HB 401: "An Act relating to certain investments of state funds in the Russian Federation and financial institutions profiteering from the Russian Federation's invasion of Ukraine; providing indemnity and immunity for certain investment actions taken in compliance with law; and providing for an effective date."
00 HOUSE BILL NO. 401 01 "An Act relating to certain investments of state funds in the Russian Federation and 02 financial institutions profiteering from the Russian Federation's invasion of Ukraine; 03 providing indemnity and immunity for certain investment actions taken in compliance 04 with law; and providing for an effective date." 05 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 06 * Section 1. AS 37.10 is amended by adding a new section to read: 07 Sec. 37.10.072. Investments in the Russian Federation and certain 08 financial institutions profiteering from the Russian Federation's invasion of 09 Ukraine. (a) The commissioner or a fiduciary of a fund subject to this title, excluding 10 the Alaska Permanent Fund and the Alaska Retirement Management Board, may not 11 invest in and shall cause the fund to divest ownership, if any, in all sovereign debt of 12 the Russian Federation and the publicly traded securities of a company that has been 13 identified by the United States Department of Treasury, Office of Foreign Assets 14 Control, as
01 (1) being owned or controlled by, or having acted or purported to act 02 for or on behalf of, the government of Russia; or 03 (2) operating or having operated in the financial services sector of the 04 Russian Federation economy. 05 (b) Divestment of an ownership interest in Russian sovereign debt or a 06 company shall occur within 180 days after that sovereign debt or company is 07 identified by the United States Department of Treasury, Office of Foreign Assets 08 Control, as provided in (a) of this section. If a fund has investments managed by an 09 outside investment manager, the fiduciary shall direct the investment manager not to 10 invest in and to divest from assets identified in (a) of this section. The outside 11 investment manager shall divest from the identified assets within 180 days after 12 direction from the fiduciary. 13 (c) If an investment in a fund under (a) of this section is managed as a 14 commingled investment or other business structure in which the fund is not the sole 15 owner of the investment interest or if the investment is an index fund, the provisions 16 of (a) of this section do not apply. The commissioner shall require that, on or before 17 January 31 of each year, the fiduciary submit letters to the managers of commingled 18 investments requesting the managers to consider divesting from the investment 19 interests identified under (a) of this section. 20 (d) The commissioner or a fiduciary of a fund subject to this title, excluding 21 the Alaska Permanent Fund and the Alaska Retirement Management Board, may not 22 conduct business with a financial institution that has been identified as profiteering 23 from the Russian Federation's invasion of Ukraine. 24 (e) Notwithstanding (a) and (d) of this section, the commissioner or a 25 fiduciary of a fund may invest in the publicly traded securities of a company identified 26 by the United States Department of Treasury, Office of Foreign Assets Control, as 27 provided in (a) of this section or a financial institution identified in (d) of this section 28 if the commissioner or fiduciary determines that a failure to invest in the company or 29 failure to conduct business with the financial institution would be otherwise 30 inconsistent with applicable fiduciary responsibilities or any other duty imposed by 31 law. Before investing in a company or conducting business with a financial institution
01 under this subsection, the commissioner or a fiduciary shall consider at least three 02 alternative investment opportunities in companies or financial institutions that do not 03 conduct or have direct investments in business operations in the Russian Federation. 04 (f) Annually, on or before January 31, the commissioner shall advise the 05 president of the senate and the speaker of the house of representatives of the 06 companies identified in (a) of this section. 07 (g) If the federal government excludes a company from its present or any 08 future federal sanctions relating to the Russian Federation, the company may be 09 exempt from the divestment requirements and the investment prohibitions of this 10 section. 11 (h) For actions taken or inaction done in good faith in compliance with this 12 section, the commissioner of revenue, a fiduciary, an agent, attorney, trustee, officer, 13 employee, staff, custodian, research firm, or investment manager under contract of the 14 commissioner or the fiduciary is 15 (1) exempt from a conflicting state statutory or common law 16 obligation, including an obligation with respect to choice of an asset manager, 17 investment fund, or investment for the securities portfolio of a public fund; 18 (2) immune from liability under state or local law; 19 (3) indemnified and held harmless by the state from claims, demands, 20 suits, actions, damages, judgments, costs, charges, and expenses, including costs and 21 attorney fees, and against all liability, losses, and damages of any nature that the 22 commissioner, the fiduciary, the agent, attorney, trustee, officer, employee, staff, 23 custodian, research firm, or investment manager under contract of the commissioner or 24 the fiduciary may, at any time, sustain because of a decision to restrict, reduce, or 25 eliminate an investment in compliance with this section; and 26 (4) immune from adverse licensing actions under AS 08. 27 (i) In this section, 28 (1) "commissioner" means the commissioner of revenue; 29 (2) "financial institution" means a company engaged in the business of 30 dealing with financial and monetary transactions such as deposits, loans, investments, 31 and currency exchange;
01 (3) "profiteering" means taking advantage of the Russian Federation's 02 invasion of Ukraine to make an excessive or unfair profit, or otherwise seeking 03 financial gain in the purchase or sale of Russian sovereign debt and the publicly traded 04 securities of a Russian entity; 05 (4) "Russian sovereign debt" means any debt instrument that is issued 06 by the government of Russia. 07 (j) This section expires on July 1, 2023. 08 * Sec. 2. AS 37.10.072, enacted by sec. 1 of this Act, is repealed July 1, 2023. 09 * Sec. 3. This Act takes effect immediately under AS 01.10.070(c).