SB-1024, As Passed House, December 13, 2012

HOUSE SUBSTITUTE FOR

SENATE BILL NO. 1024

     A bill to prohibit persons who have certain economic

relationships with Iran from submitting bids on requests for

proposals with this state, political subdivisions of this state,

and other public entities; to require bidders for certain public

contracts to submit certification of eligibility with the bid; to

require reports; and to provide for sanctions for false

certification.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 1. This act shall be known and may be cited as the "Iran

economic sanctions act".

     Sec. 2. As used in this act:

     (a) "Energy sector of Iran" means activities to develop

petroleum or natural gas resources or nuclear power in Iran.

     (b) "Investment" means 1 or more of the following:

     (i) A commitment or contribution of funds or property.

     (ii) A loan or other extension of credit.

     (iii) The entry into or renewal of a contract for goods or

services.

     (c) "Investment activity" means 1 or more of the following:

     (i) A person who has an investment of $20,000,000.00 or more in

the energy sector of Iran.

     (ii) A financial institution that extends $20,000,000.00 or

more in credit to another person, for 45 days or more, if that

person will use the credit for investment in the energy sector of

Iran.

     (d) "Iran" means any agency or instrumentality of Iran.

     (e) "Iran linked business" means either of the following:

     (i) A person engaging in investment activities in the energy

sector of Iran, including a person that provides oil or liquefied

natural gas tankers or products used to construct or maintain

pipelines used to transport oil or liquefied natural gas for the

energy sector of Iran.

     (ii) A financial institution that extends credit to another

person, if that person will use the credit to engage in investment

activities in the energy sector of Iran.

     (f) "Person" means any of the following:

     (i) An individual, corporation, company, limited liability

company, business association, partnership, society, trust, or any

other nongovernmental entity, organization, or group.

     (ii) Any governmental entity or instrumentality of a

government, including a multilateral development institution, as

defined in section 1701(c)(3) of the international financial

institutional act, 22 USC 262r(c)(3).

     (iii) Any successor, subunit, parent company, or subsidiary of,

or company under common ownership or control with, any entity

described in subparagraph (i) or (ii).

     (g) "Public entity" means this state or an agency or authority

of this state, school district, community college district,

intermediate school district, city, village, township, county,

public authority, or public airport authority.

     Sec. 3. (1) Beginning April 1, 2013, an Iran linked business

is not eligible to submit a bid on a request for proposal with a

public entity.

     (2) Beginning April 1, 2013, a public entity shall require a

person that submits a bid on a request for proposal with the public

entity to certify that it is not an Iran linked business.

     Sec. 4. If a public entity determines, using credible

information available to the public, that a person has submitted a

false certification under section 3(2), the public entity shall

provide the person with written notice of its determination and of

the intent not to enter into or renew a contract with the person.

The notice shall include information on how to contest the

determination and specify that the person may become eligible for a

future contract with the public entity if the person ceases the

activities that cause it to be an Iran linked business. The person

shall have 90 days following receipt of the notice to respond in

writing and to demonstrate that the determination of false

certification was made in error. If a person does not make that

demonstration within 90 days after receipt of the notice, the

public entity may terminate any existing contract and shall report

the name of the person to the attorney general together with

information supporting the determination.

     Sec. 5. The attorney general may bring a civil action against

any person reported under section 4. If a civil action results in a

finding that the person submitted a false certification, the person

is responsible for a civil penalty of not more than $250,000.00 or

2 times the amount of the contract or proposed contract for which

the false certification was made, whichever is greater, the cost of

the public entity's investigation, and reasonable attorney fees, in

addition to the fine. A person who submitted a false certification

shall be ineligible to bid on a request for proposal for 3 years

from the date the public entity determines that the person has

submitted the false certification.

     Sec. 6. The provisions of this act are effective only if Iran

is a state sponsor of terror as defined under section 2 of the

divestment from terror act, 2008 PA 234, MCL 129.292.

     Enacting section 1. This act takes effect April 1, 2013.