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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7357 Introduced in House (IH)]
<DOC>
119th CONGRESS
2d Session
H. R. 7357
To amend title 5, United States Code, to address the responsibilities
of fiduciaries with respect to the Thrift Savings Fund, and for other
purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 4, 2026
Mr. Fine (for himself, Mr. Harrigan, and Mr. Moran) introduced the
following bill; which was referred to the Committee on Oversight and
Government Reform
_______________________________________________________________________
A BILL
To amend title 5, United States Code, to address the responsibilities
of fiduciaries with respect to the Thrift Savings Fund, and for other
purposes.
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 ``TSP Fiduciary Security Act of
2026''.
SEC. 2. FINDINGS.
Congress finds the following:
(1) The Federal Retirement Thrift Investment Board has a
fiduciary duty to manage the Thrift Savings Fund in the best
interest of the beneficiaries of the Fund.
(2) The principal beneficiaries of the Thrift Savings Fund
are the civil servants of the United States, and members of the
uniformed services, who are tasked with defending the national
security of the United States.
(3) The duty of the Federal Retirement Thrift Investment
Board to manage the Thrift Savings Fund in the best interests
of the beneficiaries of the Fund includes a duty not to harm
the national security of the United States.
SEC. 3. FIDUCIARY RESPONSIBILITIES WITH RESPECT TO THRIFT SAVINGS FUND.
Section 8477 of title 5, United States Code, is amended--
(1) in subsection (b)(1)--
(A) in subparagraph (B), by striking ``; and'' and
inserting a semicolon;
(B) in subparagraph (C), by striking the period at
the end and inserting ``; and''; and
(C) by adding at the end the following:
``(D) to the maximum extent practicable, by preventing the
investments of the Thrift Savings Fund (or portions thereof),
and the exercise of voting rights associated with any such
investments, from harming the national security of the United
States.''; and
(2) in subsection (e), by adding at the end the following:
``(9)(A) Notwithstanding any other provision of this subsection, no
fiduciary shall be personally liable for any monetary damages, or be
assessed any civil penalty, under this subsection with respect to a
breach of the requirement under subsection (b)(1)(D).
``(B) Subparagraph (A) shall cease to have effect beginning on
January 1, 2027.''.
SEC. 4. REVIEW OF THRIFT SAVINGS FUND FOR COMPLIANCE WITH FIDUCIARY
DUTIES.
(a) In General.--Section 8477(f) of title 5, United States Code, is
amended--
(1) by inserting ``(1)'' after ``(f)''; and
(2) by adding at the end the following:
``(2)(A) Not later than 1 year after the date of enactment of this
paragraph, the Secretary of Labor, in consultation with the Secretary
of Defense, the Attorney General, the Secretary of Homeland Security,
and the Secretary of the Treasury, shall prescribe regulations to carry
out subsection (b)(1)(D) with respect to each of the following:
``(i) The investments of the Thrift Savings Fund, which
shall include the establishment of standards by which
compliance with subsection (b)(1)(D) with respect to the
investments of the Thrift Savings Fund (or portions thereof)
shall be determined.
``(ii) The exercise of voting rights associated with the
investments of the Thrift Savings Fund (or portions thereof).
``(B) The regulations prescribed under subparagraph (A)(ii) shall
include--
``(i) the establishment of a process by which the exercise
of voting rights described in subparagraph (A)(ii) shall be
reviewed by the Secretary of Labor, in consultation with the
Secretary of Defense, the Attorney General, the Secretary of
Homeland Security, and the Secretary of the Treasury, for
compliance with subsection (b)(1)(D) with respect to the
exercise of those rights; and
``(ii) the establishment of standards by which compliance
with subsection (b)(1)(D) with respect to the exercise of
voting rights described in subparagraph (A)(ii) shall be
determined, including the factors contributing to a
determination that a covered vote would not comply with
subsection (b)(1)(D).
