S-903-119
Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
Sponsored by Mike Rounds (R-SD)
What it does
This bill would amend the Defense Production Act to require the Committee on Foreign Investment in the United States (CFIUS) to review agricultural land transactions reported under existing disclosure law when a foreign person seeks to acquire an interest in U.S. farmland. It would require the President to prohibit transactions involving "covered foreign persons" tied to the governments of China, Russia, Iran, or North Korea if the land is near a military installation or other sensitive government facility, unless the President waives the prohibition as in the national interest. It also adds the Secretary of Agriculture as a CFIUS member for agriculture-related reviews and directs implementing regulations within specified timeframes.
Who benefits
U.S. national security agencies and military installations seeking to limit foreign access near sensitive sites; domestic farmers and agricultural landowners who may face less competition from certain foreign buyers; the Department of Agriculture, which gains a formal CFIUS role; and lawmakers/advocacy groups concerned about foreign, particularly Chinese, ownership of farmland near military bases.
Who is hurt
Foreign investors and entities linked to the named adversary governments (China, Russia, Iran, North Korea) who would lose the ability to complete certain land purchases or business acquisitions; U.S. sellers of agricultural land or agribusinesses near sensitive sites who could lose potential buyers or face transaction delays; and companies involved in cross-border agricultural investment that may face added compliance costs and review timelines.
Supporters argue
Supporters argue that foreign adversary-linked ownership of farmland near military bases poses a genuine national security risk, citing past incidents such as a Chinese-owned company's proposed land purchase near an Air Force base in North Dakota that drew bipartisan concern. They contend that closing this gap in CFIUS's authority, which historically focused on other sectors, is a targeted, proportionate response given USDA data showing increasing foreign holdings of U.S. agricultural land.
Opponents argue
Opponents argue the bill could deter legitimate foreign agricultural investment and create uncertainty for U.S. landowners trying to sell property, since the definition of "covered foreign person" and "sensitive" facilities is left largely to CFIUS regulations yet to be written. They contend that broad presidential discretion to prohibit transactions, tempered only by a waiver process reported to two committees, concentrates significant economic decision-making power in the executive branch with limited independent review.
Constitutional context
Congress's power to restrict foreign commercial transactions rests on the Commerce Clause (Art. I, §8, cl. 3) and its foreign affairs authority, while the delegation of prohibition and waiver authority to the President raises Article I, §1 nondelegation questions; courts applying Loper Bright v. Raimondo (2024) would independently review any implementing regulations rather than defer automatically to CFIUS's interpretation of its statutory mandate.
Checks and balances
The executive branch (President and CFIUS) gains expanded authority to block specific land and business transactions, with Congress retaining oversight through waiver-reporting requirements to two Senate and House committees but no direct veto power.
Historical precedent
The Foreign Investment Risk Review Modernization Act of 2018 expanded CFIUS's jurisdiction to include real estate transactions near sensitive government facilities, which this bill builds on by extending similar scrutiny specifically to agricultural land.