Defense Production Act Amendments of 1990

Defense Production Act Amendments of 1990 - Title I: Amendments to the Defense Production Act of 1950 - Part A: Declaration of Policy - Revises the declaration of policy under the Defense Production Act of 1950 to state that such Act affords the President an array of authorities to shape defense preparedness programs and to take appropriate steps to maintain and enhance the defense industrial and technological base (the defense base).

Requires executive agencies and departments responsible for defense acquisition to continuously assess the capability of the defense base to satisfy peacetime requirements as well as increased mobilization production requirements. States that plans and programs to carry out the policy stated above shall duly consider the promotion of efficiency and competition.

Expresses certain congressional findings disapproving the growing U.S. dependency on foreign sources for critical components and materials used to manufacture major weapons systems for our national defense. States that it is imperative for the United States to preserve and strengthen its industrial and technological capabilities.

Part B: Amendments to Title I of the Defense Production Act - Directs the President, within five years, to review the inventory of weapons systems and defense equipment and to designate as an essential weapons system those items deemed appropriate. Requires the President to identify critical components and critical technology items utilizing information from the Defense Industrial Base Information System (established under this Act). Authorizes the President to limit to domestic procurement those critical components and critical technology items needed to meet national security requirements.

Authorizes the President to provide appropriate incentives to develop, maintain, modernize, or expand the productive capacities of domestic sources for critical components, critical technology items, or industrial resources within an industry deemed essential for national security. Authorizes the use of funds provided later under this Act for guaranteeing the purchase or lease of advanced manufacturing equipment. Requires the President to give a preference to small businesses in providing assistance authorized under this Act.

Authorizes the President to provide appropriate incentives to develop, maintain, modernize, or expand the productive capacities of domestic sources for critical components, critical technology items, or industrial resources within an industry deemed essential for national security. Authorizes the use of funds provided later under this Act for guaranteeing the purchase or lease of advanced manufacturing equipment. Requires the President to give a preference to small businesses in providing assistance authorized under this Act.

Authorizes the President to stockpile appropriate supplies of critical components and critical technology items to meet the needs of the Department of Defense (DOD) and the production needs of firms furnishing essential weapons systems to DOD during peacetime and various stages of graduated mobilization, wherever it is determined that necessary quantities of such items cannot be obtained from domestic sources. Requires biennial reports on activities taken to preserve and revitalize the defense base.

States that nothing in this Act shall be interpreted to: (1) provide for the imposition of wage or price controls without prior authorization of such action by joint congressional resolution; or (2) require action or compliance by any private person to assist in the production of, or involvement in, chemical or biological warfare capabilities except in time of war or national emergency.

Part C: Amendments to Title III of the Defense Production Act - Expands the existing loan guarantee authority of the President to include providing such authority for the procurement of industrial resources or a critical technology item for the national defense. Increases from $25,000,000 to $50,000,000 the maximum loan guarantee amount that may be made before a specific authorization by law is needed. Makes the same changes for loans made to private business enterprises under such Act.

Authorizes the President to provide for purchases or purchase commitments for an industrial resource or a critical technology item for government use or resale. (Currently, such purchases or purchase commitments are permitted for the purchase of metals, minerals, and other material.) Prohibits the President from executing a contract for purchases or purchase commitments unless: (1) the industrial resource or critical technology is essential to the national defense; (2) U.S. industry cannot reasonably provide such resource or technology in a timely manner; or (3) U.S. national defense demand for the resource or technology is equal to or greater than the output of domestic industrial capability determined to be available for national defense. Increases from $25,000,000 to $50,000,000 the maximum industrial resource shortfall authorized to be reached by the President before a specific authorization by law is required. Waives such requirements, along with requirements concerning loan guarantees and loans to private business enterprises, during periods of national emergency declared by the Congress or the President. Extends the term for purchases or purchase commitments from September 30, 1995, to a date not more than ten years from the date such purchase, commitment, or sale was initially made.

Establishes in the Treasury the Defense Production Act Fund to carry out the purposes of title III of such Act. Establishes a maximum Fund balance. Directs the Secretary of the Treasury to designate a Fund manager to manage such Fund and report to the Congress annually on Fund activities. Provides for the determination of liabilities against the Fund. Transfers a specified amount to such Fund from the National Defense Stockpile Transaction Fund.

States that it shall be the policy of the U.S. Government that: (1) no agency of the United States shall encourage or commit U.S. firms to any offset arrangement in connection with the sale of defense goods or services to foreign governments; (2) Government funds shall not be used to finance offsets in security assistance transactions except under specified procedures; (3) nothing in this Act shall prevent U.S. agencies from fulfilling obligations incurred through international agreements entered into prior to enactment of this Act; (4) the decision whether to engage in offsets and in negotiating and implementing offset arrangements lies with the companies involved; and (5) any exceptions to such policy shall be approved by the President after receiving the recommendation of the National Security Council. Directs the Secretary of Defense to lead an interagency team to consult with foreign nations on limiting the adverse effects of offsets in defense procurement and to report to specified congressional committees.