``(C) For the purposes of any regulation prescribed under
subparagraph (A), the Secretary of Labor shall presume that--
``(i) an investment of the Thrift Savings Fund (or portions
thereof) does not comply with subsection (b)(1)(D) if the
investment invests in--
``(I) an entity included on--
``(aa) the list of Communist Chinese
military companies maintained under section
1237(b) of the Strom Thurmond National Defense
Authorization Act for Fiscal Year 1999 (50
U.S.C. 1701 note); or
``(bb) the entity list maintained by the
Bureau of Industry and Security of the
Department of Commerce and set forth in
Supplement No. 4 to part 744 of title 15, Code
of Federal Regulations; or
``(II) a parent, subsidiary, or affiliate of, or an
entity controlled by, an entity described in subclause
(I); and
``(ii) an exercise of voting rights associated with any
investments of the Thrift Savings Fund (or portions thereof)
does not comply with subsection (b)(1)(D) if that exercise of
voting rights is a covered vote with respect to a proposal that
would--
``(I) approve or ratify a transaction, including a
transaction described in subparagraph (D)(ii)(I), that
would cause, or would reasonably be expected to cause,
an entity to which the covered vote applies to--
``(aa) breach any contract with the Federal
Government to which the entity is a party, and
under which the consideration provided to the
entity over the course of the entire contract
is more than $10,000,000, if the entity has
otherwise complied with all applicable laws and
regulations in fulfilling the responsibilities
of the entity with respect to the contract;
``(bb) significantly reduce the production
of, or the capital expenditure or research and
development expenditure with respect to, any--
``(AA) industrial resources,
critical technology items, or materials
that are essential to the national
defense (as those terms are defined in
section 702 of the Defense Production
Act of 1950 (50 U.S.C. 4552)); or
``(BB) emerging and foundational
technology identified by the President
under section 1758 of the Export
Controls Act of 2018 (50 U.S.C. 4817);
or
``(cc) outsource or substantially sell,
whether to any affiliated entity or joint
venture, or by contract, to any entity located
in a covered country, any--
``(AA) industrial resources,
critical technology items, or materials
that are essential to the national
defense (as those terms are defined in
section 702 of the Defense Production
Act of 1950 (50 U.S.C. 4552)); or
``(BB) emerging and foundational
technology identified by the President
under section 1758 of the Export
Controls Act of 2018 (50 U.S.C. 4817);
or
``(II) elect to the board of directors of any
entity an individual who--
``(aa) is a director, officer, employee, or
affiliate of any entity described in clause
(i)(I);
``(bb) at any time during the 5-year period
preceding the date on which that election
occurs, was as described in item (aa); or
``(cc) a reasonable investor would believe
supports any proposal described in subclause
(I).
``(D) In this paragraph--
``(i) the term `covered country' means--
``(I) the People's Republic of China, the Russian
Federation, North Korea, Iran, Syria, Sudan, Venezuela,
or Cuba;
``(II) any country, the government of which the
Secretary of State determines has repeatedly provided
support for acts of international terrorism pursuant
to--
``(aa) section 1754(c)(1)(A) of the Export
Control Reform Act of 2018 (50 U.S.C.
4813(c)(1)(A));
``(bb) section 620A of the Foreign
Assistance Act of 1961 (22 U.S.C. 2371);
``(cc) section 40 of the Arms Export
Control Act (22 U.S.C. 2780); or
``(dd) any other provision of law; or
``(III) any other country that the Secretary of
Labor, in consultation with the Secretary of Defense,
the Attorney General, the Secretary of Homeland
Security, and the Secretary of the Treasury, designates
as posing an undue or unnecessary risk to the national
security of the United States; and
``(ii) the term `covered vote' means a vote in favor of (or
an abstention with respect to) a proposal to--
``(I) approve or ratify a transaction involving an
entity, including--
``(aa) any sale of, or other disposition of
(whether in a single or a series of
transactions) assets or capital stock; and
``(bb) any merger, consolidation, joint
venture, partnership, spin-off, reverse spin-
off, dissolution, restructuring,
recapitalization, liquidation, or any other
business combination or strategic transaction;
or
``(II) elect an individual to the board of
directors of the entity that is the subject of the
proposal.''.
(b) Review of Exercise of Voting Rights; Report to Congress.--
Section 8438 of title 5, United States Code, is amended--
(1) in subsection (f)--
(A) by inserting ``(1)'' after ``(f)''; and
(B) by adding at the end the following:
``(2) For the purposes of paragraph (1), a review of the exercise
of voting rights for compliance with section 8477(b)(1)(D), including
under the regulations prescribed under section 8477(f)(2), shall not be
considered to be the exercise of voting rights associated with the
ownership of securities by the Thrift Savings Fund.''; and
(2) by adding at the end the following:
``(i) Not later than 2 years after the date of enactment of this
subsection, and annually thereafter, the Secretary of Labor shall
submit to the Committee on Homeland Security and Governmental Affairs
of the Senate and the Committee on Oversight and Government Reform of
the House of Representatives a report regarding--
``(1) for the year covered by the report, the investments
of the Thrift Savings Fund (or portions thereof), and the
exercise of voting rights associated with any such investments,
that have been reviewed for compliance with section
8477(b)(1)(D); and
``(2) the outcome with respect to enforcement of each
review conducted under paragraph (1) and a justification for
that outcome.''.
SEC. 5. PROHIBITION ON INVESTMENT OF THRIFT SAVINGS FUND SUMS IN
ENTITIES BASED IN THE PEOPLE'S REPUBLIC OF CHINA THROUGH
THE TSP MUTUAL FUND WINDOW.
Section 8438(b)(5) of title 5, United States Code, is amended by
adding at the end the following:
``(E) A mutual fund accessible through a mutual fund window
authorized under this paragraph may not include an investment in any
security of--
``(i) an entity based in the People's Republic of China; or
``(ii) any subsidiary that is owned or operated by an
entity described in clause (i).''.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Oversight and Government Reform.
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