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[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 1430 Introduced in Senate (IS)]

110th CONGRESS
  1st Session
                                S. 1430

 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 SENATE OF THE UNITED STATES

                              May 17, 2007

  Mr. Obama (for himself and Mr. Brownback) introduced the following 
 bill; which was read twice and referred to the Committee on Banking, 
                       Housing, and Urban Affairs

_______________________________________________________________________

                                 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.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Iran Sanctions Enabling Act''.

SEC. 2. FINDINGS.

    Congress finds as follows:
            (1) The Convention on the Prevention and Punishment of the 
        Crime of Genocide, done at Paris December 9, 1948 (commonly 
        referred to as the ``Genocide Convention'') defines genocide 
        as, among other things, the act of killing members of a 
        national, ethnic, racial, or religious group with the intent to 
        destroy, in whole or in part, the targeted group. In addition, 
        the Genocide Convention also prohibits conspiracy to commit 
        genocide, as well as ``[d]irect and public incitement to commit 
        genocide''.
            (2) 133 member states of the United Nations have ratified 
        the Genocide Convention and thereby pledged to prosecute 
        individuals who violate the Genocide Convention's prohibition 
        on incitement to commit genocide, as well as those individuals 
        who commit genocide directly.
            (3) On October 27, 2005, at the World Without Zionism 
        Conference in Tehran, Iran, the President of Iran, Mahmoud 
        Ahmadinejad, called for Israel to be ``wiped off the map,'' 
        described Israel as ``a disgraceful blot [on] the face of the 
        Islamic world,'' and declared that ``[a]nybody who recognizes 
        Israel will burn in the fire of the Islamic nation's fury.'' 
        President Ahmadinejad has subsequently made similar types of 
        comments.
            (4) On December 23, 2006, the United Nations Security 
        Council unanimously approved Resolution 1737, which bans the 
        supply of nuclear technology and equipment to Iran and freezes 
        the assets of certain organizations and individuals involved in 
        Iran's nuclear program, until Iran suspends its enrichment of 
        uranium, as verified by the International Atomic Energy Agency.
            (5) Following Iran's failure to comply with Resolution 
        1737, on March 24, 2007, the United Nations Security Council 
        unanimously approved Resolution 1747, to tighten sanctions on 
        Iran, imposing a ban on arms sales and expanding the freeze on 
        assets, in response to the country's uranium-enrichment 
        activities.
            (6) There are now signs of domestic discontent within Iran, 
        and targeted financial and economic measures could produce a 
        change in Iranian policy. According to the Economist 
        Intelligence Unit, the nuclear crisis ``is imposing a heavy 
        opportunity cost on Iran's economic development, slowing down 
        investment in the oil, gas, and petrochemical sectors, as well 
        as in critical infrastructure projects, including 
        electricity''.
            (7) Targeted financial measures represent one of the 
        strongest non-military tools available to convince the 
        Government of Iran that it can no longer afford to engage in 
        dangerous, destabilizing activities such as its nuclear weapons 
        program and its support for terrorism.
            (8) Foreign persons that have invested in Iran's energy 
        sector, despite Iran's support of international terrorism and 
        its nuclear program, have provided additional financial means 
        for Iran's activities in these areas, and many United States 
        persons have unknowingly invested in those same foreign 
        persons.
            (9) There is an increasing interest by States, local 
        governments, educational institutions, and private institutions 
        to seek to disassociate themselves from companies that directly 
        or indirectly support the Government of Iran's efforts to 
        achieve a nuclear weapons capability.
            (10) Policy makers and fund managers may find moral, 
        prudential, or reputational reasons to divest assets from 
        persons that accept the business risk of operating in countries 
        that are subject to international economic sanctions or that 
        have business relationships with countries, governments, or 
        entities with which any United States person would be 
        prohibited from dealing because of economic sanctions imposed 
        by the United States.

SEC. 3. TRANSPARENCY IN UNITED STATES CAPITAL MARKETS.

