Calendar No. 120
117th CONGRESS 1st Session |
To amend the Federal Election Campaign Act of 1971 to provide for additional disclosure requirements for corporations, labor organizations, Super PACs and other entities, and for other purposes.
August 6 (legislative day, August 5), 2021
Mr. Schumer introduced the following bill; which was read the first time
August 7, 2021
Read the second time and placed on the calendar
To amend the Federal Election Campaign Act of 1971 to provide for additional disclosure requirements for corporations, labor organizations, Super PACs and other entities, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
(a) Short title.—This Act may be cited as the “Democracy Is Strengthened by Casting Light On Spending in Elections Act of 2021” or the “DISCLOSE Act of 2021”.
(b) Table of contents.—The table of contents of this Act is as follows:
Sec. 1. Short title; table of contents.
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 disbursements 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 connection with ballot initiatives and referenda.
Sec. 105. Disbursements and activities subject to foreign money ban.
Sec. 106. Prohibiting establishment of corporation to conceal election contributions and donations by foreign nationals.
Sec. 201. Reporting of campaign-related disbursements.
Sec. 202. Application of foreign money ban to disbursements for campaign-related disbursements consisting of covered transfers.
Sec. 203. Effective date.
Sec. 301. Petition for certiorari.
Sec. 302. Judicial review of actions related to campaign finance laws.
(a) Clarification of prohibition.—Section 319(a) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121(a)) is amended—
(1) by striking “or” at the end of paragraph (1);
(2) by striking the period at the end of paragraph (2) and inserting “; or”; and
(3) by adding at the end the following new paragraph:
“(3) a foreign national to direct, dictate, control, or directly or indirectly participate in the decision making process of any person (including a corporation, labor organization, political committee, or political organization) with regard to such person’s Federal or non-Federal election-related activity, including any decision concerning the making of contributions, donations, expenditures, or disbursements in connection with an election for any Federal, State, or local office or any decision concerning the administration of a political committee.”.
(b) Certification of Compliance.—Section 319 of such Act (52 U.S.C. 30121) is amended by adding at the end the following new subsection:
“(c) Certification of compliance required prior to carrying out activity.—Prior to the making in connection with an election for Federal office of any contribution, donation, expenditure, independent expenditure, or disbursement for an electioneering communication by a corporation, labor organization (as defined in section 316(b)), limited liability corporation, or partnership during a year, the chief executive officer of the corporation, labor organization, limited liability corporation, or partnership (or, if the corporation, labor organization, limited liability corporation, or partnership does not have a chief executive officer, the highest ranking official of the corporation, labor organization, limited liability corporation, or partnership), shall file a certification with the Commission, under penalty of perjury, that a foreign national did not direct, dictate, control, or directly or indirectly participate in the decision making process relating to such activity in violation of subsection (a)(3), unless the chief executive officer has previously filed such a certification during that calendar year.”.
(c) Effective date.—The amendments made by this section shall take effect upon the expiration of the 180-day period which begins on the date of the enactment of this Act, and shall take effect without regard to whether or not the Federal Election Commission has promulgated regulations to carry out such amendments.
(a) Application to disbursements to Super PACs and other persons.—Section 319(b) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121(b)) is amended—
(1) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B), respectively, and by moving such subparagraphs 2 ems to the right;
(2) by striking “As used in this section, the term ‘foreign national’ means” and inserting the following: “Definitions.—For purposes of this section—
“(1) FOREIGN NATIONAL.—The term”;
(3) by moving paragraphs (1) and (2) two ems to the right and redesignating them as subparagraphs (A) and (B), respectively; and
(4) by adding at the end the following new paragraph:
“(2) CONTRIBUTION AND DONATION.—For purposes of paragraphs (1) and (2) of subsection (a), the term ‘contribution or donation’ includes any disbursement to a political committee which accepts donations or contributions that do not comply with any of the limitations, prohibitions, and reporting requirements of this Act (or any disbursement to or on behalf of any account of a political committee which is established for the purpose of accepting such donations or contributions), or to any other person for the purpose of funding an expenditure, independent expenditure, or electioneering communication (as defined in section 304(f)(3)).”.
