DISCLOSE Act of 2019

II 116TH CONGRESS 1ST SESSION S. 1147 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 APRIL 11, 2019 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, Mr. UDALL, Mrs. SHAHEEN, Mr. WARNER, Mr. MERKLEY, Mr. BENNET, 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. HARRIS, Ms. CORTEZ MASTO, Ms. SMITH, Mr. JONES, and Ms. ROSEN) introduced the fol- lowing 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 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with BILLS 2 •S 1147 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 2019’’ or the ‘‘DISCLOSE Act 4 of 2019’’. 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—DISCLOSE ACT Subtitle A—Regulation of Certain Political Spending 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. Subtitle B—Reporting of Campaign-Related Disbursements Sec. 111. Reporting of campaign-related disbursements. Sec. 112. Application of foreign money ban to disbursements for campaign-re- lated disbursements consisting of covered transfers. Sec. 113. Effective date. TITLE II—STAND BY EVERY AD ACT Sec. 201. Short title. Sec. 202. Stand By Every Ad. Sec. 203. Disclaimer requirements for communications made through prerecorded telephone calls. Sec. 204. No expansion of persons subject to disclaimer requirements on Inter- net communications. Sec. 205. Effective date. TITLE III—OTHER PROVISIONS Sec. 301. Severability. VerDate Sep 11 2014 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6211 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with BILLS 3 •S 1147 IS TITLE I—DISCLOSE ACT 1 Subtitle A—Regulation of Certain 2 Political Spending 3 SEC. 101. CLARIFICATION OF PROHIBITION ON PARTICIPA- 4 TION BY FOREIGN NATIONALS IN ELECTION- 5 RELATED ACTIVITIES. 6 (a) CLARIFICATION OF PROHIBITION.—Section 7 319(a) of the Federal Election Campaign Act of 1971 (52 8 U.S.C. 30121(a)) is amended— 9 (1) by striking ‘‘or’’ at the end of paragraph 10 (1); 11 (2) by striking the period at the end of para- 12 graph (2) and inserting ‘‘; or’’; and 13 (3) by adding at the end the following new 14 paragraph: 15 ‘‘(3) a foreign national to direct, dictate, con- 16 trol, or directly or indirectly participate in the deci- 17 sion making process of any person (including a cor- 18 poration, labor organization, political committee, or 19 political organization) with regard to such person’s 20 Federal or non-Federal election-related activity, in- 21 cluding any decision concerning the making of con- 22 tributions, donations, expenditures, or disbursements 23 in connection with an election for any Federal, 24 VerDate Sep 11 2014 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with BILLS 4 •S 1147 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, limited liability corporation, or partner- 11 ship during a year, the chief executive officer of the cor- 12 poration, limited liability corporation, or partnership (or, 13 if the corporation, limited liability corporation, or partner- 14 ship does not have a chief executive officer, the highest 15 ranking official of the corporation, limited liability cor- 16 poration, or partnership), shall file a certification with the 17 Commission, under penalty of perjury, that a foreign na- 18 tional did not direct, dictate, control, or directly or indi- 19 rectly participate in the decision making process relating 20 to such activity in violation of subsection (a)(3), unless 21 the chief executive officer has previously filed such a cer- 22 tification during that calendar year.’’. 23 (c) EFFECTIVE DATE.—The amendments made by 24 this section shall take effect upon the expiration of the 25 VerDate Sep 11 2014 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with BILLS 5 •S 1147 IS 180-day period which begins on the date of the enactment 1 of this Act, and shall take effect without regard to whether 2 or not the Federal Election Commission has promulgated 3 regulations to carry out such amendments. 4 SEC. 102. CLARIFICATION OF APPLICATION OF FOREIGN 5 MONEY BAN TO CERTAIN DISBURSEMENTS 6 AND ACTIVITIES. 