§9621 — Title 22 Foreign Relations and Intercourse | U.S. Code

Summary

Limits how the Development Finance Corporation (the Corporation) may use its powers. The Corporation must act to carry out the U.S. policy and its stated purpose, reduce risk to U.S. taxpayers by sharing risk with private investors and eligible foreign governments, and make sure its help brings in private money that would not otherwise be used. The Corporation can make loans and guarantees on terms it sets. Loans or guarantees can be in U.S. dollars or foreign currency, but foreign currency must have a clear policy reason. Those loans and guarantees follow the Federal Credit Reform Act of 1990. The Corporation can invest as a minority owner by buying equity or similar stakes, including through investment funds, again in U.S. or foreign currency if justified. Equity support must have clear development and foreign-policy reasons and meet goals like fixing market failures, enabling projects that would not happen otherwise, building local markets and workforces, matching partner incentives, having lasting development impact, and furthering U.S. policy. For any project, equity support cannot be more than 40% of the total equity at approval and cannot make up more than 35% of the Corporation’s total exposure when provided. The Corporation should sell its equity stakes as soon as commercially reasonable and set a project-specific timetable. The Corporation may provide political risk insurance or reinsurance to private firms and qualifying sovereign entities against things like currency blocks, expropriation, war, terrorism, civil unrest, or contract and payment failures. It may fund feasibility studies and training to plan projects and should require recipients to share study costs and repay funds if the project goes forward. The Corporation can run post-investment technical assistance and, with Board approval, create companies or partnerships that meet development and foreign policy goals; for urgent national security actions, the CEO must notify Congress 30 days before and certify that other authorities can’t be used. The law creates an “Equity Investment Account” in the Treasury as a revolving fund for equity investments. The Corporation must manage it to favor catalytic projects in less developed countries, collect investment data, and has authorization for $5,000,000,000 for fiscal years 2026 through 2031. Earnings and sale proceeds stay in the fund without yearly limits. At least 25% of obligations from those funds must score in the top 20% under the Impact Quotient system. The Corporation may set up enterprise funds after consulting relevant agencies; these funds are not federal agencies. Enterprise funds support private-sector growth, credit access, foreign direct investment, and sustainable social investments. They must limit administrative costs to no more than 3% per year, have boards appointed by the President with a U.S. majority, report annually to Congress starting within one year, undergo Inspector General audits, keep separate accounts, and return any liquidation proceeds to the Treasury. Enterprise support ends 10 years after the first spending or when liquidated. All support is subject to section 2382(c). The Corporation must also work to involve U.S. small businesses and collect and report data on minority- and women-owned business participation in its projects.

Title 22, §9621

Foreign Relations and Intercourse — Source: USLM XML via OLRC

(a)The authorities in this subchapter shall only be exercised to—

(1)carry out of 11 So in original. The word “of” probably should not appear. the policy of the United States in section 9611 of this title and the purpose of the Corporation in section 9612 of this title;

(2)mitigate risks to United States taxpayers by sharing risks with the private sector and qualifying sovereign entities through co-financing and structuring of tools; and

(3)ensure that support provided under this subchapter is additional to private sector resources by mobilizing private capital that would otherwise not be deployed without such support.

(b)(1)The Corporation may make loans or guaranties upon such terms and conditions as the Corporation may determine.

(2)Loans and guaranties issued under paragraph (1) may be denominated and repayable in United States dollars or foreign currencies. Foreign currency denominated loans and guaranties should only be provided if the Board determines there is a substantive policy rationale for such loans and guaranties.

(3)Loans and guaranties issued under paragraph (1) shall be subject to the requirements of the Federal Credit Reform Act of 1990 (2 U.S.C. 661 et seq.).

(c)(1)The Corporation may, as a minority investor, support projects with funds or use other mechanisms for the purpose of purchasing, and may make and fund commitments to purchase, invest in, make pledges in respect of, or otherwise acquire, equity or quasi-equity securities or shares or financial interests of any entity, including as a limited partner or other investor in investment funds, upon such terms and conditions as the Corporation may determine.

(2)Support provided under paragraph (1) may be denominated and repayable in United States dollars or foreign currency. Foreign currency denominated support provided by paragraph (1) should only be provided if the Board determines there is a substantive policy rationale for such support.

(3)The Corporation shall develop guidelines and criteria to require that the use of the authority provided by paragraph (1) with respect to a project has a clearly defined development and foreign policy purpose, taking into account the following objectives:

(A)The support for the project would be more likely than not to substantially reduce or overcome the effect of an identified market failure in the country in which the project is carried out.

(B)The project would not have proceeded or would have been substantially delayed without the support.

(C)The support would meaningfully contribute to transforming local conditions to promote the development of markets, localized workforces, and partner country economic security.

(D)The support can be shown to be aligned with commercial partner incentives.

(E)The support can be shown to have significant developmental impact and will contribute to long-term commercial sustainability.

(F)The support furthers the policy of the United States described in section 9611 of this title.

