I 

116TH CONGRESS 

1ST SESSION H. R. 936 

To amend the Securities Exchange Act of 1934 and the Federal Election 

Campaign Act of 1971 to prohibit a corporation from making disbursements for a political purpose unless the corporation has assessed the 

preferences of its shareholders with respect to such disbursements, and 

for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 31, 2019 

Mr. RASKIN (for himself, Mr. ROUDA, Mr. JOHNSON of Georgia, Mr. 

CARBAJAL, Ms. NORTON, Ms. SCHAKOWSKY, Mr. SOTO, Mr. BLUMENAUER, and Mr. POCAN) introduced the following bill; which was referred to the Committee on Financial Services, and in addition to the 

Committee on House Administration, 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 amend the Securities Exchange Act of 1934 and the 

Federal Election Campaign Act of 1971 to prohibit a 

corporation from making disbursements for a political 

purpose unless the corporation has assessed the preferences of its shareholders with respect to such disbursements, 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, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Shareholders United 

3 Act of 2019’’. 

4 SEC. 2. ASSESSMENT OF SHAREHOLDER PREFERENCES 

5 FOR DISBURSEMENTS FOR POLITICAL PUR6 POSES. 

7 (a) ASSESSMENT REQUIRED.—The Securities Ex8 change Act of 1934 (15 U.S.C. 78a et seq.) is amended 

9 by inserting after section 10D the following: 

10 ‘‘SEC. 10E. ASSESSMENT OF SHAREHOLDER PREFERENCES 

11 FOR DISBURSEMENTS FOR POLITICAL PUR12 POSES. 

13 ‘‘(a) ASSESSMENT REQUIRED BEFORE MAKING A

14 DISBURSEMENT FOR A POLITICAL PURPOSE.— 

15 ‘‘(1) REQUIREMENT.—An issuer with an equity 

16 security listed on a national securities exchange may 

17 not make a disbursement for a political purpose un18 less— 

19 ‘‘(A) the issuer has in place procedures to 

20 assess the preferences of the shareholders of the 

21 issuer with respect to making such disburse22 ments; and 

23 ‘‘(B) such an assessment has been made 

24 within the 1-year period ending on the date of 

25 such disbursement. 


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1 ‘‘(2) TREATMENT OF ISSUERS WHOSE SHARE2 HOLDERS ARE PROHIBITED FROM EXPRESSING

3 PREFERENCES.—Notwithstanding paragraph (1), an 

4 issuer described under such paragraph with proce5 dures in place to assess the preferences of its share6 holders with respect to making disbursements for 

7 political purposes shall not be considered to meet the 

8 requirements of such paragraph if a majority of the 

9 number of the outstanding equity securities of the 

10 issuer are held by persons who are prohibited from 

11 expressing partisan or political preferences by law, 

12 contract, or the requirement to meet a fiduciary 

13 duty. 

14 ‘‘(b) ASSESSMENT REQUIREMENTS.—The assess15 ment described under subsection (a) shall assess— 

16 ‘‘(1) which types of disbursements for a polit17 ical purpose the shareholder believes the issuer 

18 should make; 

19 ‘‘(2) whether the shareholder believes that such 

20 disbursements should be made in support of, or in 

21 opposition to, Republican, Democratic, Independent, 

22 or other political party candidates and political com23 mittees; 


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1 ‘‘(3) whether the shareholder believes that such 

2 disbursements should be made with respect to elec3 tions for Federal, State, or local office; and 

4 ‘‘(4) such other information as the Commission 

5 may specify, by rule. 

6 ‘‘(c) DISBURSEMENT FOR A POLITICAL PURPOSE DE7 FINED.— 

8 ‘‘(1) IN GENERAL.—For purposes of this sec9 tion, the term ‘disbursement for a political purpose’ 

10 means any of the following: 

11 ‘‘(A) A disbursement for an independent 

12 expenditure, as defined in section 301(17) of 

13 the Federal Election Campaign Act of 1971 (52 

14 U.S.C. 30101(17)). 

15 ‘‘(B) A disbursement for an electioneering 

16 communication, as defined in section 304(f) of 

17 the Federal Election Campaign Act of 1971 (52 

18 U.S.C. 30104(f)). 

19 ‘‘(C) A disbursement for any public com20 munication, as defined in section 301(22) of the 

21 Federal Election Campaign Act of 1971 (52 

22 U.S.C. 30101(22))— 

23 ‘‘(i) which expressly advocates the 

24 election or defeat of a clearly identified 

25 candidate for election for Federal office, or 


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1 is the functional equivalent of express ad2 vocacy because, when taken as a whole, it 

3 can be interpreted by a reasonable person 

4 only as advocating the election or defeat of 

5 a candidate for election for Federal office; 

6 or 

7 ‘‘(ii) which refers to a clearly identi8 fied candidate for election for Federal of9 fice and which promotes or supports a can10 didate for that office, or attacks or opposes 

11 a candidate for that office, without regard 

12 to whether the communication expressly 

13 advocates a vote for or against a candidate 

14 for that office. 

15 ‘‘(D) Any other disbursement which is 

16 made for the purpose of influencing the out17 come of an election for a public office. 

18 ‘‘(E) Any transfer of funds to another per19 son which is made with the intent that such 

20 person will use the funds to make a disburse21 ment described in subparagraphs (A) through 

22 (D), or with the knowledge that the person will 

23 use the funds to make such a disbursement. 


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1 ‘‘(2) EXCEPTIONS.—The term ‘disbursement 

2 for a political purpose’ does not include any of the 

3 following: 

4 ‘‘(A) Any disbursement made from a sepa5 rate segregated fund of the corporation under 

6 section 316 of the Federal Election Campaign 

7 Act of 1971 (52 U.S.C. 30118). 

8 ‘‘(B) Any transfer of funds to another per9 son which is made in a commercial transaction 

10 in the ordinary course of any trade or business 

11 conducted by the corporation or in the form of 

12 investments made by the corporation. 

13 ‘‘(C) Any transfer of funds to another per14 son which is subject to a written prohibition 

15 against the use of the funds for a disbursement 

16 for a political purpose. 

17 ‘‘(d) OTHER DEFINITIONS.—In this section, each of 

18 the terms ‘candidate’, ‘election’, ‘political committee’, and 

19 ‘political party’ has the meaning given such term under 

20 section 301 of the Federal Election Campaign Act of 1971 

21 (52 U.S.C. 30101).’’. 

22 (b) CONFORMING AMENDMENT TO FEDERAL ELEC23 TION CAMPAIGN ACT OF 1971 TO PROHIBIT DISBURSE24 MENTS BY CORPORATIONS FAILING TO ASSESS PREF25 ERENCES.—Section 316 of the Federal Election Campaign 


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1 Act of 1971 (52 U.S.C. 30118) is amended by adding at 

2 the end the following new subsection: 

3 ‘‘(d) PROHIBITING DISBURSEMENTS BY CORPORA4 TIONS FAILING TO ASSESS SHAREHOLDER PREF5 ERENCES.— 

6 ‘‘(1) PROHIBITION.—It shall be unlawful for a 

7 corporation to make a disbursement for a political 

8 purpose unless the corporation has in place proce9 dures to assess the preferences of its shareholders 

10 with respect to making such disbursements, as pro11 vided in section 10E of the Securities Exchange Act 

12 of 1934. 

13 ‘‘(2) DEFINITION.—In this section, the term 

14 ‘disbursement for a political purpose’ has the mean15 ing given such term in section 10E(c) of the Securi16 ties Exchange Act of 1934.’’. 

17 (c) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply with respect to disbursements 

19 made on or after December 31, 2019. 

Æ 


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