DISCLOSE Act of 2021

II 117TH CONGRESS 1ST SESSION S. 443 To amend the Federal Election Campaign Act of 1971 to provide for addi- tional disclosure requirements for corporations, labor organizations, Super PACs and other entities, and for other purposes. IN THE SENATE OF THE UNITED STATES FEBRUARY 25, 2021 Mr. WHITEHOUSE (for himself, Mr. WYDEN, Mr. SCHUMER, Mr. VAN HOL- LEN, Mr. LEAHY, Mrs. FEINSTEIN, Mrs. MURRAY, Mr. DURBIN, Mr. REED, Mr. CARPER, Ms. STABENOW, Ms. CANTWELL, Mr. MENENDEZ, Mr. CARDIN, Mr. SANDERS, Mr. BROWN, Mr. CASEY, Ms. KLOBUCHAR, Mr. TESTER, Mrs. SHAHEEN, Mr. WARNER, Mr. MERKLEY, Mr. BEN- NET, Mrs. GILLIBRAND, Mr. COONS, Mr. BLUMENTHAL, Mr. SCHATZ, Ms. BALDWIN, Mr. MURPHY, Ms. HIRONO, Mr. HEINRICH, Mr. KING, Mr. KAINE, Ms. WARREN, Mr. MARKEY, Mr. BOOKER, Mr. PETERS, Ms. DUCKWORTH, Ms. HASSAN, Ms. CORTEZ MASTO, Ms. SMITH, Ms. ROSEN, Mr. LUJA´N, Mr. HICKENLOOPER, Mr. PADILLA, Mr. OSSOFF, and Mr. WARNOCK) introduced the following bill; which was read twice and referred to the Committee on Rules and Administration A BILL To amend the Federal Election Campaign Act of 1971 to provide for additional disclosure requirements for cor- porations, labor organizations, Super PACs and other entities, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 VerDate Sep 11 2014 01:06 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S443.IS S443 kjohnson on DSK79L0C42PROD with BILLS 2 •S 443 IS SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 1 (a) SHORT TITLE.—This Act may be cited as the 2 ‘‘Democracy Is Strengthened by Casting Light On Spend- 3 ing in Elections Act of 2021’’ or the ‘‘DISCLOSE Act 4 of 2021’’. 5 (b) TABLE OF CONTENTS.—The table of contents of 6 this Act is as follows: 7 Sec. 1. Short title; table of contents. TITLE I—CLOSING LOOPHOLES ALLOWING SPENDING BY FOREIGN NATIONALS IN ELECTIONS Sec. 101. Clarification of prohibition on participation by foreign nationals in election-related activities. Sec. 102. Clarification of application of foreign money ban to certain disburse- ments and activities. Sec. 103. Audit and report on illicit foreign money in Federal elections. Sec. 104. Prohibition on contributions and donations by foreign nationals in connections with ballot initiatives and referenda. Sec. 105. Disbursements and activities subject to foreign money ban. Sec. 106. Prohibiting establishment of corporation to conceal election contribu- tions and donations by foreign nationals. TITLE II—REPORTING OF CAMPAIGN-RELATED DISBURSEMENTS Sec. 201. Reporting of campaign-related disbursements. Sec. 202. Application of foreign money ban to disbursements for campaign-re- lated disbursements consisting of covered transfers. Sec. 203. Effective date. TITLE III—STAND BY EVERY AD Sec. 301. Short title. Sec. 302. Stand By Every Ad. Sec. 303. Disclaimer requirements for communications made through prerecorded telephone calls. Sec. 304. No expansion of persons subject to disclaimer requirements on inter- net communications. Sec. 305. Effective date. TITLE IV—OTHER ADMINISTRATIVE REFORMS Sec. 401. Petition for certiorari. Sec. 402. Judicial review of actions related to campaign finance laws. TITLE V—OTHER PROVISIONS Sec. 501. Severability. VerDate Sep 11 2014 01:06 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6211 E:\BILLS\S443.IS S443 kjohnson on DSK79L0C42PROD with BILLS 3 •S 443 IS TITLE I—CLOSING LOOPHOLES 1 ALLOWING SPENDING BY 2 FOREIGN NATIONALS IN 3 ELECTIONS 4 SEC. 101. CLARIFICATION OF PROHIBITION ON PARTICIPA- 5 TION BY FOREIGN NATIONALS IN ELECTION- 6 RELATED ACTIVITIES. 7 (a) CLARIFICATION OF PROHIBITION.