No China in Index Funds Act

This bill prohibits index funds (investment vehicles tracking market indices) from holding shares in companies designated as "Chinese companies" under the law. It directly affects index funds and their managers, requiring them to divest from qualifying Chinese companies within 180 days of enactment (with a grace period for existing holdings). Key provisions define "Chinese company" broadly - covering entities incorporated in China, controlled by China's government, or heavily reliant on Chinese operations - and impose civil penalties of up to $250,000 or twice the transaction value for violations. The law focuses on restricting institutional investment flows rather than individual trading.