South China Sea and East China Sea Sanctions Act of 2017

South China Sea and East China Sea Sanctions Act of 2017

This bill expresses the sense of Congress that: (1) the United States opposes actions by the government of any country to interfere in the free use of waters and airspace in the South China Sea or East China Sea, (2) China should not continue to pursue illegitimate claims and to militarize an area that is essential to global security, (3) the United States should expand freedom of navigation operations and overflights and respond to Chinese provocations with commensurate actions, and (4) the United States should oppose any unilateral Chinese actions to undermine Japan's control of the Senkaku Islands.

The bill requires the President to impose entry and U.S.-based property sanctions with respect to: (1) any Chinese person that contributes to construction or development projects in areas of the South China Sea contested by one or more members of the Association of Southeast Asian Nations (ASEAN); (2) any Chinese person that has engaged in actions or policies that threaten the peace or stability of areas of the South China Sea contested by one or more ASEAN members or areas of the East China Sea administered by Japan or the Republic of Korea; and (3) any person that is owned or acting on behalf of such person, or provides such person with financial, material, technological, or other support.

The President shall prohibit the opening in the United States of, and shall prohibit or impose strict conditions on the maintaining in the United States of, a correspondent account or a payable-through account by a foreign financial institution that conducts financial transactions for a sanctioned person if China has taken specified military-related actions concerning the South China Sea or the East China Sea.

The Department of State shall submit a report to Congress identifying each Chinese person that is engaged in sanctioned activities.

The bill prohibits: (1) with specified exceptions and subject to a presidential waiver, the provision of foreign assistance to the government of a country that recognizes China's sovereignty over the contested territory or airspace in the South China Sea or the East China Sea; and (2) the Government Publishing Office, the Department of Defense, the Department of Justice, or U.S. flagged vessels or aircraft from taking certain actions that would imply U.S. recognition of China's sovereignty over such territory or airspace.

No U.S. person may take any action to approve, facilitate, finance, or guarantee any investment, or provide insurance or underwriting, in the South China Sea or the East China Sea that involves any sanctioned person.