—Section 8 319(a) of the Federal Election Campaign Act of 1971 (52 9 U.S.C. 30121(a)) is amended— 10 (1) by striking ‘‘or’’ at the end of paragraph 11 (1); 12 (2) by striking the period at the end of para- 13 graph (2) and inserting ‘‘; or’’; and 14 (3) by adding at the end the following new 15 paragraph: 16 ‘‘(3) a foreign national to direct, dictate, con- 17 trol, or directly or indirectly participate in the deci- 18 sion making process of any person (including a cor- 19 poration, labor organization, political committee, or 20 political organization) with regard to such person’s 21 Federal or non-Federal election-related activity, in- 22 cluding any decision concerning the making of con- 23 tributions, donations, expenditures, or disbursements 24 in connection with an election for any Federal, 25 VerDate Sep 11 2014 01:06 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S443.IS S443 kjohnson on DSK79L0C42PROD with BILLS 4 •S 443 IS State, or local office or any decision concerning the 1 administration of a political committee.’’. 2 (b) CERTIFICATION OF COMPLIANCE.—Section 319 3 of such Act (52 U.S.C. 30121) is amended by adding at 4 the end the following new subsection: 5 ‘‘(c) CERTIFICATION OF COMPLIANCE REQUIRED 6 PRIOR TO CARRYING OUT ACTIVITY.—Prior to the mak- 7 ing in connection with an election for Federal office of any 8 contribution, donation, expenditure, independent expendi- 9 ture, or disbursement for an electioneering communication 10 by a corporation, labor organization (as defined in section 11 316(b)), limited liability corporation, or partnership dur- 12 ing a year, the chief executive officer of the corporation, 13 labor organization, limited liability corporation, or part- 14 nership (or, if the corporation, labor organization, limited 15 liability corporation, or partnership does not have a chief 16 executive officer, the highest ranking official of the cor- 17 poration, labor organization, limited liability corporation, 18 or partnership), shall file a certification with the Commis- 19 sion, under penalty of perjury, that a foreign national did 20 not direct, dictate, control, or directly or indirectly partici- 21 pate in the decision making process relating to such activ- 22 ity in violation of subsection (a)(3), unless the chief execu- 23 tive officer has previously filed such a certification during 24 that calendar year.’’. 25 VerDate Sep 11 2014 01:06 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S443.IS S443 kjohnson on DSK79L0C42PROD with BILLS 5 •S 443 IS (c) EFFECTIVE DATE.—The amendments made by 1 this section shall take effect upon the expiration of the 2 180-day period which begins on the date of the enactment 3 of this Act, and shall take effect without regard to whether 4 or not the Federal Election Commission has promulgated 5 regulations to carry out such amendments. 6 SEC. 102. CLARIFICATION OF APPLICATION OF FOREIGN 7 MONEY BAN TO CERTAIN DISBURSEMENTS 8 AND ACTIVITIES. 9 (a) APPLICATION TO DISBURSEMENTS TO SUPER 10 PACS AND OTHER PERSONS.—Section 319(b) of the Fed- 11 eral Election Campaign Act of 1971 (52 U.S.C. 30121(b)) 12 is amended— 13 (1) by redesignating paragraphs (1) and (2) as 14 subparagraphs (A) and (B), respectively, and by 15 moving such subparagraphs 2 ems to the right; 16 (2) by striking ‘‘As used in this section’’ and in- 17 serting the following: ‘‘DEFINITIONS.—For purposes 18 of this section— 19 ‘‘(1) FOREIGN NATIONAL.—The term’’; and 20 (3) by adding at the end the following new 21 paragraph: 22 ‘‘(2) CONTRIBUTION AND DONATION.