Corporate powers: political spending power.

Existing law regulates the formation and operation of various types of business and nonprofit entities, including corporations, nonprofit corporations, limited liability corporations, limited partnerships, limited liability partnerships, and unincorporated associations and sets forth their powers and duties. Existing law requires the Secretary of State to receive and process corporate and nonprofit entity filings, maintain records of those filings, and perform related duties.

This bill would redefine the powers of artificial persons, as defined, organized under the Corporations Code to specify that those powers do not include political spending power, as defined. The bill would revoke all powers, privileges, and capacities previously granted to corporations under state law and provide that a corporation operating under the jurisdiction of this state possesses only those powers, privileges, and capacities specifically granted in the Corporations Code.

The bill would declare void any act undertaken by a corporation beyond the scope of its granted powers, and would require that corporation to forfeit all granted powers. The bill would authorize reinstatement of granted powers after, among other things, disgorgement of all money used in the exercise of political spending power. The bill would authorize the Secretary of State to adopt rules regarding, among other things, reinstatement of forfeited powers. The bill would authorize the Attorney General with authority to enforce its provisions.

This bill would make its provisions severable and would further specify the intent and preference of the Legislature that corporations hold no powers at all, rather than be vested with political spending power. The bill would make related findings and declarations.