Patriotic Purchasing Act of 2002

Patriotic Purchasing Act of 2002 - Prohibits any foreign corporation that acquires a domestic corporation or partnership on or after the date that is ten years before this Act's enactment from being eligible to be awarded a Federal contract if immediately after such transaction, more than 80 percent of the stock of the acquiring corporation is held by former shareholders or partners of the domestic corporation or partnership. Substitutes 50 percent for 80 percent if: (1) the acquiring corporation does not have substantial business activities in the foreign country in which or under the law of which such corporation is created or organized; and (2) the stock of such corporation is publicly traded and the principal market for trading it is in the United States.

[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4831 Introduced in House (IH)]







107th CONGRESS
  2d Session
                                H. R. 4831

 To prohibit certain expatriated corporations from being eligible for 
                    the award of Federal contracts.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 23, 2002

  Mr. Turner (for himself, Mr. Maloney of Connecticut, Mr. Kanjorski, 
 Mrs. Mink of Hawaii, Mr. Phelps, Mr. Moore, Mr. Ross, Mr. Shows, Mr. 
 Matheson, Mr. Carson of Oklahoma, Mr. Berry, Mr. Waxman, Mr. Doggett, 
 Mr. Neal of Massachusetts, Mr. Pomeroy, Mr. Rodriguez, Mr. Taylor of 
Mississippi, Mrs. Tauscher, Mr. Boyd, Mr. Stenholm, Mr. Wu, Mr. Baird, 
Mr. Edwards, Mr. Green of Texas, Mr. Holden, Mr. Evans, Mr. Allen, and 
 Mr. Boswell) introduced the following bill; which was referred to the 
                     Committee on Government Reform

_______________________________________________________________________

                                 A BILL


 
 To prohibit certain expatriated corporations from being eligible for 
                    the award of Federal contracts.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Patriotic Purchasing Act of 2002''.

SEC. 2. INELIGIBILITY OF EXPATRIATED CORPORATIONS FOR FEDERAL CONTRACT 
              AWARDS.

    (a) In General.--No acquiring corporation that enters into a 
corporate expatriation transaction shall be eligible to be awarded a 
Federal contract.
    (b) Definitions.--In this Act:
            (1) Corporate expatriation transaction.--(A) The term 
        ``corporate expatriation transaction''--
                    (i) means any transaction if--
                            (I) a foreign corporation (referred to in 
                        this section as the ``acquiring corporation'') 
                        acquires, as a result of such transaction, 
                        directly or indirectly substantially all of the 
                        properties held directly or indirectly by a 
                        domestic corporation; and
                            (II) immediately after the transaction, 
                        more than 80 percent of the stock (by vote or 
                        value) of the acquiring corporation is held by 
                        former shareholders of the domestic corporation 
                        by reason of holding stock in the domestic 
                        corporation; and
                    (ii) includes any transaction if--
                            (I) a foreign corporation acquires, as a 
                        result of such transaction, directly or 
                        indirectly properties constituting a trade or 
                        business of a domestic partnership;
                            (II) immediately after the transaction, 
                        more than 80 percent of the stock (by vote or 
                        value) of the acquiring corporation is held by 
                        former partners of the domestic partnership 
                        (determined without regard to stock of the 
                        acquiring corporation which is sold in a public 
                        offering related to the transaction); and
                            (III) the acquiring corporation meets the 
                        requirements of clauses (i) and (ii) of 
                        subparagraph (B).
            (B) Subclause (II) of subparagraph (A) shall be applied by 
        substituting ``50 percent'' for ``80 percent'' with respect to 
        any foreign corporation if--
                    (i) such corporation does not have substantial 
                business activities (when compared to the total 
                business activities of the expanded affiliated group) 
                in the foreign country in which or under the law of 
                which the corporation is created or organized; and
                    (ii) the stock of the corporation is publicly 
                traded and the principal market for the public trading 
                of such stock is in the United States.
            (C) For purposes of this paragraph--
                    (i) a series of related transactions shall be 
                treated as 1 transaction; and
                    (ii) stock held by members of the expanded 
                affiliated group which includes the acquiring 
                corporation shall not be taken into account in 
                determining ownership.
            (2) Domestic.--The term ``domestic'' means created or 
        organized in the United States or under the law of the United 
        States or of any State.
            (3) Expanded affiliated group.--The term ``expanded 
        affiliated group'' means an affiliated group as defined in 
        section 1504(a) of the Internal Revenue Code of 1986, without 
        regard to section 1504(b) of such Code.
    (c) Applicability.--This section shall apply with respect to a 
corporate expatriation transaction occurring on or after the date that 
is ten years before the date of the enactment of this Act.
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