(b) Conditions under which corporate PACs may make contributions and expenditures.—Section 316(b) of such Act (52 U.S.C. 30118(b)) is amended by adding at the end the following new paragraph:
“(8) A separate segregated fund established by a corporation may not make a contribution or expenditure during a year unless the fund has certified to the Commission the following during the year:
“(A) Each individual who manages the fund, and who is responsible for exercising decisionmaking authority for the fund, is a citizen of the United States or is lawfully admitted for permanent residence in the United States.
“(B) No foreign national under section 319 participates in any way in the decisionmaking processes of the fund with regard to contributions or expenditures under this Act.
“(C) The fund does not solicit or accept recommendations from any foreign national under section 319 with respect to the contributions or expenditures made by the fund.
“(D) Any member of the board of directors of the corporation who is a foreign national under section 319 abstains from voting on matters concerning the fund or its activities.”.
(a) In general.—Title III of the Federal Election Campaign Act of 1971 (52 U.S.C. 30101 et seq.) is amended by inserting after section 319 the following new section:
“SEC. 319A. Audit and report on disbursements by foreign nationals.
“(1) IN GENERAL.—The Commission shall conduct an audit after each Federal election cycle to determine the incidence of illicit foreign money in such Federal election cycle.
“(2) PROCEDURES.—In carrying out paragraph (1), the Commission shall conduct random audits of any disbursements required to be reported under this Act, in accordance with procedures established by the Commission.
“(b) Report.—Not later than 180 days after the end of each Federal election cycle, the Commission shall submit to Congress a report containing—
“(1) results of the audit required by subsection (a)(1);
“(2) an analysis of the extent to which illicit foreign money was used to carry out disinformation and propaganda campaigns focused on depressing turnout among rural communities and the success or failure of these efforts, together with recommendations to address these efforts in future elections;
“(3) an analysis of the extent to which illicit foreign money was used to carry out disinformation and propaganda campaigns focused on depressing turnout among African-American and other minority communities and the success or failure of these efforts, together with recommendations to address these efforts in future elections;
“(4) an analysis of the extent to which illicit foreign money was used to carry out disinformation and propaganda campaigns focused on influencing military and veteran communities and the success or failure of these efforts, together with recommendations to address these efforts in future elections; and
“(5) recommendations to address the presence of illicit foreign money in elections, as appropriate.
“(c) Definitions.—As used in this section:
“(1) The term ‘Federal election cycle’ means the period which begins on the day after the date of a regularly scheduled general election for Federal office and which ends on the date of the first regularly scheduled general election for Federal office held after such date.
“(2) The term ‘illicit foreign money’ means any disbursement by a foreign national (as defined in section 319(b)) prohibited under such section.”.
(b) Effective date.—The amendment made by subsection (a) shall apply with respect to the Federal election cycle that began during November 2020, and each succeeding Federal election cycle.
(a) In general.—Section 319(b) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121(b)), as amended by section 102(a), is amended by adding at the end the following new paragraph:
“(3) FEDERAL, STATE, OR LOCAL ELECTION.—The term ‘Federal, State, or local election’ includes a State or local ballot initiative or referendum.”.
(b) Effective date.—The amendment made by this section shall apply with respect to elections held in 2022 or any succeeding year.
(a) Disbursements described.—Section 319(a)(1) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121(a)(1)), as amended by section 101, is amended—
(1) by striking “or” at the end of subparagraph (B); and
(2) by striking subparagraph (C) and inserting the following:
“(C) an expenditure;
“(D) an independent expenditure;
“(E) a disbursement for an electioneering communication (within the meaning of section 304(f)(3));
“(F) a disbursement for a communication which is placed or promoted for a fee on a website, web application, or digital application that refers to a clearly identified candidate for election for Federal office and is disseminated within 60 days before a general, special or runoff election for the office sought by the candidate or 30 days before a primary or preference election, or a convention or caucus of a political party that has authority to nominate a candidate for the office sought by the candidate;
“(G) a disbursement for a broadcast, cable or satellite communication, or for a communication which is placed or promoted for a fee on a website, web application, or digital application, that promotes, supports, attacks or opposes the election of a clearly identified candidate for Federal, State, or local office (regardless of whether the communication contains express advocacy or the functional equivalent of express advocacy);
“(H) a disbursement for a broadcast, cable, or satellite communication, or for any communication which is placed or promoted for a fee on an online platform, that discusses a national legislative issue of public importance in a year in which a regularly scheduled general election for Federal office is held, but only if the disbursement is made by a covered foreign national;
“(I) a disbursement by a covered foreign national to compensate any person for internet activity that promotes, supports, attacks or opposes the election of a clearly identified candidate for Federal, State, or local office (regardless of whether the activity contains express advocacy or the functional equivalent of express advocacy); or
“(J) a disbursement for a Federal judicial nomination communication (as defined in section 324(d)(3));”.
