Title: Shareholders United Act of 2019
Policy area: Finance and Financial Sector

Summary:
Shareholders United Act of 2019
This bill requires an issuer of securities, in order to make a disbursement for a political purpose, to assess the preferences of shareholders in the year before the disbursement. If a majority of shareholders are prohibited from expressing partisan or political preferences by law, contract, or a requirement to meet a fiduciary duty, the issuer may not make such a disbursement.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 936 Introduced in House (IH)]

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116th CONGRESS
  1st Session
                                H. R. 936

 To amend the Securities Exchange Act of 1934 and the Federal Election 
      Campaign Act of 1971 to prohibit a corporation from making 
   disbursements for a political purpose unless the corporation has 
   assessed the preferences of its shareholders with respect to such 
                 disbursements, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 31, 2019

    Mr. Raskin (for himself, Mr. Rouda, Mr. Johnson of Georgia, Mr. 
Carbajal, Ms. Norton, Ms. Schakowsky, Mr. Soto, Mr. Blumenauer, and Mr. 
    Pocan) introduced the following bill; which was referred to the 
 Committee on Financial Services, and in addition to the Committee on 
House Administration, 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 amend the Securities Exchange Act of 1934 and the Federal Election 
      Campaign Act of 1971 to prohibit a corporation from making 
   disbursements for a political purpose unless the corporation has 
   assessed the preferences of its shareholders with respect to such 
                 disbursements, 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 ``Shareholders United Act of 2019''.

SEC. 2. ASSESSMENT OF SHAREHOLDER PREFERENCES FOR DISBURSEMENTS FOR 
              POLITICAL PURPOSES.

    (a) Assessment Required.--The Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.) is amended by inserting after section 10D the 
following:

``SEC. 10E. ASSESSMENT OF SHAREHOLDER PREFERENCES FOR DISBURSEMENTS FOR 
              POLITICAL PURPOSES.

    ``(a) Assessment Required Before Making a Disbursement for a 
Political Purpose.--
            ``(1) Requirement.--An issuer with an equity security 
        listed on a national securities exchange may not make a 
        disbursement for a political purpose unless--
                    ``(A) the issuer has in place procedures to assess 
                the preferences of the shareholders of the issuer with 
                respect to making such disbursements; and
                    ``(B) such an assessment has been made within the 
                1-year period ending on the date of such disbursement.
            ``(2) Treatment of issuers whose shareholders are 
        prohibited from expressing preferences.--Notwithstanding 
        paragraph (1), an issuer described under such paragraph with 
        procedures in place to assess the preferences of its 
        shareholders with respect to making disbursements for political 
        purposes shall not be considered to meet the requirements of 
        such paragraph if a majority of the number of the outstanding 
        equity securities of the issuer are held by persons who are 
        prohibited from expressing partisan or political preferences by 
        law, contract, or the requirement to meet a fiduciary duty.
    ``(b) Assessment Requirements.--The assessment described under 
subsection (a) shall assess--
            ``(1) which types of disbursements for a political purpose 
        the shareholder believes the issuer should make;
            ``(2) whether the shareholder believes that such 
        disbursements should be made in support of, or in opposition 
        to, Republican, Democratic, Independent, or other political 
        party candidates and political committees;
            ``(3) whether the shareholder believes that such 
        disbursements should be made with respect to elections for 
        Federal, State, or local office; and
            ``(4) such other information as the Commission may specify, 
        by rule.
    ``(c) Disbursement for a Political Purpose Defined.--
            ``(1) In general.--For purposes of this section, the term 
        `disbursement for a political purpose' means any of the 
        following:
                    ``(A) A disbursement for an independent 
                expenditure, as defined in section 301(17) of the 
                Federal Election Campaign Act of 1971 (52 U.S.C. 
                30101(17)).
                    ``(B) A disbursement for an electioneering 
                communication, as defined in section 304(f) of the 
                Federal Election Campaign Act of 1971 (52 U.S.C. 
                30104(f)).
                    ``(C) A disbursement for any public communication, 
                as defined in section 301(22) of the Federal Election 
                Campaign Act of 1971 (52 U.S.C. 30101(22))--
                            ``(i) which expressly advocates the 
                        election or defeat of a clearly identified 
                        candidate for election for Federal office, or 
                        is the functional equivalent of express 
                        advocacy because, when taken as a whole, it can 
                        be interpreted by a reasonable person only as 
                        advocating the election or defeat of a 
                        candidate for election for Federal office; or
                            ``(ii) which refers to a clearly identified 
                        candidate for election for Federal office and 
                        which promotes or supports a candidate for that 
                        office, or attacks or opposes a candidate for 
                        that office, without regard to whether the 
                        communication expressly advocates a vote for or 
                        against a candidate for that office.
                    ``(D) Any other disbursement which is made for the 
                purpose of influencing the outcome of an election for a 
                public office.
                    ``(E) Any transfer of funds to another person which 
                is made with the intent that such person will use the 
                funds to make a disbursement described in subparagraphs 
                (A) through (D), or with the knowledge that the person 
                will use the funds to make such a disbursement.
            ``(2) Exceptions.--The term `disbursement for a political 
        purpose' does not include any of the following:
                    ``(A) Any disbursement made from a separate 
                segregated fund of the corporation under section 316 of 
                the Federal Election Campaign Act of 1971 (52 U.S.C. 
                30118).
                    ``(B) Any transfer of funds to another person which 
                is made in a commercial transaction in the ordinary 
                course of any trade or business conducted by the 
                corporation or in the form of investments made by the 
                corporation.
                    ``(C) Any transfer of funds to another person which 
                is subject to a written prohibition against the use of 
                the funds for a disbursement for a political purpose.
    ``(d) Other Definitions.--In this section, each of the terms 
`candidate', `election', `political committee', and `political party' 
has the meaning given such term under section 301 of the Federal 
Election Campaign Act of 1971 (52 U.S.C. 30101).''.
    (b) Conforming Amendment to Federal Election Campaign Act of 1971 
To Prohibit Disbursements by Corporations Failing To Assess 
Preferences.--Section 316 of the Federal Election Campaign Act of 1971 
(52 U.S.C. 30118) is amended by adding at the end the following new 
subsection:
    ``(d) Prohibiting Disbursements by Corporations Failing To Assess 
Shareholder Preferences.--
            ``(1) Prohibition.--It shall be unlawful for a corporation 
        to make a disbursement for a political purpose unless the 
        corporation has in place procedures to assess the preferences 
        of its shareholders with respect to making such disbursements, 
        as provided in section 10E of the Securities Exchange Act of 
        1934.
            ``(2) Definition.--In this section, the term `disbursement 
        for a political purpose' has the meaning given such term in 
        section 10E(c) of the Securities Exchange Act of 1934.''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to disbursements made on or after December 31, 2019.
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