the divestment of assets of the State or local govern-
ment from, or prohibits the investment of the assets 
of the State or local government in, any person that 
the State or local government determines, using 
credible information available to the public, engages 
in investment activities in the People’s Republic of 
China (determined without regard to subsection (c)) 
or other business activities in the People’s Republic 
of China that are identified in the measure. 
(2) 
APPLICATION
OF
NOTICE
REQUIRE-
MENTS.—A measure described in paragraph (1) 
shall be subject to the requirements of paragraphs 
(1) and (2) and the first sentence of paragraph (3) 
of subsection (d) on and after the date that is 2 
years after the date of the enactment of this Act. 
(i) DEFINITIONS.—In this section: 
(1) ASSETS.— 
(A) IN GENERAL.—Except as provided in 
subparagraph (B), the term ‘‘assets’’ refers to 
public monies and includes any pension, retire-
ment, annuity, or endowment fund, or similar 
instrument, that is controlled by a State or 
local government. 
(B) EXCEPTION.—The term ‘‘assets’’ does 
not include employee benefit plans covered by 
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title I of the Employee Retirement Income Se-
curity Act of 1974 (29 U.S.C. 1001 et seq.). 
(2) CHINESE ENTITY.—The term ‘‘Chinese en-
tity’’ means— 
(A) a person that is incorporated in, has a 
principal place of business in, or is organized 
under the laws of the People’s Republic of 
China; 
(B) a person whose equity securities are 
traded in the ordinary course of business on one 
or more exchanges in the People’s Republic of 
China; or 
(C) a person who is controlled by a single 
entity or individual, that is— 
(i) a citizen, national, or resident of 
the People’s Republic of China, other than 
an individual who is— 
(I) a citizen or lawful permanent 
resident of the United States; or 
(II) domiciled in Taiwan and pos-
sesses a valid identification card or 
number issued by the Government of 
Taiwan; 
(ii) an agent or instrumentality of the 
People’s Republic of China; or 
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(iii) a person described in subpara-
graph (A) or (B). 
(3) CONTROL.—The term ‘‘control’’ has the 
meaning given that term in part 800.208 of title 31, 
Code of Federal Regulations, or any successor regu-
lations. 
(4) 
INVESTMENT.—The 
‘‘investment’’ 
in-
cludes— 
(A) a commitment or contribution of funds 
or property; 
(B) a loan or other extension of credit; and 
(C) the entry into or renewal of a contract 
for goods or services. 
(5) MEASURE.—The term ‘‘measure’’ means a 
law or regulation. 
(6) PEOPLE’S REPUBLIC OF CHINA.—The term 
‘‘People’s Republic of China’’ includes any and all 
Special Administrative Regions of China, including 
Hong Kong and Macau but not including Taiwan. 
(7) PERSON.—The term ‘‘person’’ means— 
(A) a natural person, corporation, com-
pany, business association, partnership, society, 
trust, or any other nongovernmental entity, or-
ganization, or group; 
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(B) any governmental entity or instrumen-
tality of a government, including a multilateral 
development institution (as defined in section 
1701(c)(3) of the International Financial Insti-
tutions Act (22 U.S.C. 262r(c)(3))); and 
(C) any successor, subunit, parent entity, 
or subsidiary of, or any entity under common 
ownership or control with, any entity described 
in subparagraph (A) or (B). 
(8) STATE OR LOCAL GOVERNMENT.—The term 
‘‘State or local government’’ includes— 
(A) any State and any agency or instru-
mentality thereof; 
(B) any local government within a State, 
and any agency or instrumentality thereof; 
(C) any other governmental instrumen-
tality of a State or locality; and 
(D) any public institution of higher edu-
cation within the meaning of the Higher Edu-
cation Act of 1965 (20 U.S.C. 1001 et seq.). 
(9) STATE.—The term ‘‘State’’ means each of 
the several States. 
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SEC. 3. SAFE HARBOR FOR CHANGES OF INVESTMENT 
POLICIES BY ASSET MANAGERS. 
(a) IN GENERAL.—Section 13(c)(1) of the Invest-
ment Company Act of 1940 (15 U.S.C. 80a–13(c)(1)) is 
amended— 
(1) in subparagraph (A), by striking ‘‘or’’ at 
the end; 
(2) in subparagraph (B), by striking the period 
at the end and inserting ‘‘; or’’; and 
(3) by adding at the end the following: 
‘‘(C) engage in investment activities in the 
People’s Republic of China described in section 
2(c) of the PRC Accountability and Divestment 
Act of 2023.’’. 
(b) REGULATIONS.—Not later than 120 days after 
the date of the enactment of this Act, the Securities and 
Exchange Commission shall issue any revisions the Com-
mission determines to be necessary to the regulations re-
quiring disclosure by each registered investment company 
that divests itself of securities in accordance with section 
13(c) of the Investment Company Act of 1940 to include 
divestments of securities in accordance with paragraph 
(1)(C) of such section, as added by subsection (a). 
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SEC. 4. SENSE OF CONGRESS REGARDING CERTAIN ERISA 
PLAN INVESTMENTS. 
It is the sense of Congress that a fiduciary of an em-
ployee benefit plan, as defined in section 3(3) of the Em-
ployee Retirement Income Security Act of 1974 (29 
U.S.C. 1002(3)), may divest plan assets from, or avoid 
investing plan assets in, any person the fiduciary deter-
mines engages in investment activities in the People’s Re-
public of China described in section 2(c) of this Act, with-
out breaching the responsibilities, obligations, or duties 
imposed upon the fiduciary by subparagraph (A) or (B) 
of section 404(a)(1) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1104(a)(1)), if— 
(1) the fiduciary makes such determination 
using credible information that is available to the 
public; and 
(2) the fiduciary prudently determines that the 
result of such divestment or avoidance of investment 
would not be expected to provide the employee ben-
efit plan with— 
(A) a lower rate of return than alternative 
investments with commensurate degrees of risk; 
or 
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