Reaffirms the U.S. arms embargo on the People's Republic of China (PRC), and finds that policies by the United States and other countries which promote democratic rather than military development in the PRC will help assure a stable and peaceful Asia and Pacific region. Deplores the recent increase in arms sales by member states of the European Union (EU) to the PRC and the European Council's decision to finalize work toward lifting its arms embargo on the PRC. Declares that such a development in European security policy is inconsistent with the mutual security interests that lie at the heart of U.S. laws for transatlantic defense cooperation at both the governmental and industrial levels and would necessitate unwelcome constraints in these relationships. Requests the President to: (1) urge European leaders to reconsider such course of action and, instead, work to prevent any future sale of arms or related technology to the PRC; and (2) keep Congress fully informed of developments in this area.