[United States Statutes at Large, Volume 121, 110th Congress, 1st Session] [From the U.S. Government Publishing Office, www.gpo.gov] 121 STAT. 2516 Public Law 110-174 110th Congress An Act To authorize State and local governments to divest assets in companies that conduct business operations in Sudan, to prohibit United States Government contracts with such companies, and for other [NOTE: Dec. 31, 2007 - [S. 2271] purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress [NOTE: Sudan Accountability and Divestment Act of 2007. 50 USC 1701 note. assembled, SECTION 1. SHORT TITLE. This Act may be cited as the ``Sudan Accountability and Divestment Act of 2007''. SEC. 2. DEFINITIONS. In this Act: (1) Appropriate congressional committees.--The term ``appropriate congressional committees'' means-- (A) the Committee on Banking, Housing, and Urban Affairs, the Committee on Foreign Relations, and the Select Committee on Intelligence of the Senate; and (B) the Committee on Financial Services, the Committee on Foreign Affairs, and the Permanent Select Committee on Intelligence of the House of Representatives. (2) Business operations.--The term ``business operations'' means engaging in commerce in any form in Sudan, including by acquiring, developing, maintaining, owning, selling, possessing, leasing, or operating equipment, facilities, personnel, products, services, personal property, real property, or any other apparatus of business or commerce. (3) Executive agency.--The term ``executive agency'' has the meaning given the term in section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 403). (4) Government of sudan.--The term ``Government of Sudan''-- (A) means the government in Khartoum, Sudan, which is led by the National Congress Party (formerly known as the National Islamic Front) or any successor government formed on or after October 13, 2006 (including the coalition National Unity Government agreed upon in the Comprehensive Peace Agreement for Sudan); and (B) does not include the regional government of southern Sudan. (5) Marginalized populations of sudan.--The term ``marginalized populations of Sudan'' refers to-- (A) adversely affected groups in regions authorized to receive assistance under section 8(c) of the Darfur Peace [[Page 2517]] 121 STAT. 2517 and Accountability Act (Public Law 109-344; 50 U.S.C. 1701 note); and (B) marginalized areas in Northern Sudan described in section 4(9) of such Act. (6) Military equipment.--The term ``military equipment'' means-- (A) weapons, arms, military supplies, and equipment that readily may be used for military purposes, including radar systems or military-grade transport vehicles; or (B) supplies or services sold or provided directly or indirectly to any force actively participating in armed conflict in Sudan. (7) Mineral extraction activities.--The term ``mineral extraction activities'' means exploring, extracting, processing, transporting, or wholesale selling or trading of elemental minerals or associated metal alloys or oxides (ore), including gold, copper, chromium, chromite, diamonds, iron, iron ore, silver, tungsten, uranium, and zinc. (8) Oil-related activities.-- (A) In general.--Except as provided in subparagraph (B), the term ``oil-related activities'' means-- (i) exporting, extracting, producing, refining, processing, exploring for, transporting, selling, or trading oil; and (ii) constructing, maintaining, or operating a pipeline, refinery, or other oilfield infrastructure. (B) Exclusions.--A person shall not be considered to be involved in an oil-related activity if-- (i) the person is involved in the retail sale of gasoline or related consumer products in Sudan but is not involved in any other activity described in subparagraph (A); or (ii) the person is involved in leasing, or owns, rights to an oil block in Sudan but is not involved in any other activity described in subparagraph (A). (9) Person.--The term ``person'' means-- (A) a natural person, corporation, company, business association, partnership, society, trust, any other nongovernmental entity, organization, or group; (B) any governmental entity or instrumentality of a government, including a multilateral development institution (as defined in section 1701(c)(3) of the International Financial Institutions Act (22 U.S.C. 262r(c)(3))); and (C) any successor, subunit, parent company or subsidiary of any entity described in subparagraph (A) or (B). (10) Power production activities.--The term ``power production activities'' means any business operation that involves a project commissioned by the National Electricity Corporation of Sudan or other similar entity of the Government of Sudan whose purpose is to facilitate power generation and delivery, including establishing power-generating plants or hydroelectric dams, selling or installing components for the project, or providing service contracts related to the installation or maintenance of the project. (11) State.--The term ``State'' means each of the several States, the District of Columbia, the Commonwealth of Puerto [[Page 2518]] 121 STAT. 2518 Rico, the United States Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands. (12) State or local government.