Stop Funding the PLA Act
Bill: H.R.1093 | Sponsor: Rep. Banks, Jim (R-IN)
Policy area: Foreign Trade and International Finance

Summary:
Stop Funding the PLA Act
This bill requires the Department of the Treasury to establish a list of entities the securities of which a U.S. person shall be prohibited from purchasing or holding.
Specifically, the Treasury must submit a report specifying each foreign industrial defense corporation with substantial contacts with, ties to, or support from any PLA entity (any entity of the Chinese military). The bill prohibits a U.S. person from purchasing a security of a foreign industrial defense corporation specified in the report, and it requires a U.S. person who owns any such security to divest themselves of it.

To prohibit financial investment by a United States person in foreign 
 industrial defense corporations with substantial contracts with, ties 
to, or support from, the Chinese military and affiliated entities, 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 ``Stop Funding the PLA Act''.

SEC. 2. SPECIFICATION OF PROHIBITED FOREIGN INDUSTRIAL DEFENSE 
              CORPORATIONS.

    (a) Specification Required.--Not later than 90 days after the date 
of the enactment of this section, and annually thereafter, the 
Secretary, in consultation with the Secretary of State, the Secretary 
of Defense, and the domestic intelligence community, shall submit to 
the Committee on Banking, Housing, and Urban Affairs of the Senate and 
the Committee on Financial Services of the House of Representatives a 
report that specifies each foreign industrial defense corporation with 
substantial contracts with, ties to, or support from, a PLA entity.
    (b) Effect of Specification.--
            (1) Purchase of securities prohibited.--Beginning on the 
        date that is 180 days after a report is submitted under 
        subsection (a), a United States person may not purchase 
        securities of a foreign industrial defense corporation 
        specified in such report.
            (2) Divestment required.--
                    (A) In general.--Except as provided in subparagraph 
                (B), not later than 180 days after a report is 
                submitted under subsection (a), a United States person 
                that owns a security of a foreign industrial defense 
                corporation specified in such report shall divest 
                themselves of such security.
                    (B) Extended wind-down in case of financial 
                hardship.--The Secretary may allow a United States 
                person a 270-day extension to the 180-day period for 
                compliance under subparagraph (A) if the Secretary 
                determines that such entity--
                            (i) owns a security of a foreign industrial 
                        defense corporation specified in a report 
                        submitted under subsection (a); and
                            (ii) would experience extreme financial 
                        hardship to comply within the 180-day period 
                        under subparagraph (A).
    (c) Assignment of Authority.--
            (1) Enforcement.--The Secretary shall enforce the 
        provisions of this section.
            (2) Regulations.--Not later than 90 days after the date of 
        the enactment of this section, the Secretary shall issue such 
        regulations and guidance as necessary to implement and enforce 
        this section.
    (d) Report.--Not later than 360 days after the date of the 
enactment of this section, the Secretary shall submit to the Committee 
on Banking, Housing, and Urban Affairs of the Senate and the Committee 
on Financial Services of the House of Representatives a report on the 
progress of the divestments required under subsection (b)(2).
    (e) Petition for Removal From Designation.--
            (1) In general.--A foreign industrial defense corporation 
        may petition the Secretary to not be included or removed from a 
        report under subsection (a).
            (2) Requirements.--A petition under paragraph (1) shall 
        include such documentation of the assets and liabilities, 
        company financial records, ownership and investor records, and 
        past and current business contracts of the foreign industrial 
        defense corporation submitting such petition that the Secretary 
        determines necessary.
    (f) Final Report.--Not later than 8 years after the date of the 
enactment of this section, the Secretary shall submit to the Committee 
on Banking, Housing, and Urban Affairs of the Senate and the Committee 
on Financial Services of the House of Representatives a final report on 
the implementation of this section, including--
            (1) an analysis of the effectiveness of this section;
            (2) the development and maintenance of the reports required 
        under subsection (a); and
            (3) a description of completed and ongoing civil and 
        criminal cases related to securities of foreign industrial 
        defense corporations.
    (g) Sunset.--This section and the authority under this section 
shall expire on the date that is 10 years after the date of the 
enactment of this section.
    (h) Definitions.--In this section:
            (1) PLA entity.--The term ``PLA entity'' means any entity 
        of the Chinese military, including the People's Liberation 
        Army, Navy, Air Force, Rocket Force, Strategic Support Force, 
        and Joint Logistics Force, and the Chinese intelligence 
        community.
            (2) Foreign industrial defense corporation.--The term 
        ``foreign industrial defense corporation'' means any 
        corporation based--
                    (A) outside of the United States; and
                    (B) in a country that the Secretary, in 
                consultation with the Secretary of Defense, the 
                Secretary of State, and the domestic intelligence 
                community, determines does not possess positive 
                economic and military relations with the United States.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of the Treasury.
            (4) Substantial.--The term ``substantial'' shall, with 
        respect to contracts with, ties to, or support from, a PLA 
        entity, have the meaning determined by the Secretary, in 
        consultation with the Secretary of State, the Secretary of 
        Defense, and the domestic intelligence community.
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