sung-Yoon Lee, Ph.D., Kim Koo-Korea 
Foundation Professor in Korean Studies and Assistant Professor, 
The Fletcher School of Law and Diplomacy, Tufts University; Mr. 
Anthony Ruggiero, Senior Fellow, Foundation for Defense of 
Democracies).

                        Committee Consideration

    On March 29, 2017, the Committee on Foreign Affairs marked 
up H.R. 1644 in open session, pursuant to notice. An amendment 
in the nature of a substitute (offered by the chairman) and two 
amendments to that amendment in the nature of a substitute 
(offered by Mr. Yoho and Mr. Connolly) were considered en bloc 
with the underlying bill, and were agreed to by voice vote.

                      Committee Oversight Findings

    In compliance with clause 3(c)(1) of Rule XIII of Rules of 
the House of Representatives, the committee reports that 
findings and recommendations of the committee, based on 
oversight activities under clause 2(b)(1) of House Rule X, are 
incorporated in the descriptive portions of this report, 
particularly in the ``Background and Purpose of Legislation'' 
and ``Section-by-Section Analysis'' sections.

      New Budget Authority, Tax Expenditures, and Federal Mandates

    In compliance with clause 3(c)(2) of House Rule XIII and 
the Unfunded Mandates Reform Act (P.L. 104-4), the committee 
adopts as its own the estimate of new budget authority, 
entitlement authority, tax expenditure or revenues, and Federal 
mandates contained in the cost estimate prepared by the 
Director of the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974.

               Congressional Budget Office Cost Estimate


                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, April 24, 2017.

Hon. Edward R. Royce, Chairman,
Committee on Foreign Affairs,
House of Representatives, Washington, DC.

    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1644, the Korean 
Interdiction and Modernization of Sanctions Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Sunita 
D'Monte, who can be reached at 226-2840.
            Sincerely,
                                                Keith Hall.
Enclosure

cc:
        Honorable Eliot L. Engel
        Ranking Member

H.R. 1644--Korean Interdiction and Modernization of Sanctions Act.

    As ordered reported by the House Committee on Foreign 
Affairs on March 29, 2017

                                SUMMARY

    H.R. 1644 would require the President to expand existing 
sanctions and impose new sanctions against North Korea. The 
bill also would authorize the Department of State to provide 
rewards for information on violations of certain sanctions. 
Finally, the legislation would require preparation of several 
reports to the Congress on the implementation of the bill.
    CBO estimates that implementing H.R. 1644 would cost $10 
million over the 2017-2022 period, assuming appropriation of 
the estimated amounts. In addition, enacting the bill would 
increase revenues by $8 million and have insignificant effects 
on direct spending over the 2017-2027 period. Pay-as-you-go 
procedures apply because enacting the legislation would affect 
direct spending and revenues.
    CBO estimates that enacting the legislation would not 
increase net direct spending or on-budget deficits in any of 
the four consecutive 10-year periods beginning in 2028.
    H.R. 1644 contains no intergovernmental mandates as defined 
in the Unfunded Mandates Reform Act (UMRA) and would not affect 
the budgets of state, local, or tribal governments.
    H.R. 1644 contains private-sector mandates, as defined in 
UMRA, by imposing requirements related to certain transactions 
associated with the new and expanded sanctions against North 
Korea. Because of the broad scope of existing U.S. sanctions 
against North Korea, CBO expects the number of domestic 
entities that would be affected by the incremental requirements 
in the bill would be small. Therefore, CBO estimates that the 
aggregate cost of the mandates in the bill would fall below the 
annual threshold established in UMRA for private-sector 
mandates ($156 million in 2017, adjusted annually for 
inflation.

                ESTIMATED COST TO THE FEDERAL GOVERNMENT

    The estimated budgetary effect of H.R. 1644 is shown in the 
following table. The costs of this legislation fall within 
budget functions 150 (international affairs) and 800 (general 
government).

                                     By Fiscal Year, in Millions of Dollars
----------------------------------------------------------------------------------------------------------------
                                 2017        2018        2019        2020        2021        2022      2017-2022
----------------------------------------------------------------------------------------------------------------
INCREASES IN SPENDING SUBJECT TO APPROPRIATION
 
Estimated Authorization               0           2           2           2           2           2          10
 Level
Estimated Outlays                     0           2           2           2           2           2          10
 
INCREASES IN REVENUES\1\
 
Estimated Revenues                    0           *           *           1           1           1           3
----------------------------------------------------------------------------------------------------------------
Note: * = less than $500,000.
\1\CBO estimates enacting H.R. 1644 would increase revenues by $8 million and have insignificant effects on
  direct spending over the 2017-2027 period.

                           BASIS OF ESTIMATE

    For this estimate, CBO assumes that H.R. 1644 will be 
enacted near the start of fiscal year 2018 and that the 
estimated amounts will be appropriated near the beginning of 
each fiscal year.

Spending Subject to Appropriation

    Provisions of H.R. 1644 would increase administrative costs 
at the Department of State and the Department of the Treasury. 
Based on limited information from the administration and the 
costs of implementing similar legislation, CBO estimates that 
the departments would require additional appropriations of $2 
million a year. In total, and incorporating the effects of 
inflation, CBO estimates that implementing those provisions 
would cost $10 million over the 2017-2022 period, assuming 
appropriation of those estimated amounts.
    Section 203 would authorize the Department of State to make 
cash awards for information on violations of certain sanctions. 
The department currently has a rewards program to deter 
transnational organized crime, which uses appropriated funds to 
offer cash awards for similar purposes. Based on information 
about awards offered under that program, CBO expects that the 
department could offer individual awards of up to $1 million to 
$2 million under section 203; however, CBO has no basis for 
estimating how many or when such amounts might be paid.

Direct Spending and Revenues

    CBO expects that revenues from penalties would increase 
under provisions of the bill that would expand economic and 
trade sanctions, especially those covering certain financial 
transactions. Because significant sanctions on activity with 
North Korea already exist under current law and are generally 
complied with, and because the North Korean economy is 
relatively small, CBO expects that enacting the bill would 
increase revenues from penalties by a small amount--less than 
$500,000 each year in 2018 and 2019 and $1 million a year 
starting in 2020. In total, CBO estimates that enacting H.R. 
1644 would increase revenues by $8 million over the 2017-2027 
period.
    In addition, enacting H.R. 1644 would increase both the 
number of people who would be denied visas by the Secretary of 
State and the number who would be subject to civil or criminal 
penalties. Most visa fees are retained by the Department of 
State and spent without further appropriation, but some fees 
are deposited in the Treasury as revenues. Penalties also are 
recorded as revenues and a portion of those penalties can be 
spent without further appropriation. However, CBO estimates 
that those provisions would affect very few people and thus 
have insignificant effects on both revenues and direct 
spending.

                      PAY-AS-YOU-GO CONSIDERATIONS

    The Statutory Pay-As-You-Go Act of 2010 establishes budget-
reporting and enforcement procedures for legislation affecting 
direct spending or revenues. The net changes in outlays and 
revenues that are subject to those pay-as-you-go procedures are 
shown in the following table.

CBO Estimate of Pay-As-You-Go Effects for H.R. 1644 as ordered reported 
        by the House Committee on Foreign Affairs on March 29, 2017

                                                         By Fiscal Year, in Millions of Dollars
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  2017  2018  2019  2020  2021  2022  2023  2024  2025  2026  2027  2017-2022  2017-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE OR DECREASE (-) IN THE DEFICIT
 
Statutory Pay-As-You-Go Impact                                      0     0     0    -1    -1    -1    -1    -1    -1    -1    -1      -3         -8
--------------------------------------------------------------------------------------------------------------------------------------------------------

           INCREASE IN LONG-TERM DIRECT SPENDING AND DEFICITS

    CBO estimates that enacting the legislation would not 
increase net direct spending or on-budget deficits in any of 
the four consecutive 10-year periods beginning in 2028.

        ESTIMATED IMPACT ON STATE, LOCAL, AND TRIBAL GOVERNMENTS

    H.R. 1644 contains no intergovernmental mandates as defined 
in UMRA and would not affect the budgets of state, local, or 
tribal governments.

                 ESTIMATED IMPACT ON THE PRIVATE SECTOR

    H.R. 1644 would impose private-sector mandates, as defined 
in UMRA, by prohibiting transactions that lack sufficient 
financial controls to ensure that they do not facilitate any of 
the new or expanded set of sanctions against North Korea. The 
cost of the mandates would be the forgone net income from 
complying with the incremental requirements of the bill. 
Because of the broad scope of existing U.S. sanctions against 
North Korea, the number of domestic entities and the value of 
their transactions that would be affected by the bill would 
probably be small. For example, according to foreign trade 
statistics from the Census Bureau, U.S. exports to North Korea 
amounted to about $5 million in 2015. Therefore, CBO expects 
that the aggregate cost of mandates in the bill would fall 
below the annual threshold established in UMRA for private-
sector mandates ($156 million in 2017, adjusted annually for 
inflation).

                         ESTIMATE PREPARED BY:

Federal Costs: Sunita D'Monte and Matthew Pickford
Revenues: Jacob Fabian
Impact on State, Local, and Tribal Governments: Jon Sperl
Impact on the Private Sector: Logan Smith

                         ESTIMATE APPROVED BY:

H. Samuel Papenfuss
Deputy Assistant Director for Budget Analysis

                          Directed Rule Making

    Pursuant to clause 3(c) of House Rule XIII, as modified by 
section 3(i) of H. Res. 5 during the 115th Congress, the 
committee notes that H.R. 1644 contains no directed rule-making 
provisions.

                  Non-Duplication of Federal Programs

    Pursuant to clause 3(c)(5) of House Rule XIII, the 
committee states that no provision of this bill establishes or 
reauthorizes a program of the Federal Government known to be 
duplicative of another Federal program, a program that was 
included in any report from the Government Accountability 
Office to Congress pursuant to section 21 of Public Law 111-
139, or a program related to a program identified in the most 
recent Catalog of Federal Domestic Assistance.

                    Performance Goals and Objectives

    The Act is intended to deprive North Korea of the resources 
it requires to further test, develop, produce and weaponize 
nuclear weapons; develop and export other unconventional 
weapons and ballistic missiles; engage in destabilizing 
activities within the region and across the globe; and engage 
in the systematic suppression of the people of North Korea. 
Performance goals associated with these objectives include, but 
are not limited to, the following:

          A verifiable decrease in North Korea's 
        ability to fund its nuclear weapons program; and

          A verifiable decrease in North Korea's 
        ability to fund and export its unconventional weapons 
        programs, ballistic missiles and related technology 
        programs, destabilizing types and amounts of 
        conventional weapons, and support for regional 
        destabilization.

