Article - State Personnel and Pensions
(a) (1) In
this subtitle the following words have the meanings indicated.
(2) (i) “Actively
managed separate accounts” means the accounts of the several
systems that are actively managed at the direction of the Board of
Trustees and held in separate accounts.
managed separate accounts” does not mean indexed funds, private
equity funds, real estate funds, or other commingled or passively
means any corporation, utility, partnership, joint venture, franchisor,
franchisee, trust, entity investment vehicle, financial institution,
or a wholly owned subsidiary of any of these entities.
action” means selling, redeeming, transferring, exchanging,
otherwise disposing of, and refraining from further investment in
business in Iran” means the company has, with actual knowledge,
on or after August 5, 1996, made an investment of $20,000,000 or more,
or any combination of investments of at least $10,000,000 each, which
in the aggregate equals or exceeds $20,000,000 in any 12–month
period, and which directly or significantly contributes to the enhancement
of Iran’s ability to develop the petroleum or natural gas resources
business in Sudan” means engaging in commerce in Sudan by maintaining
or leasing equipment, facilities, personnel, or other apparatus of
business or commerce in oil–related activities, mineral extraction
activities, power production activities, or production of military
equipment of Sudan.
accounts” means actively managed separate accounts containing
funds of the several systems.
of Iran” means the government of Iran, its instrumentalities,
and companies owned or controlled by the government of Iran.
means the commitment of funds or other assets to a company, including:
(i) the ownership
or control of a share or interest in the company; or
(ii) the ownership
or control of a bond or other debt instrument of a company.
means the Islamic Republic of Iran.
(11) (i) “Sudan”
means the government in Khartoum, Sudan, that is led by the National
Congress Party (formerly known as the National Islamic Front) or any
successor government formed on or after October 13, 2006, including
the Coalition National Unity Government agreed on in the Comprehensive
Peace Agreement for Sudan.
does not mean the regional government of southern Sudan.
(b) The Board of
Trustees shall review the investment holdings in eligible accounts
for the purpose of determining the extent to which funds in eligible
accounts are invested in companies doing business in Iran or Sudan.
(c) (1) Except
as otherwise provided in this section, and consistent with the fiduciary
duties of the Board of Trustees under Subtitle 2 of this title and
all other applicable law, the Board of Trustees shall, within 30 days
of its review under subsection (b) of this section, provide written
notice and opportunity to comment to a company in which eligible accounts
are invested and that has been identified as doing business in Iran
(2) Any notice
provided by the Board of Trustees under paragraph (1) of this subsection
shall state that the company shall be subject to divestment action
by the Board of Trustees unless the company provides written comments
within 90 days to the Board of Trustees:
that the company is not doing business in Iran or Sudan; or
(ii) stating that,
within 60 days of providing written comments to the Board of Trustees
under this paragraph, the company will produce a plan to end doing
business in Iran or Sudan within 1 year.
(3) If the company
demonstrates to the satisfaction of the Board of Trustees that it
is not doing business in Iran or Sudan, the Board of Trustees may
not take any divestment action against the company.
(4) (i) If
within 60 days of providing written comments to the Board of Trustees
under paragraph (2) of this subsection, the company produces a plan
to cease doing business in Iran or Sudan within 1 year, the Board
of Trustees may not take any divestment action against the company.
(ii) If the Board
of Trustees does not take any divestment action under subparagraph
(i) of this paragraph, the Board of Trustees shall monitor the progress
of the company’s plan to cease doing business in Iran or Sudan
over the 12 months immediately following receipt of the plan.
(iii) If the company
ceases doing business in Iran or Sudan within 1 year, the Board of
Trustees may not take any divestment action against the company.
(iv) If the company
does not cease doing business in Iran or Sudan within 1 year, the
Board of Trustees shall take divestment action against the company
as provided in subsection (d) of this section.
(d) Except as provided
in subsections (c) and (e) of this section, the Board of Trustees:
(1) shall take
divestment action in eligible accounts with regard to current investments:
(i) in any company
doing business in Iran or Sudan; or
(ii) in any security
or instrument issued by Iran or Sudan; and
(2) may not make
any new investments from net new funds in an eligible account in any
company that is doing business in Iran or Sudan as determined in accordance
with the procedures set forth in subsection (c) of this section.
the provisions of this section, the Board of Trustees may exclude
from the provisions of subsections (c) and (d) of this section, a
(1) that the United
States government affirmatively declares to be excluded from its federal
sanctions regime relating to Iran or Sudan; and
(2) whose divestment
cannot be executed for fair market value or greater.
(f) If the Board
of Trustees takes divestment action under subsection (d) of this section,
with respect to investments in a company, the Board of Trustees shall
provide the company with written notice of its decision and reasons
for the decision.
(g) On or before
October 1 of each year, and every 6 months thereafter, the Board of
Trustees shall submit a report in accordance with § 2–1246
of the State Government Article to the Senate Budget and Taxation
Committee, the House Appropriations Committee, and the Joint Committee
on Pensions that provides:
(1) a summary of
correspondence with companies engaged by the Board of Trustees under
(2) all divestment
actions taken by the Board of Trustees in accordance with this section;
(3) a list of companies
doing business in Iran or Sudan which the Board of Trustees has determined
to be ineligible for investments of net new funds under subsection
(d)(2) of this section; and
(4) other developments
relevant to investment in companies doing business in Iran or Sudan.
(h) The Board of
Trustees, or any other fiduciary of the several systems, may not be
held liable for any actions taken or decisions made in good faith
for the purpose of complying with or executing the requirements of
any divestment provisions under this subtitle.
(i) The Board of
Trustees shall act in good faith to carry out divestment action as
required by this section in compliance with all applicable State and
federal law, including relevant judicial decisions and the federal
Sudan Accountability and Divestment Act of 2007.
(j) Nothing in
this section shall require the Board of Trustees to take action as
described in this section unless the Board of Trustees determines,
in good faith, that the action is consistent with the fiduciary responsibilities
of the Board of Trustees as described in Subtitle 2 of this title.