I 

110TH CONGRESS 

1ST SESSION H. R. 2347 

To authorize State and local governments to direct divestiture from, and 

prevent investment in, companies with investments of $20,000,000 or 

more in Iran’s energy sector, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 16, 2007 

Mr. FRANK of Massachusetts (for himself, Mr. LANTOS, Mr. SHERMAN, Mr. 

SHAYS, Mr. LYNCH, Mr. ACKERMAN, Mr. KLEIN of Florida, and Mr. 

WEXLER) introduced the following bill; which was referred to the Committee on Financial Services, and in addition to the Committees on Education and Labor and Oversight and Government Reform, for a period 

to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee 

concerned 

A BILL 

To authorize State and local governments to direct divestiture from, and prevent investment in, companies with 

investments of $20,000,000 or more in Iran’s energy 

sector, 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 ‘‘Iran Sanctions Ena5 bling Act of 2007’’. 


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1 SEC. 2. FINDINGS. 

2 The Congress finds as follows: 

3 (1) The Convention on the Prevention and Pun4 ishment of the Crime of Genocide, completed at 

5 Paris, December 9, 1948 (commonly referred to as 

6 the ‘‘Genocide Convention’’) defines genocide as, 

7 among other things, the act of killing members of a 

8 national, ethnic, racial, or religious group with the 

9 intent to destroy, in whole or in part, the targeted 

10 group. In addition, the Genocide Convention also 

11 prohibits conspiracy to commit genocide, as well as 

12 ‘‘direct and public incitement to commit genocide’’. 

13 (2) 133 member states of the United Nations 

14 have ratified the Genocide Convention and thereby 

15 pledged to prosecute individuals who violate the 

16 Genocide Convention’s prohibition on incitement to 

17 commit genocide, as well as those individuals who 

18 commit genocide directly. 

19 (3) On October 27, 2005, at the World Without 

20 Zionism Conference in Tehran, Iran, the President 

21 of Iran, Mahmoud Ahmadinejad, called for Israel to 

22 be ‘‘wiped off the map,’’ described Israel as ‘‘a dis23 graceful blot [on] the face of the Islamic world,’’ and 

24 declared that ‘‘[a]nybody who recognizes Israel will 

25 burn in the fire of the Islamic nation’s fury.’’ Presi26 dent Ahmadinejad has subsequently made similar 


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1 types of comments, and the Government of Iran has 

2 displayed inflammatory symbols that express similar 

3 intent. 

4 (4) On December 23, 2006, the United Nations 

5 Security Council unanimously approved Resolution 

6 1737, which bans the supply of nuclear technology 

7 and equipment to Iran and freezes the assets of cer8 tain organizations and individuals involved in Iran’s 

9 nuclear program, until Iran suspends its enrichment 

10 of uranium, as verified by the International Atomic 

11 Energy Agency. 

12 (5) Following Iran’s failure to comply with Res13 olution 1737, on March 24, 2007, the United Na14 tions Security Council unanimously approved Reso15 lution 1747, to tighten sanctions on Iran, imposing 

16 a ban on arms sales and expanding the freeze on as17 sets, in response to the country’s uranium-enrich18 ment activities. 

19 (6) There are now signs of domestic discontent 

20 within Iran, and targeted financial and economic 

21 measures could produce further political pressure 

22 within Iran. According to the Economist Intelligence 

23 Unit, the nuclear crisis ‘‘is imposing a heavy oppor24 tunity cost on Iran’s economic development, slowing 

25 down investment in the oil, gas, and petrochemical 


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1 sectors, as well as in critical infrastructure projects, 

2 including electricity’’. 

3 (7) Targeted financial measures represent one 

4 of the strongest non-military tools available to con5 vince Tehran that it can no longer afford to engage 

6 in dangerous, destabilizing activities such as its nu7 clear weapons program and its support for ter8 rorism. 

9 (8) Foreign persons that have invested in Iran’s 

10 energy sector, despite Iran’s support of international 

11 terrorism and its nuclear program, have provided 

12 additional financial means for Iran’s activities in 

13 these areas, and many United States persons have 

14 unknowingly invested in those same foreign persons. 

15 (9) There is an increasing interest by States, 

16 local governments, educational institutions, and pri17 vate institutions to seek to disassociate themselves 

18 from companies that directly or indirectly support 

19 the Government of Iran’s efforts to achieve a nu20 clear weapons capability. 

21 (10) Policy makers and fund managers may 

22 find moral, prudential, or reputational reasons to di23 vest from companies that accept the business risk of 

24 operating in countries that are subject to inter25 national economic sanctions or that have business 


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1 relationships with countries, governments, or entities 

2 with which any United States company would be 

3 prohibited from dealing because of economic sanc4 tions imposed by the United States. 

