Regular Session
Government Affairs & Regulatory Compliance Analysis
HB34 mandates the immediate divestment of Texas state funds (TRS, ERS, Permanent School Fund) from companies with significant ties to China, Iran, North Korea, and Russia, or other countries designated by the Governor. This legislation creates immediate liquidity and reputational risks for publicly traded entities and global supply chain companies with majority foreign ownership or those deriving more than 50% of revenue from these nations.
Rep. William Metcalf·House Bill·Regular Session
Comptroller of Public Accounts (List Maintenance) • Office of the Governor (Country Designation) • State Investing Entities (ERS, TRS, Permanent School Fund - Execution of Divestment)
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Key implementation requirements and action items for compliance with this legislation
JD Key Consulting specializes in Texas regulatory compliance strategy. Work directly with James Dickey—former Chairman of the Republican Party of Texas—to understand this bill's impact on your operations and develop an actionable compliance plan.
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This bill's path through the Texas Legislature
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Common questions about HB34
HB34 mandates the immediate divestment of Texas state funds (TRS, ERS, Permanent School Fund) from companies with significant ties to China, Iran, North Korea, and Russia, or other countries designated by the Governor. This legislation creates immediate liquidity and reputational risks for publicly traded entities and global supply chain companies with majority foreign ownership or those deriving more than 50% of revenue from these nations.
HB34 was authored by Texas Representative William Metcalf during the Regular Session.
HB34 was signed into law by Governor Greg Abbott on June 20, 2025.
HB34 is enforced by Comptroller of Public Accounts (List Maintenance), Office of the Governor (Country Designation) and State Investing Entities (ERS, TRS, Permanent School Fund - Execution of Divestment).
The regulatory priority for HB34 is rated as "moderate". Businesses and organizations should review the legislation to understand potential impacts.
The cost impact of HB34 is estimated as "high". This may vary based on industry and implementation requirements.
HB34 addresses topics including governor, intergovernmental relations, retirement systems, retirement systems--general and state agencies, boards & commissions.
Key dates for HB34: Effective date is 2025-06-20. Rulemaking: Update and publish the official list of 'scrutinized companies' to include entities tied to China, Iran, North Korea, and Russia. (2026-01-01); Authority to designate additional 'countries of concern' after consultation with the DPS Public Safety Director and Homeland Security Council. (Ongoing). Consult with legal counsel regarding app
HB34 establishes the following penalties: financial/divestment penalty of Total withdrawal of state funds for Failure of a listed company to cure its 'scrutinized' status (ownership/control by country of concern) within 90 days of receiving notice.. Consult with legal counsel for specific applicability to your situation.
JD Key Consulting is an Austin, Texas-based government affairs firm led by James Dickey, former Chairman of the Republican Party of Texas. We specialize in Texas regulatory compliance and legislative strategy for data centers, energy, banking, and manufacturing.