--The term ``State or local government'' includes-- (A) any State and any agency or instrumentality thereof; (B) any local government within a State, and any agency or instrumentality thereof; (C) any other governmental instrumentality; and (D) any public institution of higher education within the meaning of the Higher Education Act of 1965 (20 U.S.C. 1001 et seq.). SEC. 3. AUTHORITY OF STATE AND LOCAL GOVERNMENTS TO DIVEST FROM CERTAIN COMPANIES DIRECTLY INVESTED IN CERTAIN SUDANESE SECTORS. (a) Sense of Congress.--It is the sense of Congress that the United States Government should support the decision of any State or local government to divest from, or to prohibit the investment of assets of the State or local government in, a person that the State or local government determines poses a financial or reputational risk. (b) Authority To Divest.--Notwithstanding any other provision of law, a State or local government may adopt and enforce measures that meet the requirements of subsection (e) to divest the assets of the State or local government from, or prohibit investment of the assets of the State or local government in, persons that the State or local government determines, using credible information available to the public, are conducting or have direct investments in business operations described in subsection (d). (c) Notice to [NOTE: Deadline. Department of Justice.--Not later than 30 days after adopting a measure pursuant to subsection (b), a State or local government shall submit written notice to the Attorney General describing the measure. (d) Business Operations Described.-- (1) In general.--Business operations described in this subsection are business operations in Sudan that include power production activities, mineral extraction activities, oil- related activities, or the production of military equipment. (2) Exceptions.--Business operations described in this subsection do not include business operations that the person conducting the business operations can demonstrate-- (A) are conducted under contract directly and exclusively with the regional government of southern Sudan; (B) are conducted under a license from the Office of Foreign Assets Control, or are expressly exempted under Federal law from the requirement to be conducted under such a license; (C) consist of providing goods or services to marginalized populations of Sudan; (D) consist of providing goods or services to an internationally recognized peacekeeping force or humanitarian organization; (E) consist of providing goods or services that are used only to promote health or education; or (F) have been voluntarily suspended. [[Page 2519]] 121 STAT. 2519 (e) Requirements.--Any measure taken by a State or local government under subsection (b) shall meet the following requirements: (1) Notice.--The State or local government shall provide written notice and an opportunity to comment in writing to each person to whom a measure is to be applied. (2) Timing.--The [NOTE: Applicability. Deadline. measure shall apply to a person not earlier than the date that is 90 days after the date on which written notice is provided to the person under paragraph (1). (3) Applicability.--The measure shall not apply to a person that demonstrates to the State or local government that the person does not conduct or have direct investments in business operations described in subsection (d). (4) Sense of congress on avoiding erroneous targeting.--It is the sense of Congress that a State or local government should not adopt a measure under subsection (b) with respect to a person unless the State or local government has made every effort to avoid erroneously targeting the person and has verified that the person conducts or has direct investments in business operations described in subsection (d). (f) Definitions.--In this section: (1) Investment.--The ``investment'' of assets, with respect to a State or local government, includes-- (A) a commitment or contribution of assets; (B) a loan or other extension of credit of assets; and (C) the entry into or renewal of a contract for goods or services. (2) Assets.-- (A) In general.--Except as provided in subparagraph (B), the term ``assets'' refers to public monies and includes any pension, retirement, annuity, or endowment fund, or similar instrument, that is controlled by a State or local government. (B) Exception.--The term ``assets'' does not include employee benefit plans covered by title I of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1001 et seq.). (g) Nonpreemption.--A measure of a State or local government authorized under subsection (b) is not preempted by any Federal law or regulation. (h) Effective Date.-- (1) In general.--Except as provided in paragraph (2), this section applies to measures adopted by a State or local government before, on, or after the date of the enactment of this Act. (2) Notice [NOTE: Applicability. requirements.-- Subsections (c) and (e) apply to measures adopted by a State or local government on or after the date of the enactment of this Act. SEC. 4. SAFE HARBOR FOR CHANGES OF INVESTMENT POLICIES BY ASSET MANAGERS. (a) In General.--Section 13 of the Investment Company Act of 1940 (15 U.S.C. 80a-13) is amended by adding at the end the following: ``(c) Limitation on Actions.-- ``(1) In general.