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A BILL TO BE ENTITLED
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AN ACT
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relating to prohibiting contracts or other agreements involving the |
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receipt of certain tax incentives by certain foreign-owned |
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companies. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle F, Title 10, Government Code, is |
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amended by adding Chapter 2278 to read as follows: |
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CHAPTER 2278. PROHIBITION ON CONTRACTS INVOLVING RECEIPT OF TAX |
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INCENTIVES BY CERTAIN FOREIGN-OWNED COMPANIES |
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Sec. 2278.001. DEFINITIONS. In this chapter: |
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(1) "Company" means a sole proprietorship, |
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organization, association, corporation, partnership, joint |
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venture, limited partnership, limited liability partnership, or |
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limited liability company, including a wholly owned subsidiary, |
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majority-owned subsidiary, parent company, or affiliate of those |
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entities or business associations, that exists to make a profit. |
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(2) "Governmental entity" means a state agency or |
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political subdivision of this state. |
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(3) "Tax incentive" has the meaning assigned by |
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Section 490G.001. |
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Sec. 2278.002. PROHIBITED CONTRACTS. (a) A governmental |
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entity may not enter into a contract or other agreement relating to |
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tax incentives in this state with a company if: |
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(1) under the contract or other agreement, the company |
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would receive or be granted tax incentives from the governmental |
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entity; and |
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(2) the governmental entity knows that the company is: |
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(A) owned by or the majority of stock or other |
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ownership interest of the company is held or controlled by a company |
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or other entity, including a governmental entity, that is directly |
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controlled by the government of China, Iran, North Korea, or |
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Russia; or |
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(B) headquartered in China, Iran, North Korea, or |
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Russia. |
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(b) The prohibition described by Subsection (a) applies |
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regardless of whether: |
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(1) the company's or its parent company's securities |
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are publicly traded; or |
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(2) the company or its parent company is listed on a |
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public stock exchange as a Chinese, Iranian, North Korean, or |
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Russian company. |
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Sec. 2278.003. ASSISTANCE BY ECONOMIC INCENTIVE OVERSIGHT |
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BOARD. On request, the Economic Incentive Oversight Board |
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established under Chapter 490G shall, not later than the 60th |
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business day after the request, provide a governmental entity with |
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information to identify companies that may be prohibited from |
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contracting with a governmental entity under Section 2278.002. |
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SECTION 2. The change in law made by this Act applies only |
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to a contract entered into on or after the effective date of this |
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Act. A contract entered into before the effective date of this Act |
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is governed by the law in effect on the date the contract was |
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entered into, and the former law is continued in effect for that |
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purpose. |
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SECTION 3. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2023. |