2021 - 2022 LEGISLATURE
November 30, 2021 - Introduced by Senators Roth and Darling, cosponsored by
Representatives Murphy, Armstrong, Gundrum and Allen. Referred to
Committee on Universities and Technical Colleges.
SB743,1,5 1An Act to renumber and amend 36.11 (11m) (a); to amend 25.17 (9m) and
236.11 (11m) (b); and to create 36.11 (11m) (ag), 36.11 (11m) (c) and 36.65 (7) of
3the statutes; relating to: prohibiting the Board of Regents of the University of
4Wisconsin System from investing University of Wisconsin System trust funds
5in certain companies associated with the government of China.
Analysis by the Legislative Reference Bureau
This bill prohibits the Board of Regents of the University of Wisconsin System
from investing UW System trust funds in certain companies associated with the
government of China.
Under current law, the UW System may receive gifts, grants, and donations and
the Board of Regents is responsible for overseeing and administering these gifts,
grants, and donations, commonly referred to as UW System trust funds, subject to
certain restrictions. The Board of Regents may elect to invest the UW System trust
funds by employing a financial manager, contracting with the State of Wisconsin
Investment Board, or selecting a private investment firm.
This bill prohibits the Board of Regents, directly or through a financial
manager, SWIB, or private investment firm, from investing UW System trust funds
in securities of any company 1) that is directly controlled by the Communist Party
of China or other governmental unit or instrumentality of China (government of
China) or in which the government of China maintains a majority ownership
interest; or 2) that contracts with, or provides goods, services, or credit directly to,

the government of China. If the Board of Regents maintains a prohibited investment
on the effective date of the bill, the Board of Regents must divest itself of the
investment within approximately one year. In determining whether an investment
is prohibited, the Board of Regents may rely on information about a company
available from a third-party screening service that utilizes criteria reasonably
similar to the criteria described in 1) and 2), above. The bill also requires the Board
of Regents to include, in an annual report that under current law the Board of
Regents submits to the legislature and the governor, information relating to the
Board of Regents' efforts to satisfy the requirements under the bill, including
identification of companies in which investment is prohibited and, as applicable, the
status of divestment from these companies.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB743,1 1Section 1. 25.17 (9m) of the statutes is amended to read:
SB743,2,52 25.17 (9m) If contracted to do so by the Board of Regents of the University of
3Wisconsin System, invest the moneys specified in s. 36.11 (11m) in accordance with
4the terms of the contract and, the board's standard of responsibility specified in s.
525.15 (2), and the restrictions in s. 36.11 (11m) (c).
SB743,2 6Section 2. 36.11 (11m) (a) of the statutes is renumbered 36.11 (11m) (am), and
736.11 (11m) (am) (intro.), as renumbered, is amended to read:
SB743,2,98 36.11 (11m) (am) (intro.) The Subject to par. (c) and s. 36.29 (1), the board may
9invest revenues from gifts, grants, and donations by doing any of the following:
SB743,3 10Section 3 . 36.11 (11m) (ag) of the statutes is created to read:
SB743,2,1111 36.11 (11m) (ag) In this subsection:
SB743,2,1212 1. “Company” has the meaning given for “business entity” in s. 13.62 (5).
SB743,2,1313 2. “Government of China” means any of the following:
SB743,2,1414 a. The Communist Party of China.
SB743,3,2
1b. Any governmental unit of the People's Republic of China or of a province,
2region, or other political subdivision of the People's Republic of China.
SB743,3,43 c. Any instrumentality of the People's Republic of China or the Communist
4Party of China.
SB743,4 5Section 4. 36.11 (11m) (b) of the statutes is amended to read:
SB743,3,86 36.11 (11m) (b) Notwithstanding ss. 25.14 (1) (a) and 25.17 (1) (g), the board
7is not required to deposit revenues from gifts, grants, and donations in the state
8investment fund if the board invests these moneys as provided in par. (a) (am).
SB743,5 9Section 5 . 36.11 (11m) (c) of the statutes is created to read:
SB743,3,1210 36.11 (11m) (c) 1. Subject to subds. 2. and 3., after the effective date of this
11subdivision .... [LRB inserts date], the board may not invest revenues from gifts,
12grants, and donations in any equity or debt securities of any of the following:
SB743,3,1413 a. Any company that is directly controlled by the government of China or in
14which the government of China maintains a majority ownership interest.
SB743,3,1615 b. Any company that contracts with, or provides goods, services, or credit
16directly to, the government of China.
SB743,3,2017 2. Subject to subd. 3., if the board, on the effective date of this subdivision ....
18[LRB inserts date], maintains any investment prohibited under subd. 1., the board
19shall divest itself of the investment not later than the first day of the 13th month
20beginning after the effective date of this subdivision .... [LRB inserts date].
SB743,3,2521 3. In determining whether an investment is prohibited under subds. 1. and 2.,
22the board may rely on 3rd-party information about a company available from any
23reputable research or screening service, pension fund, institutional investor, or
24investment adviser, if the 3rd-party information utilizes criteria reasonably similar
25to the criteria specified in subd. 1. a. and b.
SB743,4,5
14. This paragraph applies to financial managers, the investment board, and
2private investment firms acting on behalf of the board as provided in par. (am), and
3applies both to investments held directly in the board's name or as nominee and to
4investments held indirectly in mutual funds, index funds, or similar commingled
5investment instruments.
SB743,6 6Section 6. 36.65 (7) of the statutes is created to read:
SB743,4,117 36.65 (7) Trust funds investment in companies associated with the
8government of China.
The board shall include in the report required under sub. (2)
9information relating to the board's efforts to satisfy the requirements under s. 36.11
10(11m) (c), including identification of companies in which investment is prohibited
11and, as applicable, the board's status of divestment from these companies.
SB743,7 12Section 7 . Initial applicability.
SB743,4,1413 (1) Report. The treatment of s. 36.65 (7) first applies to the first report
14submitted at least 90 days after the effective date of this subsection.
SB743,8 15Section 8 . Effective date.
SB743,4,1716 (1) This act takes effect on the first day of the 4th month beginning after
17publication.
SB743,4,1818 (End)
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