DISCLOSE Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 2977 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 HOUSE OF REPRESENTATIVES MAY 23, 2019 Mr. CICILLINE (for himself, Mr. AGUILAR, Mr. ALLRED, Mrs. AXNE, Ms. BARRAGA´N, Ms. BASS, Mrs. BEATTY, Mr. BERA, Mr. BEYER, Mr. BLU- MENAUER, Ms. BLUNT ROCHESTER, Ms. BONAMICI, Mr. BRENDAN F. BOYLE of Pennsylvania, Mr. BRINDISI, Mr. BROWN of Maryland, Ms. BROWNLEY of California, Mrs. BUSTOS, Mr. CARBAJAL, Mr. CA´RDENAS, Mr. CASE, Mr. CASTEN of Illinois, Ms. CASTOR of Florida, Ms. JUDY CHU of California, Mr. CISNEROS, Ms. CLARK of Massachusetts, Ms. CLARKE of New York, Mr. CLEAVER, Mr. COHEN, Mr. COOPER, Mr. COURTNEY, Mr. COX of California, Mrs. CRAIG, Mr. CRIST, Mr. CROW, Mr. CUNNINGHAM, Ms. DAVIDS of Kansas, Mrs. DAVIS of California, Ms. DEAN, Mr. DEFAZIO, Ms. DEGETTE, Ms. DELAURO, Ms. DELBENE, Mr. DELGADO, Mrs. DEMINGS, Mr. DESAULNIER, Mr. DEUTCH, Mrs. DIN- GELL, Mr. DOGGETT, Mr. ENGEL, Ms. ESCOBAR, Ms. ESHOO, Mr. ESPAILLAT, Ms. FINKENAUER, Ms. FRANKEL, Ms. GABBARD, Mr. GALLEGO, Mr. GARAMENDI, Mr. GARCI´A of Illinois, Mr. GOLDEN, Mr. GOMEZ, Mr. GREEN of Texas, Mr. GRIJALVA, Ms. HAALAND, Mr. HARD- ER of California, Mr. HASTINGS, Mrs. HAYES, Mr. HECK, Mr. HIGGINS of New York, Ms. HILL of California, Mr. HIMES, Ms. KENDRA S. HORN of Oklahoma, Mr. HORSFORD, Ms. HOULAHAN, Mr. HUFFMAN, Ms. JACKSON LEE, Ms. JAYAPAL, Ms. JOHNSON of Texas, Mr. JOHNSON of Georgia, Ms. KAPTUR, Ms. KELLY of Illinois, Mr. KHANNA, Mr. KILDEE, Mr. KILMER, Mr. KIM, Mr. KIND, Mrs. KIRKPATRICK, Mr. KRISHNAMOORTHI, Ms. KUSTER of New Hampshire, Mr. LAMB, Mr. LANGEVIN, Mr. LARSON of Connecticut, Mrs. LAWRENCE, Ms. LEE of California, Mrs. LEE of Nevada, Mr. LEVIN of Michigan, Mr. LEVIN of California, Mr. LIPINSKI, Mr. LOEBSACK, Mr. LOWENTHAL, Mrs. LOWEY, Mr. LUJA´N, Mrs. LURIA, Mr. LYNCH, Mr. MALINOWSKI, Mrs. CAROLYN B. MALONEY of New York, Mr. SEAN PATRICK MALONEY of New York, Ms. MATSUI, Mr. MCADAMS, Mrs. MCBATH, Ms. MCCOLLUM, Mr. MCEACHIN, Mr. MCGOVERN, Mr. MEEKS, Mr. MORELLE, Mr. MOULTON, Ms. MUCARSEL-POWELL, Mrs. MURPHY, Mr. NADLER, Mrs. NAPOLITANO, Mr. NEGUSE, Mr. NORCROSS, Ms. NORTON, Mr. VerDate Sep 11 2014 02:15 Jun 07, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\H2977.IH H2977 kjohnson on DSK79L0C42 with BILLS 2 •HR 2977 IH O’HALLERAN, Ms. OMAR, Mr. PALLONE, Mr. PANETTA, Mr. PAPPAS, Mr. PASCRELL, Mr. PETERS, Mr. PHILLIPS, Mr. POCAN, Ms. PORTER, Ms. PRESSLEY, Mr. PRICE of North Carolina, Mr. QUIGLEY, Miss RICE of New York, Mr. ROSE of New York, Mr. ROUDA, Ms. ROYBAL-ALLARD, Mr. RUIZ, Mr. RYAN, Ms. SA´NCHEZ, Mr. SARBANES, Ms. SCANLON, Ms. SCHAKOWSKY, Mr. SCHIFF, Mr. SCHRADER, Ms. SCHRIER, Mr. SCHNEI- DER, Mr. SCOTT of Virginia, Mr. DAVID SCOTT of Georgia, Mr. SERRANO, Ms. SHERRILL, Mr. SIRES, Mr. SMITH of Washington, Ms. SPANBERGER, Ms. SPEIER, Mr. STANTON, Ms. STEVENS, Mr. SUOZZI, Mr. SWALWELL of California, Mr. TAKANO, Mr. THOMPSON of California, Ms. TLAIB, Ms. TORRES SMALL of New Mexico, Mrs. TRAHAN, Mr. VAN DREW, Mr. VARGAS, Ms. VELA´ZQUEZ, Mrs. WATSON COLEMAN, Mr. WELCH, Ms. WILD, and Mr. YARMUTH) introduced the following bill; which was referred to the Committee on House Administration, and in addition to the Committee on Ways and Means, for a period to be subse- quently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 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 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 3 (a) SHORT TITLE.