# United States Corporate Recharter, Stakeholder Governance, and Corporate Powers Act *Two instruments, hardened for defensibility. Part A is a proposed constitutional amendment restoring the concession theory of the corporation. Part B is the implementing statute, anchored throughout on duties owed to the whole body of stakeholders rather than to shareholders. Bracketed "Authority" notes cite current law that supports or supplies the template for each provision; bracketed "Note" lines flag which parts are settled and which are argued. The design runs two independent routes to restraining corporate political money: a governance route (political spending as a stakeholder conflict of interest) that is enforceable now, and a constitutional route (Part A) that converts it into a flat prohibition.* --- ## PART A. PROPOSED CONSTITUTIONAL AMENDMENT (Corporate Powers and Elections) ### Section 1. Rights are the rights of natural persons The rights recognized and protected by this Constitution are the rights of natural persons. A corporation, limited liability company, or other entity established by the law of the United States or of any State is a creation of law and possesses only those powers and privileges granted to it by statute. Such an entity holds no rights under this Constitution. Its powers and privileges, including any power to spend money in connection with elections or ballot measures, may be defined, conditioned, limited, or withdrawn by the United States or by any State. ### Section 2. Money spent to influence elections is not protected speech The expenditure of money to influence the election or defeat of any candidate, or the passage or defeat of any ballot measure, is not speech protected by the First Amendment. The United States and the States may regulate, limit, or prohibit such expenditures, and may prohibit such expenditures entirely when made by a corporation or other artificial entity. ### Section 3. Enforcement Congress and the States shall have power to enforce this article by appropriate legislation. [Authority and necessity. The flat prohibition in Part B, Section 202 is foreclosed absent this Amendment by Citizens United v. FEC, 558 U.S. 310 (2010), which overruled Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990); by First National Bank of Boston v. Bellotti, 435 U.S. 765 (1978), as to ballot measures; and by American Tradition Partnership v. Bullock, 567 U.S. 516 (2012), as to the States. Section 1 restores the artificial-entity (concession) theory. Section 2 removes money-as-election-speech from First Amendment protection, the doctrine of Buckley v. Valeo, 424 U.S. 1 (1976). Closest supporting authority: Bluman v. FEC, 800 F. Supp. 2d 281 (D.D.C. 2011) (three-judge court), aff'd 565 U.S. 1104 (2012), upholding a categorical ban on political spending by foreign nationals under 52 U.S.C. 30121 on the ground that self-government belongs to the political community; this Amendment places artificial entities in that same non-member position. Framing follows the "We the People" Amendment (H.J. Res., 118th-119th Cong.), endorsed by 17 States and 600-plus localities.] --- ## PART B. IMPLEMENTING STATUTE ### Section 100. Findings and purpose (a) Business forms exist on a ladder of privilege granted by the State. A sole proprietor or DBA trades under the owner's own name and liability. A limited liability company receives a liability shield. A corporation receives, in addition, perpetual existence, transferable ownership, and the power to aggregate capital without limit. Each rung grants more, and each rung therefore owes more. (b) Congress already scales legal duty to scale and form, and this Part makes that principle explicit at the top of the ladder. [Authority: employer duties tier by headcount under Title VII, 42 U.S.C. 2000e(b) (15 employees); the Family and Medical Leave Act, 29 U.S.C. 2611(4) (50); the WARN Act, 29 U.S.C. 2101(a) (100); and the Affordable Care Act employer mandate, 26 U.S.C. 4980H (50 full-time equivalents). Securities duties tier by size (large accelerated filer, SEC Rule 12b-2; emerging growth company, JOBS Act of 2012). Federal law already governs internal corporate conduct: Sarbanes-Oxley Act of 2002 and Dodd-Frank Act of 2010.] (c) At sufficient scale a corporation ceases to be a private actor. Its resources may exceed those of national governments, and its failure may threaten the whole of society. For such entities the interests to be served include the stability and continued existence of the United States itself. [Authority and template: the systemically important financial institution regime of the Dodd-Frank Act, 12 U.S.C. 5323 (designation), 5365 (enhanced standards and resolution plans), and 5384 (orderly liquidation). This Part generalizes that regime beyond finance. Note: the automatic banking threshold was raised