5 SEC. 3. TRANSPARENCY IN U.S. CAPITAL MARKETS. 

6 (a) LIST OF PERSONS INVESTING IN IRAN ENERGY

7 SECTOR.— 

8 (1) PUBLICATION OF LIST.—Not later than 6 

9 months after the date of the enactment of this Act 

10 and every 6 months thereafter, the Secretary of the 

11 Treasury, in consultation with the Secretary of En12 ergy, the Secretary of State, the Securities and Ex13 change Commission, and the heads of other appro14 priate Federal departments and agencies, shall pub15 lish in the Federal Register a list of each person, 

16 whether within or outside of the United States, that, 

17 as of the date of the publication, has an investment 

18 of more than $20,000,000 in the energy sector in 

19 Iran. The list shall include a description of the in20 vestment made by each such person, including the 

21 dollar value, intended purpose, and status of the in22 vestment, as of the date of the publication. 

23 (2) PRIOR NOTICE TO PERSONS.—The Sec24 retary of the Treasury shall, at least 30 days before 

25 the list is published under paragraph (1), notify 


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1 each person that the Secretary intends to include on 

2 the list. 

3 (3) DELAY IN INCLUDING PERSONS ON THE

4 LIST.—After notifying a person under paragraph 

5 (2), the Secretary of the Treasury may delay includ6 ing that person on the list for up to 60 days if the 

7 Secretary determines and certifies to the Congress 

8 that the person has taken specific and effective ac9 tions to terminate the involvement of the person in 

10 the activities that resulted in the notification under 

11 paragraph (2). 

12 (4) REMOVAL OF PERSONS FROM THE LIST.— 

13 The Secretary of the Treasury may remove a person 

14 from the list before the next publication of the list 

15 under paragraph (1) if the Secretary, in consultation 

16 with, as appropriate, the Secretary of Energy, the 

17 Secretary of State, the Securities and Exchange 

18 Commission, and the heads of other Federal depart19 ments and agencies, determines that the person no 

20 longer has an investment of more than $20,000,000 

21 in the energy sector in Iran. 

22 (b) PUBLICATION ON WEBSITE.—The Secretary of 

23 the Treasury shall maintain on the website of the Depart24 ment of the Treasury the names of the persons on the 

25 list under subsection (a), updating the list as necessary 


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1 to take into account any person removed from the list 

2 under subsection (a)(4). 

3 (c) DEFINITION.—In this section, the term ‘‘invest4 ment’’ has the meaning given that term in section 14(9) 

5 of the Iran Sanctions Act (50 U.S.C. 1701 App.): 

6 SEC. 4. AUTHORITY OF STATE AND LOCAL GOVERNMENTS 

7 TO DIVEST FROM CERTAIN COMPANIES IN8 VESTED IN IRAN’S ENERGY SECTOR. 

9 (a) STATEMENT OF POLICY.—It is the policy of the 

10 United States to support the decision of State govern11 ments, local governments, and educational institutions to 

12 divest from, and to prohibit the investment of assets they 

13 control in, persons that have investments of more than 

14 $20,000,000 in Iran’s energy sector . 

15 (b) AUTHORITY TO DIVEST.— 

16 (1) IN GENERAL.—Notwithstanding any other 

17 provision of law, a State or local government may 

18 adopt and enforce measures to divest the assets of 

19 the State or local government from, or prohibit in20 vestment of the assets of the State or local govern21 ment in, persons that are included on the most re22 cent list published under section 3(a)(1), as modified 

23 under section 3(a)(3). 

24 (2) APPLICABILITY.—This subsection applies to 

25 measures adopted by a State or local government beVerDate Aug 31 2005 02:22 May 18, 2007 Jkt 059200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H2347.IH H2347

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1 fore, on, or after the date of the enactment of this 

2 Act. 

3 (3) DEFINITIONS.—In this subsection: 

4 (A) INVESTMENT.—The ‘‘investment’’ of 

5 assets includes— 

6 (i) a commitment or contribution of 

7 assets; and 

8 (ii) a loan or other extension of credit 

9 of assets. 

10 (B) ASSETS.—The term ‘‘assets’’ refers to 

11 public monies and includes any pension, retire12 ment, annuity, or endowment fund, or similar 

13 instrument, that is controlled by a State or 

14 local government. 

15 (C) ASSETS OF A STATE OR LOCAL GOV16 ERNMENT.—The term ‘‘assets of the State or 

17 local government’’ refers to assets that the 

18 State or local government controls. 

19 (c) PREEMPTION.—A measure of a State or local gov20 ernment that is authorized by subsection (b) is not pre21 empted by any Federal law or regulation except to the ex22 tent that a person is unable to comply with both the meas23 ure and the Federal law or regulation. 


