Defund the People’s Liberation Army Act
Bill: H.R.5786 | Sponsor: Rep. Perry, Scott (R-PA)
Policy area: Finance and Financial Sector

Summary:
Defund the People's Liberation Army Act
This bill prohibits the purchasing or selling of publicly traded securities issued by certain listed Chinese military companies or contributors. The bill provides an exception for divestment in such securities. Decisions made by the Department of Defense to include a company on such a list or regulations created by the Department of the Treasury to carry out this bill are not subject to further review, including judicial review.

To limit the sale and purchase of certain securities, 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 ``Defund the People's Liberation Army 
Act''.

SEC. 2. COUNTERING CCP HUMAN RIGHTS ABUSERS ACT.

    (a) Prohibitions on CCP Companies Listed in Both the Section 1237 
List and the Section 1260H List.--
            (1) Prohibition on purchase or sale of certain 
        securities.--Except as provided in paragraph (5) or paragraph 
        (8)(B), a United States person is prohibited from purchasing or 
        selling any--
                    (A) publicly traded security issued by a covered 
                entity;
                    (B) publicly traded security that is derivative of 
                a publicly traded security issued by a covered entity; 
                and
                    (C) security that is designed to provide investment 
                exposure to a publicly traded security issued by a 
                covered entity.
            (2) Covered entities.--The term ``covered entity'' includes 
        the following:
                    (A) Any person that is a Communist Chinese military 
                company and included on the list maintained by the 
                Department of Defense in accordance with section 
                1237(b) of the Strom Thurmond National Defense 
                Authorization Act for Fiscal Year 1999 (50 U.S.C. 1701 
                note) as of the date of the enactment of this Act.
                    (B) Any person that was designated as a Communist 
                Chinese military company on June 2, 2021, in accordance 
                with such section 1237(b).
                    (C) Any person that is a Chinese military company 
                or a military-civil fusion contributor and included on 
                the list maintained by the Department of Defense in 
                accordance with section 1260H(b) of the National 
                Defense Authorization Act for Fiscal Year 2021 (10 
                U.S.C. 113 note) as of the date of the enactment of 
                this Act.
            (3) Applicability.--
                    (A) Initial applicability.--If a person qualifies 
                as covered entity on the date of the enactment of this 
                Act, the prohibitions under this section shall apply to 
                any purchase or sale that occurs at or after 12:01 a.m. 
                eastern daylight time on the date that is 60 days after 
                the date of the enactment of this Act.
                    (B) Future additions.--If a person qualifies as 
                covered entity after the date of the enactment of this 
                Act, the prohibitions under this section shall apply to 
                any purchase or sale that occurs at or after 12:01 a.m. 
                eastern daylight time on the date that is 60 days after 
                the date on which the person qualifies as a covered 
                entity.
            (4) Rule of application.--The prohibitions under this 
        subsection shall apply except to the extent provided by 
        statutes, or in any regulation, order, directive, or license 
        that may be issued pursuant to this Act, and notwithstanding 
        any contract entered into or any license granted before the 
        date of enactment of this Act.
            (5) Exception with respect to divestment.--Notwithstanding 
        paragraph (1), the purchase or sale of publicly traded 
        securities otherwise prohibited by such paragraph that is made 
        solely to affect the divestment, in whole or in part, of such 
        securities by a United States person shall be permitted until--
                    (A) 12:01 a.m. eastern daylight time on June 3, 
                2022, with respect to any person that qualifies as a 
                covered entity on the date of the enactment of this 
                Act; or
                    (B) 12:01 a.m. eastern daylight time on the date 
                that is 1 year after the date on which a person 
                qualifies as a covered entity after the date of the 
                enactment of this Act.
            (6) Maintenance of lists.--The Secretary of Defense is 
        authorized to make additions or deletions to the lists 
        described in paragraph (2) on an ongoing basis based on the 
        latest information available. The Secretary of Defense shall, 
        concurrently with the publication of the lists in accordance 
        with the applicable provisions of law, transmit a copy of such 
        lists to the Secretary of State, the Secretary of the Treasury, 
        and the Director of National Intelligence.
            (7) Evasion of prohibition.--The following acts are 
        prohibited:
                    (A) Any transactions by a United States person or 
                within the United States that evade or avoid, or have 
                the purpose of evading or avoiding, cause a violation 
                of, or attempt to violate the prohibitions set forth in 
                this section.
                    (B) Any conspiracy formed to violate any of the 
                prohibition set forth in this Act.
            (8) Authorization for regulations and penalties.--
                    (A) In general.--The Secretary of the Treasury, 
                after consultation with the Secretary of State, the 
                Secretary of Defense, the Director of National 
                Intelligence, and the heads of other executive 
                departments and agencies as deemed appropriate by the 
                Secretary of the Treasury, is hereby authorized to take 
                such actions, including the promulgation of rules and 
                regulations, and to employ all powers granted to the 
                President by the International Emergency Economic 
                Powers Act, to carry out the purposes of this Act.
                    (B) Regulations.--Rules and regulations issued 
                pursuant to this section may, among other things, 
                establish procedures to license transactions otherwise 
                prohibited pursuant to this section if, prior to 
                issuing any license under this section, the Secretary 
                of the Treasury shall consult with the Secretary of 
                State, the Secretary of Defense, and the Director of 
                National Intelligence.
                    (C) Penalties.--The penalties provided for in 
                subsections (b) and (c) of section 206 of the 
                International Emergency Economic Powers Act (50 U.S.C. 
                1705) with respect to a person that knowingly violates, 
                attempts to violate, conspires to violate, or causes a 
                violation of regulations promulgated under this 
                paragraph or commits any acts described in paragraph 
                (6) to the same extent that such penalties apply to a 
                person that knowingly commits an unlawful act described 
                in section 206(a) of that Act.
    (b) Limitation on Judicial Review.--
            (1) Decisions by secretary of defense.--The decision of the 
        Secretary of Defense as to any question regarding the inclusion 
        of a Communist Chinese military company, a Chinese military 
        company, or a military-civil fusion contributor on either of 
        the lists described in subsection (a)(2) may not be reviewed by 
        any official or by any court, whether by action in the nature 
        of mandamus or otherwise.
            (2) Rules and regulations promulgated by the secretary of 
        the treasury.--The rules and regulations promulgated by the 
        Secretary of the Treasury under subsection (a)(8) shall be 
        final and not subject to any further agency review or to 
        judicial review by any court (including under chapter 7 of 
        title 5, United States Code).
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