(b) Online platform.—Section 319(b) of such Act (51 U.S.C. 30121(b)), as amended by sections 102(a) and 104, is amended by adding at the end the following new paragraphs:
“(A) IN GENERAL.—Subject to subparagraph (B), the term ‘online platform’ means any public-facing website, web application, or digital application (including a social network, ad network, or search engine) which—
“(i) (I) sells qualified political advertisements; and
“(II) has 50,000,000 or more unique monthly United States visitors or users for a majority of months during the preceding 12 months; or
“(ii) is a third-party advertising vendor that has 50,000,000 or more unique monthly United States visitors in the aggregate on any advertisement space that it has sold or bought for a majority of months during the preceding 12 months, as measured by an independent digital ratings service accredited by the Media Ratings Council (or its successor).
“(B) EXEMPTION.—Such term shall not include any online platform that is a distribution facility of any broadcasting station or newspaper, magazine, blog, publication, or periodical.
“(C) QUALIFIED POLITICAL ADVERTISEMENT.—For purposes of this paragraph, the term ‘qualified political advertisement’ means any advertisement (including search engine marketing, display advertisements, video advertisements, native advertisements, and sponsorships) that—
“(i) is made by or on behalf of a candidate; or
“(ii) communicates a message relating to any political matter of national importance, including—
“(I) a candidate;
“(II) any election to Federal office; or
“(III) a national legislative issue of public importance.
“(D) THIRD-PARTY ADVERTISING VENDOR DEFINED.—For purposes of this paragraph, the term ‘third-party advertising vendor’ includes, but is not limited to, any third-party advertising vendor network, advertising agency, advertiser, or third-party advertisement serving company that buys and sells advertisement space on behalf of unaffiliated third-party websites, search engines, digital applications, or social media sites.
“(5) COVERED FOREIGN NATIONAL.—
“(A) IN GENERAL.—The term ‘covered foreign national’ means—
“(i) a foreign principal (as defined in section 1(b) of the Foreign Agents Registration Act of 1938 (22 U.S.C. 611(b)) that is a government of a foreign country or a foreign political party;
“(ii) any person who acts as an agent, representative, employee, or servant, or any person who acts in any other capacity at the order, request, or under the direction or control, of a foreign principal described in clause (i) or of a person any of whose activities are directly or indirectly supervised, directed, controlled, financed, or subsidized in whole or in major part by a foreign principal described in clause (i); or
“(iii) any person included in the list of specially designated nationals and blocked persons maintained by the Office of Foreign Assets Control of the Department of the Treasury pursuant to authorities relating to the imposition of sanctions relating to the conduct of a foreign principal described in clause (i).
“(B) CLARIFICATION REGARDING APPLICATION TO CITIZENS OF THE UNITED STATES.—In the case of a citizen of the United States, clause (ii) of subparagraph (A) applies only to the extent that the person involved acts within the scope of that person’s status as the agent of a foreign principal described clause (i) of subparagraph (A).”.
(c) Effective date.—The amendments made by this section shall apply with respect to disbursements made on or after the date of the enactment of this Act.
(a) Prohibition.—Chapter 29 of title 18, United States Code, is amended by adding at the end the following:
Ҥ 612. Establishment of corporation to conceal election contributions and donations by foreign nationals
“(a) Offense.—It shall be unlawful for an owner, officer, attorney, or incorporation agent of a corporation, company, or other entity to establish or use the corporation, company, or other entity with the intent to conceal an activity of a foreign national (as defined in section 319 of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121)) prohibited under such section 319.
“(b) Penalty.—Any person who violates subsection (a) shall be imprisoned for not more than 5 years, fined under this title, or both.”.
