Below are several possible approaches to eliminating or reducing corporate political contributions. These approaches may be considered individually or together for alignment with a state’s current corporate and campaign finance laws.  Each approach includes sample language.

• Approach 1: (Revocation and grant of corporate powers) These model provisions amend the corporate code to eliminate campaign contributions as a condition of issuing a corporate charter, while also extending those requirements to corporations doing business in the state and chartered elsewhere.

a. Sample language:

i. Effective immediately, all powers, privileges, and capacities previously granted to corporations under the laws of this state related to their ability to engage in election activity or ballot-issue activity are revoked in their entirety. No corporation operating under the jurisdiction of this state shall possess any power, privilege, or capacity to engage in election activity or ballot-issue activity unless specifically granted by subsequent provisions of this statute.

ii. Every corporation has perpetual duration and succession in its corporate name and has the corporate powers contained in this subsection, unless its articles of incorporation expressly restrict the exercise of such powers, and no powers beyond those expressly granted. Nothing in this statute grants or recognizes any power to engage in election activity or ballot-issue activity.

iii. Exemptions:

1. Election activity or ballot-issue activity prohibited by this statute shall not include any bona fide news story, commentary, or editorial distributed through the facilities of a broadcasting station or of any print, online, or digital newspaper, magazine, blog, or other periodical publication, unless the broadcasting, print, online, or digital facility is owned or controlled by a political party, a political committee, or a candidate.

2. Political committees registered under state or federal law as entities created for the purpose of engaging in election activity and ballot issue activity shall be granted the power to engage in those activities provided they exist solely for that purpose and claim no charter privilege other than limited liability. This statute does not grant any other corporation the power to engage in election activity or ballot issue activity.

iv. A corporation that exercises election activity authority or ballot issue activity authority, unless expressly permitted to do so as a political committee registered under state or federal law, forfeits all charter privileges as a matter of law.

b. Examples include: Virginia, Montana, Hawaii, and Illinois

• Approach 2: (Limiting foreign influence of elections) These model provisions prevent foreign influenced corporations from engaging in elections. 

a. Sample language:

i. (Definitions):

1. “Foreign-influenced corporation” means a corporation for which at least one of the following conditions is met:

a. A single foreign investor holds, owns, controls, or otherwise has direct or indirect beneficial ownership of one percent or more of the total equity, outstanding voting shares, membership units, or other applicable ownership interests of the corporation;

b. Two or more foreign investors in aggregate hold, own, control, or otherwise have direct or indirect beneficial ownership of five percent or more of the total equity, outstanding voting shares, membership units, or other applicable ownership interests of the corporation; or

c. A foreign investor participates directly or indirectly in the corporation’s decision-making process with respect to the corporation’s political activities in the United States.

d. The calculation of a person’s or entity’s ownership interest must exclude any portion of the person’s or entity’s direct or indirect beneficial ownership of equity, outstanding voting shares, membership units, or otherwise applicable ownership interests of a corporation that are held or owned in a mutual fund based in the United States.

2. “Foreign investor” means a person or entity that:

a. Holds, owns, controls, or otherwise has direct or indirect beneficial ownership of equity, outstanding voting shares, membership units, or otherwise applicable ownership interests of a corporation; and

b. Is any of the following:

i. A government of a foreign country;

ii. A political party organized in a foreign country;

iii. A partnership, association, corporation, organization, or other combination of persons organized under the laws of or having its principal place of business in a foreign country;

iv. An individual outside of the United States who is not a citizen or national of the United States and who is not lawfully admitted for permanent residence in the United States; or

v. A corporation in which a foreign investor holds, owns, controls, or otherwise has directly or indirectly acquired beneficial ownership of equity or voting shares in an amount that is equal to or greater than 50 percent of the total equity or outstanding voting shares.

