I 117TH CONGRESS 1ST SESSION H. R. 3295 To amend title 5, United States Code, to prohibit sums in the Thrift Savings Fund from being invested in any security of an entity based in the People’s Republic of China, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MAY 18, 2021 Mr. BANKS introduced the following bill; which was referred to the Committee on Oversight and Reform A BILL To amend title 5, United States Code, to prohibit sums in the Thrift Savings Fund from being invested in any security of an entity based in the People’s Republic of China, 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 SECTION 1. SHORT TITLE; FINDINGS. 3 (a) SHORT TITLE.—This Act may be cited as the 4 ‘‘Prohibiting TSP Investment in China Act’’. 5 (b) FINDINGS.—Congress finds the following: 6 (1) The Thrift Savings Fund invests more than 7 $700,000,000,000 on behalf of plan participants. As 8 VerDate Sep 11 2014 04:19 Jun 16, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3295.IH H3295 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 3295 IH the guardian of the retirement funds of approxi- 1 mately 6,000,000 Federal civilian and military plan 2 participants, it is critical that sums in the Thrift 3 Savings Fund are not invested in securities linked to 4 the economy of the People’s Republic of China. 5 (2) Companies headquartered in the People’s 6 Republic of China have repeatedly committed cor- 7 porate espionage, violated sanctions imposed by the 8 United States, flouted international property laws, 9 committed theft, and failed to comply with audit and 10 regulatory standards designed to safeguard inves- 11 tors. 12 (3) The Thrift Savings Plan is known for its 13 low management fees and comprehensive array of in- 14 vestment strategies. The provisions of this Act, and 15 the amendments made by this Act, will not increase 16 fees imposed on participants of the Thrift Savings 17 Plan. 18 (4) The November 2017 selection of the MSCI 19 ACWI Index by the Federal Retirement Thrift In- 20 vestment Board, initially scheduled to be effective in 21 2020, would violate the terms of subsection (i) of 22 section 8438 of title 5, United States Code, as added 23 by section 2(a) of this Act. 24 VerDate Sep 11 2014 04:19 Jun 16, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3295.IH H3295 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 3295 IH SEC. 2. PROHIBITION ON ANY TSP FUND INVESTING IN EN- 1 TITIES BASED IN THE PEOPLE’S REPUBLIC 2 OF CHINA. 3 (a) IN GENERAL.—Section 8438 of title 5, United 4 States Code, is amended by adding at the end the fol- 5 lowing: 6 ‘‘(i) Notwithstanding any other provision of this sec- 7 tion, no fund established or overseen by the Board may 8 include an investment in any security of— 9 ‘‘(1) an entity based in the People’s Republic of 10 China; or 11 ‘‘(2) any subsidiary that is owned or operated 12 by an entity described in paragraph (1).’’. 13 (b) DIVESTITURE OF ASSETS.—Not later than 30 14 days after the date of enactment of this Act, the Federal 15 Retirement Thrift Investment Board established under 16 section 8472(a) of title 5, United States Code, shall— 17 (1) review whether any sums in the Thrift Sav- 18 ings Fund are invested in violation of subsection (i) 19 of section 8438 of that title, as added by subsection 20 (a) of this section; 21 (2) if any sums are invested in the manner de- 22 scribed in paragraph (1), divest those sums in a 23 manner that is consistent with the legal and fidu- 24 ciary duties provided under chapter 84 of that title, 25 or any other applicable provision of law; and 26 VerDate Sep 11 2014 04:19 Jun 16, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3295.IH H3295 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 3295 IH (3) reinvest any sums divested under paragraph 1 (2) in investments that do not violate subsection (i) 2 of section 8438 of that title, as added by subsection 3 (a) of this section. 4 SEC. 3. PROHIBITION ON INVESTMENT OF TSP FUNDS IN 5 ENTITIES BASED IN THE PEOPLE’S REPUBLIC 6 OF CHINA THROUGH THE TSP MUTUAL FUND 7 WINDOW. 8 Section 8438(b)(5) of title 5, United States Code, is 9 amended by adding at the end the following: 10 ‘‘(E) A mutual fund accessible through a mutual fund 11 window authorized under this paragraph may not include 12 an investment in any security of— 13 ‘‘(i) an entity based in the People’s Republic of 14 China; or 15 ‘‘(ii) any subsidiary that is owned or operated 16 by an entity described in clause (i).’’. 17 Æ VerDate Sep 11 2014 04:19 Jun 16, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\H3295.IH H3295 kjohnson on DSK79L0C42PROD with BILLS