--Notwithstanding any other provision of Federal or State law, no person may bring any civil, criminal, [[Page 2520]] 121 STAT. 2520 or administrative action against any registered investment company, or any employee, officer, director, or investment adviser thereof, based solely upon the investment company divesting from, or avoiding investing in, securities issued by persons that the investment company determines, using credible information that is available to the public, conduct or have direct investments in business operations in Sudan described in section 3(d) of the Sudan Accountability and Divestment Act of 2007. ``(2) Applicability.-- ``(A) Actions for breaches of fiduciary duties.-- Paragraph (1) does not prevent a person from bringing an action based on a breach of a fiduciary duty owed to that person with respect to a divestment or non- investment decision, other than as described in paragraph (1). ``(B) Disclosures.--Paragraph (1) shall not apply to a registered investment company, or any employee, officer, director, or investment adviser thereof, unless the investment company makes disclosures in accordance with regulations prescribed by the Commission. ``(3) Person defined.--For purposes of this subsection the term `person' includes the Federal Government and any State or political subdivision of a State.''. (b) SEC [NOTE: Deadline. Regulations.--Not later than 120 days after the date of the enactment of this Act, the Securities and Exchange Commission shall prescribe regulations, in the public interest and for the protection of investors, to require disclosure by each registered investment company that divests itself of securities in accordance with section 13(c) of the Investment Company Act of 1940. Such rules shall require the disclosure to be included in the next periodic report filed with the Commission under section 30 of such Act (15 U.S.C. 80a-29) following such divestiture. SEC. 5. SENSE OF CONGRESS REGARDING CERTAIN ERISA PLAN INVESTMENTS. It is the sense of Congress that a fiduciary of an employee benefit plan, as defined in section 3(3) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002(3)), may divest plan assets from, or avoid investing plan assets in, any person the fiduciary determines is conducting or has direct investments in business operations in Sudan described in section 3(d) of this Act, without breaching the responsibilities, obligations, or duties imposed upon the fiduciary by section 404 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1104), if-- (1) the fiduciary makes such determination using credible information that is available to the public; and (2) such divestment or avoidance of investment is conducted in accordance with section 2509.94-1 of title 29, Code of Federal Regulations (as in effect on the day before the date of the enactment of this Act). SEC. 6. PROHIBITION ON UNITED STATES GOVERNMENT CONTRACTS. (a) Certification Requirement.--The head of each executive agency shall ensure that each contract entered into by such executive agency for the procurement of goods or services includes a clause that requires the contractor to certify to the contracting officer that the contractor does not conduct business operations in Sudan described in section 3(d). [[Page 2521]] 121 STAT. 2521 (b) Remedies.-- (1) In general.--The head of an executive agency may impose remedies as provided in this subsection if the head of the executive agency determines that the contractor has submitted a false certification under subsection (a) after the date the Federal Acquisition Regulation is amended under subsection (e) to implement the requirements of this section. (2) Termination.--The head of an executive agency may terminate a covered contract upon the determination of a false certification under paragraph (1). (3) Suspension and debarment.--The head of an executive agency may debar or suspend a contractor from eligibility for Federal contracts upon the determination of a false certification under paragraph (1). The debarment period may not exceed 3 years. (4) Inclusion on list of parties excluded from federal procurement and nonprocurement programs.--The Administrator of General Services shall include on the List of Parties Excluded from Federal Procurement and Nonprocurement Programs maintained by the Administrator under part 9 of the Federal Acquisition Regulation issued under section 25 of the Office of Federal Procurement Policy Act (41 U.S.C. 421) each contractor that is debarred, suspended, proposed for debarment or suspension, or declared ineligible by the head of an executive agency on the basis of a determination of a false certification under paragraph (1). (5) Rule of construction.--This section shall not be construed to limit the use of other remedies available to the head of an executive agency or any other official of the Federal Government on the basis of a determination of a false certification under paragraph (1). (c) Waiver.-- (1) In [NOTE: Certification. general.--The President may waive the requirement of subsection (a) on a case-by-case basis if the President determines and certifies in writing to the appropriate congressional committees that it is in the national interest to do so. (2) Reporting requirement.