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CALIFORNIA CORPORATE & SECURITIES LAW

California Corporate Contribution Initiative Cleared For Circulation

Opponents of the Supreme Court’s decision in Citizens United v. Federal Election Commission, 130 S. Ct. 876, 558 US 50, 175 L. Ed. 2d 753 (2010) are fighting back in California on numerous fronts.  Last month, California State Senator Noreen Evans introduced a bill, SB 982, to require corporations to issue a report on planned political spending as well as expenditures for the previous fiscal year. See “Bill Seeks to Mandate Corporate Political Disclosures“.  Then in February, someone else started the initiative process to amend the California Constitution to declare that corporation is not a person.  See “Initiative Seeks to Dehumanize Corporations in California“.

Even more recently, the California Secretary of State announced that another initiative measure has been cleared for signature collection.  Below is the Attorney General’s official title and summary:

POLITICAL CONTRIBUTIONS AND EXPENDITURES BY CORPORATIONS.  SHAREHOLDER APPROVAL. INITIATIVE STATUTE. Prohibits corporations and other business entities from making contributions or expenditures for political activities without shareholders’ prior informed approval.  Reduces the total amount of any contribution or expenditure approved by the percentage of shares not voted for approval.  Defines political activities to include those related to candidates, ballot measures, issue advocacy, political parties, committees, voter registration, or any other political or legislative causes.  Imposes criminal penalties for violations against persons spending, consenting to, or receiving prohibited contributions or expenditures. Requires detailed reporting to shareholders.  Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Increased annual state enforcement costs of potentially several hundred thousand dollars, partially offset by increased fine revenues.

 

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