Bill Text: TX SB2116 | 2021-2022 | 87th Legislature | Comm Sub

NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Relating to prohibiting contracts or other agreements with certain foreign-owned companies in connection with critical infrastructure in this state.

Spectrum: Partisan Bill (Republican 10-0)

Status: (Passed) 2021-06-18 - Effective immediately [SB2116 Detail]

Download: Texas-2021-SB2116-Comm_Sub.html
  87R26997 MWC-F
 
  By: Campbell, et al. S.B. No. 2116
 
  (Parker)
 
  Substitute the following for S.B. No. 2116:  No.
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to prohibiting contracts or other agreements with certain
  foreign-owned companies in connection with critical infrastructure
  in this state.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  This Act may be cited as the Lone Star
  Infrastructure Protection Act.
         SECTION 2.  Subtitle C, Title 5, Business & Commerce Code, is
  amended by adding Chapter 113 to read as follows:
  CHAPTER 113. PROHIBITION ON AGREEMENTS WITH CERTAIN FOREIGN-OWNED
  COMPANIES IN CONNECTION WITH CRITICAL INFRASTRUCTURE
         Sec. 113.001.  DEFINITIONS. In this chapter:
               (1)  "Company" means a sole proprietorship,
  organization, association, corporation, partnership, joint
  venture, limited partnership, limited liability partnership, or
  limited liability company, including a wholly owned subsidiary,
  majority-owned subsidiary, parent company, or affiliate of those
  entities or business associations, that exists to make a profit.
               (2)  "Critical infrastructure" means a communication
  infrastructure system, cybersecurity system, electric grid,
  hazardous waste treatment system, or water treatment facility.
               (3)  "Cybersecurity" means the measures taken to
  protect a computer, computer network, computer system, or other
  technology infrastructure against unauthorized use or access.
               (4)  "Designated country" means a country designated by
  the governor as a threat to critical infrastructure under Section
  113.003.
         Sec. 113.002.  PROHIBITED ACCESS TO CRITICAL
  INFRASTRUCTURE. (a) A business entity may not enter into an
  agreement relating to critical infrastructure in this state with a
  company:
               (1)  if, under the agreement, the company would be
  granted direct or remote access to or control of critical
  infrastructure in this state, excluding access specifically
  allowed by the business entity for product warranty and support
  purposes; and
               (2)  if the business entity knows that the company is:
                     (A)  owned by or the majority of stock or other
  ownership interest of the company is held or controlled by:
                           (i)  individuals who are citizens of China,
  Iran, North Korea, Russia, or a designated country; or
                           (ii)  a company or other entity, including a
  governmental entity, that is owned or controlled by citizens of or
  is directly controlled by the government of China, Iran, North
  Korea, Russia, or a designated country; or
                     (B)  headquartered in China, Iran, North Korea,
  Russia, or a designated country.
         (b)  The prohibition described by Subsection (a) applies
  regardless of whether:
               (1)  the company's or its parent company's securities
  are publicly traded; or
               (2)  the company or its parent company is listed on a
  public stock exchange as:
                     (A)  a Chinese, Iranian, North Korean, or Russian
  company; or
                     (B)  a company of a designated country.
         Sec. 113.003.  DESIGNATION OF COUNTRY AS THREAT TO CRITICAL
  INFRASTRUCTURE. (a) The governor, after consultation with the
  public safety director of the Department of Public Safety, may
  designate a country as a threat to critical infrastructure for
  purposes of this chapter.
         (b)  The governor may consult the Homeland Security Council,
  established under Subchapter B, Chapter 421, Government Code, to
  assess a threat to critical infrastructure for purposes of making a
  designation under this section.
         SECTION 3.  Subtitle F, Title 10, Government Code, is
  amended by adding Chapter 2274 to read as follows:
  CHAPTER 2274. PROHIBITION ON CONTRACTS WITH CERTAIN FOREIGN-OWNED
  COMPANIES IN CONNECTION WITH CRITICAL INFRASTRUCTURE
         Sec. 2274.0101.  DEFINITIONS. In this chapter:
               (1)  "Company" means a sole proprietorship,
  organization, association, corporation, partnership, joint
  venture, limited partnership, limited liability partnership, or
  limited liability company, including a wholly owned subsidiary,
  majority-owned subsidiary, parent company, or affiliate of those
  entities or business associations, that exists to make a profit.
               (2)  "Critical infrastructure" means a communication
  infrastructure system, cybersecurity system, electric grid,
  hazardous waste treatment system, or water treatment facility.
               (3)  "Cybersecurity" means the measures taken to
  protect a computer, computer network, computer system, or other
  technology infrastructure against unauthorized use or access.
               (4)  "Designated country" means a country designated by
  the governor as a threat to critical infrastructure under Section
  2274.0103.
               (5)  "Governmental entity" means a state agency or
  political subdivision of this state.
         Sec. 2274.0102.  PROHIBITED CONTRACTS.  (a)  A governmental
  entity may not enter into a contract or other agreement relating to
  critical infrastructure in this state with a company:
               (1)  if, under the contract or other agreement, the
  company would be granted direct or remote access to or control of
  critical infrastructure in this state, excluding access
  specifically allowed by the governmental entity for product
  warranty and support purposes; and
               (2)  if the governmental entity knows that the company
  is:
                     (A)  owned by or the majority of stock or other
  ownership interest of the company is held or controlled by: 
                           (i)  individuals who are citizens of China,
  Iran, North Korea, Russia, or a designated country; or 
                           (ii)  a company or other entity, including a
  governmental entity, that is owned or controlled by citizens of or
  is directly controlled by the government of China, Iran, North
  Korea, Russia, or a designated country; or 
                     (B)  headquartered in China, Iran, North Korea,
  Russia, or a designated country.
         (b)  The prohibition described by Subsection (a) applies
  regardless of whether:
               (1)  the company's or its parent company's securities
  are publicly traded; or
               (2)  the company or its parent company is listed on a
  public stock exchange as:
                     (A)  a Chinese, Iranian, North Korean, or Russian
  company; or
                     (B)  a company of a designated country.
         Sec. 2274.0103.  DESIGNATION OF COUNTRY AS THREAT TO
  CRITICAL INFRASTRUCTURE. (a) The governor, after consultation
  with the public safety director of the Department of Public Safety,
  may designate a country as a threat to critical infrastructure for
  purposes of this chapter.
         (b)  The governor may consult the Homeland Security Council,
  established under Subchapter B, Chapter 421, to assess a threat to
  critical infrastructure for purposes of making a designation under
  this section.
         SECTION 4.  Chapter 113, Business & Commerce Code, as added
  by this Act, and Chapter 2274, Government Code, as added by this
  Act, apply to a contract or agreement entered into on or after the
  effective date of this Act.
         SECTION 5.  This Act takes effect September 1, 2021.
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