text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Iran Sanctions Enabling Act of 
  2009''.
  
  SEC. 2. FINDINGS.
  
      The Congress finds as follows:
              (1) There is an increasing interest by States, local 
          governments, educational institutions, and private institutions 
          to seek to disassociate themselves from companies that directly 
          or indirectly support the Government of Iran's efforts to 
          achieve a nuclear weapons capability.
              (2) Policy makers and fund managers may find moral, 
          prudential, or reputational reasons to divest from companies 
          that accept the business risk of operating in countries that 
          are subject to international economic sanctions or that have 
          business relationships with countries, governments, or entities 
          with which any United States company would be prohibited from 
          dealing because of economic sanctions imposed by the United 
          States.
  
  SEC. 3. AUTHORITY OF STATE AND LOCAL GOVERNMENTS TO DIVEST FROM CERTAIN 
                COMPANIES INVESTED IN IRAN'S ENERGY SECTOR.
  
      (a) Statement of Policy.--It is the policy of the United States to 
  support the decision of State governments, local governments, and 
  educational institutions to divest from, and to prohibit the investment 
  of assets they control in, persons that have investments of more than 
  $20,000,000 in Iran's energy sector.
      (b) Authority to Divest.--Notwithstanding any other provision of 
  law, a State or local government may adopt and enforce measures that 
  meet the requirements of subsection (d) to divest the assets of the 
  State or local government from, or prohibit investment of the assets of 
  the State or local government in, any person that the State or local 
  government determines, using credible information available to the 
  public, engages in investment activities in Iran described in 
  subsection (c).
      (c) Investment Activities in Iran Described.--A person engages in 
  investment activities in Iran described in this subsection if the 
  person--
              (1) has an investment of $20,000,000 or more in the energy 
          sector of Iran;
              (2) provides oil or liquified natural gas tankers, or 
          products used to construct or maintain pipelines used to 
          transport oil or liquified natural gas, for the energy sector 
          in Iran; or
              (3) is a financial institution that extends $20,000,000 or 
          more in credit to another person, for 45 days or more, if that 
          person will use the credit to invest in the energy sector in 
          Iran.
      (d) Requirements.--The requirements referred to in subsection (b) 
  that a measure taken by a State or local government must meet are the 
  following:
              (1) Notice.--The State or local government shall provide 
          written notice to each person to whom the State or local 
          government, as the case may be, intends to apply the measure, 
          of such intent.
              (2) Timing.--The measure shall apply to a person not 
          earlier than the date that is 90 days after the date on which 
          the person receives the written notice required by paragraph 
          (1).
              (3) Opportunity for hearing.--The State or local government 
          shall provide each person referred to in paragraph (1) with an 
          opportunity to demonstrate to the State or local government, as 
          the case may be, that the person does not engage in investment 
          activities in Iran described in subsection (c). If the person 
          demonstrates to the State or local government that the person 
          does not engage in investment activities in Iran described in 
          subsection (c), the measure shall not apply to the person.
              (4) Sense of the congress on avoiding erroneous 
          targeting.--It is the sense of the Congress that a State or 
          local government should not adopt a measure under subsection 
          (b) with respect to a person unless the State or local 
          government has made every effort to avoid erroneously targeting 
          the person and has verified that the person engages in 
          investment activities in Iran described in subsection (c).
      (e) Notice to Department of Justice.--Not later than 30 days after 
  adopting a measure pursuant to subsection (b), a State or local 
  government shall submit to the Attorney General of the United States a 
  written notice which describes the measure.
      (f) Nonpreemption.--A measure of a State or local government 
  authorized under subsection (b), or described in subsection (i), is not 
  preempted by any Federal law or regulation.
      (g) Definitions.--In this section:
              (1) Investment.--The ``investment'' of assets, with respect 
          to a State or local government, includes--
                      (A) a commitment or contribution of assets;
                      (B) a loan or other extension of credit; or
                      (C) the entry into or renewal of a contract for 
                  goods or services.
              (2) Assets.--
                      (A) In general.--Except as provided in subparagraph 
                  (B), the term ``assets'' refers to public monies and 
                  includes any pension, retirement, annuity, or endowment 
                  fund, or similar instrument, that is controlled 
                  directly or indirectly by a State or local government.
                      (B) Exception.--The term ``assets'' does not 
                  include employee benefit plans covered by title I of 
                  the Employee Retirement Income Security Act of 1974 (29 
                  U.S.C. 1001 et seq.).
      (h) Effective Date.--
              (1) In general.--Except as provided in paragraph (2) of 
          this subsection and subsection (i), this section shall apply to 
          measures adopted by a State or local government on or after the 
          date of the enactment of this Act.
              (2) Notice requirements.--Subsections (d) and (e) apply to 
          measures adopted by a State or local government on or after the 
          date of the enactment of this Act.
      (i) Authorization for Prior Enacted Measures.--Notwithstanding any 
  other provision of law, a State or local government may enforce a 
  measure (without regard to the requirements of subsection (d)) adopted 
  by the State or local government before the date of the enactment of 
  this Act that provides for the divestiture of assets of the State or 
  local government from, or prohibits the investment of the assets of the 
  State or local government in, any person that the State or local 
  government determines, using credible information available to the 
  public, engages in investment or business activities in Iran 
  (determined without regard to subsection (c)) identified in the 
  measure.
  
