Stop Funding the PLA Act

Bill: 116-hr-7064
Sponsor: full_name: Rep. Banks, Jim [R-IN-3]
Introduced: 2020-06-01
Policy area: Foreign Trade and International Finance
Subjects: Administrative law and regulatory procedures

Asia

China

Congressional oversight

Department of the Treasury

Financial services and investments

Foreign and international corporations

Securities
Latest action: action_date: 2020-06-01
text: Referred to the Committee on Financial Services, and in addition to the Committee on Foreign Affairs, 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.

Summaries:
action_date: 2020-06-01
action_desc: Introduced in House
text: <p><b>Stop Funding the PLA Act</b></p> <p>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.</p> <p>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 U.S. persons from purchasing a security of a foreign industrial defense corporation specified in the report, and it requires U.S. persons who own any such security to divest themselves of it. </p>

tv_txt: I 116th CONGRESS 2d Session H. R. 7064 IN THE HOUSE OF REPRESENTATIVES June 1, 2020 Mr. Banks (for himself, Mr. Gallagher , and Mr. LaMalfa ) introduced the following bill; which was referred to the Committee on Financial Services , and in addition to the Committee on Foreign Affairs , 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 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.

1. Short title This Act may be cited as the Stop Funding the PLA Act . 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.