Landmark Turkish Divestment Bill Passes California State Senate

Wednesday, September 11, 2019

Landmark Turkish Divestment Bill Passes California State Senate

(Sacramento, CA) AB 1320, the Divestment from Turkish Bonds Act, passed the California State Senate 33-0-7. Last year, the State Senate and Assembly passed the Divestment from Turkish Bonds Act but the bill was vetoed by former Governor Jerry Brown.

California has a long history of divesting from countries that violate human rights, South Africa (apartheid policy), Sudan (Darfur genocide), and Iran (international terrorism, human rights violations). A divestment from Turkish bonds over Turkey’s denial of the Armenian Genocide, the continued funding of a campaign of genocide denial, and the recent erosion of democratic principles would send a clear message internationally that California, the fifth largest economy in the world, demands justice for 1.5 million Armenians killed.

“California is a signature away from sending a clear message to Turkey to stop their deceitful campaign of genocide denial,” stated Assemblymember Adrin Nazarian.

AB 1320 prohibits the boards of the California Public Retirement System (CalPERS) and California State Teachers' Retirement System (CalSTRS) from making additional or new investments, or renewing existing investments issued, owned, controlled, or managed by the government of Turkey after federal sanctions are imposed on Turkey.

The boards shall liquidate investments only upon action taken by the federal government. More specifically, CalPERS and CalSTRS must liquidate any of the investments described above within six months of the passage of federal sanctions on Turkey.

This bill also requires the boards of CalPERS and CalSTRS to submit reports to the Legislature and the Governor, within a year of when the federal government issues sanctions against Turkey. The report will detail a list of investments that they have already liquidated and a list of investments that potentially can be liquidated.

CalPERS based on their data from last year (2018) estimated that the exposure to the fund from Turkish investment vehicles ranges between $77 million up to $350 million as of December 31, 2018.

From their July analysis,  CalSTRS estimates the holdings of debt securities issued by the government of Turkey is approximately $3.2 million. Global equities and currency investments subject to possible divestment have a potential combined market value of up to $8.3 million.

California is home to the largest Armenian-American population in the United States.

Adrin Nazarian represents the 46th Assembly District, serving the San Fernando Valley communities of Hollywood Hills, Lake Balboa, North Hills, North Hollywood, Panorama City, Sherman Oaks, Studio City, Toluca Lake, Valley Glen, Universal City, Van Nuys, and Valley Village.