109 HR 1743 IH: To encourage divestiture of current investments in Iran and discourage future investments in Iran and to require disclosure to investors of information relating to such investments. U.S. House of Representatives 2005-04-20 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I 109th CONGRESS 1st Session H. R. 1743 IN THE HOUSE OF REPRESENTATIVES April 20, 2005 Ms. Ros-Lehtinen (for herself, Mr. Lantos, Mr. Chabot, and Mr. Ackerman) introduced the following bill; which was referred to the Committee on Financial Services, and in addition to the Committees on Government Reform and Education and the Workforce, 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 encourage divestiture of current investments in Iran and discourage future investments in Iran and to require disclosure to investors of information relating to such investments.

1.

United States pension plans

(a)

Findings

Congress finds the following: (1)The United States and the international community face no greater threat to their security than the prospect of rogue regimes who support international terrorism obtaining weapons of mass destruction, and particularly nuclear weapons. (2)Iran is the leading state sponsor of international terrorism and is close to achieving nuclear weapons capability but has paid no price for nearly twenty years of deception over its nuclear program. Foreign entities that have invested in Iran’s energy sector, despite Iran’s support of international terrorism and its nuclear program, have afforded Iran a free pass while many United States entities have unknowingly invested in those same foreign entities. (3)United States investors have a great deal at stake in preventing Iran from acquiring nuclear weapons. (4)United States investors can have considerable influence over the commercial decisions of the foreign entities in which they have invested. (b)

Publication in Federal Register

Not later than six months after the date of the enactment of this Act and every six months thereafter, the President shall ensure publication in the Federal Register of a list of all United States and foreign entities that have invested more than $20,000,000 in Iran’s energy sector between August 5, 1996, and the date of such publication. Such list shall include an itemization of individual investments of each such entity, including the dollar value, intended purpose, and current status of each such investment. (c)

Sense of Congress relating to divestiture from Iran

It is the sense of Congress that, upon publication of a list in the relevant Federal Register under subsection (b), managers of United States Government pension plans or thrift savings plans, managers of pension plans maintained in the private sector by plan sponsors in the United States, and managers of mutual funds sold or distributed in the United States should immediately initiate efforts to divest all investments of such plans or funds in any entity included on the list. (d)

Sense of Congress relating to prohibition on future investment

It is the sense of Congress that, upon publication of a list in the relevant Federal Register under subsection (b), there should be no future investment in any entity included on the list by managers of United States Government pension plans or thrift savings plans, managers of pension plans maintained in the private sector by plan sponsors in the United States, and managers of mutual funds sold or distributed in the United States. (e)

Disclosure to investors

(1)

In general

Not later than 30 days after the date of publication of a list in the relevant Federal Register under subsection (b), managers of United States Government pension plans or thrift savings plans, managers of pension plans maintained in the private sector by plan sponsors in the United States, and managers of mutual funds sold or distributed in the United States shall notify investors that the funds of such investors are invested in an entity included on the list. Such notification shall contain the following information: (A)The name or other identification of the entity. (B)The amount of the investment in the entity. (C)The potential liability to the entity if sanctions are imposed by the United States on Iran or on the entity. (D)The potential liability to investors if such sanctions are imposed. (2)

Follow-up notification

(A)

In general

Except as provided in subparagraph (C), in addition to the notification required under paragraph (1), such managers shall also include such notification in every prospectus and in every regularly provided quarterly, semi-annual, or annual report provided to investors, if the funds of such investors are invested in an entity included on the list. (B)

Contents of notification

The notification described in subparagraph (A) shall be displayed prominently in any such prospectus or report and shall contain the information described in paragraph (1). (C)

Good-faith exception

If, upon publication of a list in the relevant Federal Register under subsection (b), such managers verifiably divest all investments of such plans or funds in any entity included on the list and such managers do not initiate any new investment in any other such entity, such managers shall not be required to include the notification described in subparagraph (A) in any prospectus or report provided to investors.

2.

Report by Office of Global Security Risks

Not later than 30 days after the date of publication of a list in the relevant Federal Register under section 206(b), the Office of Global Security Risks within the Division of Corporation Finance of the United States Securities and Exchange Commission shall issue a report containing a list of the United States and foreign entities identified in accordance with such section, a determination of whether or not the operations in Iran of any such entity constitute a political, economic, or other risk to the United States, and a determination of whether or not the entity faces United States litigation, sanctions, or similar circumstances that are reasonably likely to have a material adverse impact on the financial condition or operations of the entity.