Gov. Josh Green signed Act 011 that establishes new restrictions on political spending activities by corporations and other “artificial persons” organized under Hawai’i law by redefining and limiting the powers granted to those entities.
Senate Bill 2471 SD2 HD2 CD2, now Act 011, takes effect July 1, 2027.
It clarifies that artificial entities created under state law possess only those powers necessary or convenient to carry out their lawful business or organizational purposes. The law specifies that those powers do not include spending money or contributing anything of value to influence elections or ballot measures.
“The foundation of our democracy is that political power belongs to the people,” said Sen. Jarrett Keohokalole (District 24 – Kāneʻohe, Kailua) and chair of the Senate Commerce and Consumer Protection Committee.
“Corporations and other artificial entities exist because the state grants them legal privileges, including limited liability and lucrative tax benefits that individuals cannot claim. Act 011 clarifies that those privileges do not include the power to spend corporate money to influence our elections.”
Political action committees will remain governed by existing campaign finance laws within the state, but they will not be able to spend any money received from corporations as a result of this Act.
This new law is intended to strengthen transparency, reduce the influence of corporate money in elections, and help restore public trust in Hawaiʻi’s democratic process.
Act 011 applies to a range of entities organized or authorized to do business under Hawaiʻi law, including corporations, nonprofit corporations, limited liability companies, limited partnerships, limited liability partnerships, and certain associations. It also authorizes the attorney general and the director of Commerce and Consumer Affairs to impose penalties or bring enforcement actions for violations.
“This bill does not regulate the rights of natural persons to speak, petitio, or associate,” Keohokalole said. “It simply defines the powers that the State grants to artificial entities and makes clear that participation in election activity and ballot-issue activity is not among them.”