(b) Table of sections.—The table of sections for chapter 29 of title 18, United States Code, is amended by inserting after the item relating to section 611 the following:
(a) Disclosure requirements for corporations, labor organizations, and certain other entities.—
(1) IN GENERAL.—Section 324 of the Federal Election Campaign Act of 1971 (52 U.S.C. 30126) is amended to read as follows:
“SEC. 324. Disclosure of campaign-related disbursements by covered organizations.
“(1) IN GENERAL.—Any covered organization that makes campaign-related disbursements aggregating more than $10,000 in an election reporting cycle shall, not later than 24 hours after each disclosure date, file a statement with the Commission made under penalty of perjury that contains the information described in paragraph (2)—
“(A) in the case of the first statement filed under this subsection, for the period beginning on the first day of the election reporting cycle (or, if earlier, the period beginning one year before the first such disclosure date) and ending on the first such disclosure date; and
“(B) in the case of any subsequent statement filed under this subsection, for the period beginning on the previous disclosure date and ending on such disclosure date.
“(2) INFORMATION DESCRIBED.—The information described in this paragraph is as follows:
“(A) The name of the covered organization and the principal place of business of such organization and, in the case of a covered organization that is a corporation (other than a business concern that is an issuer of a class of securities registered under section 12 of the Securities Exchange Act of 1934 (15 U.S.C. 78l) or that is required to file reports under section 15(d) of that Act (15 U.S.C. 78o(d))) or an entity described in subsection (e)(2), a list of the beneficial owners (as defined in paragraph (4)(A)) of the entity that—
“(i) identifies each beneficial owner by name and current residential or business street address; and
“(ii) if any beneficial owner exercises control over the entity through another legal entity, such as a corporation, partnership, limited liability company, or trust, identifies each such other legal entity and each such beneficial owner who will use that other entity to exercise control over the entity.
“(B) The amount of each campaign-related disbursement made by such organization during the period covered by the statement of more than $1,000, and the name and address of the person to whom the disbursement was made.
“(C) In the case of a campaign-related disbursement that is not a covered transfer, the election to which the campaign-related disbursement pertains and if the disbursement is made for a public communication, the name of any candidate identified in such communication and whether such communication is in support of or in opposition to a candidate.
“(D) A certification by the chief executive officer or person who is the head of the covered organization that the campaign-related disbursement is not made in cooperation, consultation, or concert with or at the request or suggestion of a candidate, authorized committee, or agent of a candidate, political party, or agent of a political party.
“(E) (i) If the covered organization makes campaign-related disbursements using exclusively funds in a segregated bank account consisting of funds that were paid directly to such account by persons other than the covered organization that controls the account, for each such payment to the account—
“(I) the name and address of each person who made such payment during the period covered by the statement;
“(II) the date and amount of such payment; and
“(III) the aggregate amount of all such payments made by the person during the period beginning on the first day of the election reporting cycle (or, if earlier, the period beginning one year before the disclosure date) and ending on the disclosure date,
but only if such payment was made by a person who made payments to the account in an aggregate amount of $10,000 or more during the period beginning on the first day of the election reporting cycle (or, if earlier, the period beginning one year before the disclosure date) and ending on the disclosure date.
“(ii) In any calendar year after 2022, section 315(c)(1)(B) shall apply to the amount described in clause (i) in the same manner as such section applies to the limitations established under subsections (a)(1)(A), (a)(1)(B), (a)(3), and (h) of such section, except that for purposes of applying such section to the amounts described in subsection (b), the ‘base period’ shall be calendar year 2022.
“(F) (i) If the covered organization makes campaign-related disbursements using funds other than funds in a segregated bank account described in subparagraph (E), for each payment to the covered organization—
“(I) the name and address of each person who made such payment during the period covered by the statement;
“(II) the date and amount of such payment; and
“(III) the aggregate amount of all such payments made by the person during the period beginning on the first day of the election reporting cycle (or, if earlier, the period beginning one year before the disclosure date) and ending on the disclosure date,
but only if such payment was made by a person who made payments to the covered organization in an aggregate amount of $10,000 or more during the period beginning on the first day of the election reporting cycle (or, if earlier, the period beginning one year before the disclosure date) and ending on the disclosure date.