                    Congressional Accountability Act

    H.R. 1644 does not apply to terms and conditions of 
employment or to access to public services or accommodations 
within the legislative branch.

                        New Advisory Committees

    H.R. 1644 does not establish or authorize any new advisory 
committees.

                         Earmark Identification

    H.R. 1644 contains no congressional earmarks, limited tax 
benefits, or limited tariff benefits as described in clauses 
9(e), 9(f), and 9(g) of House Rule XXI.

                        Letters of Jurisdiction

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                              ----------                              


                      Section-by-Section Analysis


Section 1. Short Title.

    This Act may be cited as the ``Korean Interdiction and 
Modernization of Sanctions Act.''

Section 2. Table of Contents.

    This provision includes the table of contents for the 
legislation.

Section 3. Definitions.

    This provision both amends existing definitions under the 
``North Korea Sanctions and Policy Enhancement Act'' to 
modernize, update and expand definitions, as well as applying 
new definitions for the purposes of this Act.

  TITLE I--SANCTIONS TO ENFORCE AND IMPLEMENT UNITED NATIONS SECURITY 
                 COUNCIL SANCTIONS AGAINST NORTH KOREA

Section 101. Modification and expansion of requirements for the 
        designation of persons.

    This section further restricts North Korea's access to 
money and materials for its weapons programs by significantly 
expanding existing sanctions against the regime. It mandates 
sanctions against any foreign person who buys certain metals or 
minerals from the country or provides certain types of military 
use fuel or insurance or reinsurance to vessels sanctioned 
under a U.N. Security Council resolution for engaging in 
illicit trade with North Korea.
    To deny the Kim regime the hard currency it needs to fund 
its weapons programs, this section expands the ability to 
sanction those who import North Korean coal, iron, or iron ore 
above the limits imposed by United Nations Security Council 
resolutions, buy textiles or fishing rights from North Korea, 
facilitate the online business activities of the regime, or 
fail to comply with United Nations Security Council Resolutions 
targeting the country.
    It also provides tools to target those involved in the 
export or use of North Korean forced labor, which is both a 
significant human rights abuse and another source of hard 
currency for the regime. To improve the North Korean people's 
access to food, it includes similar sanctions that can be used 
against those who buy food or agricultural products from the 
country.

Section 102. Prohibition on indirect correspondent accounts.

    A recent report by international investigators found that 
North Korea has used concealment to continue its access to the 
international financial system, including the ability to 
``transact through top global financial centers.'' This section 
ensures that U.S. financial institutions have terminated the 
correspondent accounts they use to do business with foreign 
financial institutions if that account is being used to provide 
financial services to the North Korean Government or any of the 
companies and banks that have been found to enable the regime.
    To completely cut the Kim regime out of the U.S financial 
system, this section also prohibits North Korea from conducting 
any transactions using U.S. dollars. This includes ``U-turn'' 
transactions, where funds are briefly transferred into dollars 
while being exchanged between North Korean won and another 
foreign currency. This will further restrict the regime's 
ability to do business abroad by targeting its use of the U.S. 
dollar as an intermediary when transferring funds between two 
foreign currencies.

Section 103. Limitations on foreign assistance to noncompliant 
        governments.

    This section amends existing law to make clear that foreign 
governments that buy or sell North Korea conventional weapons--
a serious and continuing problem--are prohibited from receiving 
certain types of U.S. foreign assistance. It includes a 
reporting requirement to strengthen congressional oversight of 
this prohibition.

Section 104. Amendments to enhance inspection authorities.

    North Korea continues to trade banned goods, utilizing 
evasion techniques that are ``increasing in scale, scope and 
sophistication.'' One recent ship interdiction seized the 
largest cache of ammunition in the history of North Korean 
sanctions. This section requires a report to Congress detailing 
foreign countries whose seaports and airports fail to inspect 
or seize the cargo of North Korean ships or aircraft, as 
required by United Nations Security Council resolutions. The 
Secretary of Homeland Security is authorized to implement 
enhanced screening of cargo bound for the United States that 
has transited one of these identified, failing seaports or 
airports.

Section 105. Enforcing compliance with United Nations shipping 
        sanctions against North Korea.

    This section prohibits any ships owned by the Government of 
North Korea or owned or operated on behalf of any country not 
complying with U.N. Security Council resolutions from operating 
in United States waters or landing at any U.S. port.

Section 106. Report on nuclear program cooperation between North Korea 
        and Iran.

    North Korea and Iran have cooperated in developing nuclear 
weapons, ballistic missiles, and conventional arms. This 
section requires a report to Congress detailing that 
cooperation and potential consequences.

Section 107. Report on implementation of United Nations Security 
        Council resolutions by other governments.

    This provision requires a report to Congress on foreign 
governments' compliance with and implementation of U.N. 
Security Council resolutions on North Korea. A recent 
investigation by North Korea experts found that implementation 
of these U.N. resolutions remains ``insufficient and highly 
inconsistent.''

Section 108. Briefing on measures to deny specialized financial 
        messaging services to designated North Korean financial 
        institutions.

    This section requires a briefing to Congress on entities 
that provide specialized financial messaging services to North 
Korean banks designated under U.N. Security Council 
resolutions. As banks use these services to conduct 
international transactions, this will help identify North 
Korean banks that remain connected to the international 
financial system.

    TITLE II--SANCTIONS WITH RESPECT TO HUMAN RIGHTS ABUSES BY THE 
                       GOVERNMENT OF NORTH KOREA

Section 201. Sanctions for forced labor and slavery overseas of North 
        Koreans.

    This section prohibits goods produced in whole or part by 
North Korean forced labor from entering the United States. It 
also sanctions foreign persons that employ North Koreans who 
are forced to labor in inhumane conditions and are denied 
access to wages and benefits. Exporting forced labor to foreign 
countries is estimated to earn the regime billions of dollars 
of hard currency each year and represents a significant human 
rights violation.

Section 202. Modifications to sanctions suspension authorities.

    This section ensures the delivery of potential humanitarian 
aid would not be adversely impacted. It also allows Korean-
Americans to plan reunion meetings with relatives in North 
Korea.

Section 203. Reward for informants.

    This section encourages whistleblowers to report violations 
of financial sanctions on North Korea by allowing the State 
Department to offer cash rewards for such information under the 
Department's existing rewards program.

Section 204. Report on designation of North Korea as a state sponsor of 
        terrorism.

    This section requires the administration to determine 
within 90 days whether the Government of North Korea should be 
re-designated as a State Sponsor of Terrorism. This 
determination will take into account widespread reports the 
North Korean Government has carried out assassinations, 
kidnappings, and other terrorist acts outside of its own 
borders, including the recent assassination in Malaysia of Kim 
Jong Un's exiled half-brother using a banned chemical substance

                     TITLE III--GENERAL AUTHORITIES

Section 301. Authority to consolidate reports.

    This provision allows for the consolidation of reports 
consisting of similar units of time into a single report.

Section 302. Rule of construction.

    This provision clarifies that this Act shall not limit the 
authority of the President to apply additional sanctions under 
``North Korea Sanctions and Policy Enhancement Act of 2016.''

Section 303. Regulatory authority.

    This provision requires that the President promulgate 
regulations to implement this Act not later than 180 days after 
passage.

Section 304. Limitation on funds.

    This provision states that no additional funds are 
authorized to carry out the requirements of this Act.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of Rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, and existing law in which no 
change is proposed is shown in roman):

        NORTH KOREA SANCTIONS AND POLICY ENHANCEMENT ACT OF 2016


SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``North 
Korea Sanctions and Policy Enhancement Act of 2016''.
    (b) Table of Contents.--The table of contents for this Act 
is as follows:

     * * * * * * *

  TITLE II--SANCTIONS AGAINST NORTH KOREAN PROLIFERATION, HUMAN RIGHTS 
                     ABUSES, AND ILLICIT ACTIVITIES

     * * * * * * *
Sec. 201A. Prohibition on indirect correspondent accounts.
     * * * * * * *

                  TITLE III--PROMOTION OF HUMAN RIGHTS

     * * * * * * *
Sec. 302A. Rebuttable presumption applicable to goods made with North 
          Korean labor.
Sec. 302B. Sanctions on foreign persons employing North Korean labor.

           *       *       *       *       *       *       *


SEC. 3. DEFINITIONS.

