Protecting Americans’ Retirement Savings Act

I 118TH CONGRESS 1ST SESSION H. R. 4008 To amend the Employment Retirement Income Security Act of 1974 to prohibit plan investments in foreign adversary and sanctioned entities, require disclosure of existing investments in such entities, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JUNE 12, 2023 Mr. BANKS (for himself, Mr. GALLAGHER, Mr. MOOLENAAR, and Mr. WITT- MAN) introduced the following bill; which was referred to the Committee on Education and the Workforce A BILL To amend the Employment Retirement Income Security Act of 1974 to prohibit plan investments in foreign adversary and sanctioned entities, require disclosure of existing in- vestments in such 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. 3 This Act may be cited as the ‘‘Protecting Americans’ 4 Retirement Savings Act’’ or ‘‘PARSA’’. 5 VerDate Sep 11 2014 03:18 Jul 11, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4008.IH H4008 rfrederick on DSKB3L4F33PROD with BILLS 2 •HR 4008 IH SEC. 2. PROHIBITION ON INVESTMENT IN CERTAIN ENTI- 1 TIES. 2 Section 404(a) of the Employee Retirement Income 3 Security Act of 1974 (29 U.S.C. 1104(a)) is amended by 4 adding at the end the following: 5 ‘‘(3) PROHIBITION ON INVESTMENT IN CERTAIN EN- 6 TITIES.— 7 ‘‘(A) IN GENERAL.—For purposes of paragraph 8 (1), a fiduciary of a plan may not be considered to 9 act solely in the interest of the participants and 10 beneficiaries of the plan if such fiduciary does not 11 ensure that such plan does not engage in a trans- 12 action that the fiduciary knows, or should know, will 13 result in the plan— 14 ‘‘(i) acquiring an interest (as defined in 15 section 103(h)) between the plan and a sanc- 16 tioned entity or foreign adversary entity (as 17 each such term is defined in section 103(h)); 18 ‘‘(ii) lending money or extending credit to 19 such an entity; 20 ‘‘(iii) furnishing goods, services, or facili- 21 ties to such an entity; or 22 ‘‘(iv) transferring, directly or indirectly, to 23 or for use by or for the benefit of such an enti- 24 ty— 25 ‘‘(I) any assets of the plan; or 26 VerDate Sep 11 2014 03:18 Jul 11, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4008.IH H4008 rfrederick on DSKB3L4F33PROD with BILLS 3 •HR 4008 IH ‘‘(II) any data with respect to any 1 participant or beneficiary of the plan. 2 For the purposes of subclause (II), the term ‘fi- 3 duciary’ includes any person who exercises di- 4 rect or indirect discretionary authority, respon- 5 sibility, or control with respect to any partici- 6 pant beneficiary data. 7 ‘‘(B) CONTINUATION OF CURRENT INVEST- 8 MENTS.—In the case of a plan holding an invest- 9 ment in a sanctioned entity or foreign adversary en- 10 tity on the date of enactment of the Protecting 11 Americans’ Retirement Savings Act, such plan may 12 continue to hold such investment if the fiduciary of 13 such plan complies with the requirements of sub- 14 paragraphs (I) and (J) of section 103(b)(3). 15 ‘‘(C) CONTRACTUALLY OBLIGATED INVEST- 16 MENTS.—In the case of a plan that has entered into 17 a binding agreement prior to the date of enactment 18 of the Protecting Americans’ Retirement Savings 19 Act obligating such plan to engage in a transaction 20 described under subparagraph (A), if the fiduciary 21 of such plan complies with the requirements of sub- 22 paragraphs (I), (J), and (K) of section 103(b)(3), 23 such plan may fulfill the terms of such agreement 24 until such agreement— 25 VerDate Sep 11 2014 03:18 Jul 11, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4008.IH H4008 rfrederick on DSKB3L4F33PROD with BILLS 4 •HR 4008 IH ‘‘(i) expires; or 1 ‘‘(ii) allows for termination.’’