H.R. 4617: American Investment Accountability Act

The American Investment Accountability Act aims to enhance oversight of U.S. investments in foreign entities that are considered to be controlled by adversarial nations. The bill sets forth various definitions, reporting requirements, and oversight mechanisms to monitor investment activities involving certain countries deemed "foreign adversaries."

Definitions

• Country of Concern: This refers to nations identified as foreign adversaries, including China, Russia, Iran, North Korea, Cuba, and Venezuela.
• Covered United States Business: This includes U.S. corporations or partnerships, as well as foreign entities with significant U.S. ownership, and excludes small businesses.
• Covered Entity: An organization that either has ties to a country of concern, operates under its jurisdiction, or is significantly owned or controlled by such a government.

Reporting Requirements

The bill mandates multiple reports to be generated by different entities within the government:

• Secretary of Commerce: Required to report on direct investments in countries of concern, detailing the sector and origin state of the investments. This includes those made through offshore financial centers.
• Secretary of the Treasury: Needs to provide updates on portfolio investments in these countries, similarly detailing sectors and the source of investments.
• Securities and Exchange Commission (SEC): Responsible for tracking instances where U.S. businesses engage in activities with covered entities, such as mergers or joint ventures, especially those exceeding specified investment thresholds.

Investment Monitoring

The bill places particular emphasis on tracking large transactions—both direct and portfolio investments—into countries of concern. It establishes a threshold for identifying significant investments, such as those over $5 million or $10 million, depending on the type of investment.

Offshore Financial Centers

The legislation identifies offshore financial centers that facilitate significant investments into these adversarial nations. It requires transparency regarding the volume of investments made through these intermediaries.

Enforcement and Compliance

The bill gives the Secretary of the Treasury the authority to identify businesses linked to sanctioned organizations and to enforce compliance with the reporting requirements.

Transparency in Investments

Overall, the proposed legislation seeks to ensure that U.S. investments in entities tied to foreign adversaries are closely monitored and reported to Congress, thereby enhancing accountability and transparency in international economic engagements.

Relevant Companies

None found.