Requires the Secretary of Commerce (currently, the President) to prepare a report on the impact of offsets on the defense preparedness, industrial competitiveness, employment, and trade of the United States, as required under the Defense Production Act of 1950. Provides that if a U.S. firm enters into a contract for the sale of a weapon system or defense-related item to a foreign country or foreign firm and such contract is subject to an offset agreement exceeding $5,000,000, such firm shall furnish an offset agreement to a designated defense official and information concerning such sale. Provides for the protection of confidential information provided to such defense official. Outlines information to be included in the reports prepared by the Department of Commerce. Requires findings and recommendations contained in such reports to be considered by representatives of the United States during bilateral and multilateral negotiations aimed at minimizing the adverse effects of offsets.

Requires the President to issue biennial reports assessing those subsectors of the U.S. economy which have been identified as being critical to the development and production of components required for the production of weapons systems and other items of military equipment and the provision of services essential to the national defense. Outlines matters to be considered in such reports, including capacity and capabilities of domestic sources, the extent of foreign dependencies for items of military material, and reasons for decline in U.S. capabilities to meet peacetime and mobilization requirements.

Part D: Amendments to Title VII of the Defense Production Act - Requires small business concerns to be given the maximum practicable opportunity to participate as contractors and subcontractors in all programs to maintain and strengthen the nation's defense base under the Defense Production Act of 1950. Requires representatives of small business concerns to participate in such advisory committees as may be established under such Act, and requires small business concerns to be given access to appropriate information to the maximum extent practicable. Requires the President to allocate a fair share of material authorized under the Act to small business concerns, especially to new concerns or individual firms facing undue hardship.

Limits the authority of the President to delegate any power conferred upon him by this Act, including the redelegation of such authority.

Permits executives being trained and organized in the National Defense Executive Reserve and participating in voluntary agreements or plans or actions under direction of the President and pursuant to treaty obligations to be given antitrust and breach of contract immunity when undertaking any emergency actions. Exempts such activities from provisions of the Advisory Committee Act.

Requires the President to provide for the establishment of an information system on the domestic defense industrial base which includes a systematic and continuously-updated procedure to collect and analyze information necessary to evaluate: (1) the adequacy of domestic industrial capacity and capability in critical components, technologies, and technology items essential to national security; and (2) dependence on foreign sources for industrial parts, components, and technologies essential to defense production. Requires the current defense information network to be incorporated into such information system. Provides sources of, and uses for, such information as collected and analyzed, including review and production-base analysis purposes. Directs the President to require the Secretary of each military department to incorporate in such system a complete analysis of the production base of two major weapons systems of such department. Directs the President to provide for the establishment of, and report to the Congress on, a strategic plan for developing a cost-effective, comprehensive information system capable of identifying vulnerability in critical components, technologies, and technology items. Directs the President to require the Secretaries of Defense and of Commerce, as well as the heads of other appropriate Federal agencies, to consult with one another, provide information assistance and access, and coordinate standards, definitions, and specifications for information on defense production between Federal departments and agencies.

Requires the President, upon establishment of the information system, to convene a task force to establish guidelines and procedures to ensure that all Federal departments and agencies which acquire information with respect to the domestic defense industrial base are fully participating in the system. Requires the President to report on the domestic adequacy or inadequacy of critical components, technologies, and technology items needed for the defense industrial base. Authorizes appropriations.

Exempts any regulation or order issued under the Defense Production Act of 1950 from the Administrative Procedure Act.

Waives certain Federal employment restrictions (conflict-of-interests provisions) in the case of a special Government employee if the President determines and certifies that it is in the public interest to grant the waiver and that the services provided by the employee are critically needed for the benefit of the Government. Limits the government-wide waivers to 50, with 25 such waivers to be granted only to Department of Energy employees for use in discharging responsibilities with respect to ensuring adequate energy supplies during the Middle East crisis. Requires a designated agency ethics official to prepare a report at the end of the employment of an employee granted such a waiver describing the activities to which the waiver applied. Require such report to be filed with the President and the Director of the Office of Government Ethics.

Part E: Technical Amendments - Limits the use of presidential authority to prioritize contracts having a bearing on national defense over other government contracts or orders.

Increases from $1,000 to $10,000 the possible fine for the willful violation of certain information disclosure rules. Revises provisions concerning certain employment appointment procedures in connection with appointments made by the President in order to carry out the provisions of the Defense Production Act.