    In this Act:
            (1) Applicable executive order.--The term 
        ``applicable Executive order'' means--
                    (A) Executive Order 13382 (50 U.S.C. 1701 
                note; relating to blocking property of weapons 
                of mass destruction proliferators and their 
                supporters), Executive Order 13466 (50 U.S.C. 
                1701 note; relating to continuing certain 
                restrictions with respect to North Korea and 
                North Korean nationals), Executive Order 13551 
                (50 U.S.C. 1701 note; relating to blocking 
                property of certain persons with respect to 
                North Korea), Executive Order 13570 (50 U.S.C. 
                1701 note; relating to prohibiting certain 
                transactions with respect to North Korea), 
                Executive Order 13619 (50 U.S.C. 1701 note; 
                relating to blocking property of persons 
                threatening the peace, security, or stability 
                of Burma), Executive Order 13687 (50 U.S.C. 
                1701 note; relating to imposing additional 
                sanctions with respect to North Korea), [or 
                Executive Order 13694] Executive Order 13694 
                (50 U.S.C. 1701 note; relating to blocking the 
                property of certain persons engaging in 
                significant malicious cyber-enabled 
                activities), or Executive Order 13722 (50 
                U.S.C. 1701 note; relating to blocking the 
                property of the Government of North Korea and 
                the Workers' Party of Korea, and Prohibiting 
                Certain Transactions With Respect to North 
                Korea), to the extent that such Executive 
                order--
                            (i) authorizes the imposition of 
                        sanctions on persons for conduct with 
                        respect to North Korea;
                            (ii) prohibits transactions or 
                        activities involving the Government of 
                        North Korea; or
                            (iii) otherwise imposes sanctions 
                        with respect to North Korea; and
                    (B) any Executive order adopted on or after 
                the date of the enactment of this Act, to the 
                extent that such Executive order--
                            (i) authorizes the imposition of 
                        sanctions on persons for conduct with 
                        respect to North Korea;
                            (ii) prohibits transactions or 
                        activities involving the Government of 
                        North Korea; or
                            (iii) otherwise imposes sanctions 
                        with respect to North Korea.
            (2) Applicable united nations security council 
        resolution.--The term ``applicable United Nations 
        Security Council resolution'' means--
                    (A) United Nations Security Council 
                Resolution 1695 (2006), 1718 (2006), 1874 
                (2009), 2087 (2013), [or 2094 (2013)]  2094 
                (2013), 2270 (2016), or 2321 (2016); and
                    (B) any United Nations Security Council 
                resolution adopted on or after the date of the 
                enactment of this Act that--
                            (i) authorizes the imposition of 
                        sanctions on persons for conduct with 
                        respect to North Korea;
                            (ii) prohibits transactions or 
                        activities involving the Government of 
                        North Korea; or
                            (iii) otherwise imposes sanctions 
                        with respect to North Korea.
            (3) Appropriate congressional committees.--The term 
        ``appropriate congressional committees'' means--
                    (A) the Committee on Foreign Relations and 
                the Committee on Banking, Housing, and Urban 
                Affairs of the Senate; and
                    (B) the Committee on Foreign Affairs, the 
                Committee on Financial Services, and the 
                Committee on Ways and Means of the House of 
                Representatives.
            (4) Designated person.--The term ``designated 
        person'' means a person designated under subsection (a) 
        or (b) of section 104 for purposes of applying 1 or 
        more of the sanctions described in title I or II with 
        respect to the person.
            (5) Foreign person.--The term ``foreign person'' 
        means--
                    (A) an individual who is not a United 
                States citizen or an alien lawfully admitted 
                for permanent residence to the United States; 
                or
                    (B) an entity that is not a United States 
                person.
            [(5)] (6) Government of north korea.--The term 
        ``Government of North Korea'' means the Government of 
        North Korea and its agencies, instrumentalities, and 
        controlled entities.
            [(6)] (7) Humanitarian assistance.--The term 
        ``humanitarian assistance'' means assistance to meet 
        humanitarian needs, including needs for food, medicine, 
        medical supplies, clothing, and shelter.
            [(7)] (8) Intelligence community.--The term 
        ``intelligence community'' has the meaning given such 
        term in section 3(4) of the National Security Act of 
        1947 (50 U.S.C. 3003(4)).
            [(8)] (9) Luxury goods.--The term ``luxury 
        goods''--
                    (A) has the meaning given such term in 
                section 746.4(b)(1) of title 15, Code of 
                Federal Regulations; [and]
                    (B) includes the items listed in Supplement 
                No. 1 to part 746 of such title, and any 
                similar items[.]; and
                    (C) also includes any items so designated 
                under an applicable United Nations Security 
                Council resolution.
            [(9)] (10) Monetary instruments.--The term 
        ``monetary instruments'' has the meaning given such 
        term in section 5312(a) of title 31, United States 
        Code.
            [(10)] (11) North korea.--The term ``North Korea'' 
        means the Democratic People's Republic of Korea.
            [(11)] (12) North korean financial institution.--
        The term ``North Korean financial institution'' means 
        any financial institution that--
                    (A) is organized under the laws of North 
                Korea or any jurisdiction within North Korea 
                (including a foreign branch of such an 
                institution);
                    (B) is located in North Korea, except for a 
                financial institution that is excluded by the 
                President in accordance with section 208(c);
                    (C) is owned or controlled by the 
                Government of North Korea, regardless of 
                location; or
                    (D) is owned or controlled by a financial 
                institution described in subparagraph (A), (B), 
                or (C), regardless of location.
            (13) North korean person.--The term ``North Korean 
        person'' means--
                    (A) a North Korean citizen or national; or
                    (B) an entity owned or controlled by the 
                Government of North Korea or by a North Korean 
                citizen or national.
            [(12)] (14) Significant activities undermining 
        cybersecurity.--The term ``significant activities 
        undermining cybersecurity'' includes--
                    (A) significant efforts to--
                            (i) deny access to or degrade, 
                        disrupt, or destroy an information and 
                        communications technology system or 
                        network; or
                            (ii) exfiltrate information from 
                        such a system or network without 
                        authorization;
                    (B) significant destructive malware 
                attacks;
                    (C) significant denial of service 
                activities; and
                    (D) such other significant activities 
                described in regulations promulgated to 
                implement section 104.
            [(13)] (15) South korea.--The term ``South Korea'' 
        means the Republic of Korea.
            [(14)] (16) United states person.--The term 
        ``United States person'' means--
                    (A) a United States citizen or an alien 
                lawfully admitted for permanent residence to 
                the United States; or
                    (B) an entity organized under the laws of 
                the United States or of any jurisdiction within 
                the United States, including a foreign branch 
                of such an entity.

TITLE I--INVESTIGATIONS, PROHIBITED CONDUCT, AND PENALTIES

           *       *       *       *       *       *       *


SEC. 104. DESIGNATION OF PERSONS.

    (a) Mandatory Designations.--Except as provided in section 
208, the President shall designate under this subsection any 
person that the President determines--
            (1) knowingly, directly or indirectly, imports, 
        exports, or reexports to, into, or from North Korea any 
        goods, services, or technology controlled for export by 
        the United States because of the use of such goods, 
        services, or technology for weapons of mass destruction 
        or delivery systems for such weapons and materially 
        contributes to the use, development, production, 
        possession, or acquisition by any person of a nuclear, 
        radiological, chemical, or biological weapon or any 
        device or system designed in whole or in part to 
        deliver such a weapon;
            (2) knowingly, directly or indirectly, provides 
        training, advice, or other services or assistance, or 
        engages in significant financial transactions, relating 
        to the manufacture, maintenance, or use of any such 
        weapon, device, or system to be imported, exported, or 
        reexported to, into, or from North Korea;
            (3) knowingly, directly or indirectly, imports, 
        exports, or reexports luxury goods to or into North 
        Korea;
            (4) knowingly engages in, is responsible for, or 
        facilitates censorship by the Government of North 
        Korea;
            (5) knowingly engages in, is responsible for, or 
        facilitates serious human rights abuses by the 
        Government of North Korea;
            (6) knowingly, directly or indirectly, engages in 
        money laundering, the counterfeiting of goods or 
        currency, bulk cash smuggling, or narcotics trafficking 
        that supports the Government of North Korea or any 
        senior official or person acting for or on behalf of 
        that Government;
            (7) knowingly engages in significant activities 
        undermining cybersecurity through the use of computer 
        networks or systems against foreign persons, 
        governments, or other entities on behalf of the 
        Government of North Korea;
            (8) knowingly, directly or indirectly, sells, 
        supplies, or transfers to or from the Government of 
        North Korea or any person acting for or on behalf of 
        that Government, a significant amount of precious 
        metal, graphite, raw or semi-finished metals or 
        aluminum, steel, coal, or software, for use by or in 
        industrial processes directly related to weapons of 
        mass destruction and delivery systems for such weapons, 
        other proliferation activities, the Korean Workers' 
        Party, armed forces, internal security, or intelligence 
        activities, or the operation and maintenance of 
        political prison camps or forced labor camps, including 
        outside of North Korea;
            (9) knowingly, directly or indirectly, imports, 
        exports, or reexports to, into, or from North Korea any 
        arms or related materiel[; or] or any defense article 
        or defense service (as such terms are defined in 
        section 47 of the Arms Export Control Act (22 U.S.C. 
        2794));
            (10) knowingly, directly or indirectly, purchases 
        or otherwise acquires from North Korea any significant 
        amounts of gold, titanium ore, vanadium ore, copper, 
        silver, nickel, zinc, or rare earth minerals;
            (11) knowingly, directly or indirectly, sells or 
        transfers to North Korea any significant amounts of 
        rocket, aviation, or jet fuel (except for use by a 
        civilian passenger aircraft outside North Korea, 
        exclusively for consumption during its flight to North 
        Korea or its return flight);
            (12) knowingly, directly or indirectly, provides 
        fuel, supplies, or bunkering services to, or 
        facilitates a significant transaction or transactions 
        to operate or maintain, a vessel or aircraft that is 
        designated under an applicable Executive order or an 
        applicable United Nations Security Council resolution, 
        or that is owned or controlled by a person designated 
        under an applicable Executive order or applicable 
        United Nations Security Council resolution;
            (13) knowingly, directly or indirectly, insures, 
        registers, facilitates the registration of, or 
        maintains insurance or a registration for, a vessel 
        owned or controlled by the Government of North Korea, 
        except as specifically approved by the United Nations 
        Security Council;
            (14) knowingly, directly or indirectly, maintains a 
        correspondent account (as defined in section 
        201A(d)(1)) with any North Korean financial 
        institution, except as specifically approved by the 
        United Nations Security Council; or
            [(10)] (15) knowingly attempts to engage in any of 
        the conduct described in paragraphs (1) through [(9)] 
        (14).
    (b) Additional Discretionary Designations.--
            (1) Prohibited conduct described.--Except as 
        provided in section 208, the President may designate 
        under this subsection any person that the President 
        determines--
                    (A) knowingly engages in, contributes to, 
                assists, sponsors, or provides financial, 
                material or technological support for, or goods 
                and services in support of, any person 
                designated [pursuant to an applicable United 
                Nations Security Council resolution;] pursuant 
                to--
                            (i) an applicable United Nations 
                        Security Council resolution;
                            (ii) any regulation promulgated 
                        under section 404; or
                            (iii) any applicable Executive 
                        order;
                    (B) knowingly contributed to--
                            (i) the bribery of an official of 
                        the Government of North Korea or any 
                        person acting for on behalf of that 
                        official;
                            (ii) the misappropriation, theft, 
                        or embezzlement of public funds by, or 
                        for the benefit of, an official of the 
                        Government of North Korea or any person 
                        acting for or on behalf of that 
                        official; or
                            (iii) the use of any proceeds of 
                        any activity described in clause (i) or 
                        (ii); [or]
                    (C) knowingly and materially assisted, 
                sponsored, or provided significant financial, 
                material, or technological support for, or 
                goods or services to or in support of, the 
                activities described in subparagraph (A) or 
                (B)[.];
                    (D) knowingly, directly or indirectly, 
                purchased or otherwise acquired from the 
                Government of North Korea significant 
                quantities of coal, iron, or iron ore, in 
                excess of the limitations provided in 
                applicable United Nations Security Council 
                resolutions;
                    (E) knowingly, directly or indirectly, 
                purchased or otherwise acquired significant 
                types or amounts of textiles from the 
                Government of North Korea;
                    (F) knowingly facilitated any transfer of 
                funds or property of the Government of North 
                Korea that materially contributes to any 
                violation of an applicable United National 
                Security Council resolution;
                    (G) knowingly, directly or indirectly, 
                facilitated a significant transfer to or from 
                the Government of North Korea of bulk cash, 
                precious metals, gemstones, or other stores of 
                value not described under subsection (a)(10);
                    (H) knowingly, directly or indirectly, 
                sold, transferred, or otherwise provided 
                significant amounts of crude oil, condensates, 
                refined petroleum, other types of petroleum or 
                petroleum byproducts, liquified natural gas, or 
                other natural gas resources to the Government 
                of North Korea (except for heavy fuel oil, 
                gasoline, or diesel fuel for humanitarian use 
                or as excepted under subsection (a)(11));
                    (I) knowingly, directly or indirectly, 
                engaged in, facilitated, or was responsible for 
                the online commercial activities of the 
                Government of North Korea, including online 
                gambling;
                    (J) knowingly, directly or indirectly, 
                purchased or otherwise acquired fishing rights 
                from the Government of North Korea;
                    (K) knowingly, directly or indirectly, 
                provided significant telephonic, telegraphic, 
                telecommunications or other data services, in 
                whole or in part, into or out of North Korea, 
                in excess of services needed for humanitarian 
                or diplomatic purposes (other than services 
                that are excepted under section 203(b)(1) of 
                the International Emergency Economic Powers Act 
                (50 U.S.C. 1702(b)(1)));
                    (L) knowingly, directly or indirectly, 
                purchased or otherwise acquired significant 
                types or amounts of food or agricultural 
                products from the Government of North Korea;
                    (M) knowingly, directly or indirectly, 
                engaged in, facilitated, or was responsible for 
                the exportation of workers from North Korea in 
                a manner intended to generate significant 
                revenue, directly or indirectly, for use by the 
                Government of North Korea or by the Workers' 
                Party of Korea;
                    (N) knowingly conducted a significant 
                transaction or transactions in North Korea's 
                transportation, mining, energy, or financial 
                services industries; or
                    (O) except as specifically approved by the 
                United Nations Security Council, and other than 
                through a correspondent account as described in 
                subsection (a)(14), knowingly facilitated the 
                operation of any branch, subsidiary, or office 
                of a North Korean financial institution.
            (2) Effect of designation.--With respect to any 
        person designated under this subsection, the President 
        may--
                    (A) apply the sanctions described in 
                section 204, 205(c), or 206 to the person to 
                the same extent and in the same manner as if 
                the person were designated under subsection 
                (a);
                    (B) apply any applicable special measures 
                described in section 5318A of title 31, United 
                States Code;
                    (C) prohibit any transactions in foreign 
                exchange--
                            (i) that are subject to the 
                        jurisdiction of the United States; and
                            (ii) in which such person has any 
                        interest; and
                    (D) prohibit any transfers of credit or 
                payments between financial institutions or by, 
                through, or to any financial institution, to 
                the extent that such transfers or payments--
                            (i) are subject to the jurisdiction 
                        of the United States; and
                            (ii) involve any interest of such 
                        person.
    (c) Asset Blocking.--[The President]
            (1) Mandatory asset blocking._The President shall 
        exercise all of the powers granted to the President 
        under the International Emergency Economic Powers Act 
        (50 U.S.C. 1701 et seq.) to the extent necessary to 
        block and prohibit all transactions in property and 
        interests in property [of a designated person] of a 
        person designated under subsection (a), the Government 
        of North Korea, or the Workers' Party of Korea, if such 
        property and interests in property are in the United 
        States, come within the United States, or are or come 
        within the possession or control of a United States 
        person.
            (2) Discretionary asset blocking.--The President 
        may also exercise such powers, in the same manner and 
        to the same extent described in paragraph (1), with 
        respect to a person designated under subsection (b).
    (d) Application to Subsidiaries and Agents.--The 
designation of a person under subsection (a) or (b) and the 
blocking of property and interests in property under subsection 
(c) shall apply with respect to a person who is determined to 
be owned or controlled by, or to have acted or purported to 
have acted for or on behalf of, directly or indirectly, any 
person whose property and interests in property are blocked 
pursuant to this section.
    (e) Transaction Licensing.--The President shall deny or 
revoke any license for any transaction that the President 
determines to lack sufficient financial controls to ensure that 
such transaction will not facilitate any activity described in 
subsection (a) or (b).
    (f) Penalties.--The penalties provided for in subsections 
(b) and (c) of section 206 of the International Emergency 
Economic Powers Act (50 U.S.C. 1705) shall apply to any person 
who violates, attempts to violate, conspires to violate, or 
causes a violation of any prohibition of this section, or an 
order or regulation prescribed under this section, to the same 
extent that such penalties apply to a person that commits an 
unlawful act described in section 206(a) of such Act (50 U.S.C. 
1705(a)).

