DFC Modernization Act of 2025
- Bill Number
- H.R. 5299
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- International Affairs
- Status
- Introduced
- Latest Action
- 2025-09-18: Ordered to be Reported (Amended) by the Yeas and Nays: 28 - 23.
- Last Updated
- 2025-12-15T21:58:33Z
AI-Generated Summary
Purpose of the Legislation
The DFC Modernization Act of 2025 modifies and reauthorizes the Better Utilization of Investments Leading to Development Act of 2018. It aims to expand the U.S. International Development Finance Corporation's (DFC) ability to mobilize private capital, increase risk tolerance in investments, and advance U.S. foreign policy, economic development, and national security objectives, including countering strategic competitors and promoting energy security for allies.
Key Provisions Outlined
- Sense of Congress and Statement of Policy: Directs the DFC to use tools such as equity, guarantees, and blended finance; invest in high-risk countries or sectors; prevent dominance by competitors in areas like infrastructure and critical minerals; and support energy diversification for partner nations.
- Definitions and Country Focus: Adds terms for "high-income country" and "country of concern" (including China, Russia, Iran, and others). Allows DFC support in high-income areas if certified as advancing U.S. interests.
- Management Changes: Adjusts the Board of Directors composition, eliminates the Chief Development Officer position, and increases the limit on administratively determined positions from 50 to 100.
- Support Authorities: Raises the equity investment cap from 30% to 49%, creates a revolving Equity Investments Account, updates enterprise fund rules, and extends the DFC's termination date to December 31, 2031.
- Other Authorities: Increases the maximum contingent liability from $60 billion to $250 billion, raises the notification threshold for projects from $10 million to $100 million, permits use of fees for IT updates, and establishes policies prohibiting support for anticompetitive projects or those involving countries of concern or their state-owned enterprises.
- Repeal: Eliminates the European Energy Security and Diversification Act of 2019.
Significant Changes to Existing Law
- Expands DFC flexibility by allowing higher equity stakes, larger-scale operations, and operations in additional countries with presidential certification.
- Removes references to coordination with the U.S. Agency for International Development and the Millennium Challenge Corporation in several sections.
- Introduces new restrictions on partnerships with state-owned enterprises from countries of concern and strengthens competitive neutrality requirements.
- Substantially increases the DFC's financial authority and reauthorizes it through 2031.
Potential Impacts
- Government Agencies: Alters DFC internal structure and reduces mandated ties to other development agencies; increases presidential oversight through certifications.
- Citizens and Economy: May facilitate U.S. private sector exports and supply chain security while potentially exposing the DFC to higher financial risks at the portfolio level.
- International Relations: Strengthens U.S. economic statecraft to counter competitors, supports allied energy security, and promotes private investment in developing and select high-income nations.
Main Stakeholders Affected
- The U.S. International Development Finance Corporation and its Board.
- Private sector investors and U.S. businesses seeking overseas opportunities.
- Developing countries and select high-income partner nations.
- Countries designated as countries of concern (prohibited from certain partnerships).
- The President and appropriate congressional committees for oversight and certifications.
Notable Legal, Constitutional, or Political Implications
- Increases executive branch discretion in foreign economic policy through certifications and expanded authorities.
- Raises the DFC's overall financial exposure, with performance measured at the portfolio rather than individual investment level.
- Establishes explicit prohibitions tied to national security concerns regarding specific foreign governments and entities.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Recent Actions
- 2025-09-18: Ordered to be Reported (Amended) by the Yeas and Nays: 28 - 23.
- 2025-09-18: Committee Consideration and Mark-up Session Held
- 2025-09-17: Committee Consideration and Mark-up Session Held
- 2025-09-11: Referred to the House Committee on Foreign Affairs.
- 2025-09-11: Introduced in House
- 2025-09-11: Introduced in House
Bill Versions
- DFC Modernization Act of 2025 — issued 2025-09-11 — PDF (18 pages)