“(ii) In any calendar year after 2022, section 315(c)(1)(B) shall apply to the amount described in clause (i) in the same manner as such section applies to the limitations established under subsections (a)(1)(A), (a)(1)(B), (a)(3), and (h) of such section, except that for purposes of applying such section to the amounts described in subsection (b), the ‘base period’ shall be calendar year 2022.
“(G) Such other information as required in rules established by the Commission to promote the purposes of this section.
“(A) AMOUNTS RECEIVED IN ORDINARY COURSE OF BUSINESS.—The requirement to include in a statement filed under paragraph (1) the information described in paragraph (2) shall not apply to amounts received by the covered organization in commercial transactions in the ordinary course of any trade or business conducted by the covered organization or in the form of investments (other than investments by the principal shareholder in a limited liability corporation) in the covered organization. For purposes of this subparagraph, amounts received by a covered organization as remittances from an employee to the employee’s collective bargaining representative shall be treated as amounts received in commercial transactions in the ordinary course of the business conducted by the covered organization.
“(B) DONOR RESTRICTION ON USE OF FUNDS.—The requirement to include in a statement submitted under paragraph (1) the information described in subparagraph (F) of paragraph (2) shall not apply if—
“(i) the person described in such subparagraph prohibited, in writing, the use of the payment made by such person for campaign-related disbursements; and
“(ii) the covered organization agreed to follow the prohibition and deposited the payment in an account which is segregated from any account used to make campaign-related disbursements.
“(C) THREAT OF HARASSMENT OR REPRISAL.—The requirement to include any information relating to the name or address of any person (other than a candidate) in a statement submitted under paragraph (1) shall not apply if the inclusion of the information would subject the person to serious threats, harassment, or reprisals.
“(4) OTHER DEFINITIONS.—For purposes of this section:
“(A) BENEFICIAL OWNER DEFINED.—
“(i) IN GENERAL.—Except as provided in clause (ii), the term ‘beneficial owner’ means, with respect to any entity, a natural person who, directly or indirectly—
“(I) exercises substantial control over an entity through ownership, voting rights, agreement, or otherwise; or
“(II) has a substantial interest in or receives substantial economic benefits from the assets of an entity.
“(ii) EXCEPTIONS.—The term ‘beneficial owner’ shall not include—
“(I) a minor child;
“(II) a person acting as a nominee, intermediary, custodian, or agent on behalf of another person;
“(III) a person acting solely as an employee of an entity and whose control over or economic benefits from the entity derives solely from the employment status of the person;
“(IV) a person whose only interest in an entity is through a right of inheritance, unless the person also meets the requirements of clause (i); or
“(V) a creditor of an entity, unless the creditor also meets the requirements of clause (i).
“(iii) ANTI-ABUSE RULE.—The exceptions under clause (ii) shall not apply if used for the purpose of evading, circumventing, or abusing the provisions of clause (i) or paragraph (2)(A).
“(B) DISCLOSURE DATE.—The term ‘disclosure date’ means—
“(i) the first date during any election reporting cycle by which a person has made campaign-related disbursements aggregating more than $10,000; and
“(ii) any other date during such election reporting cycle by which a person has made campaign-related disbursements aggregating more than $10,000 since the most recent disclosure date for such election reporting cycle.
“(C) ELECTION REPORTING CYCLE.—The term ‘election reporting cycle’ means the 2-year period beginning on the date of the most recent general election for Federal office, except that in the case of a campaign-related disbursement for a Federal judicial nomination communication, such term means any calendar year in which the campaign-related disbursement is made.
“(D) PAYMENT.—The term ‘payment’ includes any contribution, donation, transfer, payment of dues, or other payment.
“(b) Coordination with other provisions.—
“(1) OTHER REPORTS FILED WITH THE COMMISSION.—Information included in a statement filed under this section may be excluded from statements and reports filed under section 304.
“(2) TREATMENT AS SEPARATE SEGREGATED FUND.—A segregated bank account referred to in subsection (a)(2)(E) may be treated as a separate segregated fund for purposes of section 527(f)(3) of the Internal Revenue Code of 1986.
“(c) Filing.—Statements required to be filed under subsection (a) shall be subject to the requirements of section 304(d) to the same extent and in the same manner as if such reports had been required under subsection (c) or (g) of section 304.