—This Act may be cited as the 4 ‘‘Democracy Is Strengthened by Casting Light On Spend- 5 ing in Elections Act of 2019’’ or the ‘‘DISCLOSE Act 6 of 2019’’. 7 (b) TABLE OF CONTENTS.—The table of contents of 8 this Act is as follows: 9 Sec. 1. Short title; table of contents. VerDate Sep 11 2014 02:15 Jun 07, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6211 E:\BILLS\H2977.IH H2977 kjohnson on DSK79L0C42 with BILLS 3 •HR 2977 IH 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. 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 VerDate Sep 11 2014 02:15 Jun 07, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2977.IH H2977 kjohnson on DSK79L0C42 with BILLS 4 •HR 2977 IH (2) by striking the period at the end of para- 1 graph (2) and inserting ‘‘; or’’; and 2 (3) by adding at the end the following new 3 paragraph: 4 ‘‘(3) a foreign national to direct, dictate, con- 5 trol, or directly or indirectly participate in the deci- 6 sion making process of any person (including a cor- 7 poration, labor organization, political committee, or 8 political organization) with regard to such person’s 9 Federal or non-Federal election-related activity, in- 10 cluding any decision concerning the making of con- 11 tributions, donations, expenditures, or disbursements 12 in connection with an election for any Federal, 13 State, or local office or any decision concerning the 14 administration of a political committee.’’. 15 (b) CERTIFICATION OF COMPLIANCE.—Section 319 16 of such Act (52 U.S.C. 30121) is amended by adding at 17 the end the following new subsection: 18 ‘‘(c) CERTIFICATION OF COMPLIANCE REQUIRED 19 PRIOR TO CARRYING OUT ACTIVITY.—Prior to the mak- 20 ing in connection with an election for Federal office of any 21 contribution, donation, expenditure, independent expendi- 22 ture, or disbursement for an electioneering communication 23 by a corporation, limited liability corporation, or partner- 24 ship during a year, the chief executive officer of the cor- 25 VerDate Sep 11 2014 02:15 Jun 07, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H2977.IH H2977 kjohnson on DSK79L0C42 with BILLS 5 •HR 2977 IH poration, limited liability corporation, or partnership (or, 1 if the corporation, limited liability corporation, or partner- 2 ship does not have a chief executive officer, the highest 3 ranking official of the corporation, limited liability cor- 4 poration, or partnership), shall file a certification with the 5 Commission, under penalty of perjury, that a foreign na- 6 tional did not direct, dictate, control, or directly or indi- 7 rectly participate in the decision making process relating 8 to such activity in violation of subsection (a)(3), unless 9 the chief executive officer has previously filed such a cer- 10 tification during that calendar year.’’. 11 (c) EFFECTIVE DATE.