           *       *       *       *       *       *       *


 TITLE II--SANCTIONS AGAINST NORTH KOREAN PROLIFERATION, HUMAN RIGHTS 
ABUSES, AND ILLICIT ACTIVITIES

           *       *       *       *       *       *       *


SEC. 201A. PROHIBITION ON INDIRECT CORRESPONDENT ACCOUNTS.

    (a) In General.--Except as provided in subsection (b), if a 
United States financial institution has or obtains knowledge 
that a correspondent account established, maintained, 
administered, or managed by that institution for a foreign 
financial institution is being used by the foreign financial 
institution to provide financial services indirectly to any 
person, foreign government, or financial institution designated 
under section 104, the United States financial institution 
shall ensure that such correspondent account is no longer used 
to provide such services.
    (b) Exception.--A United States financial institution is 
authorized to process transfers of funds to or from North 
Korea, or for the direct or indirect benefit of any person, 
foreign government, or financial institution that is designated 
under section 104, only if the transfer--
            (1) arises from, and is ordinarily incident and 
        necessary to give effect to, an underlying transaction 
        that has been authorized by a specific or general 
        license issued by the Secretary of the Treasury; and
            (2) does not involve debiting or crediting a North 
        Korean account.
    (c) Definitions.--In this section:
            (1) Correspondent account.--The term 
        ``correspondent account'' has the meaning given that 
        term in section 5318A of title 31, United States Code.
            (2) United states financial institution.--The term 
        ``United States financial institution'' means has the 
        meaning given that term in section 510.310 of title 31, 
        Code of Federal Regulations, as in effect on the date 
        of the enactment of this section.
            (3) Foreign financial institution.--The term 
        ``foreign financial institution'' has the meaning given 
        that term in section 1010.605 of title 31, Code of 
        Federal Regulations, as in effect on the date of the 
        enactment of this section.

           *       *       *       *       *       *       *


SEC. 203. PROLIFERATION PREVENTION SANCTIONS.

    (a) Export of Certain Goods or Technology.--A validated 
license shall be required for the export to North Korea of any 
goods or technology otherwise covered under section 6(j) of the 
Export Administration Act of 1979 (50 U.S.C. 4605(j)). No 
defense exports may be approved for the Government of North 
Korea.
    (b)  [Transactions in Lethal Military Equipment] 
Transactions in Defense Articles or Defense Services.--
            (1) In General.--The President shall withhold 
        assistance under the Foreign Assistance Act of 1961 (22 
        U.S.C. 2151 et seq.) to the government of any country 
        [that provides lethal military equipment to the 
        Government of North Korea] that provides to or receives 
        from the Government of North Korea a defense article or 
        defense service, as such terms are defined in section 
        47 of the Arms Export Control Act (22 U.S.C. 2794).
            (2) Applicability.--The prohibition under paragraph 
        (1) with respect to a government shall terminate on the 
        date that is [1 year] 2 years after the date on which 
        the prohibition under paragraph (1) is applied to that 
        government.
    (c) Waiver.--Notwithstanding any other provision of law, 
the Secretary of State may waive the prohibitions under this 
section with respect to a country if the Secretary--
            (1) determines that such waiver is in the national 
        interest of the United States; and
            (2) submits a written report to the appropriate 
        congressional committees that describes--
                    (A) the steps that the relevant agencies 
                are taking to curtail the trade described in 
                subsection (b)(1); and
                    (B) why such waiver is in the national 
                interest of the United States.
    (d) Exception.--The prohibitions under this section shall 
not apply to the provision of assistance for human rights, 
democracy, rule of law, [or emergency] maternal and child 
health, disease prevention and response, or humanitarian 
purposes.
    (e) Report on Arms Trafficking Involving North Korea.--
            (1) In general.--Not later than 180 days after the 
        date of the enactment of this subsection, and every 180 
        days thereafter for 5 years, the Secretary of State 
        shall submit to the appropriate congressional 
        committees a report that specifically describes the 
        compliance of foreign countries and other foreign 
        jurisdictions with the requirement to curtail the trade 
        described in subsection (b)(1).
            (2) Form.--The report required under paragraph (1) 
        shall be submitted in unclassified form but may contain 
        a classified annex.

           *       *       *       *       *       *       *


[SEC. 205. ENHANCED INSPECTION AUTHORITIES.

    [(a) Report Required.--Not later than 180 days after the 
date of the enactment of this Act, and annually thereafter, the 
President shall submit to the appropriate congressional 
committees a report that identifies foreign ports and airports 
at which inspections of ships, aircraft, and conveyances 
originating in North Korea, carrying North Korean property, or 
operated by the Government of North Korea are not sufficient to 
effectively prevent the facilitation of any of the activities 
described in section 104(a).
    [(b) Enhanced Customs Inspection Requirements.--The 
Secretary of Homeland Security may require enhanced inspections 
of any goods entering the United States that have been 
transported through a port or airport identified by the 
President under subsection (a).
    [(c) Seizure and Forfeiture.--A vessel, aircraft, or 
conveyance used to facilitate any of the activities described 
in section 104(a) under the jurisdiction of the United States 
may be seized and forfeited under--
            [(1) chapter 46 of title 18, United States Code; or
            [(2) title V of the Tariff Act of 1930 (19 U.S.C. 
        1501 et seq.).]

SEC. 205. ENHANCED INSPECTION AUTHORITIES.

