,,ii  #aaith ,,congress  #ast ,session  
,s4 #bjdf  ,,in ,,the ,,senate ,,of     
,,the ,,united ,,states  ,june #ab1     
#bjbe ,mr4 ,ricketts introduced the     
following bill2 which was read twice and
 referred to the ,committee on ,banking1
 ,housing1 and ,urban ,affairs  ,a      
,,bill  ,to prohibit index funds from   
investing in ,chinese companies1 and for
 other purposes4  #a4  ,short title     
,this ,act may be cited as the ,no      
,china in ,index ,funds ,act4  #b4      
,definitions  ,in this ,act3 7#a7       
,amount of the transaction ,the term    
amount of the transaction means--  7,a7 
with respect to a purchase that violates
 this ,act1 the purchase price2 and     
7,b7 with respect to the holding of an  
investment that violates this ,act1 the 
fair market value of the investment at  
the time of the violation4  7#b7        
,chinese company  ,the term ,chinese    
company means a company--  7,a7         
incorporated or otherwise organized in  
the ,people's ,republic of ,china2  7,b7

 that has a majority of its assets or   
employees located in the ,people's      
,republic of ,china2  7,c7 owned by1    
controlled by1 or subject to the        
jurisdiction or direction of the        
government of the ,people's ,republic of
 ,china2  7,d7 where a majority of the  
value of the company depends on the     
revenues1 profits1 market               
capitalization1 assets1 or the value of 
a security 7including options to        
purchase or sell7 of a company described
 in subparagraph 7,a71 7,b71 or 7,c71 as
 determined by the ,securities and      
,exchange ,commission2 or  7,e7 where a 
company described under subparagraph    
7,a71 7,b71 or 7,c7 has control1 as     
defined in section #bcj4dje of title    
#ag1 ,code of ,federal ,regulations1 of 
the company1 as determined by the       
,securities and ,exchange ,commission4  
7#c7  ,hedge fund  ,the term hedge fund 
means an issuer that would be an        
investment company but for paragraph    
7#a7 or 7#g7 of section #c7;c7 of the   

,investment ,company ,act of #aidj 7#ae 
,u4,s4,c4 #hj;a-#c7;c774  7#d7  ,index  
fund  ,the term index fund means an     
investment company or hedge fund that is
 designed to track an index of          
securities or a portion of such an      
index4  7#e7  ,investment company  ,the 
term investment company has the meaning 
given the term in section #c of the     
,investment ,company ,act of #aidj 7#ae 
,u4,s4,c4 #hj;a-#c74  #c4  ,prohibition 
7a7  ,in general  ,an index fund may not
 invest in a ,chinese company4  7b7     
,divestment period safe harbor  ,with   
respect to an index fund with an        
investment in a ,chinese company on the 
date of enactment of this ,act1         
subsection 7a7 shall not apply to such  
investment during the #ahj-;day period  
beginning on the date of enactment of   
this ,act4  7c7  ,civil penalty  ,any   
person who violates this section shall  
be subject to a civil penalty in an     
amount not to exceed the greater of--   
7#a7 #bej1jjj2 or  7#b7 an amount that  

is twice the amount of the transaction  
that is the basis of the violation with 
respect to which the penalty is imposed4
  7d7  ,rulemaking  ,the ,securities and
 ,exchange ,commission may issue such   
rules as may be necessary to carry out  
this section4