[116th Congress Public Law 276]
[From the U.S. Government Publishing Office]
[[Page 3361]]
SECURE FEDERAL LEASES FROM ESPIONAGE AND SUSPICIOUS ENTANGLEMENTS ACT
[[Page 134 STAT. 3362]]
Public Law 116-276
116th Congress
An Act
To require the disclosure of ownership of high-security space leased to
accommodate a Federal agency, and for other purposes. <<NOTE: Dec. 31,
2020 - [S. 1869]>>
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, <<NOTE: Secure Federal
Leases from Espionage And Suspicious Entanglements Act. 40 USC 585
note.>>
SECTION 1. SHORT TITLE; FINDINGS.
(a) Short Title.--This Act may be cited as the ``Secure Federal
Leases from Espionage And Suspicious Entanglements Act'' or the ``Secure
Federal LEASEs Act''.
(b) Findings.--Congress finds that--
(1) the Government Accountability Office has reported that
the Federal Government often leases high-security space from
private sector landlords;
(2) the General Services Administration collects highest-
level and immediate ownership information through the System for
Award Management, but it is not currently required to collect
beneficial ownership information and lacks an adequate system
for doing so;
(3) the General Services Administration and Federal agencies
with leasing authority may not know if foreign owners have a
stake in the buildings leased by the agencies, either through
foreign-incorporated legal entities or through ownership in
United States-incorporated legal entities, even when the leased
space is used for classified operations or to store sensitive
data; and
(4) according to a report of the Government Accountability
Office, dated January 2017, that examined the risks of foreign
ownership of Government-leased real estate, ``leasing space in
foreign-owned buildings could present security risks such as
espionage and unauthorized cyber and physical access''.
SEC. 2. DEFINITIONS.
In this Act:
(1) Beneficial owner.--
(A) In general.--Except as provided in subparagraph
(B), the term ``beneficial owner'' means, with respect
to a covered entity, each natural person who, directly
or indirectly, through any contract, arrangement,
understanding, relationship, or otherwise--
(i) exercises control over the covered entity;
or
(ii) has a substantial interest in or receives
substantial economic benefits from the assets of
the covered entity.
[[Page 134 STAT. 3363]]
(B) Exceptions.--The term ``beneficial owner'' does
not include, with respect to a covered entity--
(i) a minor child;
(ii) a person acting as a nominee,
intermediary, custodian, or agent on behalf of
another person;
(iii) a person acting solely as an employee of
the covered entity and whose control over or
economic benefits from the covered entity derives
solely from the employment status of the person;
(iv) a person whose only interest in the
covered entity is through a right of inheritance,
unless the person also meets the requirements of
subparagraph (A); or
(v) a creditor of the covered entity, unless
the creditor also meets the requirements of
subparagraph (A).
(C) Anti-abuse rule.--The exceptions under
subparagraph (B) shall not apply if used for the purpose
of evading, circumventing, or abusing the requirements
of this Act.
(2) Control.--The term ``control'' means, with respect to a
covered entity--
(A) having the authority or ability to determine how
a covered entity is utilized; or
(B) having some decision-making power for the use of
a covered entity.
(3) Covered entity.--The term ``covered entity'' means--
(A) a person, corporation, company, business
association, partnership, society, trust, or any other
nongovernmental entity, organization, or group; or
(B) any governmental entity or instrumentality of a
government.
(4) Executive agency.--The term ``Executive agency'' has the
meaning given the term in section 105 of title 5, United States
Code.
(5) Federal agency.--The term ``Federal agency'' means any
Executive agency or any establishment in the legislative or
judicial branch of the Government.
(6) Federal lessee.--The term ``Federal lessee''--
(A) means the Administrator of General Services, the
Architect of the Capitol, or the head of any Federal
agency, other than the Department of Defense, that has
independent statutory leasing authority; and
(B) does not include the head of an element of the
intelligence community.
(7) Federal tenant.--The term ``Federal tenant''--
(A) means a Federal agency that is occupying or will
occupy a high-security leased space for which a lease
agreement has been secured on behalf of the Federal
agency; and
(B) does not include an element of the intelligence
community.
(8) Foreign entity.--The term ``foreign entity'' means a
covered entity that is headquartered or incorporated in a
country that is not the United States.
(9) Foreign person.--The term ``foreign person'' means an
individual who is not a United States person.
[[Page 134 STAT. 3364]]
(10) High-security leased space.--The term ``high-security
leased space'' means a space leased by a Federal lessee that--
(A) will be occupied by Federal employees for
nonmilitary activities; and
(B) has a facility security level of III, IV, or V,
as determined by the Federal tenant in consultation with
the Interagency Security Committee, the Department of
Homeland Security, and the General Services
Administration.
(11) Highest-level owner.--The term ``highest-level owner''
means the entity that owns or controls an immediate owner of the
offeror of a lease, or that owns or controls 1 or more entities
that control an immediate owner of the offeror.
(12) Immediate owner.--The term ``immediate owner'' means an
entity, other than the offeror of a lease, that has direct
control of the offeror, including ownership or interlocking
management, identity of interests among family members, shared
facilities and equipment, and the common use of employees.
(13) Intelligence community.--The term ``intelligence
community'' has the meaning given the term in section 3 of the
National Security Act of 1947 (50 U.S.C. 3003).
(14) Substantial economic benefits.--The term ``substantial
economic benefits'' means, with respect to a natural person
described in paragraph (1)(A)(ii), having an entitlement to the
funds or assets of a covered entity that, as a practical matter,
enables the person, directly or indirectly, to control, manage,
or direct the covered entity.
(15) United states person.--The term ``United States
person'' means an individual who--
(A) is a citizen of the United States; or
(B) is an alien lawfully admitted for permanent
residence in the United States.