—For pur- 23 poses of paragraphs (1) and (2) of subsection (a), 24 the term ‘contribution or donation’ includes any dis- 25 VerDate Sep 11 2014 01:06 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S443.IS S443 kjohnson on DSK79L0C42PROD with BILLS 6 •S 443 IS bursement to a political committee which accepts do- 1 nations or contributions that do not comply with any 2 of the limitations, prohibitions, and reporting re- 3 quirements of this Act (or any disbursement to or on 4 behalf of any account of a political committee which 5 is established for the purpose of accepting such do- 6 nations or contributions), or to any other person for 7 the purpose of funding an expenditure, independent 8 expenditure, or electioneering communication (as de- 9 fined in section 304(f)(3)).’’. 10 (b) CONDITIONS UNDER WHICH CORPORATE PACS 11 MAY MAKE CONTRIBUTIONS AND EXPENDITURES.—Sec- 12 tion 316(b) of such Act (52 U.S.C. 30118(b)) is amended 13 by adding at the end the following new paragraph: 14 ‘‘(8) A separate segregated fund established by a cor- 15 poration may not make a contribution or expenditure dur- 16 ing a year unless the fund has certified to the Commission 17 the following during the year: 18 ‘‘(A) Each individual who manages the fund, 19 and who is responsible for exercising decisionmaking 20 authority for the fund, is a citizen of the United 21 States or is lawfully admitted for permanent resi- 22 dence in the United States. 23 ‘‘(B) No foreign national under section 319 24 participates in any way in the decisionmaking proc- 25 VerDate Sep 11 2014 01:06 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S443.IS S443 kjohnson on DSK79L0C42PROD with BILLS 7 •S 443 IS esses of the fund with regard to contributions or ex- 1 penditures under this Act. 2 ‘‘(C) The fund does not solicit or accept rec- 3 ommendations from any foreign national under sec- 4 tion 319 with respect to the contributions or expend- 5 itures made by the fund. 6 ‘‘(D) Any member of the board of directors of 7 the corporation who is a foreign national under sec- 8 tion 319 abstains from voting on matters concerning 9 the fund or its activities.’’. 10 SEC. 103. AUDIT AND REPORT ON ILLICIT FOREIGN MONEY 11 IN FEDERAL ELECTIONS. 12 (a) IN GENERAL.—Title III of the Federal Election 13 Campaign Act of 1971 (52 U.S.C. 30101 et seq.) is 14 amended by inserting after section 319 the following new 15 section: 16 ‘‘SEC. 319A. AUDIT AND REPORT ON DISBURSEMENTS BY 17 FOREIGN NATIONALS. 18 ‘‘(a) AUDIT.— 19 ‘‘(1) IN GENERAL.—The Commission shall con- 20 duct an audit after each Federal election cycle to de- 21 termine the incidence of illicit foreign money in such 22 Federal election cycle. 23 ‘‘(2) PROCEDURES.—In carrying out paragraph 24 (1), the Commission shall conduct random audits of 25 VerDate Sep 11 2014 01:06 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S443.IS S443 kjohnson on DSK79L0C42PROD with BILLS 8 •S 443 IS any disbursements required to be reported under 1 this Act, in accordance with procedures established 2 by the Commission. 3 ‘‘(b) REPORT.—Not later than 180 days after the end 4 of each Federal election cycle, the Commission shall sub- 5 mit to Congress a report containing— 6 ‘‘(1) results of the audit required by subsection 7 (a)(1); 8 ‘‘(2) an analysis of the extent to which illicit 9 foreign money was used to carry out disinformation 10 and propaganda campaigns focused on depressing 11 turnout among rural communities and the success or 12 failure of these efforts, together with recommenda- 13 tions to address these efforts in future elections; 14 ‘‘(3) an analysis of the extent to which illicit 15 foreign money was used to carry out disinformation 16 and propaganda campaigns focused on depressing 17 turnout among African-American