3. (Foreign influenced corporations) A foreign-influenced corporation shall not:

i. Make an expenditure, or offer or agree to make an expenditure, to promote or defeat the candidacy of an individual for nomination, election, or appointment to a public office;

ii. Make contributions or expenditures to promote or defeat a ballot question, or to qualify a question for placement on the ballot;

iii. Make a contribution to a candidate for nomination, election, or appointment to a public office or to a candidate’s principal campaign committee; or

iv. Make a contribution to a political committee, political fund, or political party unit.

v. Make a contribution or donation to any other person or entity with the express or implied condition that the contribution or donation or any part of it be used for any of the purposes prohibited by this subdivision.

b. Examples include: Minnesota, South Dakota, and California

• Approach 3: (Corporate campaign contributions prohibited) These model provisions ban a corporation from making campaign contributions within the election code.

a. Sample language:

i. No business or professional corporation, partnership, or limited liability company incorporated or operating under the laws of this or any other state or any foreign country and not operating or registered as a political committee, and no officer or agent acting on behalf of any such entity, may make a contribution to a candidate for nomination, election, or appointment to a political office.

ii. A candidate may not accept a contribution or an offer or agreement to make a contribution that is prohibited under this section.

iii. Penalties shall be enforced for violation of this section as under STATE campaign finance laws.

b. Examples include: Iowa and Massachusetts

• Approach 4: (Shareholder approval for political contributions) These model provisions prevent a corporation from making political contributions without notice to and consent of shareholders.

a. Sample language:

i. A corporation or any of its subsidiaries may not use its money or other property in connection with a political contribution or independent expenditure unless the shareholders of the corporation, by the affirmative vote of a majority of all votes entitled to be cast, have:

1. authorized in advance the total amount of money or property that may be used for all political expenditures during a specific fiscal year of the corporation; and

2. directed that the money or property be used for:

a. a specified candidate or candidates;

b. candidates of a specified political party or parties;

c. a specified political party or parties;

d. a specified political committee or committees;

e. a specified entity or entities exempt from taxation under §501(c)(4) or (6) of the internal revenue code; or

f. a specified question or questions.

ii. Any corporation, either by itself or its subsidiaries, making a contribution or independent expenditure shall at least annually disclose to its shareholders and file with the secretary of state an accounting of the contributions and independent expenditures used for such purposes, including:

1. the date of the contribution or independent expenditure;

2. the amount of the contribution or independent expenditure;

3. the identity of the recipient of the contribution, or if an independent expenditure, the identity of the candidate, referendum, political party, pending legislation, public policy or a government rule or regulation supported or opposed; and

4. the business rationale for each such contribution or independent expenditure.

iii. The secretary of state shall post each corporation’s annual disclosure on the website maintained by the secretary of state. 

iv. Whenever it appears to the Attorney General that any person has engaged in any act or practice constituting a violation of any provision of this section, the attorney general may bring an action to obtain one or more of the following remedies:

1. a temporary restraining order

2. a temporary or permanent injunction;

3. a civil penalty not exceeding:

a. three times the amount of a political expenditure made in violation of subsection (a) of this section; or

b. $5,000 for any other violation of this section;

4. a declaratory judgment;

5. rescission;

6. restitution; and

7. any other appropriate relief.

b. Examples include: Maryland and Maine

• Approach 5: (Resolution) A model resolution such as the one below can call to nationally overturn unlimited corporate political contributions. This resolution, which has secured bipartisan support in many places, may be most effective if paired with at least one of the other approaches outlined in this document, which have greater immediate impact.

a. Suggested language:

i. The Legislature hereby calls upon the members representing [STATE] in the Congress of the United States to actively uphold the principles of federalism and to be proponents of appropriate action including championing a constitutional amendment that affirms the primary role and the authority of states to govern their election processes and to enact policies regarding campaign finance, election security and transparency, and outside influence in a manner that is consistent with established constitutional principles and that prioritizes state sovereignty.

ii. Be it further resolved, that the Secretary of the Senate is hereby authorized and directed to forward a copy of this Resolution to the President of the Senate and the Speaker of the House of Representatives of Congress and to the congressional delegation representing [STATE] in the Congress of the United States.

b. Examples include: Idaho, Maine