. 2 SEC. 3. ADDITIONAL DISCLOSURES FOR EMPLOYEE RE- 3 TIREMENT FUNDS. 4 (a) IN GENERAL.—Section 103(b)(3) of the Em- 5 ployee Retirement Income Security Act of 1974 (29 6 U.S.C. 1023(b)(3)) is amended— 7 (1) in subparagraph (H)(iv), by striking the pe- 8 riod at the end and inserting ‘‘; and’’; and 9 (2) by inserting at the end the following: 10 ‘‘(I) a separate statement of all assets in the 11 plan that consist, in whole or in part, of an interest 12 in a sanctioned entity, including— 13 ‘‘(i) the aggregate value of such assets in 14 the plan; 15 ‘‘(ii) the identity of each sanctioned entity 16 in which such plan holds an interest; and 17 ‘‘(iii) information identifying each list 18 under subsection (h)(5) on which such sanc- 19 tioned entity is listed, and the reasons for which 20 an entity may be placed on such list; 21 ‘‘(J) a separate statement of all assets in the 22 plan that consist, in whole or in part, of an interest 23 in a foreign adversary entity, including— 24 VerDate Sep 11 2014 03:18 Jul 11, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4008.IH H4008 rfrederick on DSKB3L4F33PROD with BILLS 5 •HR 4008 IH ‘‘(i) the aggregate value of such assets in 1 the plan; 2 ‘‘(ii) the specific interest, and value there- 3 of, that such plan holds in each such foreign 4 adversary entity; 5 ‘‘(iii) the name of any investment vehicle 6 through which the plan holds such interest; 7 ‘‘(iv) the name of the fiduciary responsible 8 for such investment; and 9 ‘‘(v) a brief statement of factors considered 10 by the fiduciary in maintaining such invest- 11 ment; 12 ‘‘(K) a description of any ongoing agreement 13 subject to section 404(a)(3)(C), including— 14 ‘‘(i) the assets involved in such agreement; 15 ‘‘(ii) the date on which such agreement ex- 16 pires; 17 ‘‘(iii) the date on which such commitment 18 may be terminated; and 19 ‘‘(iv) such other information as the Sec- 20 retary may deem appropriate.’’. 21 (b) DEFINITIONS.—Section 103 of the Employee Re- 22 tirement Income Security Act of 1974 (29 U.S.C. 1023) 23 is further amended by adding at the end the following new 24 subsection: 25 VerDate Sep 11 2014 03:18 Jul 11, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H4008.IH H4008 rfrederick on DSKB3L4F33PROD with BILLS 6 •HR 4008 IH ‘‘(h) DEFINITIONS.—In this section: 1 ‘‘(1) CONTROL.—The term ‘control’ has the 2 meaning given in section 800.208 of title 31, Code 3 of Federal Regulations (as in effect on the date of 4 enactment of this Act). 5 ‘‘(2) EXPORT ADMINISTRATION REGULA- 6 TIONS.—The term ‘Export Administration Regula- 7 tions’ means the regulations set forth in subchapter 8 C of chapter VII of title 15, Code of Federal Regu- 9 lations, or successor regulations. 10 ‘‘(3) FOREIGN ADVERSARY.—The term ‘foreign 11 adversary’— 12 ‘‘(A) has the meaning given the term ‘cov- 13 ered nation’ in section 4872(d) of title 10, 14 United States Code (as in effect on the date of 15 enactment of this Act); and 16 ‘‘(B) includes any Special Administrative 17 Region of any such covered nation. 18 ‘‘(4) FOREIGN ADVERSARY ENTITY.