    (a) Report Required.--
            (1) In general.--Not later than 180 days after the 
        date of the enactment of this section, and annually 
        thereafter for 5 years, the President shall submit to 
        the appropriate congressional committees a report--
                    (A) identifying the operators of foreign 
                sea ports and airports that have knowingly--
                            (i) failed to implement or enforce 
                        regulations to inspect ships, aircraft, 
                        cargo, or conveyances in transit to or 
                        from North Korea, as required by 
                        applicable United Nations Security 
                        Council resolutions;
                            (ii) facilitated the transfer, 
                        transshipment, or conveyance of 
                        significant types or quantities of 
                        cargo, vessels, or aircraft owned or 
                        controlled by persons designated under 
                        applicable United Nations Security 
                        Council resolutions; or
                            (iii) facilitated any of the 
                        activities described in section 104(a);
                    (B) describing the extent to which the 
                requirements of applicable United Nations 
                Security Council resolutions to de-register any 
                vessel owned, controlled, or operated by the 
                Government of North Korea have been implemented 
                by other foreign countries;
                    (C) describing the compliance of the 
                Islamic Republic of Iran with the sanctions 
                mandated in applicable United Nations Security 
                Council resolutions;
                    (D) identifying vessels, aircraft, and 
                conveyances owned or controlled by the 
                Reconnaissance General Bureau of the Workers' 
                Party of Korea; and
                    (E) describing the diplomatic and 
                enforcement efforts by the President to secure 
                the full implementation of the applicable 
                United Nations Security Council resolutions, as 
                described in subparagraphs (A) through (C).
            (2) Form.--The report required under paragraph (1) 
        shall be submitted in unclassified form but may contain 
        a classified annex.
    (b) Specific Findings.--Each report required under 
subsection (a) shall include specific findings with respect to 
the following ports and airports:
            (1) The ports of Dandong, Dalian, and any other 
        port in the People's Republic of China that the 
        President deems appropriate.
            (2) The ports of Abadan, Bandar-e-Abbas, Chabahar, 
        Bandar-e-Khomeini, Bushehr Port, Asaluyeh Port, Kish, 
        Kharg Island, Bandar-e-Lenge, and Khorramshahr, and 
        Tehran Imam Khomeini International Airport, in the 
        Islamic Republic of Iran.
            (3) The ports of Nakhodka, Vanino, and Vladivostok, 
        in the Russian Federation.
            (4) The ports of Latakia, Banias, and Tartous, and 
        Damascus International Airport, in the Syrian Arab 
        Republic.
    (c) Enhanced Security Targeting Requirements.--
            (1) In general.--Except as provided in paragraph 
        (2), the Secretary of Homeland Security may, using the 
        Automated Targeting System operated by the National 
        Targeting Center of U.S. Customs and Border Protection, 
        require enhanced screening procedures to determine 
        whether physical inspections are warranted of any cargo 
        bound for or landed in the United States that--
                    (A) has been transported through a sea port 
                or airport the operator of which has been 
                identified by the President in accordance with 
                subsection (a)(1) as having repeatedly failed 
                to comply with applicable United Nations 
                Security Council resolutions;
                    (B) is aboard a vessel or aircraft, or 
                within a conveyance that has, within the last 
                365 days, entered the territory, waters, or 
                airspace of North Korea, or landed in any of 
                the sea ports or airports of North Korea; or
                    (C) is registered by a country or 
                jurisdiction whose compliance has been 
                identified by the President as deficient 
                pursuant to subsection (a)(2).
            (2) Exception for food, medicine, and humanitarian 
        shipments.--Paragraph (1) shall not apply to any 
        vessel, aircraft, or conveyance that has entered the 
        territory, waters, or airspace of North Korea, or 
        landed in any of the sea ports or airports of North 
        Korea, exclusively for the purposes described in 
        section 208(b)(3)(B), or to import food, medicine, or 
        supplies into North Korea to meet the humanitarian 
        needs of the North Korean people.
    (d) Seizure and Forfeiture.--A vessel, aircraft, or 
conveyance used to facilitate any of the activities described 
in section 104(a) under the jurisdiction of the United States 
may be seized and forfeited under--
            (1) chapter 46 of title 18, United States Code; or
            (2) part V of title IV of the Tariff Act of 1930 
        (19 U.S.C. 1581 et seq.).

           *       *       *       *       *       *       *


SEC. 208. EXEMPTIONS, WAIVERS, AND REMOVALS OF DESIGNATION.

    (a) Exemptions.--The following activities shall be exempt 
from sanctions under sections 104, 201A, 206, 209, 302A, 302B, 
and 304:
            (1) Activities subject to the reporting 
        requirements under title V of the National Security Act 
        of 1947 (50 U.S.C. 3091 et seq.), or to any authorized 
        intelligence activities of the United States.
            (2) Any transaction necessary to comply with United 
        States obligations under the Agreement between the 
        United Nations and the United States of America 
        regarding the Headquarters of the United Nations, 
        signed at Lake Success June 26, 1947, and entered into 
        force November 21, 1947, or under the Convention on 
        Consular Relations, done at Vienna April 24, 1963, and 
        entered into force March 19, 1967, or under other 
        international agreements.
            (3) Any activities incidental to the POW/MIA 
        accounting mission in North Korea, including activities 
        by the Defense POW/MIA Accounting Agency and other 
        governmental or nongovernmental organizations tasked 
        with identifying or recovering the remains of members 
        of the United States Armed Forces in North Korea.
    (b) Humanitarian Waiver.--
            (1) In general.--The President may waive, for 
        renewable periods of between 30 days and 1 year, the 
        application of the sanctions authorized under section 
        104, 201A, 204, 205, 206, 209(b), 302A, 302B, or 304(b) 
        if the President submits to the appropriate 
        congressional committees a written determination that 
        the waiver is necessary for humanitarian assistance or 
        to carry out the humanitarian purposes set forth 
        section 4 of the North Korean Human Rights Act of 2004 
        (22 U.S.C. 7802).
            (2) Content of written determination.--A written 
        determination submitted under paragraph (1) with 
        respect to a waiver shall include a description of all 
        notification and accountability controls that have been 
        employed in order to ensure that the activities covered 
        by the waiver are humanitarian assistance or are 
        carried out for the purposes set forth in section 4 of 
        the North Korean Human Rights Act of 2004 (22 U.S.C. 
        7802) and do not entail any activities in North Korea 
        or dealings with the Government of North Korea not 
        reasonably related to humanitarian assistance or such 
        purposes.
            (3) Clarification of permitted activities under 
        waiver.--An internationally recognized humanitarian 
        organization shall not be subject to sanctions under 
        section 104, 201A, 204, 205, 206, 209(b), 302A, 302B, 
        or 304(b) for--
                    (A) engaging in a financial transaction 
                relating to humanitarian assistance or for 
                humanitarian purposes pursuant to a waiver 
                issued under paragraph (1);
                    (B) transporting goods or services that are 
                necessary to carry out operations relating to 
                humanitarian assistance or humanitarian 
                purposes pursuant to such a waiver; or
                    (C) having merely incidental contact, in 
                the course of providing humanitarian assistance 
                or aid for humanitarian purposes pursuant to 
                such a waiver, with individuals who are under 
                the control of a foreign person subject to 
                sanctions under this Act.
    (c) Waiver.--The President may waive, on a case-by-case 
basis, for renewable periods of between 30 days and 1 year, the 
application of the sanctions authorized under section 104, 
201A, 201(c)(2), 204, 205, 206, 209(b), 302A, 302B, or 304(b) 
if the President submits to the appropriate congressional 
committees a written determination that the waiver--
            (1) is important to the national security interests 
        of the United States; or
            (2) will further the enforcement of this Act or is 
        for an important law enforcement purpose.
    (d) Financial Services for Humanitarian and Consular 
Activities.--The President may promulgate such regulations, 
rules, and policies as may be necessary to facilitate the 
provision of financial services by a foreign financial 
institution that is not a North Korean financial institution in 
support of activities conducted pursuant to an exemption or 
waiver under this section.

           *       *       *       *       *       *       *


TITLE III--PROMOTION OF HUMAN RIGHTS

           *       *       *       *       *       *       *


SEC. 302. STRATEGY TO PROMOTE NORTH KOREAN HUMAN RIGHTS.

    (a) In general.--Not later than 180 days after the date of 
the enactment of this Act, the Secretary of State, in 
coordination with other appropriate Federal departments and 
agencies, shall submit to the Committee on Foreign Relations of 
the Senate and the Committee on Foreign Affairs of the House of 
Representatives a report that details a United States strategy 
to promote initiatives to enhance international awareness of 
and to address the human rights situation in North Korea.
    (b) Information.--The report required under subsection (a) 
should include--
            (1) a list of countries that forcibly repatriate 
        refugees from North Korea; [and]
            (2) a list of countries where North Korean laborers 
        work, including countries the governments of which have 
        formal arrangements with the Government of North Korea 
        or any person acting for or on behalf of that 
        Government to employ North Korean workers[.]; and
            (3) a list of foreign persons that employ North 
        Korean laborers.
    (c) Strategy.--The report required under subsection (a) 
should include--
            (1) a plan to enhance bilateral and multilateral 
        outreach, including sustained engagement with the 
        governments of partners and allies with overseas posts 
        to routinely demarche or brief those governments on 
        North Korea human rights issues, including forced 
        labor, trafficking, and repatriation of citizens of 
        North Korea;
            (2) public affairs and public diplomacy campaigns, 
        including options to work with news organizations and 
        media outlets to publish opinion pieces and secure 
        public speaking opportunities for United States 
        Government officials on issues related to the human 
        rights situation in North Korea, including forced 
        labor, trafficking, and repatriation of citizens of 
        North Korea; and
            (3) opportunities to coordinate and collaborate 
        with appropriate nongovernmental organizations and 
        private sector entities to raise awareness and provide 
        assistance to North Korean defectors throughout the 
        world.

SEC. 302A. REBUTTABLE PRESUMPTION APPLICABLE TO GOODS MADE WITH NORTH 
                    KOREAN LABOR.

    (a) In General.--Except as provided in subsection (b), any 
goods, wares, articles, and merchandise mined, produced, or 
manufactured wholly or in part by the labor of North Korean 
nationals or citizens shall be deemed to be prohibited under 
section 307 of the Tariff Act of 1930 (19 U.S.C. 1307) and 
shall not be entitled to entry at any of the ports of the 
United States.
    (b) Exception.--The prohibition described in subsection (a) 
shall not apply if the Commissioner of U.S. Customs and Border 
Protection finds, by clear and convincing evidence, that the 
goods, wares, articles, or merchandise described in such 
paragraph were not produced with convict labor, forced labor, 
or indentured labor under penal sanctions.

SEC. 302B. SANCTIONS ON FOREIGN PERSONS EMPLOYING NORTH KOREAN LABOR.

