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Inside Privacy Updates on Developments in Global Privacy & Data Security from Covington & Burling LLP

Cyber Theft Bill Introduced by Bipartisan Group of Senators

Posted in Congress, Cybersecurity

On Tuesday, Senators Carl Levin (D-MI), John McCain (R-AZ), Jay Rockefeller (D-WV), and Tom Coburn (R-OK) introduced the “Deter Cyber Theft Act.”

The Act would require the Director of National Intelligence (“DNI”) to provide relevant congressional committees with an annual report on “foreign economic and industrial espionage in cyberspace.”  The report would require the DNI to identify “foreign countries that engage in economic or industrial espionage in cyberspace with respect to trade secrets or proprietary information owned by United States persons” and “priority foreign countries”—those countries that the DNI “determines engage in the most egregious economic or industrial espionage in cyberspace.”  The bill specifies that the DNI must identify foreign countries pursuant to the Act  if the foreign government “engages in economic or industrial espionage in cyberspace with respect to trade secrets or proprietary information owned by United States persons” or “facilitates, supports, fails to prosecute, or otherwise permits such espionage by” its citizens or residents or entities organized under its laws or subject to its jurisdiction.

The report would also require the DNI to identify:

  • “[T]echnologies or proprietary information” that are “developed by United States persons” and that are either “targeted for” espionage or “have been appropriated” through espionage;
  • Articles “manufactured or otherwise produced” using technologies or information stolen through espionage;
  • Services provided using technologies or information stolen through espionage; and
  • “[F]oreign entities, including entities owned or controlled by the government of a foreign country, that request, engage in, support, facilitate, or benefit from” economic or industrial espionage against U.S. persons.

In addition, the report would have to describe “the economic or industrial espionage engaged in by” foreign countries and “priority foreign countries” identified in the report, actions the federal government has taken to decrease economic espionage, and progress made in decreasing such espionage.

The bill  is not, however, focused solely on naming and shaming countries that engage in economic espionage.  After issuance of the annual report, the bill would require the President to “exclude from entry into the United States” certain articles if the President determines that exclusion is warranted to enforce intellectual property rights or “protect the integrity of the Department of Defense supply chain.”  The bill defines the articles to be excluded as: (1) items identified in the DNI report as produced using stolen information; (2) items “produced or exported” by an entity identified in the report as engaging in, supporting, etc. economic espionage; and (3) items “produced or exported” by an entity that is “owned or controlled by the government of a priority foreign country” and that “produces or exports articles that are the same as or similar to articles” produced using technologies that the report identifies as having been stolen or targeted for espionage.