and other minority 18 communities and the success or failure of these ef- 19 forts, together with recommendations to address 20 these efforts in future elections; 21 ‘‘(4) an analysis of the extent to which illicit 22 foreign money was used to carry out disinformation 23 and propaganda campaigns focused on influencing 24 military and veteran communities and the success or 25 VerDate Sep 11 2014 01:06 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S443.IS S443 kjohnson on DSK79L0C42PROD with BILLS 9 •S 443 IS failure of these efforts, together with recommenda- 1 tions to address these efforts in future elections; and 2 ‘‘(5) recommendations to address the presence 3 of illicit foreign money in elections, as appropriate. 4 ‘‘(c) DEFINITIONS.—As used in this section: 5 ‘‘(1) The term ‘Federal election cycle’ means 6 the period which begins on the day after the date of 7 a regularly scheduled general election for Federal of- 8 fice and which ends on the date of the first regularly 9 scheduled general election for Federal office held 10 after such date. 11 ‘‘(2) The term ‘illicit foreign money’ means any 12 disbursement by a foreign national (as defined in 13 section 319(b)) prohibited under such section.’’. 14 (b) EFFECTIVE DATE.—The amendment made by 15 subsection (a) shall apply with respect to the Federal elec- 16 tion cycle that began during November 2020, and each 17 succeeding Federal election cycle. 18 SEC. 104. PROHIBITION ON CONTRIBUTIONS AND DONA- 19 TIONS BY FOREIGN NATIONALS IN CONNEC- 20 TIONS WITH BALLOT INITIATIVES AND 21 REFERENDA. 22 (a) IN GENERAL.—Section 319(b) of the Federal 23 Election Campaign Act of 1971 (52 U.S.C. 30121(b)), as 24 VerDate Sep 11 2014 01:06 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S443.IS S443 kjohnson on DSK79L0C42PROD with BILLS 10 •S 443 IS amended by section 102(a), is amended by adding at the 1 end the following new paragraph: 2 ‘‘(3) FEDERAL, STATE, OR LOCAL ELECTION.— 3 The term ‘Federal, State, or local election’ includes 4 a State or local ballot initiative or referendum.’’. 5 (b) EFFECTIVE DATE.—The amendment made by 6 this section shall apply with respect to elections held in 7 2022 or any succeeding year. 8 SEC. 105. DISBURSEMENTS AND ACTIVITIES SUBJECT TO 9 FOREIGN MONEY BAN. 10 (a) DISBURSEMENTS DESCRIBED.—Section 11 319(a)(1) of the Federal Election Campaign Act of 1971 12 (52 U.S.C. 30121(a)(1)) is amended— 13 (1) by striking ‘‘or’’ at the end of subparagraph 14 (B); and 15 (2) by striking subparagraph (C) and inserting 16 the following: 17 ‘‘(C) an expenditure; 18 ‘‘(D) an independent expenditure; 19 ‘‘(E) a disbursement for an electioneering 20 communication (within the meaning of section 21 304(f)(3)); 22 ‘‘(F) a disbursement for a communication 23 which is placed or promoted for a fee on a 24 website, web application, or digital application 25 VerDate Sep 11 2014 01:06 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S443.IS S443 kjohnson on DSK79L0C42PROD with BILLS 11 •S 443 IS that refers to a clearly identified candidate for 1 election for Federal office and is disseminated 2 within 60 days before a general, special or run- 3 off election for the office sought by the can- 4 didate or 30 days before a primary or pref- 5 erence election, or a convention or caucus of a 6 political party that has authority to nominate a 7 candidate for the office sought by the can- 8 didate; 9 ‘‘(G) a disbursement for a broadcast, cable 10 or satellite communication, or for a communica- 11 tion which is placed or promoted for a fee on 12 a websi [Text truncated for display. 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