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Washington, DC - The U.S. House of Representatives today overwhelmingly passed S. 2271 – The Sudan Accountability and Divestment Act of 2007. The bill, led by Rep. Barbara Lee in the House, will enable state and local governments, public and private pension funds, and mutual funds to divest from companies doing business in Sudan that contribute to the ongoing genocide in that country. Although not presenting a mandate, this bill will allow those investors and managers of public funds to take actions that will hopefully help bring this genocide to a halt.
“I urge the President to do the right thing—to listen to the bipartisan, bicameral support from Congress for divestment, to learn from the example of South Africa and sign this bill,” said Rep. Barbara Lee (D-CA). “This is the moment of truth. Let’s stop the rhetoric and put the United States on the right side of history.”
“What we have here is an overwhelming demonstration that sends the message that we will empower American people’s ability to do whatever we can to put an end to the genocide in the Darfur region. Particularly, to the Government of Sudan and to those governments, including some in the Arab world and the People’s Republic of China, that across party lines and ideological divides, we have a determination to do whatever we can to put an end to this terrible set of events,” said Rep. Barney Frank (D-MA).
The measure authorizes state and local governments who choose to divest their pension fund holdings from companies on publicly available lists and contains “safe harbor” provisions for managers of mutual funds and corporate pension managers who choose to do the same. The measure also bans U.S. Government procurement contracts with companies that do not certify that they are not contributing to the energy extraction or military build up in Sudan. It also authorizes the prohibition of these types of contracts at the state and local level.
Although the government of the United States currently bans companies from conducting business operations in Sudan, millions of Americans are inadvertently supporting the Sudanese government by investing in foreign companies that conduct business operations there.
The United Nations has described Sudan’s western Darfur region as one of the world’s worst humanitarian crises. It is estimated that 200,000-400,000 Darfurians have been slaughtered, 2.5 million more have been driven from their homes, and the Sudanese government’s blockade of humanitarian aid to the displaced have left over 3 million in danger of starvation. Despite the genocide, the Sudanese economy has remained strong, supported heavily by direct foreign investment in the oil industry.
Divestment has proven effective in similar situations, as in 1986, when State pension funds and university endowments began to divest from companies that conducted business operations in South Africa and played a major role in ending apartheid in that country.
Summary of S. 2271:
- Authorizes state and local governments to divest in companies that conduct government operations in specific sectors of the Sudanese economy.
- Allows mutual fund managers to cut ties, at their discretion, from companies involved in specific sectors of the Sudanese economy.
- Requires federal contractors to certify that they do not do business with firms involved in specific Sudanese sectors.
- Establishes the sense of Congress that private pension managers are already authorized to divest their public pension funds from such businesses, in accordance with existing Department of Labor regulations.
- Withdraws divestment authority and federal contract prohibitions once the President certifies to Congress that the Sudanese government has changed certain policies and the situation in the Darfur region has improved.
A copy of the Sudan Accountability and Divestment Act Fact Sheet is attached.
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