Bill > S2046

This bill aims to prohibit index funds, which are investment funds designed to track a specific market index, from investing in Chinese companies as defined broadly by the legislation. The bill defines a "Chinese company" to include businesses incorporated in China, with majority assets or employees in China, controlled by the Chinese government, or significantly dependent on such companies' value. The legislation provides a 180-day safe harbor period for existing index funds to divest from Chinese companies after the bill's enactment. Any violation of this prohibition could result in civil penalties up to $250,000 or twice the value of the transaction in question. The Securities and Exchange Commission (SEC) is authorized to create rules for implementing this restriction. The bill's purpose appears to be limiting U.S. investment in Chinese companies, potentially due to national security concerns or geopolitical tensions, by preventing index funds from including Chinese firms in their portfolios.

Housing and Urban Affairs

https://www.congress.gov/bill/119th-congress/senate-bill/2046/all-info