House Bill Could Expand CFIUS Jurisdiction, Scrutiny Over Land Purchases
A bipartisan bill recently introduced in the House would give the Committee on Foreign Investment in the U.S. the power to block all U.S. land purchases by entities from certain “foreign adversary” countries and require mandatory CFIUS filings for those entities buying land near all American military bases. The Protecting U.S. Farmland and Sensitive Sites From Foreign Adversaries Act, introduced last week, also would establish a “presumption of non-resolvability” for those reviews, which would require the committee to assume at the outset that any national security concerns can’t be resolved.
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The bill defines “foreign adversary entities” as any entities subject to the jurisdiction or organized under the laws of China, Cuba, Iran, North Korea, Russia or Venezuela. “Food is a national security issue. Increasing foreign ownership of American farms and farmland is a threat to our food security,” said Rep. Jim Costa, D-Calif., who introduced the bill with Reps. Mike Gallagher, R-Wis., Mike Thompson, D-Calif., and others. “We need to prevent foreign adversaries like China from undermining the American agricultural industry.”
The bill's presumption of non-resolvability would require CFIUS to assume that foreign adversary entities buying land near sensitive sites is an “elevated risk real estate transaction” that “cannot be resolved through any agreement or condition,” according to the legislation's text. To clear that assumption hurdle and potentially approve that investment, the committee would need to prove “by clear and convincing evidence” the transaction “is not a risk to national security” and notify congressional committees of its decision.
The bill also could expand the CFIUS jurisdiction in other ways, including by authorizing it to consider U.S. food security, “including via biotechnology acquisition, as a factor in its national security reviews,” the lawmakers said in their news release. It also would require the USDA secretary to have a vote on CFIUS reviews of transactions that involve farmland or agriculture technology. Paul Rosen, the head of CFIUS, recently told Congress that the committee already regularly consults USDA on agriculture-related investment reviews (see 2306020027).