WeVote
Log In

Bill

Bill

HR 9028

PRC Broker-Dealers and Investment Advisers Moratorium Act

119th Congress Introduced by Josh Gottheimer and 1 co-sponsor

Imposes a five-year moratorium blocking PRC-owned or PRC-connected broker-dealers and investment advisers from U.S. registration.

Introduced in House
0
WeVote Research Nonpartisan
Bill Summary · HR 9028

Summary of HR 9028 — PRC Broker-Dealers and Investment Advisers Moratorium Act

Purpose and intent

  • Establishes a temporary moratorium (5 years) on registering certain brokers/dealers and investment advisers with ties to the People's Republic of China (PRC).
  • Aims to prohibit registration of Chinese-owned or China-connected entities and individuals in key U.S. securities regulatory regimes (SEC registration for brokers/dealers and investment advisers).

Key provisions

Prohibition on broker-dealer registration (Section 15, Securities Exchange Act of 1934)

  • Defines “control” as beneficial ownership of more than 15% of voting securities.
  • Prohibits registration of a broker or dealer if:
    • The entity is organized under PRC law.
    • The entity is controlled by an PRC-organized entity.
    • The entity is controlled by a PRC national residing in the PRC.
    • There is an associated person of the broker/dealer organized under PRC law that provides services to the broker/dealer, including:
    • Platform infrastructure
    • Network services
    • Software or product development, maintenance, or support
  • Effect: Any such entities/relationships cannot register as brokers or dealers in the U.S. during the 5-year period.
  • Termination: After 5 years from enactment, the added subsection (p) would be removed from Section 15.

Prohibition on investment adviser registration (Section 203, Investment Advisers Act of 1940)

  • Defines “control” similarly as more than 15% voting securities.
  • Prohibits registration of an investment adviser if:
    • The entity is organized under PRC law.
    • The entity is controlled by a PRC-organized entity.
    • The entity is controlled by a PRC national residing in the PRC.
    • An affiliate organized under PRC law provides services to the adviser, including:
    • Software development or support
    • Product development
    • Customer service
  • Effect: Any such entities/relationships cannot register as investment advisers in the U.S. during the 5-year period.
  • Termination: After 5 years from enactment, the added subsection (o) would be removed from Section 203.

Who would be affected

  • Broker-dealers seeking registration in the United States with PRC ties or ownership structures.
  • Investment advisers seeking U.S. registration that are PRC-organized, controlled by PRC entities or nationals, or rely on PRC-affiliates for key services.
  • Associated PRC entities that provide platform, software, network, development, or customer service functions to U.S.-registered firms.

Timelines and procedural aspects

  • Introduction date: May 26, 2026.
  • Referral: House Committee on Financial Services.
  • Effective period: 5-year moratorium on the new registration prohibitions.
  • Sunset: The targeted subsections (p) of Section 15 and subsection (o) of Section 203 would be repealed automatically at the end of the 5-year period.

Potential impact and considerations

  • Significantly restricts PRC-owned or PRC-connected entities from entering or expanding within the U.S. broker-dealer and investment adviser registration frameworks during the moratorium.
  • Could affect foreign-ownership structures and service arrangements that rely on PRC-affiliated personnel or infrastructure.
  • Creates a defined, temporary policy leverage point for security/functional risk considerations related to PRC connections in the U.S. securities industry.
  • After the 5-year period, the new prohibitions would terminate, returning to pre-moratorium registration rules unless renewed or amended by subsequent legislation.

Note: This summary presents the bill’s text as introduced and does not reflect any amendments, committee reports, or potential alternative measures that may arise during the legislative process.

Compiled from official sources — confirm details with the bill’s official record.

Sign in to ask a question.