The No Foreign Gifts Act of 2025 amends the Higher Education Act of 1965 to prohibit any institution of higher education that receives HEA funds from accepting gifts from certain countries. It directs that, beginning on enactment, gifts from countries that provide material support to foreign terrorist organizations or from China, Russia, North Korea, or Iran are impermissible.
Institutions must report every such gift offer to the Secretary of Education to remain eligible for federal funds. The definitions of “material support” and “foreign terrorist organization” align with existing federal law, tying the prohibition to established criteria.
At a Glance
What It Does
The act inserts Section 117A into the Higher Education Act, prohibiting gifts to HEA-funded institutions from any country providing material support to a foreign terrorist organization or from China, Russia, North Korea, or Iran. It also requires institutions to report each such gift offer to the Secretary of Education to maintain eligibility for funds.
Who It Affects
Public and private colleges and universities that receive HEA funds; their development and compliance offices; and the Department of Education which administers ongoing eligibility and reporting.
Why It Matters
It creates a clear legal standard governing foreign gifts to federally funded higher education institutions and establishes a reporting duty to support enforcement and transparency in the funding ecosystem.
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What This Bill Actually Does
The bill adds a new prohibition to the Higher Education Act. Effective upon enactment, any institution that receives federal higher education funds may not accept a gift from a country that provides material support to a foreign terrorist organization, as determined by the Secretary of State, or from China, Russia, North Korea, or Iran.
If such a gift offer is made, the institution must report it to the Secretary of Education to preserve its eligibility for HEA funds. The terms “material support” and “foreign terrorist organization” reference existing federal definitions, ensuring the scope aligns with current law.
This means institutions must implement screening and reporting practices to comply with the prohibition.
The Five Things You Need to Know
The bill creates Section 117A in the Higher Education Act prohibiting gifts to HEA-funded institutions from certain countries.
Gifts from any country providing material support to a foreign terrorist organization, or from China, Russia, North Korea, or Iran, are prohibited.
Institutions must report every gift offer to the Secretary of Education to remain eligible for HEA funds.
Definitions of material support and foreign terrorist organization rely on existing federal law (18 U.S.C. 2339A(b) and 8 U.S.C. 1189).
The prohibition takes effect upon enactment and is implemented through amending the Higher Education Act.
Section-by-Section Breakdown
Every bill we cover gets an analysis of its key sections.
Short title
Section 1 designates the act as the No Foreign Gifts Act of 2025. This formal title frames the scope of the measure and signals its alignment with national security and higher education policy concerns.
Prohibition on gifts from certain countries
Section 2 inserts new Section 117A into the Higher Education Act. It bars HEA-funded institutions from receiving gifts from any country that provides material support to a foreign terrorist organization, as determined by the Secretary of State, or from China, Russia, North Korea, or Iran. Institutions must report every such gift offer to the Secretary to preserve eligibility for funds. The section also defines material support and foreign terror organizations by cross-referencing existing federal statutes (18 U.S.C. 2339A(b) and 8 U.S.C. 1189).
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Explore Education in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- HEA-funded colleges and universities gain a clear compliance standard, reducing risk of inadvertently accepting problematic gifts and simplifying governance around philanthropic proposals.
- University general counsel and compliance teams benefit from a defined framework for evaluating gifts and reporting requirements, potentially reducing legal ambiguity.
- Research administration offices gain a transparent threshold for accepting donations, aiding risk management and donor relations within federal funding contexts.
- Academic and international partnerships may benefit from clearer boundaries, helping institutions assess the acceptability of international gifts and collaborations.
Who Bears the Cost
- Institutions must implement screening and reporting processes, potentially increasing administrative workload and costs.
- Development offices face new due diligence obligations when evaluating potential gifts from foreign sources.
- The Department of Education bears ongoing enforcement and monitoring responsibilities to ensure compliance and eligibility for HEA funds.
- Small or:scale institutions with limited compliance resources may experience a relatively higher relative burden to establish and maintain the reporting workflow.
Key Issues
The Core Tension
The central dilemma is balancing national security and safeguarding federal funds with the risk of over-regulating philanthropy and chilling legitimate international collaborations.
The bill creates a clean, security-minded prohibition but also introduces practical implementation challenges. The use of the Secretary of State’s designation to determine “material support” links higher education funding eligibility to foreign policy classifications that can evolve over time, potentially creating compliance complexity for institutions with long-standing international partnerships.
The reporting obligation provides a paper trail that supports enforcement but uncovers questions about penalties, exceptions, or safe harbors that are not specified in the bill. Overall, the measure frames safety and integrity of federal funding against gift sources, but it may raise chilling effects on donor engagement and complicate cross-border collaborations.
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