Technical corrections only. The two versions of H.R. 1048 are substantively identical, with only minor procedural updates reflecting the bill's passage from the House to the Senate. No policy changes were made between v3 and v4.
DETERRENT Act
- Sponsor
- Rep. Baumgartner, Michael [R-WA-5]
- Committees
- Health, Education, Labor, and Pensions Committee (primary)
- Last action
- Mar 31, 2025
Bottom line
The DETERRENT Act aims to increase transparency and mitigate foreign influence in U.S. higher education by imposing strict disclosure rules and prohibitions, particularly concerning adversarial nations and entities.
What it actually does
This bill, the DETERRENT Act, significantly expands disclosure requirements for U.S. institutions of higher education regarding foreign gifts and contracts. It prohibits contracts with "foreign countries of concern" and "foreign entities of concern" unless a waiver is granted, and mandates new policies for faculty and staff to disclose foreign gifts and contracts. It also requires certain institutions to report investments in entities of concern and establishes a robust enforcement regime with substantial fines for non-compliance.
Proponents argue
Proponents argue that the bill is crucial for national security, protecting academic integrity, and preventing foreign adversaries from exploiting U.S. research and educational institutions. They contend that increased transparency will expose undue foreign influence and ensure that collaborations align with U.S. interests, safeguarding intellectual property and democratic values.
Opponents contend
Opponents express concerns that the bill's broad scope and stringent requirements could stifle legitimate international academic collaboration, impose excessive administrative burdens on institutions, and create a chilling effect on research. They argue that it might lead to unintended consequences, such as discouraging foreign student enrollment or research partnerships, without a clear demonstration of widespread harm from current practices.
The bill is lengthy and technically dense, requiring significant time to understand its full implications, especially due to numerous cross-references to existing statutes and regulations.
Section 2(a), amending Section 117 of the Higher Education Act of 1965.
Enhanced Foreign Gift and Contract Disclosure for Institutions
This provision lowers the reporting threshold for foreign gifts and contracts from $250,000 to $50,000 for most foreign sources. Crucially, it requires disclosure of all gifts and contracts, regardless of value, from "foreign countries of concern" or "foreign entities of concern." Institutions must provide detailed information, including the purpose, value, dates, and, for contracts with countries/entities of concern, unredacted copies. It also mandates annual reporting for institutions "substantially controlled" by a foreign source.
Supporters argue
Supporters argue this is essential to identify and counter malign foreign influence, protect intellectual property, and ensure transparency in academic funding. The lower thresholds and specific focus on countries/entities of concern close loopholes and provide a clearer picture of foreign engagement.
Critics contend
Critics contend that the expanded requirements, especially the $0 threshold for "countries of concern," will create a massive administrative burden, potentially deterring legitimate international collaborations and leading to over-reporting of minor interactions. They also raise concerns about the privacy of natural persons involved in disclosures.
Tradeoffs
Balances national security and transparency against academic freedom, administrative burden, and the potential chilling effect on international research and educational partnerships.
Section 2(b), adding Section 117A to the Higher Education Act of 1965.
Direct Prohibition on Contracts with Foreign Adversaries
This provision directly prohibits institutions from entering into contracts with "foreign countries of concern" or "foreign entities of concern." Waivers are possible but are limited to one-year periods and require a determination by the Secretary of Education (in consultation with multiple intelligence and national security officials) that the contract benefits the institution's mission and promotes U.S. security/economic vitality. Existing contracts with newly designated entities must be terminated within 60 days.
Section 3, adding Section 117B to the Higher Education Act of 1965.
Faculty and Staff Disclosure of Foreign Engagements
This section requires certain institutions (those receiving over $50M in federal R&D funds or Title VI funds) to establish a policy mandating annual disclosure from "covered individuals" (faculty, researchers) of foreign gifts above "minimal value" and contracts above $5,000. All contracts with "countries/entities of concern" must be disclosed, regardless of value, including the full text. Institutions must maintain a publicly searchable database of this information, with some privacy protections for natural persons not involved with countries/entities of concern.
Section 4, adding Section 117C to the Higher Education Act of 1965.
Disclosure of Investments in Countries/Entities of Concern
This provision requires "specified institutions" (non-public institutions with endowments over $6 billion and investments of concern over $250 million) to file annual reports detailing their purchases, sales, and holdings of "investments of concern" (specified interests in foreign countries/entities of concern). This includes pooled investments unless certified otherwise. The Secretary of Education must maintain a publicly searchable database of these reports.
Section 5(a), adding Section 117D to the Higher Education Act of 1965.
Robust Enforcement and Institutional Compliance Officer Mandate
This section establishes a strong enforcement mechanism, authorizing the Secretary of Education to investigate violations and request the Attorney General to bring civil actions. Fines for non-compliance are substantial, ranging from $50,000 or the value of the gift/contract for first-time reporting violations, up to 200% of investment value for subsequent investment disclosure violations. Repeat offenders can be prohibited from obtaining waivers and even become ineligible for federal student aid programs. It also mandates institutions to establish compliance policies and designate compliance officers to certify reports.
