The Trump administration is placing increased emphasis on oversight of foreign gifts, contracts and connections with colleges and universities in the United States. Newly announced reporting mechanisms and statutory changes making their way through Congress could reshape the landscape for this issue in U.S. higher education.
Executive Order. On April 23, 2025, President Donald Trump signed the Transparency Regarding Foreign Influence at American Universities Executive Order, which includes a focus on Section 117 of the Higher Education Act. Section 117 requires colleges and universities to report on an annual basis foreign gifts and contracts valued at more than $250,000. According to the executive order, “section 117 has not been robustly enforced” and therefore “the true amounts, sources, and purposes of foreign money flowing to American campuses are unknown.” This concern echoes back to the first Trump administration, which increased scrutiny of foreign gift reporting by investigating universities and developing an online portal that required institutions to answer specific questions about their foreign financial ties. The executive order emphasized the current administration’s commitment to the work it started during Trump’s first term and ordered the Secretary of Education to take all appropriate actions to “require complete and timely disclosure by higher education institutions of foreign funding.”
New Section 117 Reporting Portal. On Dec. 1, the U.S. Department of Education rolled out a portal for colleges and universities to complete their Section 117 reporting. Schools can begin using the portal to upload funding disclosures on Jan. 2, 2026, with this year’s submission deadline falling on Feb. 2, 2026. The Department stated that failure to comply with the reporting requirement could result in an enforcement action.
Potential Legislative Action. At present, the Department does not have robust enforcement tools to address misrepresentations or violations of Section 117, given that reporting is not tied to federal student aid or the statutory and regulatory certifications required in a Program Participation Agreement to receive federal student aid. Changing this would require legislative action, such as an amendment to Title IV of the Higher Education Act of 1965. Such an amendment could give federal agencies the authority to pursue actions under the federal False Claims Act or even revoke federal student aid eligibility for egregious violations related to reporting requirements.
The Defending Education Transparency and Ending Rogue Regimes Act (DETERRENT Act), as passed in the U.S. House of Representatives, would include just such a change. Key provisions include:
- Reducing the foreign gift or contract reporting threshold from $250,000 to $50,000, considered alone or in combination with all other gifts or contracts within a calendar year.
- Requiring institutions of higher education (IHEs) to receive a waiver to enter into a contract with a foreign country of concern or foreign entity of concern.
- Requiring IHEs to annually report any contracts with countries of concern or foreign entities of concern regardless of the value of the contract.
- Requiring IHEs substantially controlled by a foreign source to annually disclose certain information regarding the foreign source that substantially controls the IHE.
- Requiring certain IHEs to disclose gifts or contracts between covered individuals (e.g., researchers) and foreign sources.
- Requiring private institutions of higher education with endowments or assets over $6 billion or with “investments of concern” above $250 million to annually disclose investments with a country of concern or foreign entity of concern.
- Imposing specified fines for violations and amending Title IV of the Higher Education Act of 1965 to include foreign reporting of gifts and contracts in the Program Participation Agreement, which allows for revocation of federal student aid and potential liability under the False Claims Act.
The Senate has not yet acted on the DETERRENT Act, which if enacted as proposed by the House would provide powerful enforcement tools not currently available.
Members of the House Rules Committee are simultaneously advancing three additional bills aimed at deterring improper foreign influence at colleges and universities: H.R. 1005: Combating the Lies of Authoritarians in School Systems Act; H.R. 1069: PROTECT Our Kids Act; and H.R. 1049: Transparency in Reporting of Adversarial Contributions to Education Act.
Compact for Academic Excellence in Higher Education. Section 8 of the administration’s proposed Compact for Academic Excellence in Higher Education speaks to “foreign entanglements.” Section 8’s stated goal is to “assist the federal government in detecting, preventing, and eradicating criminal and terrorist financing and activity.” It focuses on concepts of “know-your-customer” screening and related recordkeeping, and it appears to be calibrated towards identifying and monitoring potential foreign participation in and/or influence over university activities and initiatives, including dealings with non-U.S. students, faculty, temporary guests, donors, sponsors and other partners. Such initiatives may cover multiple areas, including export controls, classified activities, conflicts of interest, donations and foreign influence. If and as the Compact moves forward, participants may establish new best practices related to the screening and oversight of potential “foreign entanglements” that the administration will expect other colleges and universities to emulate.
The administration clearly indicated it will continue to focus on proper disclosure of foreign relationships. Institutions should consider reviewing and, if necessary, updating their screening and disclosure protocols related to foreign financial ties and foreign research, visitors, faculty and other connections.
For more information, contact the authors of this article. McGuireWoods’ Higher Education Team will host a webinar covering this topic in January. An invitation is coming soon.