The Florida Legislature has passed a bill that would require the Florida State Board of Administration, Tallahassee, to divest from Chinese state-owned entities.
The bill, HB 7071, passed both the House of Representatives and Senate unanimously March 4. Gov. Ron DeSantis has until March 27 to sign the bill, and he has not announced any plans to veto it. The bill would become law if DeSantis either signs the bill or does not do so by the deadline.
The bill requires the board, which oversees $250.3 billion in overall state assets, to cease investing in any entities that have at least 50.1% ownership by China, and also divest from any current direct holdings in the $190.4 billion Florida Retirement System Pension Plan by Sept. 1, 2025.
At the board’s March 12 investment advisory council meeting, Lamar Taylor, the board’s interim executive director and chief investment officer, said the pension plan has less than $300 million in those China state-owned entities.
“They are fairly ascertainable standards, and there are a number of service providers that we can look to help us to identify those companies so that we can implement that from a compliance process,” Taylor said in a video of the meeting.
“This legislation is directed at what’s called direct holdings, so it’ll be public market assets in separately managed accounts,” Taylor said. “We will have the ability to instruct our managers to divest those holdings, and as a result we will also have that run through our custom benchmarks as we do now with the Iran and Sudan requirements.”
A 2007 Florida law requires the SBA to publish a list of scrutinized companies in Sudan and Iran that have prohibited business operations.
