On May 29, President Trump issued a proclamation, effective on June 1, 2020, to suspend and limit certain nonimmigrant Chinese nationals who seek to enter the United States with an F or J visa. This latest action by the Trump administration is another step in a multi-agency initiative to protect federally-funded research at American universities and research institutions, specifically with a concern over the diversion of intellectual property, critical technologies and defense know-how.
In this alert, we provide the following:
- Summary of the latest presidential proclamation and explanation of what impact universities, academic medical centers and other research institutions might expect from it.
- Reminder of recent regulatory activities concerning foreign influence in federally-funded research.
- Highlight of best practices and recommendations going forward.
Proclamation on the Suspension of Entry as Nonimmigrants of Certain Students and Researchers from the People’s Republic of China
The president’s proclamation, while effective as of June 1, 2020, does not at this time require any action by, and may not directly affect, universities or other institutions that host Chinese students (with one caveat, discussed below). That is because the proclamation to suspend the issuance of visas applies prospectively to nonimmigrant Chinese nationals (specifically, post-graduate and post-doctoral researchers, not undergraduate students) who either receive funding from or who are currently or have been employed by, study at or conduct research at or on the behalf of an entity in China that implements or supports China’s “military-civil fusion (MCF) strategy.” MCF means actions by or at the behest of China to acquire and divert foreign technologies, specifically for critical and emerging technologies, in order to incorporate into and advance China’s military capabilities.
As mentioned, the proclamation applies prospectively and does not call for the removal of students currently in the United States on an F or J visa. That said, there is one caveat: the Secretary of State, in his discretion, is required to consider whether Chinese nationals who are currently in the United States pursuant to an F or J visa and who otherwise meet the criteria set out in the proclamation (ties to China’s MCF) should have their visas revoked pursuant to 8 USC § 1201(i).
The State Department has not yet released a list of affected Chinese institutions with MCF ties or identified a number of students that will be impacted by this policy, because those numbers will be based on how many students apply for visas. With Chinese students and researchers potentially working on COVID-19 therapies, vaccines or other important scientific projects, it remains to be seen how and whether the State Department will implement this policy to remove current visa-holders. Still, a Senate report from 2019 ties one of the most prominent Chinese talent recruitment programs, the “Thousand Talents Program,” to China’s MCF strategy.
Note that the proclamation does not specifically ban students in science, technology, engineering and mathematics (STEM) programs or STEM areas of research. Additionally, the suspension of visas is not contingent on an American institution’s receipt of federal funds but could impact any institution that hosts or supports Chinese post-graduate or post-doctorate researchers, to the extent those individuals are affiliated with the Chinese MCF.
Congress has also taken a stab at this issue, with Senators Cotton (R-Ark.) and Blackburn (R- Tenn.) and Representative Kustoff (R-Tenn.) recently introducing the SECURE CAMPUS Act (the Act) in both chambers. The Act contains similar, but in many ways, more extensive restrictions on the entry of Chinese students in STEM fields. Given that this proposed legislation is more over-reaching compared with the proclamation, we suspect that it will not progress far in its current form.
Regulation and Enforcement of Foreign Influence in Federally-Funded Research
Concerns about the integrity of clinical research and foreign influence in the United States is not new. For the last several years, the federal government has taken a cross-agency approach in addressing these issues, with numerous agencies including Defense, Energy, Health and Human Services, and Education issuing their own rules on disclosure and reporting of foreign sources of support, foreign talent recruitment programs, and research conducted outside of the United States.
In-house counsel should be aware of the regulatory schemes applicable to their institution. The following is a brief reminder of the more prominent rules that impact federally-funded research activities at universities, academic medical centers, and other research institutions.
The National Institutes of Health
The National Institutes of Health (NIH) has issued several guidances clarifying existing regulations and requirements that pertain to foreign influence in NIH-funded research. First, 42 CFR Part 50, Subpart F addresses financial conflicts of interest and requires each institution receiving NIH funds to maintain an up-to-date written and enforced policy on financial conflicts of interest that complies with the regulation. This includes the disclosure of “significant financial interests” of all investigators conducting NIH-funded research, including income from teaching sponsored by foreign entities. Second, the NIH Grants Policy Statement (NIHGPS) requires grant applicants to disclose “other support,” which includes any “…financial support from all foreign and domestic entities…,” as part of an application for NIH funding. Finally, the NIHGPS requires that applicants disclose any “foreign components,” which means “the performance of any significant scientific element or segment of a project outside of the United States, either by the recipient or by a researcher employed by a foreign organization, whether or not grant funds are expended.” Not all funding opportunities permit foreign components.
