I 
114TH CONGRESS 
1ST SESSION H. R. 1809 
To prohibit the award of Federal Government contracts to inverted domestic 
corporations, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 15, 2015 
Ms. DELAURO (for herself, Mr. DOGGETT, and Mr. LEVIN) introduced the fol-
lowing bill; which was referred to the Committee on Oversight and Gov-
ernment Reform, and in addition to the Committee on Armed Services, 
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 prohibit the award of Federal Government contracts to 
inverted domestic corporations, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘No Federal Contracts 
for Corporate Deserters Act of 2015’’. 
SEC. 2. PROHIBITION ON AWARDING CONTRACTS TO IN-
VERTED DOMESTIC CORPORATIONS. 
(a) CIVILIAN CONTRACTS.— 
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(1) IN
GENERAL.—Chapter 47 of title 41, 
United States Code, is amended by adding at the 
end the following new section: 
‘‘§ 4713. Prohibition on awarding contracts to in-
verted domestic corporations 
‘‘(a) PROHIBITION.— 
‘‘(1) IN GENERAL.—The head of an executive 
agency may not award a contract to— 
‘‘(A) any foreign incorporated entity that 
such head has determined is an inverted domes-
tic corporation or any subsidiary of such entity; 
or 
‘‘(B) any joint venture if more than 10 
percent of the joint venture (by vote or value) 
is held by a foreign incorporated entity that 
such head has determined is an inverted domes-
tic corporation or any subsidiary of such entity. 
‘‘(2) SUBCONTRACTS.— 
‘‘(A) IN GENERAL.—The head of an execu-
tive agency shall include in each contract 
awarded by the executive agency with a value in 
excess of $10,000,000, other than a contract 
for exclusively commercial items, a clause that 
prohibits the prime contractor on such contract 
from— 
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‘‘(i) awarding a first-tier subcontract 
with a value greater than 10 percent of the 
total value of the prime contract to an en-
tity or joint venture described in paragraph 
(1); or 
‘‘(ii) structuring subcontract tiers in a 
manner designed to avoid the limitation in 
paragraph (1) by enabling an entity or 
joint venture described in paragraph (1) to 
perform more than 10 percent of the total 
value of the prime contract as a lower-tier 
subcontractor. 
‘‘(B) PENALTIES.—The contract clause in-
cluded in contracts pursuant to subparagraph 
(A) shall provide that, in the event that the 
prime contractor violates the contract clause— 
‘‘(i) the prime contract may be termi-
nated for default; and 
‘‘(ii) the matter may be referred to 
the suspension or debarment official for 
the appropriate agency and may be a basis 
for suspension or debarment of the prime 
contractor. 
‘‘(b) INVERTED DOMESTIC CORPORATION.— 
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‘‘(1) IN GENERAL.—For purposes of this sec-
tion, a foreign incorporated entity shall be treated as 
an inverted domestic corporation if, pursuant to a 
plan (or a series of related transactions)— 
‘‘(A) the entity completes before, on, or 
after May 8, 2014, the direct or indirect acqui-
sition of— 
‘‘(i) substantially all of the properties 
held directly or indirectly by a domestic 
corporation; or 
‘‘(ii) substantially all of the assets of, 
or substantially all of the properties consti-
tuting a trade or business of, a domestic 
partnership; and 
‘‘(B) after the acquisition, either— 
‘‘(i) more than 50 percent of the stock 
(by vote or value) of the entity is held— 
‘‘(I) in the case of an acquisition 
with respect to a domestic corpora-
tion, by former shareholders of the 
domestic corporation by reason of 
holding stock in the domestic corpora-
tion; or 
‘‘(II) in the case of an acquisition 
with respect to a domestic partner-
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ship, by former partners of the do-
mestic partnership by reason of hold-
ing a capital or profits interest in the 
domestic partnership; or 
‘‘(ii) the management and control of 
the expanded affiliated group which in-
cludes the entity occurs, directly or indi-
rectly, primarily within the United States, 
as determined pursuant to regulations pre-
scribed by the Secretary of the Treasury, 
and such expanded affiliated group has 
significant domestic business activities. 
‘‘(2) EXCEPTION
FOR
CORPORATIONS
WITH 
SUBSTANTIAL
BUSINESS
ACTIVITIES
IN
FOREIGN 
COUNTRY OF ORGANIZATION.— 
‘‘(A) IN GENERAL.—A foreign incorporated 
entity described in paragraph (1) shall not be 
treated as an inverted domestic corporation if 
after the acquisition the expanded affiliated 
group which includes the entity has substantial 
business activities in the foreign country in 
which or under the law of which the entity is 
created or organized when compared to the 
total business activities of such expanded affili-
ated group. 
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