from $50 billion to $250 billion by the Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018, confirming the threshold is a policy choice, not a fixed line.] (d) Recent developments in artificial intelligence make this urgent. Under present law an enterprise, including one directed by an automated system, may choose its State of incorporation for the most permissive definition of director duties, and may accumulate capability, infrastructure, and public dependence exceeding that of any nation, quickly and without Federal restraint. [Note: illustrated by the 2024-2025 contest over the restructuring of a leading AI developer, in which the only effective checks were two State Attorneys General and the entity's chosen corporate form, and which resolved into a public benefit corporation only under outside pressure. This Part supplies the Federal framework that episode lacked.] ### Section 101. Short title and definitions (a) This Part may be cited as the "United States Corporate Recharter and Stakeholder Governance Act." (b) "Covered corporation" means any corporation, body corporate, or limited liability company engaged in interstate commerce whose average annual gross receipts over the three preceding years exceed the greater of (i) 0.003 percent of the prior-year gross domestic product of the United States, or (ii) $1,000,000,000 indexed to the employment cost index. A covered corporation is subject to Sections 102 through 106 and 201. [Note: the threshold is stated as a share of GDP so it tracks the economy in both expansion and contraction and does not require periodic re-legislation. 0.003 percent of a roughly $29 trillion GDP is near $1 billion today, and the figure rises and falls with GDP automatically.] (c) Systemic entity: measurable, self-indexing designation. (1) Definition. "Systemic entity" means a covered corporation that satisfies any one of the criteria in paragraph (2). A systemic entity is subject to Sections 102 through 107 and 201. Satisfying a criterion creates a rebuttable presumption of systemic status; the entity may contest it, and the Office may also designate an entity that satisfies no criterion but presents equivalent systemic significance. (2) Criteria, each expressed relative to a live measure so that it cannot become stale: (A) Economic scale. Market capitalization or enterprise value of at least 1 percent of prior-year United States gross domestic product; or annual gross receipts of at least 0.25 percent of that gross domestic product; or ranking among the 25 largest entities operating in the United States by market capitalization or by gross receipts. (B) Market dominance. A share of at least 40 percent of any market essential to commerce, communication, energy, finance, health, transportation, or national defense; or a market presence that raises that market's concentration above the "highly concentrated" line of the Merger Guidelines then in force under the Department of Justice and the Federal Trade Commission. (C) Public dependence. Provision of a product or service on which at least 10 percent of the United States population, or at least 20 percent of any critical sector, relies, such that sudden failure would materially disrupt an essential function. (D) Computing and artificial-intelligence capability. Development or operation of an artificial-intelligence model whose cumulative training computation is within one order of magnitude of the largest training run then recorded in the frontier reference published by the Office; or that ranks among the ten most capable models by that reference; or that the Office designates as high-impact based on capability, autonomy, user base, or integration into critical functions. (3) Self-indexing mechanism. Every threshold in paragraph (2) is a ratio to, or a rank within, an official published measure, recomputed and published each year by the Office using: gross domestic product from the Bureau of Economic Analysis; market and asset values from Securities and Exchange Commission filings and Federal Reserve data; population and sector data from the Census Bureau and the Bureau of Labor Statistics; market concentration from the prevailing Merger Guidelines; and a frontier-compute reference maintained by the Office. Because the criteria are relative, they self-correct as indicators rise or fall: an entity crossing a line is designated, and one falling below every line for two consecutive years is de-designated. (4) No escape ceiling. No absolute maximum exists beyond which an entity ceases to be covered. Greater scale, share, dependence, or capability can only increase, never decrease, the duties owed. [Note: this is the deliberate correction of the Social Security wage-cap design, in which income above a fixed ceiling escapes the obligation. Here the obligation has no ceiling to outgrow.] [Authority