In August 2018, the Director of the NIH, Francis Collins, issued a letter to some 10,000 institutional awardees describing threats to American biomedical research and areas of concern, including the diversion of intellectual property, sharing confidential information in grant applications and the failure of researchers to disclose substantial resources from other organizations and foreign governments. Additionally, on July 10, 2019, NIH issued a reminder to the research community about the need to report foreign activities through documentation of other support, foreign components, and financial conflicts of interest.
The National Science Foundation
Similar to NIH, the Director of the National Science Foundation (NSF) also issued a “Dear Colleague” letter in July 2019. Director Frances Córdova, among other admonishments to maintain the integrity of research protection, stated that the NSF would be issuing a policy making it clear that NSF personnel and other government employees detailed to the NSF cannot participate in foreign government recruitment programs.
The Department of Education
Section 117 of the Higher Education Act (20 USC § 1011f) requires universities and colleges to report contracts with foreign sources and foreign gifts greater than $250,000, whether those gifts are made by a foreign government or non-government foreign source. In the last year, the Department of Education has elevated its enforcement of foreign gift reporting under Section 117 through an information collection request that was finalized in April 2020. Under the changes, the Department of Education has expanded its reporting mechanism, requiring the collection of more information on foreign sources and the imposition of criminal penalties for falsifying reports to the Department. Since July 2019, the Department’s heightened scrutiny has led to $6.5 billion in previously undisclosed foreign money being reported.
In addition to NIH probes resulting in refunds to NIH, the Department of Justice (DOJ) launched a “China Initiative” to prosecute alleged violations of the laws described above. For example, several Chinese researchers have been arrested on charges of wire fraud; making false, fictitious or fraudulent statements; and attempts to smuggle goods in connection with ties to undisclosed Chinese institutions or receipt of Chinese grants. The DOJ and the FBI have also employed the False Claims Act (FCA) as another enforcement mechanism, claiming that the submission of federal grant applications and progress reports to federal agencies while failing to disclose “other support” constitutes an FCA violation. Use of the FCA permits the government to impose heightened penalties, such as treble damages.
Best Practices and Recommendations
While individual researchers or students may ultimately be the source of non-compliant actions, it is important to keep in mind that enforcement actions may be taken against the institution as the awardee of federal grants, in addition to individual researchers. Further, even though the president’s proclamation does not impose any new obligations, the following items are best practices and recommendations for an institution that is an awardee of federal grants or host of foreign students:
The institution’s policies on foreign influence should conform to the NIH’s regulations and policies, including the NIHGPS, and any other required agency rules and regulations, as applicable (e.g., Department of Education regulations).
Coordination and Communication
An effective working group of relevant stakeholders across the institution should be coordinated as aspects of these regulations are handled by numerous offices. Those offices may include: the Grants and Sponsored Research Office, Institutional Review Board, International and Travel Programs Office, Faculty and Administration, and the Legal Office.
All relevant stakeholders must be trained on institutional policies and federal agency policies from initial onboarding and at periodic intervals. Researchers and administrative staff must understand grant requirements and ensure their applications are consistent with applicable law and policy. Any changes or ongoing obligations must similarly be documented and reported.
Review Grant Submissions
Review applications, Just-in-Time Reports, and Research Performance Progress Reports, to identify foreign activities or foreign support and to determine consistency with other internal submissions (e.g., IRB or IACUC).
Monitoring and Enforcement
Conduct scheduled, periodic reviews of federally-funded projects with opportunities for refreshed disclosures by researchers; conduct random case audits to determine compliance gaps; run public searches and cross-check government exclusionary lists where applicable; and take disciplinary action in accordance with institutional policies in response to instances of non-compliance.