Section 4. Required actions.
(a) Procedure.--A public fund shall adhere to the procedures under this section for determining companies on its Scrutinized Companies with Activities in Iran List and Scrutinized Companies with Activities in Sudan List that qualify for divestment.
(b) Engagement.--
(1) For each company on a public fund's Scrutinized
Companies with Activities in Iran List or Scrutinized
Companies with Activities in Sudan List in which the public
fund has direct holdings, the public fund shall send a
written notice informing the company of its scrutinized
company status and specify the business activities which have
resulted in this determination and that it may become subject
to divestment by the public fund. The notice must inform the
company of the opportunity to clarify its scrutinized
business activities and encourage the company, within 180
days of the date of receipt of the notice, to cease its
scrutinized business activities in Iran, Sudan or both or
convert the activities to inactive business activities in
order to avoid qualifying for divestment by the public fund.
The notice shall be sent no later than 120 days after the
effective date of this section.
(2) If, within 180 days of the date of receipt of a
notice under paragraph (1), a company announces by public
disclosure substantial action specific to Iran or substantial
action specific to Sudan, the public fund may maintain its
holdings, but the company shall remain on the Scrutinized
Companies with Activities in Iran List or Scrutinized
Companies with Activities in Sudan List pending completion of
the companies' cessation of scrutinized business activities.
Following completion of a company's cessation of scrutinized
business activities, the public fund shall remove the company
from its Scrutinized Companies with Activities in Iran List
or Scrutinized Companies with Activities in Sudan List.
(c) Divestment.--
(1) If, after 180 days following the effective date of
receipt of the notice under subsection (b)(1), a company has
not announced by public disclosure substantial action
specific to Iran, substantial action specific to Sudan or
both as specified in the notice, or the public fund
determines or becomes aware that the company continues to
have scrutinized business activities, the public fund, within
26 months after the 180-day period, shall sell, redeem,
divest or withdraw from its direct holdings all securities of
the company.
(2) If a public fund determines or becomes aware that a
company that ceased scrutinized business activities following
engagement under subsection (b) has resumed the activities,
the public fund shall send a written notice to the company
under subsection (b), and the company shall be immediately
placed onto the public fund's Scrutinized Companies with
Activities in Iran List or Scrutinized Companies with
Activities in Sudan List.
(3) A public fund shall monitor a scrutinized company
that has announced by public disclosure substantial action
specific to Iran, substantial action specific to Sudan or
both. If, after one year the public fund determines or
becomes aware that the company has not implemented the plan,
within 26 months after the expiration of the one-year period,
the public fund shall sell, redeem, divest or withdraw from
its direct holdings all securities of the company.
(d) Prohibition.--A public fund may not acquire securities of a company on its Scrutinized Companies with Activities in Iran List or Scrutinized Companies with Activities in Sudan List.
(e) Excluded securities.--Nothing in this act shall apply to the public fund's holdings in alternative investments or indirect holdings.