—The term 19 ‘foreign adversary entity’ means— 20 ‘‘(A) any official governmental body at any 21 level in a foreign adversary; 22 ‘‘(B) the armed forces of a foreign adver- 23 sary; 24 VerDate Sep 11 2014 03:18 Jul 11, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H4008.IH H4008 rfrederick on DSKB3L4F33PROD with BILLS 7 •HR 4008 IH ‘‘(C) the leading political party of a foreign 1 adversary; 2 ‘‘(D) a person organized under the laws of, 3 headquartered in, or with its principal place of 4 business in a foreign adversary; or 5 ‘‘(E) a person subject to the direction or 6 control of an entity listed in subparagraphs (A) 7 through (D). 8 ‘‘(5) INTEREST.—The term ‘interest’ includes 9 any interest— 10 ‘‘(A) held directly or indirectly through any 11 chain of ownership; or 12 ‘‘(B) held as a derivative financial instru- 13 ment or other contractual arrangement with re- 14 spect to such sanctioned entity, including any 15 financial instrument or other contract which 16 seeks to replicate any financial return with re- 17 spect to a sanctioned entity or interest in such 18 sanctioned entity. 19 ‘‘(6) SANCTIONED ENTITY.—The term ‘sanc- 20 tioned entity’ means an entity listed on any of the 21 following lists: 22 ‘‘(A) The Non-SDN Chinese Military-In- 23 dustrial Complex Companies List (NS–CMIC 24 List) maintained by the Office of Foreign As- 25 VerDate Sep 11 2014 03:18 Jul 11, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H4008.IH H4008 rfrederick on DSKB3L4F33PROD with BILLS 8 •HR 4008 IH sets Control of the Department of the Treasury 1 under Executive Order 14032 (86 Fed. Reg. 2 30145), or any successor order. 3 ‘‘(B) The list of Chinese military compa- 4 nies identified by the Secretary of Defense pur- 5 suant to section 1260H of the William M. 6 (Mac) Thornberry National Defense Authoriza- 7 tion Act for Fiscal Year 2021 (Public Law 8 116–283; 10 U.S.C. 113 note). 9 ‘‘(C) The Entity List maintained by the 10 Department of Commerce and set forth in Sup- 11 plement No. 4 to part 744 of the Export Ad- 12 ministration Regulations. 13 ‘‘(D) The Denied Persons List maintained 14 by the Department of Commerce and described 15 in section 764.3(a)(2) of the Export Adminis- 16 tration Regulations. 17 ‘‘(E) The Unverified List set forth in Sup- 18 plement No. 6 to part 744 of the Export Ad- 19 ministration Regulations. 20 ‘‘(F) The Military End User List set forth 21 in Supplement No. 7 to part 744 of the Export 22 Administration Regulations. 23 ‘‘(G) The list of companies whose equip- 24 ment or services are maintained by the Federal 25 VerDate Sep 11 2014 03:18 Jul 11, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H4008.IH H4008 rfrederick on DSKB3L4F33PROD with BILLS 9 •HR 4008 IH Communications Commission under section 2(a) 1 of the Secure and Trusted Communications 2 Networks Act of 2019 (47 U.S.C. 1601(a)), 3 commonly referred to as the FCC Covered list. 4 ‘‘(H) The Uyghur Forced Labor Preven- 5 tion Act Entity List maintained by the Depart- 6 ment of Homeland Security pursuant to Public 7 Law 117–78. 8 ‘‘(I) The Withhold Release Orders and 9 Findings List maintained by the Commissioner 10 of U.S. Customs and Border Protection pursu- 11 ant to Public Law 117–78.’’. 12 (c) EFFECTIVE DATE.— 13 (1) REGULATIONS REQUIRED.—Not more than 14 180 days after the enactment of this Act, the Sec- 15 retary shall issue regulations implementing this Act. 16 (2) EFFECTIVE DATE OF REGULATIONS.—The 17 regulations issued under paragraph (1) shall take ef- 18 fect not later than 1 year after the date of enact- 19 ment of this Act. 20 Æ VerDate Sep 11 2014 03:18 Jul 11, 2023 Jkt 039200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6301 E:\BILLS\H4008.IH H4008 rfrederick on DSKB3L4F33PROD with BILLS