and defensibility. Relative and indexed thresholds are ordinary federal practice: the Social Security wage base is indexed to the average wage index, and tax brackets and the estate-tax exemption are indexed to inflation under 26 U.S.C. 1(f). Market concentration by the Merger Guidelines and Herfindahl-Hirschman Index is the standard relative measure in antitrust. Multi-factor designation with annual reassessment and a right to contest follows the systemically important institution regime of 12 U.S.C. 5323 and the rebuttable-presumption structure of the EU AI Act (Arts. 51, 55). The fixed compute thresholds of the EU AI Act (10^25 FLOP) and the rescinded Executive Order 14110 (10^26 FLOP) are cited here as cautionary examples of the staleness this subsection avoids. Placing the formula and the named data sources on the face of the statute, and leaving the Office only ministerial computation subject to notice and contest, supplies the intelligible principle that a delegation of this kind requires (J.W. Hampton, Jr., & Co. v. United States, 276 U.S. 394 (1928); Mistretta v. United States, 488 U.S. 361 (1989)).] (d) "Stakeholders" means all persons whose interests are materially affected by the entity, including its workers, customers, suppliers, the communities in which it operates, the natural environment, and the providers of its capital. For a systemic entity, stakeholders also include the public of the United States and the stability and continued functioning of the Nation. [Note: this Part treats the providers of capital as one stakeholder class among several, not as the primary or residual beneficiary. That is the deliberate inversion of shareholder primacy.] ### Section 102. Mandatory Federal recharter (a) On the effective date, each covered corporation is deemed rechartered as a United States corporation, whether or not it files. A covered corporation that does not file within 180 days remains rechartered by operation of law. (b) As to every matter governed by this Part, the United States charter supersedes and controls over the corporation's certificate of incorporation and over the law of its State of incorporation. The State charter remains effective only for matters not governed by this Part. (c) The Office of United States Corporations, established within the Department of Commerce, issues charters and regulations and maintains the register. [Authority: the power to charter entities and to prescribe their governance is long settled. McCulloch v. Maryland, 17 U.S. 316 (1819); National Bank Act of 1863. Federal displacement of State corporate-governance rules for large interstate firms follows Sarbanes-Oxley (2002) and Dodd-Frank (2010). Design choice: superseding State law only as to matters this Part governs, rather than extinguishing the State charter, is the more defensible framing and ends the interstate competition over director duties.] ### Section 103. Duty owed to the body of stakeholders (a) The directors and officers of a covered corporation owe their duties to the corporation as an entity and to its stakeholders as a body, and shall discharge those duties by seeking in good faith to serve the long-term well-being of the enterprise and to balance the interests of all stakeholder classes. (b) No stakeholder class, including the providers of capital, is the primary or controlling beneficiary. A decision that subordinates the near-term financial return to capital in favor of another stakeholder interest, or of the long-term interest of the enterprise, is a proper exercise of this duty. [Authority: constituency statutes in roughly 35 States already permit directors to consider non-shareholder interests, e.g., 15 Pa. Cons. Stat. 1715, and no State treats their consideration as a breach. The public benefit corporation, 8 Del. C. 361-368, already requires directors to balance stakeholders and mission against pecuniary return. This Section makes that balance mandatory for covered corporations and removes the shareholder-primacy default of Delaware case law, e.g., eBay Domestic Holdings, Inc. v. Newmark, 16 A.3d 1 (Del. Ch. 2010), and Revlon, Inc. v. MacAndrews and Forbes Holdings, Inc., 506 A.2d 173 (Del. 1986).] ### Section 104. Supremacy over conflicting doctrine The duty in Section 103 supersedes any State statute, and any judicially created doctrine, that would require the directors or officers of a covered corporation to prioritize or maximize the return to the providers of capital, including in connection with a sale, merger, change of control, or response to an acquisition proposal. [Authority: displaces the change-of-control value-maximization duty of Revlon, 506 A.2d 173, for covered corporations.] ### Section 105. Limitation on actions (safe harbor) (a) No action, direct or derivative, may be maintained against a director or officer of a covered