    (a) In General.--Except as provided in subsection (c), the 
President shall designate any person identified under section 
302(b)(3) for the imposition of sanctions under subsection (b).
    (b) Imposition of Sanctions.--
            (1) In general.--The President shall impose the 
        sanctions described in paragraph (2) with respect to 
        any person designated under subsection (a).
            (2) Sanctions described.--The sanctions described 
        in this paragraph are sanctions pursuant to the 
        International Emergency Economic Powers Act (50 U.S.C. 
        1701 et seq.) to block and prohibit all transactions in 
        property and interests in property of a person 
        designated under subsection (a), if such property and 
        interests in property are in the United States, come 
        within the United States, or are or come within the 
        possession or control of a United States person.
    (c) Exception.--
            (1) In general.--A person may not be designated 
        under subsection (a) if the President certifies to the 
        appropriate congressional committees that the President 
        has received reliable assurances from such person 
        that--
                    (A) the employment of North Korean laborers 
                does not result in the direct or indirect 
                transfer of convertible currency, luxury goods, 
                or other stores of value to the Government of 
                North Korea;
                    (B) all wages and benefits are provided 
                directly to the laborers, and are held, as 
                applicable, in accounts within the jurisdiction 
                in which they reside in locally denominated 
                currency; and
                    (C) the laborers are subject to working 
                conditions consistent with international 
                standards.
            (2) Recertification.--Not later than 180 days after 
        the date on which the President transmits to the 
        appropriate congressional committees an initial 
        certification under paragraph (1), and every 180 days 
        thereafter, the President shall--
                    (A) transmit a recertification stating that 
                the conditions described in such paragraph 
                continue to be met; or
                    (B) if such recertification cannot be 
                transmitted, impose the sanctions described in 
                subsection (b) beginning on the date on which 
                the President determines that such 
                recertification cannot be transmitted.

           *       *       *       *       *       *       *


TITLE IV--GENERAL AUTHORITIES

           *       *       *       *       *       *       *


SEC. 402. TERMINATION OF SANCTIONS AND OTHER MEASURES.

    Any sanction or other measure required under title I, II, 
or III (or any amendment made by such titles) shall terminate 
on the date on which the President determines and certifies to 
the appropriate congressional committees that the Government of 
North Korea has--
            (1) met the requirements set forth in section 401; 
        and
            (2) made significant progress toward--
                    (A) completely, verifiably, and 
                irreversibly dismantling all of its nuclear, 
                chemical, biological, and radiological weapons 
                programs, including all programs for the 
                development of systems designed in whole or in 
                part for the delivery of such weapons;
                    (B) releasing all political prisoners, 
                including the citizens of North Korea detained 
                in North Korea's political prison camps;
                    (C) ceasing its censorship of peaceful 
                political activity;
                    (D) establishing an open, transparent, and 
                representative society; [and]
                    (E) fully accounting for and repatriating 
                United States citizens (including deceased 
                United States citizens)--
                            (i) abducted or unlawfully held 
                        captive by the Government of North 
                        Korea; or
                            (ii) detained in violation of the 
                        Agreement Concerning a Military 
                        Armistice in Korea, signed at Panmunjom 
                        July 27, 1953 (commonly referred to as 
                        the ``Korean War Armistice 
                        Agreement'')[.]; and
                    (F) planning for unrestricted family 
                reunification meetings, including for those 
                individuals in the Korean-American community 
                who maintain family ties with relatives in 
                North Korea.

           *       *       *       *       *       *       *

                              ----------                              


PORTS AND WATERWAYS SAFETY ACT

           *       *       *       *       *       *       *


    Sec. 4. Vessel Operating Requirements.
    (a) In General.--Subject to the requirements of section 5, 
the Secretary--
            (1) in any port or place under the jurisdiction of 
        the United States, in the navigable waters of the 
        United States, or in any area covered by an 
        international agreement negotiated pursuant to section 
        11, may construct, operate, maintain, improve, or 
        expand vessel traffic services, consisting of measures 
        for controlling or supervising vessel traffic or for 
        protecting navigation and the marine environment and 
        may include, but need not be limited to one or more of 
        the following: reporting and operating requirements, 
        surveillance and communications systems, routing 
        systems, and fairways;
            (2) shall require appropriate vessels which operate 
        in an area of a vessel traffic service to utilize or 
        comply with that service;
            (3) may require vessels to install and use 
        specified navigation equipment, communications 
        equipment, electronic relative motion analyzer 
        equipment, or any electronic or other device necessary 
        to comply with a vessel traffic service or which is 
        necessary in the interests of vessel safety: Provided, 
        That the Secretary shall not require fishing vessels 
        under 300 gross tons as measured under section 14502 of 
        title 46, United States Code, or an alternate tonnage 
        measured under section 14302 of that title as 
        prescribed by the Secretary under section 14104 of that 
        title or recreational vessels 65 feet or less to 
        possess or use the equipment or devices required by 
        this subsection solely under the authority of this Act;
            (4) may control vessel traffic in areas subject to 
        the jurisdiction of the United States which the 
        Secretary determines to be hazardous, or under 
        conditions of reduced visibility, adverse weather, 
        vessel congestion, or other hazardous circumstances 
        by--
                    (A) specifying times of entry, movement, or 
                departure;
                    (B) establishing vessel traffic routing 
                schemes;
                    (C) establishing vessel size, speed, draft 
                limitations and vessel operating conditions; 
                and
                    (D) restricting operation, in any hazardous 
                area or under hazardous conditions, to vessels 
                which have particular operating characteristics 
                or capabilities which he considers necessary 
                for safe operation under the circumstances;
            (5) may require the receipt of prearrival messages 
        from any vessel, destined for a port or place subject 
        to the jurisdiction of the United States, in sufficient 
        time to permit advance vessel traffic planning prior to 
        port entry, which shall include any information which 
        is not already a matter of record and which the 
        Secretary determines necessary for the control of the 
        vessel and the safety of the port or the marine 
        environment; and
            (6) may prohibit the use on vessels of electronic 
        or other devices that interfere with communication and 
        navigation equipment, except that such authority shall 
        not apply to electronic or other devices certified to 
        transmit in the maritime services by the Federal 
        Communications Commission and used within the frequency 
        bands 157.1875-157.4375 MHz and 161.7875-162.0375 MHz.
    (b) Special Powers.--The Secretary may order any vessel, in 
a port or place subject to the jurisdiction of the United 
States or in the navigable waters of the United States, to 
operate or a anchor in a manner he directs if--
            (1) he has reasonable cause to believe such vessel 
        does not comply with any regulation issued under this 
        Act or any other applicable law or treaty;
            (2) he determines that such vessel does not satisfy 
        the conditions for port entry set forth in section 9 or 
        16; or
            (3) by reason of weather, visibility, sea 
        conditions, port congestion, other hazardous 
        circumstances, or the condition of such vessel, he is 
        satisfied that such directive is justified in the 
        interest of safety.
    (c) Port Access Routes.--(1) In order to provide safe 
access routes for the movement of vessel traffic proceeding to 
or from ports or places subject to the jurisdiction of the 
United States, and subject to the requirements of paragraph (3) 
hereof, the Secretary shall designate necessary fairways and 
traffic separation schemes for vessels operating in the 
territorial sea of the United States and in high seas 
approaches, outside the territorial sea, to such ports or 
places. Such a designation shall recognize, within the 
designated area, the paramount right of navigation over all 
other uses.
    (2) No designation may be made by the Secretary pursuant to 
this subsection, if such a designation, as implemented, would 
deprive any person of the effective exercise of a right granted 
by a lease or permit executed or issued under other applicable 
provisions of law: Provided, That such right has become vested 
prior to the time of publication of the notice required by 
clause (A) of paragraph (3) hereof: Provided further, That the 
determination as to whether the designation would so deprive 
any such person shall be made by the Secretary, after 
consultation with the responsible official under whose 
authority the lease was executed or the permit issued.
    (3) Prior to making a designation pursuant to paragraph (1) 
hereof, and in accordance with the requirements of section 5, 
the Secretary shall--
            (A) within six months after date of enactment of 
        this Act (and may, from time to time thereafter), 
        undertake a study of the potential traffic density and 
        the need for safe access routes for vessels in any area 
        for which fairways or traffic separation schemes are 
        proposed or which may otherwise be considered and shall 
        publish notice of such undertaking in the Federal 
        Register;
            (B) in consultation with the Secretary of State, 
        the Secretary of the Interior, the Secretary of 
        Commerce, the Secretary of the Army, and the Governors 
        of affected States, as their responsibilities may 
        require, take into account all other uses of the area 
        under consideration (including, as appropriate, the 
        exploration for, or exploitation of, oil, gas, or other 
        mineral resources, the construction or operation of 
        deepwater ports or other structures on or above the 
        seabed or subsoil of the submerged lands or the Outer 
        Continental Shelf of the United States, the 
        establishment or operation of marine or estuarine 
        sanctuaries, and activities involving recreational or 
        commercial fishing); and
            (C) to the extent practicable, reconcile the need 
        for safe access routes with the needs of all other 
        reasonable uses of the area involved.
    (4) In carrying out his responsibilities under paragraph 
(3), the Secretary shall proceed expeditiously to complete any 
study undertaken. Thereafter, he shall promptly issue a notice 
of proposed rulemaking for the designation contemplated or 
shall have published in the Federal Register a notice that no 
designation is contemplated as a result of the study and the 
reason for such determination.
    (5) In connection with a designation made pursuant to this 
subsection, the Secretary--
            (A) shall issue reasonable rules and regulations 
        governing the use of such designated areas, including 
        the applicability of rules 9 and 10 of the 
        International Regulations for Preventing Collisions at 
        Sea, 1972, relating to narrow channels and traffic 
        separation schemes, respectively, in waters where such 
        regulations apply;
            (B) to the extent that he finds reasonable and 
        necessary to effectuate the purposes of the 
        designation, make the use of designated fairways and 
        traffic separation schemes mandatory for specific types 
        and sizes of vessels, foreign and domestic, operating 
        in the territorial sea of the United States and for 
        specific types and sizes of vessels of the United 
        States operating on the high seas beyond the 
        territorial sea of the United States;
            (C) may, from time to time, as necessary, adjust 
        the location or limits of designated fairways or 
        traffic separation schemes, in order to accommodate the 
        needs of other uses which cannot be reasonably 
        accommodated otherwise: Provided, That such an 
        adjustment will not, in the judgment of the Secretary, 
        unacceptably adversely affect the purpose for which the 
        existing designation was made and the need for which 
        continues; and
            (D) shall, through appropriate channels, (i) notify 
        cognizant international organizations of any 
        designation, or adjustment thereof, and (ii) take 
        action to seek the cooperation of foreign States in 
        making it mandatory for vessels under their control to 
        use any fairway or traffic separation scheme designated 
        pursuant to this subsection in any area of the high 
        seas, to the same extent as required by the Secretary 
        for vessels of the United States.
    (d) Exception.--Except pursuant to international treaty, 
convention, or agreement, to which the United States is a 
party, this Act shall not apply to any foreign vessel that is 
not destined for, or departing from, a port or place subject to 
the jurisdiction of the United States and that is in--
            (1) innocent passage through the territorial sea of 
        the United States, or
            (2) transit through the navigable waters of the 
        United States which form a part of an international 
        strait.
    (e) Cooperative Agreements.--(1) The Secretary may enter 
into cooperative agreements with public or private agencies, 
authorities, associations, institutions, corporations, 
organizations, or other persons to carry out the functions 
under subsection (a)(1).
    (2) A nongovernmental entity may not under this subsection 
carry out an inherently governmental function.
    (3) As used in this paragraph, the term ``inherently 
governmental function'' means any activity that is so 
intimately related to the public interest as to mandate 
performance by an officer or employee of the Federal 
Government, including an activity that requires either the 
exercise of discretion in applying the authority of the 
Government or the use of judgment in making a decision for the 
Government.