Part F: Repealers and Conforming Amendments - Repeals specified provisions of such Act which: (1) provide for the effective date of a synthetic fuel action sent to the Congress by the President; (2) provide for voluntary agreements and plans of action for international agreements for the international allocation of petroleum products and related information systems; (3) provide for the accrual of interest on remaining funds authorized and appropriated to carry out such Act; (4) establish the Joint Committee on Defense Production; (5) disqualify certain persons for employment under such Act; (6) require a feasibility study of the application of uniform cost accounting standards under defense procurement contracts; and (7) establish the National Commission on Supplies and Shortages.

Part G: Reauthorization of Selected Provisions - Authorizes appropriations for FY 1991 through 1993 to carry out the Defense Production Act of 1950. Terminates all authority under the Act as of the end of FY 1993.

Title II: Additional Provisions to Improve Industrial Preparedness - Part A: Encouraging Improvement of the Defense Industrial Base - Directs the President to issue a procurement policy providing for the solicitation and award of contracts for critical components or critical technology items where only domestic sources must be eligible for their award or where a specified percentage of domestic participation is required in the total estimated value of the contract. Waives such requirements if the contracting officer determines that such restrictions are likely to have a significant adverse impact on national interests. Requires the Federal Acquisition Regulation (FAR) to be modified to include such contracting requirements for the procurement of critical components or critical technology items. Directs the President to prescribe an acquisition policy which requires that the acquisition plan for any major system or any other acquisition program so designated provide for contract solicitation provisions which encourage competing offerors to acquire modern industrial facilities and production systems for utilization in the performance of the contract, as well as other modern equipment that increases productivity of the offerors while reducing the costs of production. Outlines provisions authorized to be included in such contract provisions.

Expresses the sense of the Congress that the Secretary of Defense, as part of his study of the defense acquisition process under the Defense Management Review, shall consider: (1) the full cost allowability of independent research and development bid and proposal; and (2) an increase in the progress payment rate on defense contracts.

Part B: Miscellaneous - Requires the Code of Federal Regulations to be amended to specify the circumstances under which a contractor who has engaged in an unfair trade practice may be found to lack business integrity or honesty that seriously and directly affects his or her responsibility to perform any Government contract or subcontract.

Title III: Amendment to Related Laws - Finds that congressional interest in energy security and the availability of energy for defense mobilization, industrial preparedness, and other purposes of the Defense Production Act has also been expressed in other laws. Directs the President to submit to the Congress biennially the projected capacity and potential prospects for the use of alternative and renewable sources of energy for such purposes.

Amends the Geothermal Energy Research, Development, and Demonstration Act of 1974 to extend the period of loan guaranties and interest assistance provided under such Act through FY 1993.

Title IV: Fair Trade in Financial Services - Fair Trade in Financial Services Act of 1990 - Amends the International Banking Act of 1978, the Securities Exchange Act of 1934, and the Investment Advisers Act of 1940 to direct the Secretary of the Treasury to: (1) submit biennial status reports to the Congress regarding foreign treatment of certain U.S. business interests; and (2) initiate negotiations with foreign countries to ensure that they offer U.S. banking and bank holding companies, securities brokers and dealers, and investment advisers the same competitive opportunities as are available to their foreign counterparts.

Authorizes the Secretary to publish in the Federal Register a determination that a foreign country does not accord national treatment to such U.S. business interests. Authorizes a Federal banking agency, or the Securities and Exchange Commission (SEC), after notice of such determination, to include such determination as a basis for denial of certain foreign trade applications (to conduct banking, securities, or investment advice activities in the United States) from such foreign country in reports required under the Omnibus Trade and Competitiveness Act of 1988. Directs the Secretary to review such determinations annually and rescind determinations, if appropriate.

Amends the International Banking Act of 1978 to preclude banking interests from such countries from commencing or conducting business in this country as of the date of the Secretary's determination unless prior approval has been obtained from a Federal banking agency (including, under certain circumstances, a State banking agency). Outlines the factors to be considered by the Secretary and the banking and securities regulatory agencies in their exercise of discretion with respect to existing foreign operations in the United States.

Amends the Securities Exchange Act of 1934 and the Investment Advisers Act of 1940 to provide that, subsequent to the Secretary's determination in the Federal Register that a foreign country does not accord national treatment to U.S. securities or investment adviser interests, a person from such foreign country may not acquire control of a registered broker, dealer, or investment adviser unless the SEC has been duly notified and has not prohibited such acquisition.

Amends the Omnibus Trade and Competitiveness Act of 1988 to direct the Secretary of the Treasury, together with other appropriate agencies and representatives, to conduct an investigation to determine the extent of interdependence of U.S. financial services sectors and foreign countries whose financial services institutions provide financial services in the United States, or whose persons have substantial ownership interests in U.S. financial institutions, and the economic, strategic, and other consequences of that interdependence for the United States. Directs the Secretary to report the results of this investigation within two years to the President, the Congress, and other specified commissions, departments, and agencies as deemed appropriate by the Secretary.

Title V: Effective Dates - Sets forth effective dates for provisions of this Act.