Texas 2025 - 89th Regular

Texas House Bill HB34 Compare Versions

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1	1	89R4868 CS-D
2	2	By: Metcalf, Hefner, Bonnen, Capriglione, H.B. No. 34
3	3	et al.
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8	8	A BILL TO BE ENTITLED
9	9	AN ACT
10	10	relating to prohibiting the investment of state money in certain
11	11	countries and in certain private business entities in those
12	12	countries.
13	13	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
14	14	SECTION 1. Section 2270.0001, Government Code, is amended
15	15	by adding Subdivision (2-a) and amending Subdivision (9) to read as
16	16	follows:
17	17	(2-a) "Country of concern" means:
18	18	(A) China, Iran, North Korea, or Russia; or
19	19	(B) a country designated by the governor under
20	20	Section 2270.0121.
21	21	(9) "Scrutinized company" means:
22	22	(A) a company that:
23	23	(i) engages in scrutinized business
24	24	operations described by Section 2270.0052; or
25	25	(ii) has been complicit in the Darfur
26	26	genocide during any preceding 20-month period;
27	27	(B) a company that engages in scrutinized
28	28	business operations described by Section 2270.0102; [and]
29	29	(C) a company that is a scrutinized company under
30	30	Section 2270.0124; and
31	31	(D) a company that engages in scrutinized
32	32	business operations described by Section 2270.0152.
33	33	SECTION 2. Section 2270.0002, Government Code, is amended
34	34	to read as follows:
35	35	Sec. 2270.0002. EXCEPTION. Notwithstanding any other law,
36	36	a company that the United States government affirmatively declares
37	37	to be excluded from its federal sanctions regime relating to Sudan,
38	38	its federal sanctions regime relating to Iran or another country of
39	39	concern, or any federal sanctions regime relating to a designated
40	40	foreign terrorist organization is not subject to divestment or
41	41	investment prohibition under this chapter.
42	42	SECTION 3. Chapter 2270, Government Code, is amended by
43	43	adding Subchapter C-1 to read as follows:
44	44	SUBCHAPTER C-1. GENERAL PROVISIONS RELATING TO INVESTMENTS IN
45	45	COUNTRIES OF CONCERN
46	46	Sec. 2270.0121. DESIGNATION AS COUNTRY OF CONCERN. (a) The
47	47	governor, after consultation with the public safety director of the
48	48	Department of Public Safety, may designate a country as a country of
49	49	concern for purposes of this subchapter.
50	50	(b) The governor shall consult the Homeland Security
51	51	Council, established under Subchapter B, Chapter 421, to assess the
52	52	status of a country of concern for purposes of making a designation
53	53	under this section.
54	54	Sec. 2270.0122. PROHIBITION ON INVESTMENT IN COUNTRY OF
55	55	CONCERN. An investing entity may not acquire a security issued by a
56	56	country of concern or an entity owned or controlled by or subject to
57	57	the jurisdiction of a country of concern.
58	58	Sec. 2270.0123. PROHIBITION AGAINST INVESTMENT OR DEPOSIT
59	59	IN CERTAIN BANKS. An investing entity may not invest or make a
60	60	deposit in a bank with a principal place of business located in a
61	61	country of concern.
62	62	Sec. 2270.0124. SCRUTINIZED COMPANIES IN COUNTRIES OF
63	63	CONCERN. A company is a scrutinized company if:
64	64	(1) the company is organized under the laws of, has its
65	65	principal place of business in the territory of, or is controlled by
66	66	a country of concern;
67	67	(2) the company is owned by a country of concern or
68	68	individuals who are citizens of a country of concern; or
69	69	(3) the majority of stock or other ownership interest
70	70	of the company is held or controlled by a country of concern or
71	71	individuals who are citizens of a country of concern.
72	72	SECTION 4. Sections 2270.0201(a) and (b), Government Code,
73	73	are amended to read as follows:
74	74	(a) The comptroller shall prepare and maintain a list of all
75	75	scrutinized companies. The list must be categorized according to:
76	76	(1) companies that are scrutinized companies under
77	77	Section 2270.0001(9)(A);
78	78	(2) companies that are scrutinized companies under
79	79	Section 2270.0001(9)(B); [and]
80	80	(3) companies that are scrutinized companies under
81	81	Section 2270.0001(9)(C); and
82	82	(4) companies that are scrutinized companies under
83	83	Section 2270.0001(9)(D).
84	84	(b) In maintaining the list of scrutinized companies under
85	85	Subsection (a), the comptroller may review and rely, as appropriate
86	86	in the comptroller's judgment, on publicly available information
87	87	regarding companies with business operations in Sudan, in Iran or
88	88	another country of concern, or with designated foreign terrorist
89	89	organizations, as applicable, including information provided by
90	90	the state, nonprofit organizations, research firms, international
91	91	organizations, and governmental entities.
92	92	SECTION 5. Subchapter E, Chapter 2270, Government Code, is
93	93	amended by adding Section 2270.02035 to read as follows:
94	94	Sec. 2270.02035. ACTIONS RELATED TO LISTED COMPANY OWNED OR
95	95	CONTROLLED BY OR LOCATED IN COUNTRY OF CONCERN. (a) For each
96	96	listed company identified under Section 2270.0202 that is a
97	97	scrutinized company under Section 2270.0124, the investing entity
98	98	shall send a written notice informing the company of its listed
99	99	company status and warning the company that it may become subject to
100	100	divestment by investing entities.
101	101	(b) The notice shall offer the company the opportunity to,
102	102	not later than the 90th day after the date the company receives
103	103	notice under this section, change its organizational or ownership
104	104	structure or location so as to not be a scrutinized company as
105	105	described by Section 2270.0124 in order to avoid qualifying for
106	106	divestment by investing entities.
107	107	(c) If, during the time provided by Subsection (b), the
108	108	company makes any applicable changes required by that subsection,
109	109	the comptroller shall remove the company from the list of
110	110	scrutinized companies and this chapter will no longer apply to the
111	111	company unless the company later again becomes a scrutinized
112	112	company as described by Section 2270.0124.
113	113	(d) If, after the time provided by Subsection (b) expires,
114	114	the listed company continues to operate as a scrutinized company as
115	115	described by Section 2270.0124, the investing entity shall sell,
116	116	redeem, divest, or withdraw all publicly traded securities of the
117	117	company, except securities described by Section 2270.0207,
118	118	according to the schedule provided by Section 2270.0206.
119	119	SECTION 6. Not later than January 1, 2026, the comptroller
120	120	of public accounts shall include on the list maintained under
121	121	Section 2270.0201(a), Government Code, as amended by this Act, the
122	122	companies described by Subsection (a)(3) of that section.
123	123	SECTION 7. This Act takes effect September 1, 2025.