“(d) Campaign-Related disbursement defined.—
“(1) IN GENERAL.—In this section, the term ‘campaign-related disbursement’ means a disbursement by a covered organization for any of the following:
“(A) An independent expenditure which expressly advocates the election or defeat of a clearly identified candidate for election for Federal office, or is the functional equivalent of express advocacy because, when taken as a whole, it can be interpreted by a reasonable person only as advocating the election or defeat of a candidate for election for Federal office.
“(B) An applicable public communication.
“(C) An electioneering communication, as defined in section 304(f)(3).
“(D) A Federal judicial nomination communication.
“(E) A covered transfer.
“(2) APPLICABLE PUBLIC COMMUNICATIONS.—
“(A) IN GENERAL.—The term ‘applicable public communication’ means any public communication that refers to a clearly identified candidate for election for Federal office and which promotes or supports the election of a candidate for that office, or attacks or opposes the election of a candidate for that office, without regard to whether the communication expressly advocates a vote for or against a candidate for that office.
“(B) EXCEPTION.—Such term shall not include any news story, commentary, or editorial distributed through the facilities of any broadcasting station or any print, online, or digital newspaper, magazine, publication, or periodical, unless such facilities are owned or controlled by any political party, political committee, or candidate.
“(3) FEDERAL JUDICIAL NOMINATION COMMUNICATION.—
“(A) IN GENERAL.—The term ‘Federal judicial nomination communication’ means any communication—
“(i) that is by means of any broadcast, cable, or satellite, paid internet, or paid digital communication, paid promotion, newspaper, magazine, outdoor advertising facility, mass mailing, telephone bank, telephone messaging effort of more than 500 substantially similar calls or electronic messages within a 30-day period, or any other form of general public political advertising; and
“(ii) which promotes, supports, attacks, or opposes the nomination or Senate confirmation of an individual as a Federal judge or justice.
“(B) EXCEPTION.—Such term shall not include any news story, commentary, or editorial distributed through the facilities of any broadcasting station or any print, online, or digital newspaper, magazine, publication, or periodical, unless such facilities are owned or controlled by any political party, political committee, or candidate.
“(4) INTENT NOT REQUIRED.—A disbursement for an item described in subparagraph (A), (B), (C), (D), or (E) of paragraph (1) shall be treated as a campaign-related disbursement regardless of the intent of the person making the disbursement.
“(e) Covered organization defined.—In this section, the term ‘covered organization’ means any of the following:
“(1) A corporation (other than an organization described in section 501(c)(3) of the Internal Revenue Code of 1986).
“(2) A limited liability corporation that is not otherwise treated as a corporation for purposes of this Act (other than an organization described in section 501(c)(3) of the Internal Revenue Code of 1986).
“(3) An organization described in section 501(c) of such Code and exempt from taxation under section 501(a) of such Code (other than an organization described in section 501(c)(3) of such Code).
“(4) A labor organization (as defined in section 316(b)).
“(5) Any political organization under section 527 of the Internal Revenue Code of 1986, other than a political committee under this Act (except as provided in paragraph (6)).
“(6) A political committee with an account that accepts donations or contributions that do not comply with the contribution limits or source prohibitions under this Act, but only with respect to such accounts.
“(f) Covered transfer defined.—
“(1) IN GENERAL.—In this section, the term ‘covered transfer’ means any transfer or payment of funds by a covered organization to another person if the covered organization—
“(A) designates, requests, or suggests that the amounts be used for—
“(i) campaign-related disbursements (other than covered transfers); or
“(ii) making a transfer to another person for the purpose of making or paying for such campaign-related disbursements;
“(B) made such transfer or payment in response to a solicitation or other request for a donation or payment for—
“(i) the making of or paying for campaign-related disbursements (other than covered transfers); or
“(ii) making a transfer to another person for the purpose of making or paying for such campaign-related disbursements;
“(C) engaged in discussions with the recipient of the transfer or payment regarding—
“(i) the making of or paying for campaign-related disbursements (other than covered transfers); or
“(ii) donating or transferring any amount of such transfer or payment to another person for the purpose of making or paying for such campaign-related disbursements;
“(D) made campaign-related disbursements (other than a covered transfer) in an aggregate amount of $50,000 or more during the 2-year period ending on the date of the transfer or payment, or knew or had reason to know that the person receiving the transfer or payment made such disbursements in such an aggregate amount during that 2-year period; or
“(E) knew or had reason to know that the person receiving the transfer or payment would make campaign-related disbursements in an aggregate amount of $50,000 or more during the 2-year period beginning on the date of the transfer or payment.