(4)(A)The aggregate amount of support provided under this subsection with respect to any project shall not exceed 40 percent of the aggregate amount of all equity investment made to the project at the time that the Corporation approves support of the project.

(B)Support provided pursuant to this subsection shall be limited to not more than 35 percent of the Corporation’s aggregate exposure on the date that such support is provided.

(5)The Corporation shall seek to sell and liquidate any support for a project provided under this subsection as soon as commercially feasible, commensurate with other similar investors in the project and taking into consideration the national security interests of the United States.

(6)The Corporation shall create a project-specific timetable for support provided under paragraph (1).

(7)(A)There is established in the Treasury of the United States a fund to be known as the “Development Finance Corporate Equity Investment Account” (referred to in this division as the “Equity Investment Account”), which shall be administered by the Corporation as a revolving account to carry out the purposes of this section.

(B)The Corporation shall—

(i)manage the Equity Investment Account in ways that demonstrate a commitment to pursuing catalytic investments in less developed countries in accordance with section 9612(c)(1) of this title and paragraph (1); and

(ii)collect data and information about the use of the Equity Investment Account to inform the Corporation’s record of returns on investments and reevaluation of equity investment subsidy rates prior to the termination of the authorities provided under this subchapter.

(C)There is authorized to be appropriated to the Equity Investment Account $5,000,000,000 for fiscal years 2026 through 2031.

(D)Earnings and proceeds from the sale or redemption of, and fees, credits, and other collections from, the equity investments of the Corporation under the Equity Investment Account shall be retained and deposited into the Fund and shall remain available to carry out this subsection without fiscal year limitation without further appropriation.

(E)The Corporation shall ensure that at least 25 percent of its obligations from funds authorized to be appropriated under subparagraph (C) or otherwise made available for the Fund for Corporation projects are rated in the upper 20 percent on the Impact Quotient tier system, or any similar or successor assessment tool, developed pursuant to section 9652(b)(1) of this title.

(d)The Corporation may issue insurance or reinsurance, upon such terms and conditions as the Corporation may determine, to private sector entities and qualifying sovereign entities assuring protection of their investments in whole or in part against any or all political risks such as currency inconvertibility and transfer restrictions, expropriation, war, terrorism, civil disturbance, breach of contract, or nonhonoring of financial obligations.

(e)(1)In order to carry out the purpose of the Corporation described in section 9612(b) of this title, the Corporation may initiate and support, through financial participation, incentive grant, or otherwise, and on such terms and conditions as the Corporation may determine, feasibility studies for the planning, development, and management of, and procurement for, potential bilateral and multilateral development projects eligible for support under this subchapter, including training activities undertaken in connection with such projects, for the purpose of promoting investment in such projects and the identification, assessment, surveying, and promotion of private investment opportunities, utilizing wherever feasible and effective, the facilities of private investors.

(2)The Corporation shall, to the maximum extent practicable, require any person receiving funds under the authorities of this subsection to—

(A)share the costs of feasibility studies and other project planning services funded under this subsection; and

(B)reimburse the Corporation those funds provided under this section, if the person succeeds in project implementation.

(f)The Corporation may administer and manage special projects and programs in support of specific transactions undertaken by the Corporation—

(1)for the provision of post-investment technical assistance for existing projects of the Corporation, including programs of financial and advisory support that provide private technical, professional, or managerial assistance in the development of human resources, skills, technology, or capital savings; or

(2)subject to the nondelegable review and approval of the Board, by creating companies, corporations, and partnerships that advance both the development objectives and foreign policy interests outlined in the purpose of this division if, not later than 30 days prior to entering into an agreement or other arrangement to provide support pursuant to this section, the Chief Executive Officer—

(A)notifies the appropriate congressional committees; and

(B)includes in the notification required by subparagraph (A) a certification that such support—

(i)is designed to meet an exigent need that is critical to the national security interests of the United States; and

(ii)could not otherwise be secured utilizing the authorities under this section.

(g)(1)The Corporation may, following consultation with the Secretary of State, the Administrator of the United States Agency for International Development, and the heads of other relevant departments or agencies, establish and operate enterprise funds in accordance with this subsection.

(2)Nothing in this section shall be construed to make an enterprise fund an agency or establishment of the United States Government, or to make the officers, employees, or members of the Board of Directors of an enterprise fund officers or employees of the United States for purposes of title 5.

(3)The Corporation, subject to the approval of the Board, may designate private, nonprofit organizations as eligible to receive support under this subchapter for the following purposes:

(A)To promote development of economic freedom and private sectors, including small- and medium-sized enterprises and joint ventures with the United States and host country participants.

(B)To facilitate access to credit to small- and medium-sized enterprises with sound business plans in countries where there is limited means of accessing credit on market terms.

(C)To promote policies and practices conducive to economic freedom and private sector development.

(D)To attract foreign direct investment capital to further promote private sector development and economic freedom.

(E)To complement the work of the United States Agency for International Development and other donors to improve the overall business-enabling environment, financing the creation and expansion of the private business sector.

