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Rubio Warns CHIPS Act Could Help China, Files Amendments

Jul 22, 2022 | Press Releases

Despite repeated warnings from America’s law enforcement and intelligence agencies on the vast threat of Chinese Communist Party espionage, the current CHIPS Act of 2022 lacks critical guardrails to protect American research and development.

  • “America needs to make things again, especially critical chips and other tech, but we need to do it in a way that benefits our country and our workers. Unless we add meaningful safeguards in this package, we should call this for what it is: the China Investment Bill.” — U.S. Senator Marco Rubio (R-FL) 

In response, Rubio introduced three amendments to address critical errors and omissions in the package. 

  • Fully Fund Rip-and-Replace. The amendment would fully fund the FCC’s underfunded “rip and replace” program. Without approximately $3 billion in  additional funding, the FCC will not be able to thoroughly remove dangerous Chinese hardware (including from blacklisted companies like Huawei and ZTE) from America’s telecommunications infrastructure. 
  • Congressional Guardrails on CHIPS. The amendment would require the Department of Commerce to secure approval from the Senate and House committees on Intelligence, Commerce, and Armed Services before altering the definition of “legacy chips.”

    In the current text, recipients of CHIPS funding cannot expand certain chip production in China. “Legacy chips” are exempt from that prohibition, but the bill allows Commerce to revise the definition. The amendment would ensure the executive branch could not unilaterally allow CHIPS funding recipients to expand higher-tech chip production in China.

    In addition, the amendment tightens language elsewhere in the bill to ensure no loopholes exist allowing certain categories of expansion or transactions in China.

  • Protect Critical U.S. R&D. The amendment would establish a counterintelligence screening process involving the Director of National Intelligence, the Director of the National Counterintelligence and Security Center, and the Director of the FBI to protect against Chinese and others’ efforts to engage in economic espionage and misappropriate our intellectual property, R&D, and innovation efforts.

    This counterintelligence screening process would protect America’s research and innovation by requiring those IC agencies to certify that anyone receiving funds under the bill has sufficient protections against foreign government threats. It would also require that, before obtaining certification to receive funds, the applicant must disclose any foreign funding over the last decade or any financial support from China, as well as any participation in a foreign talent recruitment program.

    Rubio filed a similar amendment in May 2021.

Rubio opposed the Senate-passed United States Innovation and Competition Act of 2021 because it similarly “fail[ed] to protect American taxpayer investments.”