“(2) EXCLUSIONS.—The term ‘covered transfer’ does not include any of the following:
“(A) A disbursement made by a covered organization in a commercial transaction in the ordinary course of any trade or business conducted by the covered organization or in the form of investments made by the covered organization.
“(B) A disbursement made by a covered organization if—
“(i) the covered organization prohibited, in writing, the use of such disbursement for campaign-related disbursements; and
“(ii) the recipient of the disbursement agreed to follow the prohibition and deposited the disbursement in an account which is segregated from any account used to make campaign-related disbursements.
“(3) SPECIAL RULE REGARDING TRANSFERS AMONG AFFILIATES.—
“(A) SPECIAL RULE.—A transfer of an amount by one covered organization to another covered organization which is treated as a transfer between affiliates under subparagraph (C) shall be considered a covered transfer by the covered organization which transfers the amount only if the aggregate amount transferred during the year by such covered organization to that same covered organization is equal to or greater than $50,000.
“(B) DETERMINATION OF AMOUNT OF CERTAIN PAYMENTS AMONG AFFILIATES.—In determining the amount of a transfer between affiliates for purposes of subparagraph (A), to the extent that the transfer consists of funds attributable to dues, fees, or assessments which are paid by individuals on a regular, periodic basis in accordance with a per-individual calculation which is made on a regular basis, the transfer shall be attributed to the individuals paying the dues, fees, or assessments and shall not be attributed to the covered organization.
“(C) DESCRIPTION OF TRANSFERS BETWEEN AFFILIATES.—A transfer of amounts from one covered organization to another covered organization shall be treated as a transfer between affiliates if—
“(i) one of the organizations is an affiliate of the other organization; or
“(ii) each of the organizations is an affiliate of the same organization,
except that the transfer shall not be treated as a transfer between affiliates if one of the organizations is established for the purpose of making campaign-related disbursements.
“(D) DETERMINATION OF AFFILIATE STATUS.—For purposes of subparagraph (C), a covered organization is an affiliate of another covered organization if—
“(i) the governing instrument of the organization requires it to be bound by decisions of the other organization;
“(ii) the governing board of the organization includes persons who are specifically designated representatives of the other organization or are members of the governing board, officers, or paid executive staff members of the other organization, or whose service on the governing board is contingent upon the approval of the other organization; or
“(iii) the organization is chartered by the other organization.
“(E) COVERAGE OF TRANSFERS TO AFFILIATED SECTION 501(c)(3) ORGANIZATIONS.—This paragraph shall apply with respect to an amount transferred by a covered organization to an organization described in paragraph (3) of section 501(c) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code in the same manner as this paragraph applies to an amount transferred by a covered organization to another covered organization.
“(g) No effect on other reporting requirements.—Nothing in this section shall be construed to waive or otherwise affect any other requirement of this Act which relates to the reporting of campaign-related disbursements.”.
(2) CONFORMING AMENDMENT.—Section 304(f)(6) of such Act (52 U.S.C. 30104) is amended by striking “Any requirement” and inserting “Except as provided in section 324(b), any requirement”.
(b) Coordination with FinCEN.—
(1) IN GENERAL.—The Director of the Financial Crimes Enforcement Network of the Department of the Treasury shall provide the Federal Election Commission with such information as necessary to assist in administering and enforcing section 324 of the Federal Election Campaign Act of 1971, as amended by this section.
(2) REPORT.—Not later than 6 months after the date of the enactment of this Act, the Chairman of the Federal Election Commission, in consultation with the Director of the Financial Crimes Enforcement Network of the Department of the Treasury, shall submit to Congress a report with recommendations for providing further legislative authority to assist in the administration and enforcement of such section 324.
Section 319(b)(2) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121(a)(1)(A)), as amended by section 102, is amended—
(1) by striking “includes any disbursement” and inserting “includes—
“(A) any disbursement”;
(2) by striking the period at the end and inserting “; and”, and
(3) by adding at the end the following new subparagraph:
The amendments made by this title shall apply with respect to disbursements made on or after January 1, 2022, and shall take effect without regard to whether or not the Federal Election Commission has promulgated regulations to carry out such amendments.
