Senate bill S-2048 bars all U.S. persons — including individual investors, mutual funds, and retirement accounts — from purchasing, selling, or holding publicly traded securities issued by Chinese entities on eight existing federal watchlists, including the Pentagon's Chinese military company list, the Treasury's NS-CMIC list, entities sanctioned under the Global Magnitsky Act, and companies linked to Uyghur forced labor. The President must consolidate these lists into a single public registry within 90 days, and U.S. investors must fully divest any covered holdings within 180 days of a security being identified. Violations carry civil penalties up to twice the transaction value or $250,000 (whichever is greater), and willful violations can result in criminal fines up to $1 million and up to 20 years in prison. Index funds, ETFs, and 401(k) plans that hold broad China exposure could be affected if any of their underlying securities are issued by covered entities.
Average Household Impact
- Investor holdings of covered Chinese securities — mandatory divestment within 180 days
- 401(k) and index-fund exposure — forced sales at market price possible
Criminal Justice & Due Process
- Criminal penalties for willful violations — up to $1M fine and 20 years prison
- Conspiracy liability — same exposure as direct violation
Transparency & Accountability
- Consolidated covered-entity list — public registry due within 90 days
- Securities identifier disclosure — CUSIP/SEDOL required in public list
Congressional Summary
PRC Military and Human Rights Capital Markets Sanctions Act of 2025This bill prohibits U.S. persons from investing in securities issued by certain sanctioned and otherwise restricted entities, including Chinese military companies and Chinese entities sanctioned for human rights abuses or corruption.The bill establishes divestment deadlines and criminal and civil penalties for violations of the bill.
Details
- Congress
- 119th
- Chamber
- Senate
- Status
- summarized
- Action
- Introduced in Senate
- Action Date
- 2025-06-12
- Date Added
- 2026-05-29
- Source
- Congress.gov →
Like reading a bill in plain English?
We're building an app that does this for every bill in Congress and lets you tell your reps how you want them to vote. We're a small team getting ready to launch, and we're trying to show investors that real people want this. Be one of them. Help us get it built. Leave your email and we'll tell you the moment the app is ready.