Summary
# H.R. 605: Special Drawing Rights Oversight Act of 2023
## WHAT THIS BILL DOES
This bill changes how the United States approves allocations of Special Drawing Rights (SDRs), which are international reserve assets managed by the International Monetary Fund (IMF). The bill requires Congress to approve SDR allocations in most cases and blocks allocations to countries whose governments have committed genocide or repeatedly supported terrorism without congressional permission.
## WHO IT AFFECTS
The bill directly affects the Secretary of the Treasury, the President and the federal government when voting on IMF matters. The bill also affects any country that is a member of the IMF and could receive SDRs.
## KEY PROVISIONS
* The Treasury Secretary cannot vote for or accept an SDR allocation without consulting Congress and waiting 180 days, unless Congress has already authorized the specific allocation. (Sec. 3)
* The bill expands oversight by requiring that before approving SDR allocations, the United States can only approve up to 25 percent of the United States quota within any 10-year period. (Sec. 3)
* The President and federal officials cannot vote to give SDRs to any IMF member country if the U.S. President has determined that country's government committed genocide within the previous 10 years, unless Congress passes a law authorizing it. (Sec. 4)
* The President and federal officials cannot vote to give SDRs to any IMF member country if the U.S. President has determined that country's government has repeatedly supported acts of international terrorism, unless Congress passes a law authorizing it. (Sec. 4)
## WHAT CHANGES
If this bill becomes law, the Treasury Secretary and the President must wait 180 days and notify key members of Congress before approving most SDR allocations. Currently, the Treasury Secretary can approve these allocations without waiting or getting congressional approval. The bill also creates a new rule blocking SDRs to countries that committed genocide or supported terrorism in the previous 10 years unless Congress votes to allow it.
## IMPORTANT DEFINITIONS
Special Drawing Rights (SDRs): International reserve assets created by the International Monetary Fund that countries can use as currency among themselves.
## EFFECTIVE DATE
Not specified in bill text.
I
118TH CONGRESS
1ST SESSION
H. R. 605
To amend the Special Drawing Rights Act in order to strengthen congres-
sional oversight with respect to allocations of Special Drawing Rights
by the International Monetary Fund, and to prohibit such allocations
for perpetrators of genocide and state sponsors of terrorism without
congressional authorization, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 27, 2023
Mr. HILL (for himself, Mr. BARR, and Mr. HUIZENGA) introduced the
following bill; which was referred to the Committee on Financial Services
A BILL
To amend the Special Drawing Rights Act in order to
strengthen congressional oversight with respect to alloca-
tions of Special Drawing Rights by the International
Monetary Fund, and to prohibit such allocations for per-
petrators of genocide and state sponsors of terrorism
without congressional authorization, and for other pur-
poses.
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 ‘‘Special Drawing
4
Rights Oversight Act of 2023’’.
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•HR 605 IH
SEC. 2. FINDINGS.
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The Congress finds as follows:
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(1) The allocation of Special Drawing Rights
3
(SDRs) through the International Monetary Fund
4
(IMF) creates unconditional liquidity for IMF mem-
5
ber countries.
6
(2) According to article XVIII of the Articles of
7
Agreement of the IMF, allocations of SDRs ‘‘shall
8
seek to meet the long-term global need’’ in reserve
9
assets.
10
(3) SDRs are allocated in proportion to the
11
quotas of IMF members, such that the G20 alone is
12
entitled to approximately two-thirds of a general al-
13
location. At the same time, the Board of Governors
14
of the Federal Reserve System has swap line ar-
15
rangements with the central banks of eight G20
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members, including the European Central Bank, the
17
Bank of Japan, and the Bank of England, for the
18
purpose of providing sufficient liquidity.
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(4) The size of SDR allocations has expanded
20
dramatically, rising from 9,300,000,000 SDRs in
21
1970–1972, to 12,100,000,000 SDRs in 1979–1981,
22
to 204,000,000,000 SDRs in 2009, with proposals
23
for a new, unilateral allocation that bypasses con-
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gressional authorization in an amount of approxi-
25
mately 450,000,000,000 SDRs.
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•HR 605 IH
(5) Under current law, the Secretary of the
1
Treasury is able to bypass Congress and approve an
2
allocation of SDRs in a manner that provides uncon-
3
ditional liquidity in the following approximate
4
amounts: $41,700,000,000 to the People’s Republic
5
of China; $17,600,000,000 to the Russian Federa-
6
tion; $4,900,000,000 to the Islamic Republic of
7
Iran, and $5,000,000,000 to Venezuela. In addition,
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current law permits allocations in these amounts to
9
be made in successive years that span two basic pe-
10
riods.
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(6) In the 98th Congress, the House of Rep-
12
resentatives passed the bipartisan International Re-
13
covery and Financial Stability Act, which would have
14
prohibited new allocations of SDRs without congres-
15
sional authorization.
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SEC. 3. STRENGTHENING CONGRESSIONAL OVERSIGHT.
17
Section 6 of the Special Drawing Rights Act (22
18
U.S.C. 286q) is amended—
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(1) in subsection (a)—
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(A) by striking ‘‘each basic period’’ and in-
21
serting ‘‘any 10-year period’’; and
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(B) by inserting ‘‘25 percent of’’ before
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‘‘the United States quota’’; and
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(2) in subsection (b)—
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•HR 605 IH
(A) by inserting ‘‘, or consent to or acqui-
1
esce in such an allocation,’’ before ‘‘without
2
consultations’’;
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(B) by striking ‘‘90’’ and inserting ‘‘180’’;
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and
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(C) by inserting ‘‘Chairman and ranking
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minority members of’’ before ‘‘the appropriate
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subcommittees’’.
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SEC. 4. PROHIBITION ON ALLOCATIONS FOR PERPETRA-
9
TORS OF GENOCIDE AND STATE SPONSORS
10
OF TERRORISM WITHOUT CONGRESSIONAL
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AUTHORIZATION.
12
Section 6(b) of the Special Drawing Rights Act (22
13
U.S.C. 286q(b)) is amended by adding at the end the fol-
14
lowing:
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‘‘(3) Unless Congress by law authorizes such action,
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neither the President nor any person or agency shall on
17
behalf of the United States vote to allocate Special Draw-
18
ing Rights under article XVIII, sections 2 and 3, of the
19
Articles of Agreement of the Fund to a member country
20
of the Fund, if the President of the United States has
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found that the government of the member country—
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‘‘(A) has committed genocide at any time dur-
23
ing the 10-year period ending with the date of the
24
vote; or
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•HR 605 IH
‘‘(B) has repeatedly provided support for acts
1
of international terrorism.’’.
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