I 

118TH CONGRESS 

2D SESSION H. R. 7759 

To prohibit the purchase of certain securities from covered entities, and 

for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 20, 2024 

Mr. SHERMAN (for himself and Mrs. SPARTZ) introduced the following bill; 

which was referred to the Committee on Financial Services 

A BILL 

To prohibit the purchase of certain securities from covered 

entities, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘PRC Military and 

5 Human Rights Capital Markets Sanctions Act of 2024’’. 

6 SEC. 2. PROHIBITION ON PURCHASE OF CERTAIN SECURI7 TIES FROM COVERED ENTITIES. 

8 (a) IN GENERAL.—Not later than 90 days after the 

9 date of the enactment of this Act, the President shall— 


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1 (1) compile and maintain a single list of cov2 ered entities; 

3 (2) where possible, include in the list a unique 

4 identification number for each covered entity, such 

5 as a Committee on Uniform Securities Identification 

6 Procedures number or a Stock Exchange Daily Offi7 cial List number; 

8 (3) make such list available to the public; and 

9 (4) publicly identify and prohibit the purchase, 

10 sale, or holding by a United States person (as de11 fined under section 560.314 of title 31, Code of Fed12 eral Regulations) of a— 

13 (A) publicly traded security issued by a 

14 covered entity; 

15 (B) publicly traded security that is deriva16 tive of a publicly traded security issued by a 

17 covered entity; and 

18 (C) security that provides investment expo19 sure to a publicly traded security issued by a 

20 covered entity. 

21 (b) DIVESTMENT REQUIRED.— 

22 (1) IN GENERAL.—Notwithstanding subsection 

23 (a), a United States person shall divest of all securi24 ties described in subsection (a)— 


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1 (A) with respect to a security identified by 

2 the President under subsection (a) before the 

3 end of the 90-day period beginning on the date 

4 of the enactment of this Act, not later than 180 

5 days after the date of the enactment of this 

6 Act; and 

7 (B) with respect to a security identified by 

8 the President under subsection (a) after the end 

9 of the 90-day period beginning on the date of 

10 the enactment of this Act, not later than 180 

11 days after the date of such identification. 

12 (2) FACILITATING DIVESTMENT TRANS13 ACTIONS.—Subsection (a) shall not apply to a 

14 United States person to the extent the person is fa15 cilitating the divestment of securities described 

16 under paragraph (1). 

17 (c) PENALTIES.— 

18 (1) IN GENERAL.—A United States person that 

19 violates, attempts to violate, conspires to violate, or 

20 causes a violation of this Act shall be subject to the 

21 following penalties: 

22 (A) A civil penalty in an amount not to ex23 ceed the greater of— 

24 (i) $250,000; or 


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1 (ii) an amount that is twice the 

2 amount of the transaction that is the basis 

3 of the violation with respect to which the 

4 penalty is imposed. 

5 (B) With respect to a United States person 

6 that willfully violates, willfully attempts to vio7 late, willfully conspires to violate, or aids or 

8 abets in the commission of a violation of this 

9 Act shall be subject to a criminal penalty— 

10 (i) of a fine of not more than 

11 $1,000,000; or 

12 (ii) if such United States person is an 

13 individual, a fine of not more than 

14 $1,000,000, a term of imprisonment of not 

15 more than 20 years, or both. 

16 (2) AMOUNT OF A TRANSACTION DEFINED.— 

17 For purposes of paragraph (1)(A)(ii), the term 

18 ‘‘amount of a transaction’’ means— 

19 (A) with respect to a purchase that violates 

20 this Act, the purchase price; 

21 (B) with respect to a sale that violates this 

22 Act, the sale price; and 

23 (C) with respect to the holding of a secu24 rity that violates this Act, the fair market value 

25 of the security at the time of the violation. 


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1 (d) COVERED ENTITY DEFINED.— 

2 (1) IN GENERAL.—In this section, the term 

3 ‘‘covered entity’’ means the following: 

4 (A) Any person that is on the list of Spe5 cially Designated Nationals and Blocked Per6 sons maintained by the Office of Foreign Assets 

7 Control of the Department of the Treasury, or 

8 any person under common ownership or control 

9 of such person. 

10 (B) Any person on the Non-SDN Chinese 

11 Military-Industrial Complex Companies List 

12 (NS–CMIC List) maintained by the Office of 

13 Foreign Assets Control of the Department of 

14 the Treasury under Executive Order 14032 (86 

15 Fed. Reg. 30145; relating to addressing the 

16 threat from securities investments that finance 

17 certain companies of the People’s Republic of 

18 China), or any person under common ownership 

19 or control of such person. 

20 (C) Any person that is a Chinese military 

21 company or a military-civil fusion contributor 

22 and included on the list maintained by the De23 partment of Defense in accordance with section 

24 1260H(b) of the National Defense Authoriza25 tion Act for Fiscal Year 2021 (10 U.S.C. 113 


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1 note) as of the date of the enactment of this 

2 Act, or any person under common ownership or 

3 control of such person. 

4 (D) Any person that is a Chinese person 

5 and with respect to which sanctions have been 

6 imposed under the under the Global Magnitsky 

7 Human Rights Accountability Act (22 U.S.C. 

8 10101 et seq.), or any person under common 

9 ownership or control of such person. 

10 (E) Any person that is a Chinese person 

11 whose goods have been the subject of a With12 hold Release Order pursuant to section 307 of 

13 the Tariff Act of 1930 (19 U.S.C. 1307) during 

14 the 2-year period ending on the date of the en15 actment of this Act, or any person under com16 mon ownership or control of such person. 

17 (F) Any person that is Chinese entity list18 ed on the Entity List set forth in Supplement 

19 No. 4 to part 744 of the Export Administration 

20 Regulations. 

21 (G) Any Chinese person on the Uyghur 

22 Forced Labor Prevention Act Entity List, 

23 maintained by the Department of Homeland 

24 Security, or any person under common owner25 ship or control of such person. 


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1 (H) Any Chinese person on the Military 

2 End User List maintained by the Department 

3 of Commerce (Supplement 7 to part 744 of 

4 chapter VII, subchapter C of title 15, Code of 

5 Federal Regulations), or any person under com6 mon ownership or control of such person. 

7 (2) CONTROL.—For purposes of paragraph (1), 

8 the term ‘‘control’’ has the meaning given that term 

9 under section 230.405 of title 17, Code of Federal 

10 Regulations. 

Æ 


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