7 (a) APPLICATION TO DISBURSEMENTS TO SUPER 8 PACS.—Section 319(a)(1)(A) of the Federal Election 9 Campaign Act of 1971 (52 U.S.C. 30121(a)(1)(A)) is 10 amended by striking the semicolon and inserting the fol- 11 lowing: ‘‘, including any disbursement to a political com- 12 mittee which accepts donations or contributions that do 13 not comply with the limitations, prohibitions, and report- 14 ing requirements of this Act (or any disbursement to or 15 on behalf of any account of a political committee which 16 is established for the purpose of accepting such donations 17 or contributions);’’. 18 (b) CONDITIONS UNDER WHICH CORPORATE PACS 19 MAY MAKE CONTRIBUTIONS AND EXPENDITURES.—Sec- 20 tion 316(b) of such Act (52 U.S.C. 30118(b)) is amended 21 by adding at the end the following new paragraph: 22 ‘‘(8) A separate segregated fund established by a cor- 23 poration may not make a contribution or expenditure dur- 24 VerDate Sep 11 2014 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with BILLS 6 •S 1147 IS ing a year unless the fund has certified to the Commission 1 the following during the year: 2 ‘‘(A) Each individual who manages the fund, 3 and who is responsible for exercising decisionmaking 4 authority for the fund, is a citizen of the United 5 States or is lawfully admitted for permanent resi- 6 dence in the United States. 7 ‘‘(B) No foreign national under section 319 8 participates in any way in the decisionmaking proc- 9 esses of the fund with regard to contributions or ex- 10 penditures under this Act. 11 ‘‘(C) The fund does not solicit or accept rec- 12 ommendations from any foreign national under sec- 13 tion 319 with respect to the contributions or expend- 14 itures made by the fund. 15 ‘‘(D) Any member of the board of directors of 16 the corporation who is a foreign national under sec- 17 tion 319 abstains from voting on matters concerning 18 the fund or its activities.’’. 19 SEC. 103. AUDIT AND REPORT ON ILLICIT FOREIGN MONEY 20 IN FEDERAL ELECTIONS. 21 (a) IN GENERAL.—Title III of the Federal Election 22 Campaign Act of 1971 (52 U.S.C. 30101 et seq.) is 23 amended by inserting after section 319 the following new 24 section: 25 VerDate Sep 11 2014 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with BILLS 7 •S 1147 IS ‘‘SEC. 319A. AUDIT AND REPORT ON DISBURSEMENTS BY 1 FOREIGN NATIONALS. 2 ‘‘(a) AUDIT.— 3 ‘‘(1) IN GENERAL.—The Commission shall con- 4 duct an audit after each Federal election cycle to de- 5 termine the incidence of illicit foreign money in such 6 Federal election cycle. 7 ‘‘(2) PROCEDURES.—In carrying out paragraph 8 (1), the Commission shall conduct random audits of 9 any disbursements required to be reported under 10 this Act, in accordance with procedures established 11 by the Commission. 12 ‘‘(b) REPORT.—Not later than 180 days after the end 13 of each Federal election cycle, the Commission shall sub- 14 mit to Congress a report containing— 15 ‘‘(1) results of the audit required by subsection 16 (a)(1); and 17 ‘‘(2) recommendations to address the presence 18 of illicit foreign money in elections, as appropriate. 19 ‘‘(c) DEFINITIONS.—As used in this section: 20 ‘‘(1) The term ‘Federal election cycle’ means 21 the period which begins on the day after the date of 22 a regularly scheduled general election for Federal of- 23 fice and which ends on the date of the first regularly 24 scheduled general election for Federal office held 25 after such date. 26 VerDate Sep 11 2014 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with BILLS 8 •S 1147 IS ‘‘(2) The term ‘illicit foreign money’ means any 1 disbursement by a foreign national (as defined in 2 section 319(b)) prohibited under such section.’’. 3 (b) EFFECTIVE DATE.—The amendment made by 4 subsection (a) shall apply with respect to the Federal elec- 5 tion cycle that began during November 2018, and each 6 succeeding Federal election cycle. 7 SEC. 104. PROHIBITION ON CONTRIBUTIONS AND DONA- 8 TIONS BY FOREIGN NATIONALS IN CONNEC- 9 TIONS WITH BALLOT INITIATIVES AND 10 REFERENDA. 11 (a) IN GENERAL.