  SEC. 4. SAFE HARBOR FOR CHANGES OF INVESTMENT POLICIES BY ASSET 
                MANAGERS.
  
      Section 13(c)(1) of the Investment Company Act of 1940 (15 U.S.C. 
  80a-13(c)(1)) is amended to read as follows:
              ``(1) In general.--Solely for purposes of this subsection, 
          and notwithstanding any other provision of Federal or State 
          law, no person may bring any civil, criminal, or administrative 
          action against any registered investment company, or any 
          employee, officer, director, or investment adviser thereof, 
          based solely upon the investment company divesting from, or 
          avoiding investing in, securities issued by persons that the 
          investment company determines, using credible information that 
          is available to the public, conduct or have direct investments 
          in business operations in Sudan described in section 3(d) of 
          the Sudan Accountability and Divestment Act of 2007 or engage 
          in investment activities in Iran described in section 3(c) of 
          the Iran Sanctions Enabling Act of 2009. Nothing in this 
          paragraph shall be construed to create, imply, diminish, 
          change, or affect in any way the existence of a private cause 
          of action under any other provision of this Act.''.
  
  SEC. 5. SAFE HARBOR FOR CHANGES OF INVESTMENT POLICIES BY EMPLOYEE 
                BENEFIT PLANS.
  
      Section 404 of the Employee Retirement Income Security Act of 1974 
  (29 U.S.C. 1104) is amended by adding at the end the following new 
  subsection:
      ``(e) No person shall be treated as breaching any of the 
  responsibilities, obligations, or duties imposed upon fiduciaries by 
  this title for divesting plan assets from, or avoiding investing plan 
  assets in, persons that are determined by such person, using credible 
  information that is available to the public, to be engaged in 
  investment activities in Iran described in section 3(c) of the Iran 
  Sanctions Enabling Act of 2009. Any divestiture of plan assets from, or 
  avoidance of investing plan assets in, persons that are so determined 
  to be engaged in such investment activities shall be treated as in 
  accordance with this title and the documents and instruments governing 
  the plan.''.
  
  SEC. 6. DEFINITIONS.
  