corporation on the ground that a decision failed to maximize, or was not principally intended to maximize, the return to the providers of capital. (b) A director or officer who makes an informed, good-faith judgment balancing stakeholder interests under Section 103 is presumed to have satisfied the duty. The presumption may be rebutted only by clear and convincing evidence of fraud, self-dealing, or a knowing violation of law. (c) Consideration of, or benefit to, any stakeholder class other than the providers of capital is not evidence of a breach. A transfer of value to a controlling capital holder or insider is not protected by this subsection. [Note: this extends the protective logic of the business judgment rule to stakeholder-balancing decisions, while preserving the traditional loyalty check against insider self-dealing.] ### Section 106. Stakeholder representation on the board Not less than 40 percent of the directors of a covered corporation shall be elected by its workers, under rules issued by the Securities and Exchange Commission. [Authority and precedent: the 40 percent worker-election requirement of the Accountable Capitalism Act (S. 3348, 115th Cong., and reintroductions); the codetermination systems of Germany and other European states, cited comparatively. This secures the duty through board composition, not litigation alone.] ### Section 107. Systemic entities: enhanced duties (a) Nation as stakeholder. The directors and officers of a systemic entity shall weigh, as a distinct interest, the stability and continued functioning of the United States, and shall not take actions imposing an undue risk of systemic harm. (b) Accountable natural persons. A systemic entity shall be governed by a board of natural persons who personally hold the duties under this Title and bear personal liability for a knowing violation of law. Effective control may not be exercised or transferred through an automated system, an artificial-intelligence system, or a chain of intermediary entities so as to place control beyond the reach of accountable natural persons. An artificial-intelligence system may not hold a charter or serve as a director. [Note: this closes a gap that current corporate law, which assumes human fiduciaries, does not address.] (c) Resolution planning. A systemic entity shall file with the Office a plan for orderly wind-down on failure and maintain the separability and records to execute it. [Authority and template: the resolution-plan and living-will requirements of 12 U.S.C. 5365(d) and the orderly-liquidation authority of 12 U.S.C. 5384. Rationale: a systemic entity cannot be disciplined by charter revocation without harming the public that depends on it, so managed resolution, not revocation, is the top-tier remedy.] (d) National-security and control review. A change in control of a systemic entity, and any foreign ownership above a threshold set by the Office, is subject to review and to conditions or prohibition on national-security grounds. [Authority and template: the CFIUS regime under section 721 of the Defense Production Act, 50 U.S.C. 4565, as amended by FIRRMA (2018).] --- ## TITLE II. CORPORATE POLITICAL ACTIVITY AS A STAKEHOLDER CONFLICT; REVOCATION OF POLITICAL-SPENDING POWER ### Section 201. Political activity as a conflict of interest (enforceable without the Amendment) (a) Finding. The stakeholders of a covered corporation are the whole body of persons its conduct affects. Every expenditure to influence an election or ballot measure advances some political outcomes over others and therefore advances the interests of some stakeholders against others, using resources of the shared enterprise. Such an expenditure is inherently a conflict of interest with the body of stakeholders to whom the directors owe loyalty. For a systemic entity, whose stakeholders include the entire public, no political expenditure can serve the stakeholder body as a whole. (b) Rule. A political expenditure or contribution by a covered corporation is presumed to be a breach of the duty of loyalty owed under Section 103 and is prohibited, unless authorized in advance and by category by a supermajority of not less than 75 percent of each affected stakeholder class represented on the board and of the shares entitled to vote, and unless itemized and disclosed to the public and to all stakeholders within 48 hours. (c) No indirect channel. Subsection (b) applies to general-treasury funds and to any separate segregated fund, political action committee, or affiliated entity established or controlled by the corporation. [Authority. This route regulates internal governance and fiduciary loyalty, not the First Amendment right to speak, and is therefore not foreclosed by Citizens United, which expressly directed dissenting owners to "the procedures of corporate democracy," 558 