—Section 319(a)(1)(A) of the Fed- 12 eral Election Campaign Act of 1971 (52 U.S.C. 13 30121(a)(1)(A)) is amended by striking ‘‘election;’’ and 14 inserting the following: ‘‘election, including a State or local 15 ballot initiative or referendum;’’. 16 (b) EFFECTIVE DATE.—The amendment made by 17 this section shall apply with respect to elections held in 18 2020 or any succeeding year. 19 SEC. 105. DISBURSEMENTS AND ACTIVITIES SUBJECT TO 20 FOREIGN MONEY BAN. 21 (a) DISBURSEMENTS DESCRIBED.—Section 22 319(a)(1) of the Federal Election Campaign Act of 1971 23 (52 U.S.C. 30121(a)(1)) is amended— 24 VerDate Sep 11 2014 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with BILLS 9 •S 1147 IS (1) by striking ‘‘or’’ at the end of subparagraph 1 (B); and 2 (2) by striking subparagraph (C) and inserting 3 the following: 4 ‘‘(C) an expenditure; 5 ‘‘(D) an independent expenditure; 6 ‘‘(E) a disbursement for an electioneering 7 communication (within the meaning of section 8 304(f)(3)); 9 ‘‘(F) a disbursement for a paid internet or 10 paid digital communication that refers to a 11 clearly identified candidate for election for Fed- 12 eral office and is disseminated within 60 days 13 before a general, special, or runoff election for 14 the office sought by the candidate or 30 days 15 before a primary or preference election, or a 16 convention or caucus of a political party that 17 has authority to nominate a candidate for the 18 office sought by the candidate; 19 ‘‘(G) a disbursement for a broadcast, 20 cable, or satellite communication, or for a paid 21 internet or paid digital communication, that 22 promotes, supports, attacks or opposes the elec- 23 tion of a clearly identified candidate for Fed- 24 eral, State, or local office (regardless of whether 25 VerDate Sep 11 2014 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with BILLS 10 •S 1147 IS the communication contains express advocacy or 1 the functional equivalent of express advocacy) 2 and is for the purpose of influencing an elec- 3 tion; or 4 ‘‘(H) a disbursement for a broadcast, 5 cable, or satellite communication, or for any 6 communication which is placed or promoted for 7 a fee on an online platform, that discusses a 8 national legislative issue of public importance in 9 a year in which a regularly scheduled general 10 election for Federal office is held, but only if 11 the disbursement is made by a foreign principal 12 who is a government of a foreign country or a 13 foreign political party or an agent of such a for- 14 eign principal under the Foreign Agents Reg- 15 istration Act of 1938, as amended.’’. 16 (b) EFFECTIVE DATE.—The amendments made by 17 subsection (a) shall apply with respect to disbursements 18 made on or after the date of the enactment of this Act. 19 VerDate Sep 11 2014 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with BILLS 11 •S 1147 IS Subtitle B—Reporting of 1 Campaign-Related Disbursements 2 SEC. 111. REPORTING OF CAMPAIGN-RELATED DISBURSE- 3 MENTS. 4 (a) DISCLOSURE REQUIREMENTS FOR CORPORA- 5 TIONS, LABOR ORGANIZATIONS, AND CERTAIN OTHER 6 ENTITIES.— 7 (1) IN GENERAL.—Section 324 of the Federal 8 Election Campaign Act of 1971 (52 U.S.C. 30126) 9 is amended to read as follows: 10 ‘‘SEC. 324. DISCLOSURE OF CAMPAIGN-RELATED DISBURSE- 11 MENTS BY COVERED ORGANIZATIONS. 12 ‘‘(a) DISCLOSURE STATEMENT.— 13 ‘‘(1) IN GENERAL.—Any covered organization 14 that makes campaign-related disbursements aggre- 15 gating more than $10,000 in an election reporting 16 cycle shall, not later than 24 hours after each disclo- 17 sure date, file a statement with the Commission 18 made under penalty of perjury that contains the in- 19 formation described in paragraph (2)— 20 ‘‘(A) in the case of the first statement filed 21 under this subsection, for the period beginning 22 on the first day of the election reporting cycle 23 (or, if earlier, the period beginning one year be- 24 VerDate Sep 11 2014 22:36 Apr 18, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S1147.IS S1147 kjohnson on DSK79L0C42 with B [Text truncated for display. Full text available on Congress.gov.]