“A bill to prohibit the award of Federal Government contracts to inverted domestic corporations, and for other purposes.”
No CRS summary available for this bill.
This section prohibits heads of executive agencies from awarding contracts for property or services to (1) foreign incorporated entities determined to be inverted domestic corporations (i.e., entities that acquired substantially all properties of a domestic corporation or partnership on or after May 8, 2014, after which more than 50% of their stock is held by former U.S. owners or their expanded affiliated group is managed primarily in the U.S. with significant domestic business activities) or such entities' subsidiaries; or (2) joint ventures in which more than 10% (by vote or value) is held by such entities. It further requires prime contracts exceeding $10 million (other than for exclusively commercial items) to include clauses barring first-tier subcontracts exceeding 10% of the prime contract's value to such entities or joint ventures, or structuring lower-tier subcontracts to evade that limit, with violations subject to prime contract termination for default and potential suspension or debarment. The prohibition does not apply to entities whose expanded affiliated groups conduct substantial business activities in their foreign country of organization (as determined under Treasury regulations no more lenient than those under IRC §7874 as of January 18, 2017); significant domestic business activities exist if at least 25% of group employees, compensation, assets, or income are U.S.-based. Agency heads may waive the prohibition for national security or the efficient administration of federal health benefits or public health programs.