Section 307(a)(6) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30107(a)(6)) is amended by inserting “(including a proceeding before the Supreme Court on certiorari)” after “appeal”.
(a) In general.—Title IV of the Federal Election Campaign Act of 1971 (52 U.S.C. 30141 et seq.) is amended by inserting after section 406 the following new section:
“(a) In general.—If any action is brought for declaratory or injunctive relief to challenge, whether facially or as-applied, the constitutionality or lawfulness of any provision of this Act or of chapter 95 or 96 of the Internal Revenue Code of 1986, or is brought to with respect to any action of the Commission under chapter 95 or 96 of the Internal Revenue Code of 1986, the following rules shall apply:
“(1) The action shall be filed in the United States District Court for the District of Columbia and an appeal from the decision of the district court may be taken to the Court of Appeals for the District of Columbia Circuit.
“(2) In the case of an action relating to declaratory or injunctive relief to challenge the constitutionality of a provision, the party filing the action shall concurrently deliver a copy of the complaint to the Clerk of the House of Representatives and the Secretary of the Senate.
“(3) It shall be the duty of the United States District Court for the District of Columbia and the Court of Appeals for the District of Columbia Circuit to advance on the docket and to expedite to the greatest possible extent the disposition of the action and appeal.
“(b) Clarifying scope of jurisdiction.—If an action at the time of its commencement is not subject to subsection (a), but an amendment, counterclaim, cross-claim, affirmative defense, or any other pleading or motion is filed challenging, whether facially or as-applied, the constitutionality or lawfulness of this Act or of chapter 95 or 96 of the Internal Revenue Code of 1986, or is brought to with respect to any action of the Commission under chapter 95 or 96 of the Internal Revenue Code of 1986, the district court shall transfer the action to the District Court for the District of Columbia, and the action shall thereafter be conducted pursuant to subsection (a).
“(c) Intervention by Members of Congress.—In any action described in subsection (a) relating to declaratory or injunctive relief to challenge the constitutionality of a provision, any Member of the House of Representatives (including a Delegate or Resident Commissioner to the Congress) or Senate shall have the right to intervene either in support of or opposition to the position of a party to the case regarding the constitutionality of the provision. To avoid duplication of efforts and reduce the burdens placed on the parties to the action, the court in any such action may make such orders as it considers necessary, including orders to require interveners taking similar positions to file joint papers or to be represented by a single attorney at oral argument.
“(d) Challenge by Members of Congress.—Any Member of Congress may bring an action, subject to the special rules described in subsection (a), for declaratory or injunctive relief to challenge, whether facially or as-applied, the constitutionality of any provision of this Act or chapter 95 or 96 of the Internal Revenue Code of 1986.”.
(1) Section 9011 of the Internal Revenue Code of 1986 is amended to read as follows:
“For provisions relating to judicial review of certifications, determinations, and actions by the Commission under this chapter, see section 407 of the Federal Election Campaign Act of 1971.”.
(2) Section 9041 of the Internal Revenue Code of 1986 is amended to read as follows:
“For provisions relating to judicial review of actions by the Commission under this chapter, see section 407 of the Federal Election Campaign Act of 1971.”.
(3) Section 310 of the Federal Election Campaign Act of 1971 (52 U.S.C. 30110) is repealed.
(4) Section 403 of the Bipartisan Campaign Reform Act of 2002 (52 U.S.C. 30110 note) is repealed.
(c) Effective date.—The amendments made by this section shall apply to actions brought on or after January 1, 2021.
If any provision of this Act or amendment made by this Act, or the application of a provision or amendment to any person or circumstance, is held to be unconstitutional, the remainder of this Act and amendments made by this Act, and the application of the provisions and amendment to any person or circumstance, shall not be affected by the holding.
Calendar No. 120 | |||||
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A BILL | |||||
To amend the Federal Election Campaign Act of 1971 to provide for additional disclosure requirements for corporations, labor organizations, Super PACs and other entities, and for other purposes. | |||||
August 7, 2021 | |||||
Read the second time and placed on the calendar |