AZ SB1221

Prohibits publicly managed funds in Arizona from holding investments in the People's Republic of China, Chinese companies, or entities controlled by the Chinese government, Chinese Communist Party, or Chinese military.

Requires divestment of prohibited holdings to begin immediately upon the law's effective date and be completed within one year, using methods such as reviewing public information, contacting asset managers, or hiring independent research firms.

Exempts funds from divestment if less than one percent of total holdings are Chinese investments and divesting would cost more than one percent of the prohibited holdings' value over five years.

Provides immunity to publicly managed funds and their representatives from liability and fiduciary duty conflicts resulting from divestment decisions made under this law.

Applies to private equity and venture capital investments entered into or renewed on or after the law's effective date.