    (a) List of Persons Investing in Iran Energy Sector.--
            (1) Publication of list.--Not later than 180 days after the 
        date of the enactment of this Act, and every 180 days 
        thereafter, the Secretary of the Treasury, in consultation with 
        the Secretary of Energy, the Secretary of State, the Securities 
        and Exchange Commission, and the heads of other appropriate 
        Federal departments and agencies, shall publish in the Federal 
        Register a list of persons, whether within or outside of the 
        United States, that, as of the date of the publication, have 
        made an investment of more than $20,000,000 in the energy 
        sector of Iran. The list shall include a description of the 
        investment made by each such person, including the dollar 
        value, intended purpose, and status of the investment, as of 
        the date of the publication of the list.
            (2) Prior notice to persons.--Not later than 30 days before 
        the list is published under paragraph (1), the Secretary of the 
        Treasury shall notify each person that the Secretary intends to 
        include on the list.
            (3) Delay in including persons on the list.--After 
        notifying a person under paragraph (2) that the Secretary 
        intends to include such person on the list, the Secretary may 
        delay including such person on the list for not more than 60 
        days if the Secretary determines and certifies to Congress that 
        such person has taken specific and effective actions to divest 
        or terminate the investment in the energy sector of Iran that 
        resulted in the notification under paragraph (2).
            (4) Removal of persons from the list.--The Secretary of the 
        Treasury may remove a person from the list under paragraph (1) 
        before the next publication of the list if the Secretary, in 
        consultation with, as appropriate, the Secretary of Energy, the 
        Secretary of State, the Securities and Exchange Commission, and 
        the heads of other Federal departments and agencies, determines 
        that the person has divested or terminated the investment in 
        the energy sector of Iran that resulted in the Secretary 
        including such person on the list.
    (b) Publication on Website.--The Secretary of the Treasury shall 
maintain on the website of the Department of the Treasury the names of 
the persons on the list published under subsection (a)(1), updating the 
list as necessary to take into account any person removed from the list 
under subsection (a)(4).
    (c) Definition.--In this section, the term ``investment'' has the 
meaning given that term in section 14(9) of the Iran Sanctions Act (50 
U.S.C. 1701 note).

SEC. 4. AUTHORITY OF STATE AND LOCAL GOVERNMENTS TO DIVEST ASSETS FROM 
              CERTAIN COMPANIES INVESTED IN IRAN'S ENERGY SECTOR.

    (a) Authority to Divest.--
            (1) In general.--Notwithstanding any other provision of 
        law, a State or local government may adopt and enforce measures 
        to divest the assets of the State or local government from, or 
        prohibit investment of the assets of the State or local 
        government in, persons that are included on the most recent 
        list published under section 3(a)(1), as modified under section 
        3(a)(4).
            (2) Applicability.--This subsection applies to measures 
        adopted by a State or local government before, on, or after the 
        date of the enactment of this Act.
            (3) Definitions.--In this subsection:
                    (A) Investment of the assets of the state or local 
                government.--The term ``investment of the assets of the 
                State or local government'' includes--
                            (i) a commitment or contribution of assets; 
                        and
                            (ii) a loan or other extension of credit of 
                        assets.
                    (B) Assets.--The term ``assets'' refers to public 
                monies and includes any pension, retirement, annuity, 
                or endowment fund, or similar instrument, that is 
                controlled by a State or local government.
    (b) Preemption.--A measure of a State or local government that is 
authorized by subsection (a) is not preempted by any Federal law or 
regulation except to the extent that a person is unable to comply with 
both the measure and the Federal law or regulation.

SEC. 5. SAFE HARBOR FOR CHANGES OF INVESTMENT POLICIES BY MUTUAL FUNDS.

    Section 13 of the Investment Company Act of 1940 (15 U.S.C. 80a-13) 
is amended by adding at the end the following new subsection:
    ``(c) Safe Harbor for Changes in Investment Policies.--
Notwithstanding any other provision of Federal or State law, no person 
may bring any civil, criminal, or administrative action against any 
registered investment company or person providing services to such 
registered investment company (including its investment adviser), or 
any employee, officer, or director thereof, based upon the investment 
company divesting from, or avoiding investing in, securities issued by 
companies that are included on the most recent list published under 
section 3(a)(1) of the Iran Sanctions Enabling Act, as modified under 
section 3(a)(4) of that Act. For purposes of this subsection the term 
`person' shall include the Federal government and any State or 
political subdivision of a State.''.