--Not later than April 15, 2008, and semi-annually thereafter, the Administrator for Federal Procurement Policy shall submit to the appropriate congressional committees a report on waivers granted under paragraph (1). (d) Implementation [NOTE: Deadline. Through the Federal Acquisition Regulation.--Not later than 120 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation issued pursuant to section 25 of the Office of Federal Procurement Policy Act (41 U.S.C. 421) to provide for the implementation of the requirements of this section. (e) Report.--Not later than one year after the date the Federal Acquisition Regulation is amended under subsection (e) to implement the requirements of this section, the Administrator of General Services, with the assistance of other executive agencies, shall submit to the Office of Management and Budget and the appropriate congressional committees a report on the actions taken under this section. [[Page 2522]] 121 STAT. 2522 SEC. 7. SENSE OF CONGRESS ON EFFORTS BY OTHER COUNTRIES. It is the sense of Congress that the governments of all other countries should adopt measures, similar to those contained in this Act, to publicize the activities of all persons that, through their financial dealings, knowingly or unknowingly enable the Government of Sudan to continue to oppress and commit genocide against people in the Darfur region and other regions of Sudan, and to authorize divestment from, and the avoidance of further investment in, such persons. SEC. 8. SENSE OF CONGRESS ON PEACEKEEPING EFFORTS IN SUDAN. It is the sense of Congress that the President should-- (1) continue to work with other members of the international community, including the Permanent Members of the United Nations Security Council, the African Union, the European Union, the Arab League, and the Government of Sudan to facilitate the urgent deployment of a peacekeeping force to Sudan; and (2) bring before the United Nations Security Council, and call for a vote on, a resolution requiring meaningful multilateral sanctions against the Government of Sudan in response to its acts of genocide against the people of Darfur and its continued refusal to allow the implementation of a peacekeeping force in Sudan. SEC. 9. SENSE OF CONGRESS ON THE INTERNATIONAL OBLIGATIONS OF THE UNITED STATES. It is the sense of Congress that nothing in this Act-- (1) conflicts with the international obligations or commitments of the United States; or (2) affects article VI, clause 2, of the Constitution of the United States. SEC. 10. REPORTS ON SANCTIONS IN SUPPORT OF PEACE IN DARFUR. (a) In General.--The Secretary of State and the Secretary of the Treasury shall submit to the appropriate congressional committees a report assessing the effectiveness of sanctions imposed with respect to Sudan at the time the Secretary of State and the Secretary of the Treasury submits reports required under-- (1) the Sudan Peace Act (Public Law 107-245; 50 U.S.C. 1701 note); (2) the Comprehensive Peace in Sudan Act of 2004 (Public Law 108-497; 50 U.S.C. 1701 note); and (3) the Darfur Peace and Accountability Act of 2006 (Public Law 109-344; 50 U.S.C. 1701 note). (b) Additional Report by the Secretary of the Treasury.--The Secretary of the Treasury shall submit to the appropriate congressional committees a report assessing the effectiveness of sanctions imposed with respect to Sudan under the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) at the time the President submits the reports required by section 204(c) of such Act (50 U.S.C. 1703(c)) with respect to Executive Order 13,067 (50 U.S.C. 1701 note; relating to blocking property of persons in connection with the conflict in Sudan's region of Darfur). (c) Contents.--The reports required by subsections (a) and (b) shall include-- (1) a description of each sanction imposed under a law or executive order described in subsection (a) or (b); [[Page 2523]] 121 STAT. 2523 (2) the name of the person subject to the sanction, if any; and (3) whether or not the person subject to the sanction is also subject to sanctions imposed by the United Nations. SEC. 11. REPEAL OF REPORTING REQUIREMENT. Section 6305 of the U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007 (Public Law 110-28; 121 Stat. 172) is repealed. SEC. 12. [NOTE: President. Certification. TERMINATION. The provisions of sections 3, 4, 5, 6, and 10 shall terminate 30 days after the date on which the President has certified to Congress that the Government of Sudan has honored its commitments to-- (1) abide by United Nations Security Council Resolution 1769 (2007); (2) cease attacks on civilians; (3) demobilize and demilitarize the Janjaweed and associated militias; (4) grant free and unfettered access for delivery of humanitarian assistance; and (5) allow for the safe and voluntary return of refugees and internally displaced persons. Approved December 31, 2007. LEGISLATIVE HISTORY--S. 2271: --------------------------------------------------------------------------- SENATE REPORTS: No. 110-213 (Comm. on Banking, Housing, and Urban Affairs). CONGRESSIONAL RECORD, Vol. 153 (2007): Dec. 12, considered and passed Senate. Dec. 18, considered and passed House. WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 43 (2007): Dec. 31, Presidential statement.