—The amendments made by 12 this section shall take effect upon the expiration of the 13 180-day period which begins on the date of the enactment 14 of this Act, and shall take effect without regard to whether 15 or not the Federal Election Commission has promulgated 16 regulations to carry out such amendments. 17 SEC. 102. CLARIFICATION OF APPLICATION OF FOREIGN 18 MONEY BAN TO CERTAIN DISBURSEMENTS 19 AND ACTIVITIES. 20 (a) APPLICATION TO DISBURSEMENTS TO SUPER 21 PACS.—Section 319(a)(1)(A) of the Federal Election 22 Campaign Act of 1971 (52 U.S.C. 30121(a)(1)(A)) is 23 amended by striking the semicolon and inserting the fol- 24 lowing: ‘‘, including any disbursement to a political com- 25 VerDate Sep 11 2014 02:15 Jun 07, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H2977.IH H2977 kjohnson on DSK79L0C42 with BILLS 6 •HR 2977 IH mittee which accepts donations or contributions that do 1 not comply with the limitations, prohibitions, and report- 2 ing requirements of this Act (or any disbursement to or 3 on behalf of any account of a political committee which 4 is established for the purpose of accepting such donations 5 or contributions);’’. 6 (b) CONDITIONS UNDER WHICH CORPORATE PACS 7 MAY MAKE CONTRIBUTIONS AND EXPENDITURES.—Sec- 8 tion 316(b) of such Act (52 U.S.C. 30118(b)) is amended 9 by adding at the end the following new paragraph: 10 ‘‘(8) A separate segregated fund established by a cor- 11 poration may not make a contribution or expenditure dur- 12 ing a year unless the fund has certified to the Commission 13 the following during the year: 14 ‘‘(A) Each individual who manages the fund, 15 and who is responsible for exercising decisionmaking 16 authority for the fund, is a citizen of the United 17 States or is lawfully admitted for permanent resi- 18 dence in the United States. 19 ‘‘(B) No foreign national under section 319 20 participates in any way in the decisionmaking proc- 21 esses of the fund with regard to contributions or ex- 22 penditures under this Act. 23 ‘‘(C) The fund does not solicit or accept rec- 24 ommendations from any foreign national under sec- 25 VerDate Sep 11 2014 02:15 Jun 07, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H2977.IH H2977 kjohnson on DSK79L0C42 with BILLS 7 •HR 2977 IH tion 319 with respect to the contributions or expend- 1 itures made by the fund. 2 ‘‘(D) Any member of the board of directors of 3 the corporation who is a foreign national under sec- 4 tion 319 abstains from voting on matters concerning 5 the fund or its activities.’’. 6 SEC. 103. AUDIT AND REPORT ON ILLICIT FOREIGN MONEY 7 IN FEDERAL ELECTIONS. 8 (a) IN GENERAL.—Title III of the Federal Election 9 Campaign Act of 1971 (52 U.S.C. 30101 et seq.) is 10 amended by inserting after section 319 the following new 11 section: 12 ‘‘SEC. 319A. AUDIT AND REPORT ON DISBURSEMENTS BY 13 FOREIGN NATIONALS. 14 ‘‘(a) AUDIT.— 15 ‘‘(1) IN GENERAL.—The Commission shall con- 16 duct an audit after each Federal election cycle to de- 17 termine the incidence of illicit foreign money in such 18 Federal election cycle. 19 ‘‘(2) PROCEDURES.—In carrying out paragraph 20 (1), the Commission shall conduct random audits of 21 any disbursements required to be reported under 22 this Act, in accordance with procedures established 23 by the Commission. 