           *       *       *       *       *       *       *

    Sec. 13. Enforcement.
    (a) Civil Penalty.--(1) Any person who is found by the 
Secretary, after notice and an opportunity for a hearing, to 
have violated this Act or a regulation issued hereunder shall 
be liable to the United States for a civil penalty, not to 
exceed $25,000 for each violation. Each day of a continuing 
violation shall constitute a separate violation. The amount of 
such civil penalty shall be assessed by the Secretary, or his 
designee, by written notice. In determining the amount of such 
penalty, the Secretary shall take into account the nature, 
circumstances, extent and gravity of the prohibited acts 
committed and, with respect to the violator, the degree of 
culpability, any history of prior offenses, ability to pay, and 
such other matters as justice may require.
    (2) The Secretary may compromise, modify, or remit, with or 
without conditions, any civil penalty which is subject to 
imposition or which has been imposed under this section.
    (3) If any person fails to pay an assessment of a civil 
penalty after it has become final, the Secretary may refer the 
matter to the Attorney General of the United States, for 
collection in any appropriate district court of the United 
States.
    (b) Criminal Penalty.--(1) Any person who willfully and 
knowingly violates this Act or any regulation issued hereunder 
commits a class D felony.
    (2) Any person who, in the willfull and knowing violation 
of this Act or of any regulation issued hereunder, uses a 
dangerous weapon, or engages in conduct that causes bodily 
injury or fear of imminent bodily injury to any officer 
authorized to enforce the provisions of this Act or the 
regulations issued hereunder, commits a class C felony.
    (c) In Rem Liability.--Any vessel subject to the provisions 
of this Act, which is used in violation of this Act, or any 
regulations issued hereunder, shall be liable in rem for any 
civil penalty assessed pursuant to subsection (a) and may be 
proceeded against in the United States district court for any 
district in which such vessel may be found.
    (d) Injunction.--The United States district courts shall 
have jurisdiction to restrain violations of this Act or of 
regulations issued hereunder, for cause shown.
    (e) Denial of Entry.--Except as provided in [section 9] 
section 9 or 16, the Secretary may, subject to recognized 
principles of international law, deny entry into the navigable 
waters of the United States or to any port or place under the 
jurisdiction of the United States to any vessel not in 
compliance with the provisions of this Act or the regulations 
issued hereunder.
    (f) Withholding of Clearance.--(1) If any owner, operator, 
or individual in charge of a vessel is liable for a penalty or 
fine under this section, or if reasonable cause exists to 
believe that the owner, operator, or individual in charge may 
be subject to a penalty or fine under this section, the 
Secretary of the Treasury, upon the request of the Secretary, 
shall with respect to such vessel refuse or revoke any 
clearance required by section 4197 of the Revised Statutes of 
the United States (46 App. U.S.C. 91).
    (2) Clearance refused or revoked under this subsection may 
be granted upon filing of a bond or other surety satisfactory 
to the Secretary.

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SEC. 16. PROHIBITION ON ENTRY AND OPERATION.

    (a) Prohibition.--
            (1) In general.--Except as otherwise provided in 
        this section, no vessel described in subsection (b) may 
        enter or operate in the navigable waters of the United 
        States or transfer cargo in any port or place under the 
        jurisdiction of the United States.
            (2) Limitation on application.--
                    (A) Determination by secretary of state.--
                Paragraph (1) shall not apply with respect to a 
                vessel described in subsection (b)(2) if the 
                Secretary of State determines that the vessel 
                is no longer registered as described in that 
                subsection.
                    (B) Notice.--The Secretary of State shall 
                publish a notice in the Federal Register of 
                each determination made under subparagraph (A).
    (b) Vessels Described.--A vessel referred to in subsection 
(a) is a foreign vessel for which a notice of arrival is 
required to be filed under section 4(a)(5), and that--
            (1) is on the most recent list of vessels published 
        in Federal Register under subsection (c)(2); or
            (2) more than 180 days after the publication of 
        such list, is knowingly registered, pursuant to the 
        1958 Convention on the High Seas entered into force on 
        September 30, 1962, by a government the agents or 
        instrumentalities of which are maintaining a 
        registration of a vessel that is included on such list.
    (c) Information and Publication.--The Secretary of the 
department in which the Coast Guard is operating, in 
consultation with the Secretary of State, shall--
            (1) maintain timely information on the 
        registrations of all foreign vessels over 300 gross 
        tons that are--
                    (A) owned or operated by or on behalf of 
                the Government of North Korea or a North Korean 
                person;
                    (B) owned or operated by or on behalf of 
                any country in which a sea port or airport is 
                located, the operator of which the President 
                has identified in the most recent report 
                submitted under section 205(a)(1) of the North 
                Korea Sanctions and Policy Enhancement Act of 
                2016; or
                    (C) owned or operated by or on behalf of 
                any country identified by the President as a 
                country that has not complied with the 
                applicable United Nations Security Council 
                resolutions (as such term is defined in section 
                3 of such Act); and
            (2) not later than 180 days after the date of the 
        enactment of this section, and periodically thereafter, 
        publish in the Federal Register a list of the vessels 
        described in paragraph (1).
    (d) Notification of Governments.--
            (1) In general.--The Secretary of State shall 
        notify each government, the agents or instrumentalities 
        of which are maintaining a registration of a foreign 
        vessel that is included on a list published under 
        subsection (c)(2), not later than 30 days after such 
        publication, that all vessels registered under such 
        government's authority are subject to the prohibition 
        under subsection (a).
            (2) Additional notification.--In the case of a 
        government that continues to maintain a registration 
        for a vessel that is included on such list after 
        receiving an initial notification under paragraph (1), 
        the Secretary shall issue an additional notification to 
        such government not later than 120 days after the 
        publication of a list under subsection (c)(2).
    (e) Notification of Vessels.--Upon receiving a notice of 
arrival under section 4(a)(5) from a vessel described in 
subsection (b), the Secretary of the department in which the 
Coast Guard is operating shall notify the master of such vessel 
that the vessel may not enter or operate in the navigable 
waters of the United States or transfer cargo in any port or 
place under the jurisdiction of the United States, unless--
            (1) the Secretary of State has made a determination 
        under subsection (a)(2); or
            (2) the Secretary of the department in which the 
        Coast Guard is operating allows provisional entry of 
        the vessel, or transfer of cargo from the vessel, under 
        subsection (f).
    (f) Provisional Entry or Cargo Transfer.--Notwithstanding 
any other provision of this section, the Secretary of the 
department in which the Coast Guard is operating may allow 
provisional entry of, or transfer of cargo from, a vessel, if 
such entry or transfer is necessary for the safety of the 
vessel or persons aboard.
    (g) Right of Innocent Passage.--This section shall not be 
construed as authority to restrict the right of innocent 
passage as recognized under international law.
    (h) Foreign Vessel Defined.--In this section, the term 
`foreign vessel' has the meaning given that term in section 110 
of title 46, United States Code.
                              ----------                              


STATE DEPARTMENT BASIC AUTHORITIES ACT OF 1956

           *       *       *       *       *       *       *


TITLE I--BASIC AUTHORITIES GENERALLY

           *       *       *       *       *       *       *


SEC. 36. DEPARTMENT OF STATE REWARDS PROGRAM.

