II 109th CONGRESS 1st Session S. 1428 IN THE SENATE OF THE UNITED STATES July 20, 2005 Mr. Lautenberg (for himself, Mr. Corzine, Mrs. Clinton, and Mr. Feingold) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To stop corporations from financing terrorism.

1.

Short title

This Act may be cited as the Stop Business With Terrorists Act of 2005.

2.

Definitions

In this Act: (1)

Control in fact

The term control in fact, with respect to a corporation or other legal entity, includes— (A)in the case of— (i)a corporation, ownership or control (by vote or value) of at least 50 percent of the capital structure of the corporation; and (ii)any other kind of legal entity, ownership or control of interests representing at least 50 percent of the capital structure of the entity; or (B)control of the day-to-day operations of a corporation or entity. (2)

Person subject to the jurisdiction of the United States

The term person subject to the jurisdiction of the United States means— (A)an individual, wherever located, who is a citizen or resident of the United States; (B)a person actually within the United States; (C)a corporation, partnership, association, or other organization or entity organized under the laws of the United States, or of any State, territory, possession, or district of the United States; (D)a corporation, partnership, association, or other organization, wherever organized or doing business, that is owned or controlled in fact by a person or entity described in subparagraph (A) or (C); and (E)a successor, subunit, or subsidiary of an entity described in subparagraph (C) or (D). (3)

Foreign person

The term foreign person means— (A)an individual who is an alien; (B)a corporation, partnership, association, or any other organization or entity that is organized under the laws of a foreign country or has its principal place of business in a foreign country; (C)a foreign governmental entity operating as a business enterprise; and (D)a successor, subunit, or subsidiary of an entity described in subparagraph (B) or (C).

3.

Clarification of sanctions

(a)

Prohibitions on Engaging in Transactions With Foreign Persons

(1)

In general

In the case of a person subject to the jurisdiction of the United States that is prohibited as described in subsection (b) from engaging in a transaction with a foreign person, that prohibition shall also apply to— (A)each subsidiary and affiliate, wherever organized or doing business, of the person prohibited from engaging in such a transaction; and (B)any other entity, wherever organized or doing business, that is controlled in fact by that person. (2)

Prohibition on control

A person subject to the jurisdiction of the United States that is prohibited as described in subsection (b) from engaging in a transaction with a foreign person shall also be prohibited from controlling in fact any foreign person that is engaged in such a transaction whether or not that foreign person is subject to the jurisdiction of the United States. (b)

IEEPA sanctions

Subsection (a) applies in any case in which— (1)the President takes action under the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) or the Trading with the Enemy Act (50 U.S.C. App.) to prohibit a person subject to the jurisdiction of the United States from engaging in a transaction with a foreign person; or (2)the Secretary of State has determined that the government of a country that has jurisdiction over a foreign person has repeatedly provided support for acts of international terrorism under section 6(j) of the Export Administration Act of 1979 (as in effect pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.)), or any other provision of law, and because of that determination a person subject to the jurisdiction of the United States is prohibited from engaging in transactions with that foreign person. (c)

Cessation of applicability by divestiture or termination of business

(1)

In general

In any case in which the President has taken action described in subsection (b) and such action is in effect on the date of enactment of this Act, the provisions of this section shall not apply to a person subject of the jurisdiction of the United States if such person divests or terminates its business with the government or person identified by such action within 90 days after the date of enactment of this Act. (2)

Actions after date of enactment

In any case in which the President takes action described in subsection (b) on or after the date of enactment of this Act, the provisions of this section shall not apply to a person subject to the jurisdiction of the United States if such person divests or terminates its business with the government or person identified by such action within 90 days after the date of such action. (d)

Publication in Federal Register

Not later than 90 days after the date of enactment of this Act, the President shall publish in the Federal Register a list of persons with respect to whom there is in effect a sanction described in section 3(b) and shall publish notice of any change to that list in a timely manner.

4.

Notification of Congress of termination of investigation by office of foreign assets control

(a)

Requirement for notification

The Office of Federal Procurement Policy Act (41 U.S.C. 403 et seq.) is amended by adding at the end the following new section:

42.

Notification of Congress of termination of investigation by Office of Foreign Assets Control

The Director of the Office of Foreign Assets Control shall notify Congress upon the termination of any investigation by the Office of Foreign Assets Control of the Department of the Treasury if any sanction is imposed by the Director of such office as a result of the investigation.

. (b)

Clerical amendment

The table of contents in subsection (b) of such Act is amended by adding at the end the following new item: Sec. 42. Notification of Congress of termination of investigation by Office of Foreign Assets Control. .

5.

Annual reporting

(a)

Sense of Congress

It is the sense of the Congress that investors and the public should be informed of activities engaged in by a person that may threaten the national security, foreign policy, or economy of the United States, so that investors and the public can use the information in their investment decisions. (b)

Regulations

(1)

In general

Not later than 120 days after the date of enactment of this Act, the Securities and Exchange Commission shall issue regulations that require any person subject to the annual reporting requirements of section 13 of the Securities Exchange Act of 1934 (15 U.S.C. 78m) to disclose in that person's annual reports— (A)any ownership stake of at least 10 percent (or less if the Commission deems appropriate) in a foreign person that is engaging in a transaction prohibited under section 3(a) of this Act or that would be prohibited if such person were a person subject to the jurisdiction of the United States; and (B)the nature and value of any such transaction. (2)

Person described

A person described in this section is an issuer of securities, as that term is defined in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c), that is subject to the jurisdiction of the United Sates and to the annual reporting requirements of section 13 of the Securities Exchange Act of 1934 (15 U.S.C. 78m).