Korean Interdiction and Modernization of Sanctions Act TITLE I--SANCTIONS TO ENFORCE AND IMPLEMENT UNITED NATIONS SECURITY COUNCIL SANCTIONS AGAINST NORTH KOREA (Sec. 101) This bill amends the North Korea Sanctions and Policy Enhancement Act of 2016 to direct the President to designate and subject to specified sanctions under such Act any person who knowingly: purchases or acquires from North Korea any significant amounts of gold, titanium ore, vanadium ore, copper, silver, nickel, zinc, or rare earth minerals; sells or transfers to North Korea any significant amount of rocket, aviation, or jet fuel, except for certain use by a civilian passenger aircraft outside North Korea; provides significant amounts of fuel or supplies or facilitates a significant transaction to operate or maintain a vessel or aircraft that is designated under an applicable executive order or an applicable United Nations Security Council resolution; insures or registers a vessel owned or controlled by the government of North Korea, except as approved by the Security Council; or maintains a correspondent account with any North Korean financial institution, except as approved by the Security Council. The President may designate and subject to such sanctions any person who knowingly: purchased or otherwise acquired significant quantities of coal or iron in excess of Security Council limitations from the North Korean government; purchased or otherwise acquired significant types or amounts of textiles from such government; facilitated a significant transfer to such government of funds or property that materially contributes to a violation of an applicable Security Council resolution; facilitated a significant transfer to or from such government of bulk cash, precious metals, or gemstones; sold or otherwise provided to such government significant amounts of crude oil, condensates, refined petroleum, other types of petroleum or petroleum by products, liquefied natural gas, or other natural gas resources, except for fuel oil, gasoline, or diesel fuel for humanitarian use; engaged in or was responsible for online commercial activities of such government, including online gambling; purchased or otherwise acquired fishing rights from such government; provided significant telephonic, telegraphic, telecommunications or other data services into or out of North Korea in excess of services needed for humanitarian or diplomatic purposes; purchased or otherwise acquired significant types or amounts of food or agricultural products from such government; engaged in or was responsible for the exportation of workers from North Korea in a manner intended to generate significant revenue; conducted significant transactions in North Korea's transportation, mining, energy, or financial services industries; or except as approved by the Security Council and other than through a correspondent account, facilitated the operation of any North Korean financial institution. The President may block transactions of U.S.-based or -controlled property or interests as part of such discretionary sanction authority. The President shall report to Congress whether the following entities should be designated and subject to sanctions: (1) the Korea Shipowners' Protection and Indemnity Association, (2) Chinpo Shipping Company (Private) Limited, (3) the Central Bank of the Democratic People's Republic of Korea, (4) Kumgang Economic Development Corporation, (5) Sam Pa, and (6) the Chamber of Commerce of the Democratic People's Republic of Korea. (Sec. 102) A U.S. financial institution shall terminate the use of a correspondent account it uses to do business with foreign financial institutions if the bank knows that such account is being used to provide financial services to a person, foreign government, or financial institution designated under such Act. A U.S. financial institution may process fund transfers to or from North Korea, or for a person, foreign government, or financial institution designated under such Act if the transfer: (1) arises from an underlying transaction authorized by the Department of the Treasury, and (2) does not involve debiting or crediting a North Korean account. (Sec. 103) A foreign government that provides to or receives from North Korea a significant type or amount of specified defense articles or services (as determined by the President) is prohibited from receiving certain types of U.S. foreign assistance for two years. The Department of State shall report to Congress periodically regarding foreign compliance with curtailing North Korea's arms trade. (Sec. 104) The President shall report to Congress periodically: identifying foreign port and airport operators that knowingly fail to implement or enforce regulations to inspect ships, aircraft, cargo, or conveyances in transit to or from North Korea or that facilitate the transfer or conveyance of significant types or quantities of cargo, vessels, or aircraft owned or controlled by certain designated persons; describing the extent that Security Council resolutions to de-register any vessel owned, controlled, or operated by or on behalf of the government of North Korea have been implemented by foreign countries; describing the Islamic Republic of Iran's compliance with the sanctions mandated in Security Council resolutions; identifying vessels, aircraft, and conveyances owned or controlled by the Reconnaissance General Bureau of the Workers' Party of Korea; and describing the President's efforts to secure full implementation of applicable Security Council resolutions. Each report shall include findings with respect to specified ports and airports in China, Iran, Russia, and Syria. The Department of Homeland Security may implement enhanced screening of cargo bound for or landed in the United States that: (1) has been transported through a sea port or airport that has repeatedly failed to comply with applicable Security Council resolutions; (2) is aboard a vessel, aircraft, or within a conveyance that has entered North Korean territory or waters or landed in any of its seaports or airports, within the last 365 days; or (3) is registered by a country whose inspection compliance is deficient. An exception is provided for food, medicine, or humanitarian shipments. Such enhanced screening procedures shall not apply to food, medicine, and humanitarian shipments. (Sec. 105) The Ports and Waterways Safety Act is amended to prohibit, with specified exceptions, a foreign vessel from entering or operating in U.S. navigable waters or transferring cargo in any port under U.S. jurisdiction if such vessel is a foreign vessel for which a notice of arrival is required and is: (1) on a list of vessels owned or operated by or on behalf of the government of North Korea, a North Korean person, a country with a designated port, or a country that is not in Security Council compliance; or (2) registered by a government that maintains registration of a vessel that is on such list. (Sec. 106) The President shall report to Congress periodically regarding: (1) North Korea-Iran cooperation, (2) implementation of Security Council resolutions by other governments, and (3) measures to deny specialized financial messaging services to designated North Korean financial institutions or other North Korean persons. TITLE II--SANCTIONS WITH RESPECT TO HUMAN RIGHTS ABUSES BY THE GOVERNMENT OF NORTH KOREA (Sec. 201) The bill requires the State Department to report on the U.S. strategy to enhance international awareness of the North Korean human rights situation to identify foreign persons that knowingly employ forced North Korean laborers in a manner intended to generate revenue for the government of North Korea or by the Workers' Party of Korea. Goods produced in whole or part by North Korean labor are prohibited from entering the United States unless U.S. Customs and Border Protection finds that they were not produced with convict, forced, or indentured labor. The President shall impose U.S. property-based sanctions on foreign persons that employ North Korean forced laborers. (Sec. 203) The bill amends the State Department Basic Authorities Act of 1956 to authorize the State Department to offer cash rewards for information on violations of North Korean sanctions. (Sec. 204) The State Department shall submit to Congress a determination as to whether North Korea meets the criteria for designation as a state sponsor of terrorism. TITLE III--GENERAL AUTHORITIES (Sec. 301) The bill sets forth provisions regarding: (1) consolidation of reports, (2) presidential sanction and regulatory authority, and (3) limitation of funds.