Government Bonds Expansion Act

Government Bonds Expansion Act

Passed on the 2nd of March 2025

Section 1: Economic Foundation Act

§1. The Revised Economic Foundation Act Part 1, Article 3, §1.3 shall be stricken

Article 1: Request and Approval

§1. The Senate shall have the authority to authorize and instruct the Department of Treasury to create government bonds after a majority vote as a one-time measure, as part of the passage of a piece of legislation, or as an approved regular issuance.

§1.1. The President shall have the ability to formally propose the creation of government bonds in the #bill-proposal channel as a one-time measure or regular issuance. However, the President cannot authorize government bonds.

§2. The Senate shall have the ability to force the Department of Treasury to repurchase and/or destroy government bonds.

§2.1 The Department of Tresary shall have the ability to repurchase and /or destroy government bonds if they choose so

§3. The Senate shall authorize and instruct the Department of Treasury to create a bond for a particular matter or delegate specific bond structuring details to the Treasury

Article 2: Bonds Issuance

§1. If bonds are issued then the bond proposal, or the Department of Treasury absent that, must clarify:

§1.1. The type of bond:

§1.1.1. Fixed-Term Bonds: This bond has a set value and pays a defined percentage of that value on top of the original value when its life ends or is repurchased.

§1.1.2. Interest-Bearing Bonds: This bond pays a defined percentage of a set value at regular intervals until its life ends or is repurchased.

§1.1.3. Convertible Bonds: A Bond that is converted into government ensured reward or promise at a later established date.

§1.1.4. Zero-Coupon Bonds: A Bond sold at a discount of its full value but matures or is repurchased at its full value.

§1.2 When the bond’s life ends or if it doesn’t

§2. The government must maintain a record of who owns government bonds

Article 3: Sale Approval

§1. The seller of SimDem government bonds has the authority to sell government bonds to the SimDem government public.

§1.1 If a sale of a government bond is made to a non-citizen or foreign government then the bond sale is null and void.

§1.2 The SimDem citizens who are buyers of a null and void bond have a right to claim uncompensated appropriation under article 22a of the civil code wherein these buyers have suffered indirect expropriation of private property due to the State’s failure.

§2. The purchaser of a public bond can resell the government bond to anyone in the SimDem public.

§2.1. For the transfer of bonds via private purchases or deals to be legal then the seller must inform the government of the sale so it can update the record

§2.2 Failure to inform the government of the transfer of ownership via a private purchase or deal means the bonds remain the property of the registered owner

Article 4: Repurchase

§1. The SimDem government shall have the authority to forcibly repurchase bonds at any time but must pay out the entire bond’s promised value and fulfill all conditions. However, the government must give bondholders at least 72 hours' notice before initiating a repurchase.

§1.1 SimDem citizens must be informed of the repurchase of their bond(s) and paid in one (1) week

§2. Upon the maturity of a bond, the SimDem government must be paid out within one (1) week and complete any attached conditions within three (3) weeks

§2.1 If a bond is not paid out within one (1) week then the interest on the debt is 2% weekly on the debt until the SimDem government pays in full the debt and added-on interest

§2.2 If a bond condition or promise is broken or unfulfillable then the government and the bondholder shall agree on reasonable equal financial compensation. If agreement is not reached in two (2) weeks then a lawyer or judge shall hear out the two sides and then force upon the parties an agreement.

Article 5: Implementation

§1. The bill comes into effect immediately upon passage