Foreign owners of land in court

FILE - The Jefferson County Courthouse (Pine Bluff Commercial/Byron Tate)
FILE - The Jefferson County Courthouse (Pine Bluff Commercial/Byron Tate)

The successful appeal of an attempt to stop a Florida law restricting foreign ownership of real estate may be the vanguard of legal actions against similar laws in other states, said Micah Brown, staff attorney for the National Agricultural Law Center.

The week of Jan. 29, the 11th U.S. Circuit Court of Appeals, based in Atlanta, halted enforcement of the law barring two Chinese investors from buying real estate in the Sunshine State. The federal court heard the case after a lower court denied an injunction sought by plaintiffs.

Nearly half of the nation's states have laws that put some kind of limits on foreign ownership of real property, particularly agricultural land, located within their state.

Twelve states proposed such laws from 2021-22, but in 2023, 36 states considered at least one measure that sought to restrict foreign investments, 12 of which enacted such a law.

"With this ruling, we might see an uptick in litigation or challenges to some of these laws," Brown said on Feb. 5.

However, Brown said there are significant differences between the Florida case and those that might spring up in other states.

"As it stands right now, the opinion is only for those two specific plaintiffs in the Florida suit," he said. "What the court is saying, is 'Florida, you cannot enforce this foreign ownership law on these two specific plaintiffs.' The upshot is this really isn't going to make any waves for any of the other foreign-owned laws that are out there now because each law only applies to land located within the boundaries of that state."

The other difference is in the Florida law itself.

"In the batch of 2023 laws -- almost across the board -- they use some kind of federal definition, or restrict investments from specific countries, namely, 'the Big Four': China, Iran, North Korea and Russia," Brown said. "Florida is a little bit different where it doesn't use a federal definition."

Arkansas was one of the states that enacted restrictions on foreign ownership in 2023; the governor signed a bill into law in May. Three months later, Arkansas became the first state to take enforcement action, when Attorney General Tim Griffin ordered the China National Chemical Co. to divest itself of farmland in Craighead County. The company was also fined $280,000.

Resources and information on foreign ownership of ag land can be found on the NALC website: https://nationalaglawcenter.org/resources-at-a-glance-foreign-ownership-of-ag-land/.

For information about the National Agricultural Law Center, visit the website or follow @Nataglaw on Twitter.

To learn about extension programs in Arkansas, contact a local Cooperative Extension Service agent or visit www.uaex.uada.edu.

Mary Hightower is with the University of Arkansas System Division of Agriculture.

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