[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.
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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
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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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