SEC. 6. SAFE HARBOR FOR CHANGES OF INVESTMENT POLICIES BY EMPLOYEE 
              BENEFIT PLANS.

    Section 502 of the Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1132) is amended by adding at the end the following new 
subsection:
    ``(n) Divestment of Assets in Fiduciaries Investing in Iran.--No 
person shall be treated as breaching any of the responsibilities, 
obligations, or duties imposed upon fiduciaries by this title, and no 
action may be brought under this section against any person, for 
divesting plan assets from, or avoiding investing plan assets in, 
persons that are included on the most recent list published under 
section 3(a)(1) of the Iran Sanctions Enabling Act, as modified under 
section 3(a)(4) of such Act.''.

SEC. 7. SENSE OF CONGRESS REGARDING THRIFT SAVINGS PLAN.

    It is the sense of the Congress that--
            (1) the Federal Retirement Thrift Investment Board should 
        initiate efforts to provide a terror-free international 
        investment option among the funds of the Thrift Savings Fund 
        that would invest in stocks in which the International Stock 
        Index Investment Fund may invest under section 8438(b)(4) of 
        title 5, United States Code, other than the stock of companies 
        that do business in any country the government of which the 
        Secretary of State has determined is a government that has 
        repeatedly provided support for acts of international 
        terrorism, for purposes of section 40 of the Arms Export 
        Control Act (22 U.S.C. 2780), section 620A of the Foreign 
        Assistance Act of 1961 (22 U.S.C. 2371), section 6(j) of the 
        Export Administration Act of 1979 (50 U.S.C. App. 2405(j)), as 
        continued in effect pursuant to the International Emergency 
        Economic Powers Act (50 U.S.C. 1701 et seq.), or any other 
        provision of law relating to governments that provide support 
        for acts of international terrorism; and
            (2) the Federal Retirement Thrift Investment Board should 
        initiate efforts similar to those described in paragraph (1) to 
        provide a genocide-free international investment option.

SEC. 8. DEFINITIONS.

    In this Act:
            (1) Iran.--The term ``Iran'' includes any agency or 
        instrumentality of the Government of Iran.
            (2) Energy sector.--The term ``energy sector'' refers to 
        activities to develop petroleum or natural gas resources.
            (3) Person.--The term ``person'' means a natural person as 
        well as a corporation, business association, partnership, 
        society, trust, any other nongovernmental entity, organization, 
        or group, and any governmental entity or instrumentality of a 
        government.
            (4) State.--The term ``State'' includes the District of 
        Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, 
        Guam, American Samoa, and the Commonwealth of the Northern 
        Mariana Islands.
            (5) State or local government.--The term ``State or local 
        government'' includes--
                    (A) any State and any agency or instrumentality 
                thereof;
                    (B) any local government within a State, and any 
                agency or instrumentality thereof; and
                    (C) any public institution of higher education, as 
                defined in section 102 of the Higher Education Act of 
                1965 (20 U.S.C. 1002).

SEC. 9. SUNSET.

    The provisions of this Act shall terminate 30 days after the date 
on which the President has certified to Congress that--
            (1) the Government of Iran has ceased providing support for 
        acts of international terrorism and no longer satisfies the 
        requirements for designation as a state sponsor of terrorism 
        for purposes of section 40 of the Arms Export Control Act (22 
        U.S.C. 2780), section 620A of the Foreign Assistance Act of 
        1961 (22 U.S.C. 2371), section 6(j) of the Export 
        Administration Act of 1979 (50 U.S.C. App. 2405(j)), as 
        continued in effect pursuant to the International Emergency 
        Economic Powers Act (50 U.S.C. 1701 et seq.), or any other 
        provision of law relating to governments that provide support 
        for acts of international terrorism;
            (2) the Government of Iran has ceased the pursuit, 
        acquisition, and development of nuclear, biological, and 
        chemical weapons and ballistic missiles and ballistic missile 
        launch technology; and
            (3) the Government of Iran has retracted the statements of 
        the President of Iran, Mahmoud Ahmadinejad, calling for the 
        destruction of Israel.
                                 <all>
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