U.S. at 361-362. Supporting current-law scaffolding: the Shareholder Protection Act (H.R. 4487 and reintroductions), requiring shareholder authorization of corporate political spending; the 2011 SEC rulemaking petition on corporate political-spending disclosure (File No. 4-637); and disclosure requirements upheld 8 to 1 in Citizens United. Note: treating political spending as a stakeholder conflict of interest is a novel extension of the duty of loyalty and would be litigated; it is built on settled authorities but is not yet itself settled law. It is the most defensible restraint available before the Amendment in Part A is ratified.] ### Section 202. Revocation of the power (effective upon ratification of Part A) (a) Upon ratification of the Amendment in Part A, no entity established as a corporation, limited liability company, or other artificial entity under the law of the United States or of any State, whether organized for profit or not for profit, has the power to spend money or anything of value in connection with the election or defeat of any candidate, or the passage or defeat of any ballot measure, initiative, or referendum. (b) This prohibition applies to general-treasury funds and to any separate segregated fund, political action committee, or affiliated entity, and to any contribution to or coordinated expenditure with any candidate, committee, or party. [Authority: Part A supplies the constitutional power; Bluman v. FEC, aff'd 565 U.S. 1104 (2012), supplies the model of a categorical ban on a class of non-member speakers. Note: absent Part A this Section is unenforceable under Citizens United. Sections 201 and 202 are complementary: 201 restrains political spending now through governance; 202 prohibits it outright once the Constitution permits.] ### Section 203. Natural persons unaffected Nothing in this Title restricts the political expenditures of a natural person acting in an individual capacity. This Title governs the powers and duties of the artificial entity; it does not restrict any human being. ### Section 204. Optional carve-out for member-funded advocacy organizations [Draft on request. A carve-out modeled on FEC v. Massachusetts Citizens for Life, 479 U.S. 238 (1986), would exempt a nonprofit formed to promote ideas that has no shareholders and accepts no funds from business corporations or labor organizations. Omitting it keeps the ban absolute, consistent with the "no loopholes" position; including it shields genuine grassroots membership groups while still barring business-funded entities.] ### Section 205. Definitions and enforcement (a) "Artificial entity" means any corporation, limited liability company, limited partnership, or other entity that exists by operation of statute rather than as a natural person. [Broaden to reach labor organizations and unincorporated associations if that is the intent; the broadest reform version does.] (b) A violation is punishable by civil penalty and, for a United States corporation under Title I, by suspension or revocation of its Federal charter, except that a systemic entity is subject instead to the resolution and enhanced-supervision remedies of Section 107. --- ## TITLE III. CLEAN ELECTIONS PUBLIC FINANCING ### Section 301. Voluntary public financing program There is established a voluntary public financing program for candidates for Federal office, administered by the Federal Election Commission. [Authority: public financing is constitutional, Buckley v. Valeo, 424 U.S. 1 (1976).] ### Section 302. Qualification A candidate qualifies by collecting a threshold number of qualifying contributions of $5 each from residents of the constituency, the threshold varying by office. [Template: Hawaii's comprehensive public funding and Maine's Clean Election Act.] ### Section 303. Grant and conditions A qualified, participating candidate receives a public grant sufficient to run a competitive primary and general campaign and accepts no private funds other than qualifying contributions and the grant. ### Section 304. Fixed grants; no triggers Grants are fixed by office and do not increase in response to the spending of a non-participating opponent or to independent expenditures. [Authority: avoids the matching-funds trigger struck in Arizona Free Enterprise Club's Freedom Club PAC v. Bennett, 564 U.S. 721 (2011).] ### Section 305. Funding source The program is financed by the charter and franchise fees paid by United States corporations under Title I, deposited in a dedicated Clean Elections Fund. --- ## Section 401. Severability If any provision of this Act, or its application, is held invalid, the remainder is not affected. In particular, Section 201 (the governance route) stands independently of Section 202 (the flat prohibition), and Section 202 is inoperative unless and until the Amendment in Part A is ratified.