      In this title:
              (1) Energy sector.--The term ``energy sector'' refers to 
          activities to develop petroleum or natural gas resources or 
          nuclear power.
              (2) Financial institution.--The term ``financial 
          institution'' has the meaning given that term in section 14(5) 
          of the Iran Sanctions Act of 1996 (Public Law 104-172; 50 
          U.S.C. 1701 note).
              (3) Iran.--The term ``Iran'' includes any agency or 
          instrumentality of Iran.
              (4) Person.--The term ``person'' means--
                      (A) a natural person, corporation, company, 
                  business association, partnership, society, trust, or 
                  any other nongovernmental entity, organization, or 
                  group;
                      (B) any governmental entity or instrumentality of a 
                  government, including a multilateral development 
                  institution (as defined in section 1701(c)(3) of the 
                  International Financial Institutions Act (22 U.S.C. 
                  262r(c)(3))); and
                      (C) any successor, subunit, parent company, or 
                  subsidiary of, or company under common ownership or 
                  control with, any entity described in subparagraph (A) 
                  or (B).
              (5) State.--The term ``State'' means each of the several 
          States, the District of Columbia, the Commonwealth of Puerto 
          Rico, the United States Virgin Islands, Guam, American Samoa, 
          and the Commonwealth of the Northern Mariana Islands.
              (6) State or local government.--The term ``State or local 
          government'' includes--
                      (A) any State and any agency or instrumentality 
                  thereof;
                      (B) any local government within a State, and any 
                  agency or instrumentality thereof;
                      (C) any other governmental instrumentality; and
                      (D) any public institution of higher education 
                  within the meaning of the Higher Education Act of 1965 
                  (20 U.S.C. 1001 et seq.).
  
  SEC. 7. SUNSET.
  
      This Act shall terminate 30 days after the date on which the 
  President has certified to the Congress that--
              (1) the Government of Iran has ceased providing support for 
          acts of international terrorism and no longer satisfies the 
          requirements for designation as a state-sponsor of terrorism 
          for purposes of section 6(j) of the Export Administration Act 
          of 1979, section 620A of the Foreign Assistance Act of 1961, 
          section 40 of the Arms Export Control Act, or any other 
          provision of law; or
              (2) Iran has ceased the pursuit, acquisition, and 
          development of nuclear, biological, and chemical weapons and 
          ballistic missiles and ballistic missile launch technology.
  
              Passed the House of Representatives October 14, 2009.
  
              Attest:
  
                                              LORRAINE C. MILLER,
  
                                                                   Clerk.
target: Iran Sanctions Enabling Act of 2009 - (Sec. 3) States that it is the policy of the United States to support the decision of state and local governments and educational institutions to divest from, and to prohibit the investment of assets they control in, persons that the have investments of more than $20 million in Iran's energy sector.
  
  Authorizes a state or local government to adopt and enforce measures to divest its assets from, or prohibit their investment in, any person that the state or local government determines, using credible information available to the public, engages in certain investment activities in Iran. Specifies such activities as: (1) the investment of $20 million or more in Iran's energy sector; or (2) provision of oil or liquefied natural gas tankers, or products used to construct or maintain pipelines used to transport oil or liquefied natural gas, for that energy sector. Authorizes divestment, as well, from any financial institution which extend $20 million or more in credit to another person, for 45 days or more, if that person will use the credit to invest in Iran's energy sector.
  
  Expresses the sense of Congress that a state or local government should not adopt such measures against such a person unless it has made every effort to avoid erroneously targeting the person and has verified that such person engages in such investment activities.
  
  Declares that any measure of a state or local government authorized under this Act is not preempted by any federal law or regulation.
  
  (Sec. 4) Amends the Investment Company Act of 1940 to shield any registered investment company from civil, criminal, or administrative action based upon its divesting from, or avoiding investing in, securities issued by persons that have invested in Sudan or in Iran.
  
  (Sec. 5) Amends the Employee Retirement Income Security Act of 1974 (ERISA) to shield from treatment as breaching a fiduciary duty any person divesting employee benefit plan assets from, or avoiding investing plan assets in, persons that have engaged in such investment activities in Iran.
  
  (Sec. 7) Terminates this Act 30 days after the President certifies to Congress that the government of Iran has ceased: (1) providing support for acts of international terrorism and no longer satisfies the requirements for designation as a state-sponsor of terrorism; or (2) the pursuit, acquisition, and development of nuclear, biological, and chemical weapons and ballistic missiles and ballistic missile launch technology.
feat_title: To authorize State and local governments to direct divestiture from, and prevent investment in, companies with investments of $20,000,000 or more in Iran's energy sector, and for other purposes.