No China in Index Funds Act

This bill would stop index funds from investing in Chinese companies. If a fund already owns these stocks when the law starts, it gets 180 days to sell them. After that, investing in Chinese companies would be banned for index funds. The Securities and Exchange Commission (SEC) could write rules to carry this out .

If a fund breaks the rule, it could face a civil fine: either $250,000 or twice the amount of the transaction, whichever is higher .

• Who is affected: Index funds (including hedge funds that track an index) and their investors .
• What changes: Index funds may not invest in Chinese companies; existing holdings must be sold within the grace period .
• When: The 180-day sell-off window starts on the date the law takes effect .
• Penalties: Up to $250,000 or twice the transaction amount for violations .
• Oversight: The SEC may issue rules to implement the law .