II 

110TH CONGRESS 

1ST SESSION S. 1234 

To strengthen the liability of parent companies for violations of sanctions 

by foreign entities, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

APRIL 26, 2007 

Mr. LAUTENBERG (for himself and Mrs. CLINTON) introduced the following 

bill; which was read twice and referred to the Committee on Banking, 

Housing, and Urban Affairs 

A BILL 

To strengthen the liability of parent companies for violations 

of sanctions by foreign 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 ‘‘Stop Business with 

5 Terrorists Act of 2007’’. 

6 SEC. 2. DEFINITIONS. 

7 In this Act: 

8 (1) ENTITY.—The term ‘‘entity’’ means a part9 nership, association, trust, joint venture, corpora10 tion, or other organization. 


pwalker on PROD1PC71 with BILLS
2 

•S 1234 IS

1 (2) PARENT COMPANY.—The term ‘‘parent 

2 company’’ means an entity that is a United States 

3 person and— 

4 (A) the entity owns, directly or indirectly, 

5 more than 50 percent of the equity interest by 

6 vote or value in another entity; 

7 (B) board members or employees of the en8 tity hold a majority of board seats of another 

9 entity; or 

10 (C) the entity otherwise controls or is able 

11 to control the actions, policies, or personnel de12 cisions of another entity. 

13 (3) UNITED STATES PERSON.—The term 

14 ‘‘United States person’’ means— 

15 (A) a natural person who is a citizen of the 

16 United States or who owes permanent alle17 giance to the United States; and 

18 (B) an entity that is organized under the 

19 laws of the United States, any State or terri20 tory thereof, or the District of Columbia, if nat21 ural persons described in subparagraph (A) 

22 own, directly or indirectly, more than 50 per23 cent of the outstanding capital stock or other 

24 beneficial interest in such entity. 


pwalker on PROD1PC71 with BILLS
3 

•S 1234 IS

1 SEC. 3. LIABILITY OF PARENT COMPANIES FOR VIOLA2 TIONS OF SANCTIONS BY FOREIGN ENTITIES. 

3 (a) IN GENERAL.—In any case in which an entity en4 gages in an act outside the United States that, if com5 mitted in the United States or by a United States person, 

6 would violate the provisions of Executive Order 12959 (50 

7 U.S.C. 1701 note) or Executive Order 13059 (50 U.S.C. 

8 1701 note), or any other prohibition on transactions with 

9 respect to Iran imposed under the authority of the Inter10 national Emergency Economic Powers Act (50 U.S.C. 

11 1701 et seq.), the parent company of the entity shall be 

12 subject to the penalties for the act to the same extent as 

13 if the parent company had engaged in the act. 

14 (b) APPLICABILITY.—Subsection (a) shall not apply 

15 to a parent company of an entity on which the President 

16 imposed a penalty for a violation described in subsection 

17 (a) that was in effect on the date of the enactment of this 

18 Act if the parent company divests or terminates its busi19 ness with such entity not later than 90 days after such 

20 date of enactment. 

Æ 


pwalker on PROD1PC71 with BILLS