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1 SEC. 5. SAFE HARBOR FOR CHANGES OF INVESTMENT 

2 POLICIES BY MUTUAL FUNDS. 

3 Section 13 of the Investment Company Act of 1940 

4 (15 U.S.C. 80a–13) is amended by adding at the end the 

5 following new subsection: 

6 ‘‘(c) SAFE HARBOR FOR CHANGES IN INVESTMENT

7 POLICIES.—Notwithstanding any other provision of Fed8 eral or State law, no person may bring any civil, criminal, 

9 or administrative action against any registered investment 

10 company or person providing services to such registered 

11 investment company (including its investment adviser), or 

12 any employee, officer, or director thereof, based upon the 

13 investment company divesting from, or avoiding investing 

14 in, securities issued by companies that are included on the 

15 most recent list published under section 3(a)(1) of the 

16 Iran Sanctions Enabling Act, as modified under section 

17 3(b) of that Act. For purposes of this subsection the term 

18 ‘person’ shall include the Federal government, any State 

19 or political subdivision of a State.’’. 

20 SEC. 6. SAFE HARBOR FOR CHANGES OF INVESTMENT 

21 POLICIES BY EMPLOYEE BENEFIT PLANS. 

22 Section 502 of the Employee Retirement Income Se23 curity Act of 1974 (29 U.S.C. 1132) is amended by adding 

24 at the end the following new subsection: 

25 ‘‘(n) No person shall be treated as breaching any of 

26 the responsibilities, obligations, or duties imposed upon fiVerDate Aug 31 2005 02:22 May 18, 2007 Jkt 059200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H2347.IH H2347

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1 duciaries by this title, and no action may be brought under 

2 this section against any person, for divesting plan assets 

3 from, or avoiding investing plan assets in, persons that 

4 are included on the most recent list published under sec5 tion 3(a)(1) of the Iran Sanctions Enabling Act , as modi6 fied under section 3(a)(4) of such Act.’’. 

7 SEC. 7. SENSE OF THE CONGRESS REGARDING THRIFT SAV8 INGS PLAN. 

9 It is the sense of the Congress that the Federal Re10 tirement Thrift Investment Board should initiate efforts 

11 to provide a terror-free international investment option 

12 among the funds of the Thrift Savings Fund that would 

13 invest in stocks in which the International Stock Index 

14 Investment Fund may invest under section 8438(b)(4) of 

15 title 5, United States Code, other than the stock of compa16 nies that do business in any country the government of 

17 which the Secretary of State has determined, for purposes 

18 of section 6(j) of the Export Administration Act of 1979 

19 (as continued in effect pursuant to the International 

20 Emergency Economic Powers Act), section 40 of the Arms 

21 Export Control Act, section 620A of the Foreign Assist22 ance Act of 1961, or other provision of law, is a govern23 ment that has repeatedly provided support for acts of 

24 international terrorism. 


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1 SEC. 8. DEFINITIONS. 

2 In this Act: 

3 (1) IRAN.—the term ‘‘Iran’’ includes any agen4 cy or instrumentality of Iran. 

5 (2) ENERGY SECTOR.—The term ‘‘energy sec6 tor’’ refers to activities to develop petroleum or nat7 ural gas resources. 

8 (3) PERSON.—The term ‘‘person’’ means— 

9 (A) a natural person as well as a corpora10 tion, business association, partnership, society, 

11 trust, any other nongovernmental entity, orga12 nization, or group; 

13 (B) any governmental entity or instrumen14 tality of a government; and 

15 (C) any successor, subunit, or subsidiary of 

16 any entity described in subparageraph (B) or 

17 (C). 

18 (4) STATE.—The term ‘‘State’’ includes the 

19 District of Columbia, the Commonwealth or Puerto 

20 Rico, the Virgin Islands, Guam, American Samoa, 

21 and the Commonwealth of the Northern Mariana Is22 lands. 

23 (5) STATE OR LOCAL GOVERNMENT.— 

24 (A) IN GENERAL.—The term ‘‘State or 

25 local government’’ includes— 


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1 (i) any State and any agency or in2 strumentality thereof; 

3 (ii) any local government within a 

4 State, and any agency or instrumentality 

5 thereof; and 

6 (iii) any public institution of higher 

7 education. 

8 (B) PUBLIC INSTITUTION OF HIGHER EDU9 CATION.—The term ‘‘public institution of high10 er education’’ means a public institution of 

11 higher education within the meaning of the 

12 Higher Education Act of 1965. 

13 SEC. 9. SUNSET. 

14 This Act shall terminate 30 days after the date on 

15 which the President has certified to Congress that— 

16 (1) the Government of Iran has ceased pro17 viding support for acts of international terrorism 

18 and no longer satisfies the requirements for designa19 tion as a state-sponsor of terrorism for purposes of 

20 section 6(j) of the Export Administration Act of 

21 1979, section 620A of the Foreign Assistance Act of 

22 1961, section 40 of the Arms Export Control Act, 

23 or any other provision of law; and 

24 (2) Iran has ceased the pursuit, acquisition, 

25 and development of nuclear, biological, and chemical 


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1 weapons and ballistic missiles and ballistic missile 

2 launch technology. 

Æ 


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