Section 5(b), amending Section 487(a) of the Higher Education Act of 1965.
Compliance as a Condition for Federal Student Aid
This provision adds compliance with the new Sections 117, 117A, 117B, 117C, and 117D(c) as a condition for institutions to participate in federal student aid programs (Program Participation Agreement). Institutions that incur judgment in three separate civil actions for non-compliance and are prohibited from obtaining waivers under Section 117A will become ineligible for federal student aid for at least two fiscal years, requiring demonstrated compliance to regain eligibility.
Section 5(c).
Government Accountability Office Study on Interagency Coordination
This provision mandates the Comptroller General of the United States (GAO) to conduct a study within two years of enactment to identify ways to improve intergovernmental agency coordination regarding the implementation and enforcement of the new disclosure and prohibition sections. A report on the study's results must be submitted to Congress and made public within three years of the study's initiation.
Defines "foreign country of concern" to include "any covered nation defined in section 4872 of title 10, United States Code" (which refers to China, Russia, Iran, and North Korea) and any other country determined by the Secretary of Education (in consultation with Defense, State, and DNI) to be detrimental to U.S. national security or foreign policy.
Section 5(d)(1).
Why it matters:Standard legislative practice to use existing definitions and grant executive authority for dynamic threat assessment, but it means the full scope of "countries of concern" is not self-contained within the bill.
Case for: Supporters argue this provides necessary flexibility to adapt to evolving geopolitical threats without needing new legislation for each designation, ensuring the bill remains relevant.
Case against: Critics might argue that relying on external definitions and broad executive discretion creates uncertainty for institutions and could lead to politically motivated designations without sufficient legislative oversight.
Estimated impact: Directly determines which countries trigger the most stringent disclosure and prohibition requirements, impacting all institutions with international ties.
Defines "foreign entity of concern" by cross-referencing section 10612(a) of the Research and Development, Competition, and Innovation Act (42 U.S.C. 19221(a)), and explicitly includes entities on lists published under section 1286(c)(9)(A) of the John S. McCain NDAA for FY19 and Chinese military companies on the list required by section 1260H of the William M. (Mac) Thornberry NDAA for FY21.
Section 5(d)(2).
Why it matters:Standard practice to integrate with existing national security lists and definitions, providing consistency across federal policy, but requires external research to fully understand.
Case for: Supporters argue this ensures comprehensive coverage of entities already identified as national security risks by other federal agencies, streamlining the process and leveraging existing intelligence.
Case against: Critics might argue that the complexity of these layered definitions and external lists makes compliance extremely difficult for institutions, who may struggle to identify all relevant "entities of concern."
Estimated impact: Determines which specific non-governmental or quasi-governmental entities trigger the most stringent disclosure and prohibition requirements, impacting institutions' research and business partnerships.
Requires annual disclosure for institutions "substantially controlled" by a foreign source, and defines "foreign source" to include legal entities "substantially controlled (as described in section 668.174(c)(3) of title 34, Code of Federal Regulations) (or successor regulations)) by a foreign source."
Section 2(a), amending HEA Section 117(a)(2) and (f)(4)(C).
Why it matters:Standard practice to use existing regulatory definitions to avoid redundancy and maintain consistency, but it requires external lookup for full understanding.
Case for: Supporters argue that using an existing, established regulatory definition provides clarity and avoids creating new, potentially conflicting definitions for "control."
Case against: Critics might argue that a definition from financial responsibility regulations may not be perfectly suited for assessing national security risks related to foreign influence, potentially leading to unintended interpretations or compliance challenges.
Estimated impact: Determines which institutions are subject to annual "foreign source ownership or control" disclosure and which foreign entities are considered "foreign sources" due to control by another foreign source.
Exempts the name or address (other than attributable country) of a foreign source that is a natural person from public disclosure in the Department's database (Sec. 117) and the institution's database (Sec. 117B), unless the disclosure relates to a contract with a foreign country of concern or foreign entity of concern. It also protects the name/PII of covered individuals making disclosures under Sec. 117B, with the same exception.
Section 2(d)(2) and Section 3(c)(2).
Why it matters:A common legislative technique to balance competing interests (transparency vs. privacy) by creating specific exceptions within general rules.
Case for: Supporters argue these protections are essential to safeguard the privacy and safety of individual researchers and foreign donors/contractors, preventing potential harassment or targeting, while still allowing full transparency for engagements with high-risk entities.
Case against: Some transparency advocates might argue that all foreign funding, regardless of source, should be fully public, and these exceptions create potential blind spots, even with the "country of concern" carve-out.
Estimated impact: Significantly affects the amount of personally identifiable information made public, potentially influencing individuals' willingness to engage in international collaborations.