(F)To make financially sustainable investments designed to generate measurable social benefits and build technical capacity in addition to financial returns.

(4)(A)Funds made available to an enterprise fund shall be expended at the minimum rate necessary to make timely payments for projects and activities carried out under this subsection.

(B)Not more than 3 percent per annum of the funds made available to an enterprise fund may be obligated or expended for the administrative expenses of the enterprise fund.

(5)Each enterprise fund established under this subsection should be governed by a Board of Directors comprised of private citizens of the United States or the host country, who—

(A)shall be appointed by the President after consultation with the chairmen and ranking members of the appropriate congressional committees; and

(B)have pursued careers in international business and have demonstrated expertise in international and emerging market investment activities.

(6)The majority of the members of the Board of Directors shall be United States citizens who shall have relevant experience relating to the purposes described in paragraph (3).

(7)Not later than one year after the date of the establishment of an enterprise fund under this subsection, and annually thereafter until the enterprise fund terminates in accordance with paragraph (10), the Board of Directors of the enterprise fund shall—

(A)submit to the appropriate congressional committees a report—

(i)detailing the administrative expenses of the enterprise fund during the year preceding the submission of the report;

(ii)describing the operations, activities, engagement with civil society and relevant local private sector entities, development objectives and outcomes, financial condition, and accomplishments of the enterprise fund during that year;

(iii)describing the results of any audit conducted under paragraph (8); and

(iv)describing how audits conducted under paragraph (8) are informing the operations and activities of the enterprise fund; and

(B)publish, on a publicly available internet website of the enterprise fund, each report required by subparagraph (A).

(8)(A)(i)The Inspector General of the Corporation shall conduct periodic audits of the activities of each enterprise fund established under this subsection.

(ii)In conducting an audit under clause (i), the Inspector General shall assess whether the activities of the enterprise fund—

(I)support the purposes described in paragraph (3);

(II)result in profitable private sector investing; and

(III)generate measurable social benefits.

(B)The Corporation shall ensure that each enterprise fund receiving support under this subsection—

(i)keeps separate accounts with respect to such support; and

(ii)maintains such records as may be reasonably necessary to facilitate effective audits under this paragraph.

(9)Any funds resulting from any liquidation, dissolution, or winding up of an enterprise fund, in whole or in part, shall be returned to the Treasury of the United States.

(10)The authority of an enterprise fund to provide support under this subsection shall terminate on the earlier of—

(A)the date that is 10 years after the date of the first expenditure of amounts from the enterprise fund; or

(B)the date on which the enterprise fund is liquidated.

(h)Support provided under this subchapter shall be subject to section 2382(c) of this title.

(i)(1)The Corporation shall undertake, in cooperation with appropriate departments, agencies, and instrumentalities of the United States as well as private entities and others, to broaden the participation of United States small businesses and cooperatives and other small United States investors in the development of small private enterprise in less developed friendly countries or areas.

(2)(A)The Corporation shall collect data on the involvement of minority- and women-owned businesses in projects supported by the Corporation, including—

(i)the amount of insurance and financing provided by the Corporation to such businesses in connection with projects supported by the Corporation; and

(ii)to the extent such information is available, the involvement of such businesses in procurement activities conducted or supported by the Corporation.

(B)The Corporation shall include, in its annual report submitted to Congress under section 9653 of this title, the aggregate data collected under this paragraph, in such form as to quantify the effectiveness of the Corporation’s outreach activities to minority- and women-owned businesses.

Notes & Related Subsidiaries

Termination of SectionFor termination of section on Dec. 31, 2031, see section 9624 of this title.

Editorial Notes

References in Text

The Federal Credit Reform Act of 1990, referred to in subsec. (b)(3), is title V of Pub. L. 93–344 as added by Pub. L. 101–508, title XIII, § 13201(a), Nov. 5, 1990, 104 Stat. 1388–609, which is classified generally to subchapter III (§ 661 et seq.) of chapter 17A of Title 2, The Congress. For complete classification of this Act to the Code, see

Short Title

note set out under section 621 of Title 2 and Tables.

Amendments

2025—Subsec. (c)(3)(C). Pub. L. 119–60, § 8741(b), inserted “, localized workforces, and partner country economic security” after “markets”. Subsec. (c)(4)(A). Pub. L. 119–60, § 8741(c), substituted “40” for “30”. Subsec. (c)(7). Pub. L. 119–60, § 8741(a), added par. (7). Subsec. (f). Pub. L. 119–60, § 8742, added subsec. (f) and struck out former subsec. (f). Prior to amendment, text read as follows: “The Corporation may administer and manage special projects and programs in support of specific transactions undertaken by the Corporation, including programs of financial and advisory support that provide private technical, professional, or managerial assistance in the development of human resources, skills, technology, capital savings, or intermediate financial and investment institutions or cooperatives, and including the initiation of incentives, grants, or studies for energy, women’s economic empowerment, microenterprise households, or other small business activities.”

§9621 Authorities Relating to Provision of Support