24 VerDate Sep 11 2014 02:15 Jun 07, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H2977.IH H2977 kjohnson on DSK79L0C42 with BILLS 8 •HR 2977 IH ‘‘(b) REPORT.—Not later than 180 days after the end 1 of each Federal election cycle, the Commission shall sub- 2 mit to Congress a report containing— 3 ‘‘(1) results of the audit required by subsection 4 (a)(1); and 5 ‘‘(2) recommendations to address the presence 6 of illicit foreign money in elections, as appropriate. 7 ‘‘(c) DEFINITIONS.—As used in this section: 8 ‘‘(1) The term ‘Federal election cycle’ means 9 the period which begins on the day after the date of 10 a regularly scheduled general election for Federal of- 11 fice and which ends on the date of the first regularly 12 scheduled general election for Federal office held 13 after such date. 14 ‘‘(2) The term ‘illicit foreign money’ means any 15 disbursement by a foreign national (as defined in 16 section 319(b)) prohibited under such section.’’. 17 (b) EFFECTIVE DATE.—The amendment made by 18 subsection (a) shall apply with respect to the Federal elec- 19 tion cycle that began during November 2018, and each 20 succeeding Federal election cycle. 21 VerDate Sep 11 2014 02:15 Jun 07, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H2977.IH H2977 kjohnson on DSK79L0C42 with BILLS 9 •HR 2977 IH SEC. 104. PROHIBITION ON CONTRIBUTIONS AND DONA- 1 TIONS BY FOREIGN NATIONALS IN CONNEC- 2 TIONS WITH BALLOT INITIATIVES AND 3 REFERENDA. 4 (a) IN GENERAL.—Section 319(a)(1)(A) of the Fed- 5 eral Election Campaign Act of 1971 (52 U.S.C. 6 30121(a)(1)(A)) is amended by striking ‘‘election;’’ and 7 inserting the following: ‘‘election, including a State or local 8 ballot initiative or referendum;’’. 9 (b) EFFECTIVE DATE.—The amendment made by 10 this section shall apply with respect to elections held in 11 2020 or any succeeding year. 12 SEC. 105. DISBURSEMENTS AND ACTIVITIES SUBJECT TO 13 FOREIGN MONEY BAN. 14 (a) DISBURSEMENTS DESCRIBED.—Section 15 319(a)(1) of the Federal Election Campaign Act of 1971 16 (52 U.S.C. 30121(a)(1)) is amended— 17 (1) by striking ‘‘or’’ at the end of subparagraph 18 (B); and 19 (2) by striking subparagraph (C) and inserting 20 the following: 21 ‘‘(C) an expenditure; 22 ‘‘(D) an independent expenditure; 23 ‘‘(E) a disbursement for an electioneering 24 communication (within the meaning of section 25 304(f)(3)); 26 VerDate Sep 11 2014 02:15 Jun 07, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H2977.IH H2977 kjohnson on DSK79L0C42 with BILLS 10 •HR 2977 IH ‘‘(F) a disbursement for a paid internet or 1 paid digital communication that refers to a 2 clearly identified candidate for election for Fed- 3 eral office and is disseminated within 60 days 4 before a general, special or runoff election for 5 the office sought by the candidate or 30 days 6 before a primary or preference election, or a 7 convention or caucus of a political party that 8 has authority to nominate a candidate for the 9 office sought by the candidate; 10 ‘‘(G) a disbursement for a broadcast, cable 11 or satellite communication, or for a paid inter- 12 net or paid digital communication, that pro- 13 mot [Text truncated for display. 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