(16) Widely held.--The term ``widely held'' means a fund
that has not less than 100 natural persons as direct or indirect
investors.
SEC. 3. DISCLOSURE OF OWNERSHIP OF HIGH-SECURITY SPACE LEASED FOR
FEDERAL AGENCIES.
(a) Required Disclosures.--Before entering into a lease agreement
with a covered entity or approving a novation agreement with a covered
entity involving a change of ownership under a lease that will be used
for high-security leased space, a Federal lessee shall require the
covered entity to identify and disclose whether the immediate or
highest-level owner of the leased space, including an entity involved in
the financing thereof, is a foreign person or a foreign entity,
including the country associated with the ownership entity.
(b) <<NOTE: Consultation.>> Notification.--If a disclosure is made
under subsection (a), the Federal lessee shall notify the Federal tenant
of the building or other improvement that will be used for high-security
space in writing, and consult with the Federal tenant, regarding
security concerns and necessary mitigation measures, if any, prior to
award of the lease or approval of the novation agreement.
[[Page 134 STAT. 3365]]
(c) Timing.--
(1) In general.--A Federal lessee shall require a covered
entity to provide the information described in subsection (a)
when first submitting a proposal in response to a solicitation
for offers issued by the Federal lessee.
(2) <<NOTE: Deadline. Effective date.>> Updates.--A Federal
lessee shall require a covered entity to submit an update of the
information described in subsection (a) annually, beginning on
the date that is 1 year after the date on which the Federal
tenant began occupancy, with information including--
(A) <<NOTE: List. Time period.>> the list of
immediate or highest-level owners of the covered entity
during the preceding 1-year period of Federal occupancy;
or
(B) the information required to be provided relating
to each such immediate or highest-level owner.
SEC. 4. IMMEDIATE, HIGHEST-LEVEL, AND BENEFICIAL OWNERS.
(a) <<NOTE: Coordination.>> Plan.--The General Services
Administration, in coordination with the Office of Management and
Budget, shall develop a Government-wide plan for agencies (as such term
is defined in section 551 of title 5, United States Code) for
identifying all immediate, highest-level, or beneficial owners of high-
security leased spaces before entering into a lease agreement with a
covered entity for the accommodation of a Federal tenant in a high-
security leased space.
(b) Requirements.--
(1) Contents.--The plan described in subsection (a) shall
include a process for collecting and utilizing the following
information on each immediate, highest-level, or beneficial
owner of a high-security leased space:
(A) Name.
(B) Current residential or business street address.
(C) An identifying number or document that verifies
identity as a United States person, foreign person, or
foreign entity.
(2) Disclosures and notifications.--The plan described in
subsection (a) shall--
(A) require the disclosure of any immediate,
highest-level, or beneficial owner that is a foreign
person;
(B) require that, if the Federal lessee is assigning
the building or other improvement that will be used for
high-security space to a Federal tenant, the Federal
tenant shall be notified of the disclosure described in
subparagraph (A); and
(C) exclude collecting ownership information on
widely held pooled-investment vehicles, mutual funds,
trusts, or other pooled-investment vehicles.
(c) Report and Implementation.--The General Services Administration
shall--
(1) not later than 1 year after the date of enactment of
this Act, submit the plan described in subsection (a) to the
Committee on Homeland Security and Governmental Affairs of the
Senate and the Committee on Transportation and Infrastructure of
the House of Representatives;
(2) not later than 2 years after the date of enactment of
this Act, implement the plan described in subsection (a); and
[[Page 134 STAT. 3366]]
(3) <<NOTE: Time period.>> not later than 1 year after the
implementation of the plan described in subsection (a), and each
year thereafter for 9 years, submit a report to the Committee on
Homeland Security and Governmental Affairs of the Senate and the
Committee on Transportation and Infrastructure of the House of
Representatives on the status of the implementation of the plan,
including the number of disclosures made under subsection
(b)(2).
SEC. 5. OTHER SECURITY AGREEMENTS FOR LEASED SPACE.
A lease agreement between a Federal lessee and a covered entity for
the accommodation of a Federal agency in a building or other improvement
that will be used for high-security leased space shall include language
that provides that--
(1) the covered entity and any member of the property
management company who may be responsible for oversight or
maintenance of the high-security leased space shall not--
(A) maintain access to the high-security leased
space; or
(B) have access to the high-security leased space
without prior approval from the Federal tenant;
(2) <<NOTE: Determination.>> access to the high-security
leased space or any property or information located within that
space will only be granted by the Federal tenant if the Federal
tenant determines that the access is clearly consistent with the
mission and responsibilities of the Federal tenant; and
(3) <<NOTE: Procedures.>> the Federal lessee shall have
written procedures in place, signed by the Federal lessee and
the covered entity, governing access to the high-security leased
space in case of emergencies that may damage the leased
property.
SEC. 6. <<NOTE: Deadline. Consultation.>> AGENCY NOTIFICATIONS.
Not later than 60 days after the date of enactment of this Act, the
Administrator of General Services, in consultation with the Office of
Management and Budget, shall provide notification to relevant Executive
branch agencies with independent leasing authorities of the requirements
of this Act.
[[Page 134 STAT. 3367]]
SEC. 7. <<NOTE: Time period.>> APPLICABILITY.
Except where otherwise provided, this Act shall apply with respect
to any lease or novation agreement entered into on or after the date
that is 6 months after the date of enactment of this Act.
Approved December 31, 2020.
LEGISLATIVE HISTORY--S. 1869:
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SENATE REPORTS: No. 116-92 (Comm. on Homeland Security and Governmental
Affairs).
CONGRESSIONAL RECORD, Vol. 166 (2020):
Mar. 3, considered and passed Senate.
Nov. 17, considered and passed House, amended.
Dec. 8, Senate concurred in House amendment.
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