S. 1488: Sovereign Wealth Fund Transparency Act

This bill, titled the **Sovereign Wealth Fund Transparency Act**, aims to modify existing laws related to foreign agents and their activities in the United States. Here’s a breakdown of its key components:

Clarification of Commercial Exemption

The bill clarifies that certain exemptions in the Foreign Agents Registration Act (FARA) do not apply to agents of foreign principals (such as sovereign wealth funds) whose activities promote the interests of a foreign government or political party. This means that such agents would be required to register and disclose their activities under FARA.

Authority for Civil Investigative Demands

The bill grants the Attorney General the authority to issue civil investigative demands to gather information related to investigations under FARA. This includes the power to require individuals to produce documents, provide written answers, and give oral testimony regarding their activities.

Contents of Civil Investigative Demands

Each civil investigative demand must specify:

• The nature of the alleged violation.
• The documents or information requested and deadlines for submission.
• Information on the testimony required and the rights of those summoned.

Restrictions on Disclosure

Any information or materials obtained through civil investigative demands are protected from public disclosure, ensuring confidentiality when appropriate.

Judicial Proceedings

If a person fails to comply with a civil investigative demand, the Attorney General may file a petition in district court to enforce compliance. Individuals served with a demand can challenge the demand in court.

Civil Penalties for Noncompliance

The bill establishes civil penalties for individuals who do not comply with registration requirements under FARA, which can include fines for failing to file timely registration statements or supplements. The penalties can reach up to $200,000 for willful noncompliance.

Annual Reporting Requirement

Each year, the Attorney General is required to report to Congress on the use of the civil investigative demand authority, detailing the number of demands issued, the nature of investigations, and outcomes related to those investigations.

Temporary Authority

The provisions allowing the Attorney General to issue civil investigative demands would expire five years after the bill is enacted.

Definitions

The bill provides specific definitions for various terms used within it, such as "custodian," "documentary material," and "investigation," to clarify how the law will be applied.

Relevant Companies

• SBUX - Starbucks Corporation: As a global brand, Starbucks may be subject to scrutiny if it engages in partnerships or investments with foreign sovereign wealth funds.
• AAPL - Apple Inc.: Apple has significant financial ties and operations with investors worldwide, including sovereign wealth funds that may require broader disclosures under this act.