    (a) Establishment.--
            (1) In general.--There is established a program for 
        the payment of rewards to carry out the purposes of 
        this section.
            (2) Purpose.--The rewards program shall be designed 
        to assist in the prevention of acts of international 
        terrorism, international narcotics trafficking, serious 
        violations of international humanitarian law, 
        transnational organized crime, and other related 
        criminal acts.
            (3) Implementation.--The rewards program shall be 
        administered by the Secretary of State, in 
        consultation, as appropriate, with the Attorney 
        General.
    (b) Rewards Authorized.--In the sole discretion of the 
Secretary (except as provided in subsection (c)(2)) and in 
consultation, as appropriate, with the heads of other relevant 
departments or agencies, the Secretary may pay a reward to any 
individual who furnishes information leading to--
            (1) the arrest or conviction in any country of any 
        individual for the commission of an act of 
        international terrorism against a United States person 
        or United States property;
            (2) the arrest or conviction in any country of any 
        individual conspiring or attempting to commit an act of 
        international terrorism against a United States person 
        or United States property;
            (3) the arrest or conviction in any country of any 
        individual for committing, primarily outside the 
        territorial jurisdiction of the United States, any 
        narcotics-related offense if that offense involves or 
        is a significant part of conduct that involves--
                    (A) a violation of United States narcotics 
                laws such that the individual would be a major 
                violator of such laws;
                    (B) the killing or kidnapping of--
                            (i) any officer, employee, or 
                        contract employee of the United States 
                        Government while such individual is 
                        engaged in official duties, or on 
                        account of that individual's official 
                        duties, in connection with the 
                        enforcement of United States narcotics 
                        laws or the implementing of United 
                        States narcotics control objectives; or
                            (ii) a member of the immediate 
                        family of any such individual on 
                        account of that individual's official 
                        duties, in connection with the 
                        enforcement of United States narcotics 
                        laws or the implementing of United 
                        States narcotics control objectives; or
                    (C) an attempt or conspiracy to commit any 
                act described in subparagraph (A) or (B);
            (4) the arrest or conviction in any country of any 
        individual aiding or abetting in the commission of an 
        act described in paragraph (1), (2), (3), (8), (9), or 
        (10);
            (5) the prevention, frustration, or favorable 
        resolution of an act described in paragraph (1), (2), 
        (3), (8), (9), or (10) including by dismantling an 
        organization in whole or significant part;
            (6) the identification or location of an individual 
        who holds a key leadership position in a terrorist 
        organization or transnational organized crime group;
            (7) the disruption of financial mechanisms of a 
        foreign terrorist organization or transnational 
        organized crime group, including the use by such 
        organization or group of illicit narcotics production 
        or international narcotics trafficking--
                    (A) to finance acts of international 
                terrorism or transnational organized crime; or
                    (B) to sustain or support any terrorist 
                organization or transnational organized crime 
                group;
            (8) the arrest or conviction in any country of any 
        individual for participating in, primarily outside the 
        United States, transnational organized crime;
            (9) the arrest or conviction in any country of any 
        individual conspiring to participate in or attempting 
        to participate in transnational organized crime; [or]
            (10) the arrest or conviction in any country, or 
        the transfer to or conviction by an international 
        criminal tribunal (including a hybrid or mixed 
        tribunal), of any foreign national accused of war 
        crimes, crimes against humanity, or genocide, as 
        defined under the statute of such tribunal[.];
            (11) the identification or location of any person 
        who, while acting at the direction of or under the 
        control of a foreign government, aids or abets a 
        violation of section 1030 of title 18, United States 
        Code; or
            (12) the disruption of financial mechanisms of any 
        person who has engaged in the conduct described in 
        sections 104(a) or 104(b)(1) of the North Korea 
        Sanctions and Policy Enhancement Act of 2016 (22 U.S.C. 
        2914(a) or (b)(1)).
    (c) Coordination.--
            (1) Procedures.--To ensure that the payment of 
        rewards pursuant to this section does not duplicate or 
        interfere with the payment of informants or the 
        obtaining of evidence or information, as authorized to 
        the Department of Justice, the offering, 
        administration, and payment of rewards under this 
        section, including procedures for--
                    (A) identifying individuals, organizations, 
                and offenses with respect to which rewards will 
                be offered;
                    (B) the publication of rewards;
                    (C) the offering of joint rewards with 
                foreign governments;
                    (D) the receipt and analysis of data; and
                    (E) the payment and approval of payment,
        shall be governed by procedures developed by the 
        Secretary of State, in consultation with the Attorney 
        General.
            (2) Prior approval of attorney general required.--
        Before making a reward under this section in a matter 
        over which there is Federal criminal jurisdiction, the 
        Secretary of State shall obtain the concurrence of the 
        Attorney General.
    (d) Funding.--
            (1) Authorization of appropriations.--
        Notwithstanding section 102 of the Foreign Relations 
        Authorization Act, Fiscal Years 1986 and 1987 (Public 
        Law 99-93; 99 Stat. 408), but subject to paragraph (2), 
        there are authorized to be appropriated to the 
        Department of State from time to time such amounts as 
        may be necessary to carry out this section.
            (2) Period of availability.--Amounts appropriated 
        under paragraph (1) shall remain available until 
        expended.
    (e) Limitations and Certification.--
            (1) Maximum amount.--No reward paid under this 
        section may exceed $25,000,000, except as personally 
        authorized by the Secretary of State if he determines 
        that offer or payment of an award of a larger amount is 
        necessary to combat terrorism or defend the Nation 
        against terrorist acts. Without first making such 
        determination, the Secretary may authorize a reward of 
        up to twice the amount specified in this paragraph for 
        the capture or information leading to the capture of a 
        leader of a foreign terrorist organization.
            (2) Approval.--A reward under this section of more 
        than $100,000 may not be made without the approval of 
        the Secretary.
            (3) Certification for payment.--Any reward granted 
        under this section shall be approved and certified for 
        payment by the Secretary.
            (4) Nondelegation of authority.--The authority to 
        approve rewards of more than $100,000 set forth in 
        paragraph (2) may not be delegated.
            (5) Protection measures.--If the Secretary 
        determines that the identity of the recipient of a 
        reward or of the members of the recipient's immediate 
        family must be protected, the Secretary may take such 
        measures in connection with the payment of the reward 
        as he considers necessary to effect such protection.
            (6) Forms of reward payment.--The Secretary may 
        make a reward under this section in the form of money, 
        a nonmonetary item (including such items as automotive 
        vehicles), or a combination thereof.
    (f) Ineligibility.--An officer or employee of any entity of 
Federal, State, or local government or of a foreign government 
who, while in the performance of his or her official duties, 
furnishes information described in subsection (b) shall not be 
eligible for a reward under this section.
    (g) Reports.--
            (1) Reports on payment of rewards.--Not later than 
        30 days after the payment of any reward under this 
        section, the Secretary shall submit a report to the 
        appropriate congressional committees with respect to 
        such reward. The report, which may be submitted in 
        classified form if necessary, shall specify the amount 
        of the reward paid, to whom the reward was paid, and 
        the acts with respect to which the reward was paid. The 
        report shall also discuss the significance of the 
        information for which the reward was paid in dealing 
        with those acts.
            (2) Annual reports.--Not later than 60 days after 
        the end of each fiscal year, the Secretary shall submit 
        a report to the appropriate congressional committees 
        with respect to the operation of the rewards program. 
        The report shall provide information on the total 
        amounts expended during the fiscal year ending in that 
        year to carry out this section, including amounts 
        expended to publicize the availability of rewards.
            (3) Advance notification for international criminal 
        tribunal rewards.--Not less than 15 days before 
        publicly announcing that a reward may be offered for a 
        particular foreign national accused of war crimes, 
        crimes against humanity, or genocide, the Secretary of 
        State shall submit to the appropriate congressional 
        committees a report, which may be submitted in 
        classified form if necessary, setting forth the reasons 
        why the arrest or conviction of such foreign national 
        is in the national interests of the United States.
            (4) Reports on rewards authorized.--Not less than 
        15 days after a reward is authorized under this 
        section, the Secretary of State shall submit to the 
        appropriate congressional committees a report, which 
        may be submitted in classified form if necessary to 
        protect intelligence sources and methods, detailing 
        information about the reward, including the identity of 
        the individual for whom the reward is being made, the 
        amount of the reward, the acts with respect to which 
        the reward is being made, and how the reward is being 
        publicized.
    (h) Publication Regarding Rewards Offered by Foreign 
Governments.--Notwithstanding any other provision of this 
section, in the sole discretion of the Secretary, the resources 
of the rewards program shall be available for the publication 
of rewards offered by foreign governments regarding acts of 
international terrorism which do not involve United States 
persons or property or a violation of the narcotics laws of the 
United States.
    (i) Media Surveys and Advertisements.--
            (1) Surveys conducted.--For the purpose of more 
        effectively disseminating information about the rewards 
        program, the Secretary may use the resources of the 
        rewards program to conduct media surveys, including 
        analyses of media markets, means of communication, and 
        levels of literacy, in countries determined by the 
        Secretary to be associated with acts of international 
        terrorism.
            (2) Creation and purchase of advertisements.--The 
        Secretary may use the resources of the rewards program 
        to create advertisements to disseminate information 
        about the rewards program. The Secretary may base the 
        content of such advertisements on the findings of the 
        surveys conducted under paragraph (1). The Secretary 
        may purchase radio or television time, newspaper space, 
        or make use of any other means of advertisement, as 
        appropriate.
    (j) Determinations of the Secretary.--A determination made 
by the Secretary under this section shall be final and 
conclusive and shall not be subject to judicial review.
    (k) Definitions.--As used in this section:
            (1) Act of international terrorism.--The term ``act 
        of international terrorism'' includes--
                    (A) any act substantially contributing to 
                the acquisition of unsafeguarded special 
                nuclear material (as defined in paragraph (8) 
                of section 830 of the Nuclear Proliferation 
                Prevention Act of 1994 (22 U.S.C. 3201 note)) 
                or any nuclear explosive device (as defined in 
                paragraph (4) of that section) by an 
                individual, group, or non-nuclear-weapon state 
                (as defined in paragraph (5) of that section); 
                and
                    (B) any act, as determined by the 
                Secretary, which materially supports the 
                conduct of international terrorism, including 
                the counterfeiting of United States currency or 
                the illegal use of other monetary instruments 
                by an individual, group, or country supporting 
                international terrorism as determined for 
                purposes of section 6(j)(1)(A) of the Export 
                Administration Act of 1979 (50 U.S.C. App. 
                2405(j)(1)(A)).
            (2) Appropriate congressional committees.--The term 
        ``appropriate congressional committees'' means the 
        Committee on Foreign Affairs of the House of 
        Representatives and the Committee on Foreign Relations 
        of the Senate.
            (3) Member of the immediate family.--The term 
        ``member of the immediate family'', with respect to an 
        individual, includes--
                    (A) a spouse, parent, brother, sister, or 
                child of the individual;
                    (B) a person with respect to whom the 
                individual stands in loco parentis; and
                    (C) any person not covered by subparagraph 
                (A) or (B) who is living in the individual's 
                household and is related to the individual by 
                blood or marriage.
            (4) Rewards program.--The term ``rewards program'' 
        means the program established in subsection (a)(1).
            (5) Transnational organized crime.--The term 
        ``transnational organized crime'' means--
                    (A) racketeering activity (as such term is 
                defined in section 1961 of title 18, United 
                States Code) that involves at least one 
                jurisdiction outside the United States; or
                    (B) any other criminal offense punishable 
                by a term of imprisonment of at least four 
                years under Federal, State, or local law that 
                involves at least one jurisdiction outside the 
                United States and that is intended to obtain, 
                directly or indirectly, a financial or other 
                material benefit.
            (6) Transnational organized crime group.--The term 
        ``transnational organized crime group'' means a group 
        of persons that includes one or more citizens of a 
        foreign country, exists for a period of time, and acts 
        in concert with the aim of engaging in transnational 
        organized crime.
            (7) United states narcotics laws.--The term 
        ``United States narcotics laws'' means the laws of the 
        United States for the prevention and control of illicit 
        trafficking in controlled substances (as such term is 
        defined in section 102(6) of the Controlled Substances 
        Act (21 U.S.C. 802(6))).
            (8) United states person.--The term ``United States 
        person'' means--
                    (A) a citizen or national of the United 
                States; and
                    (B) an alien lawfully present in the United 
                States.

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