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Arkansas Senate Bill SB383

Arkansas 2023 Regular Session

Arkansas Senate Bill SB383 Compare Versions

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11 Stricken language would be deleted from and underlined language would be added to present law.
2-Act 636 of the Regular Session
32 *DTP141* 03-30-2023 10:37:33 DTP141
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54 State of Arkansas As Engrossed: S3/15/23 H3/30/23 1
65 94th General Assembly A Bill 2
76 Regular Session, 2023 SENATE BILL 383 3
87 4
98 By: Senators B. Johnson, J. Boyd, J. Bryant, Crowell, B. Davis, J. Dotson, J. English, Flippo, Gilmore, K. 5
109 Hammer, Hester, Hill, M. McKee, J. Payton, C. Penzo, J. Petty, Rice, Stone, G. Stubblefield, D. Sullivan 6
1110 By: Representatives Vaught, Cavenaugh, Beaty Jr., Andrews, Puryear 7
1211 8
1312 For An Act To Be Entitled 9
1413 AN ACT TO AMEND THE LAW CONCERNING OWNER SHIP AND 10
1514 POSSESSION OF REAL P ROPERTY; AND FOR OTH ER PURPOSES. 11
1615 12
1716 13
1817 Subtitle 14
1918 TO AMEND THE LAW CONCERNING OWNERSHIP AND 15
2019 POSSESSION OF REAL PR OPERTY. 16
2120 17
2221 18
2322 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS: 19
2423 20
2524 SECTION 1. Arkansas Code § 18 -11-101(a), concerning the capacity of 21
2625 aliens to take and transfer lands, is amended to read as follows: 22
2726 (a) All Except as provided in § 18-11-110 and § 18-11-701 et seq., 23
2827 all aliens shall be capable of taking, by deed or will, lands and tenements 24
2928 in fee simple, or other less estate, and of holding, aliening, and devising 25
3029 them. 26
3130 27
3231 SECTION 2. Arkansas Code Title 18, Chapter 11, Subchapter 1, is 28
3332 amended to add an additional section to read as follows: 29
3433 18-11-110. Land ownership by prohibited foreign -party-controlled 30
3534 business prohibited — Definitions. 31
3635 (a) As used in this section: 32
3736 (1) "Controlling interest" means an ownership interest of fifty 33
3837 percent (50%) or more, in the aggregate; 34
3938 (2) "Prohibited foreign -party-controlled business" means a 35
4039 corporation, company, association, firm, partnership, society, joint -stock 36 As Engrossed: S3/15/23 H3/30/23 SB383
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4443
4544 company, trust, estate or other legal entity whose controlling interest is 1
4645 owned by a prohibited foreign party; and 2
4746 (3) "Prohibited foreign party" means the same as in § 18 -11-702. 3
4847 (b)(1) A prohibited foreign -party-controlled business shall not 4
4948 acquire by grant, purchase, devise, descent, or otherwise any interest in 5
5049 public or private land in this state. 6
5150 (2) A party may not hold public or private land as an agent, 7
5251 trustee, or other fiduciary for a prohibited foreign -party-controlled 8
5352 business in violation of this section. 9
5453 (c)(1) A prohibited foreign -party-controlled business entity in 10
5554 violation of this section shall have two (2) years to divest of the public or 11
5655 private land. 12
5756 (2) If a prohibited foreign -party-controlled business entity 13
5857 does not divest the public or private land as required by subdivision (c)(1) 14
5958 of this section, the Attorney General shall commence an action in the circuit 15
6059 court within the jurisdiction of the public or private land. 16
6160 (3)(A) If the public or private land is held in violation of 17
6261 this section, the circuit court shall order that the public or private land 18
6362 be sold through judicial foreclosure. 19
6463 (B) Proceeds of the sale shall be disbursed to lien 20
6564 holders, in the order of priority, except for liens which under the terms of 21
6665 the sale are to remain on the public or private land. 22
6766 (4) The Attorney General shall promptly record a copy of the 23
6867 following in the local land records: 24
6968 (A) Upon commencement, notice of the pendency of an action 25
7069 brought under subdivision (c)(2) of this section; and 26
7170 (B) The order for the sale of the public or pri vate land 27
7271 under subdivision (c)(3)(A) of this section. 28
7372 (d) A prohibited foreign -party-controlled business entity shall upon 29
7473 conviction be guilty of a felony punishable by not more than two (2) years 30
7574 imprisonment in the custody of the Division of Correcti on or a fifteen 31
7675 thousand dollar ($15,000) fine, or both. 32
7776 (e) It is an affirmative defense to prosecution under this section 33
7877 that a prohibited foreign -party-controlled business entity is a resident 34
7978 alien of the State of Arkansas. 35
8079 (f) Title to public or private land is not invalid or subject to 36 As Engrossed: S3/15/23 H3/30/23 SB383
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8584 divestiture due to a violation of this section by: 1
8685 (1) Any former owner; or 2
8786 (2) Other person holding or owning a former interest in the 3
8887 public or private land. 4
8988 (g) No person not subject to this section shall be required to 5
9089 determine or inquire into whether another person is or may be subject to this 6
9190 section. 7
9291 8
9392 SECTION 3. Arkansas Code Title 18, Chapter 11, is amended to add an 9
9493 additional subchapter to read as follows: 10
9594 Subchapter 7 — Foreign Ownership of Agricultural Land 11
9695 12
9796 18-11-701. Purpose. 13
9897 Under § 2-4-101, "It is the declared policy of the state to conserve, 14
9998 protect, and encourage the development and improvement of its agricultural 15
10099 and forest lands and other facilities for the production of food, fiber, and 16
101100 other agricultural and silvicultural products". 17
102101 18
103102 18-11-702. Definitions. 19
104103 As used in this subchapter: 20
105104 (1)(A) "Agricultural land" means any Arkansas land which is 21
106105 outside the corporate limits of a municipality and is: 22
107106 (i) Used for forestry production, including without 23
108107 limitation land exceeding ten (10) acres in which ten percent (10%) of the 24
109108 land is stocked by trees of any size, including land that formerly had trees 25
110109 of any size covering the land that will be naturally or artifici ally 26
111110 regenerated; or 27
112111 (ii) Currently used for, or, if currently idle, land 28
113112 last used within the past five (5) years, for farming, ranching, or timber 29
114113 production, except land not exceeding ten (10) acres in the aggregate, if the 30
115114 annual gross receipts fr om the sale of the farm, ranch, or timber products 31
116115 produced on the land do not exceed one thousand dollars ($1,000), including 32
117116 without limitation land used for activities described in the Standard 33
118117 Industrial Classification Manual (1987), Division A, exclus ive of industry 34
119118 numbers 0711-0783, 0851, and 0912 -0919 which cover animal trapping, game 35
120119 management, hunting carried on as a business enterprise, trapping carried on 36 As Engrossed: S3/15/23 H3/30/23 SB383
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125124 as a business enterprise, and wildlife management. 1
126125 (B) "Agricultural land" does not i nclude oil, gas, and all 2
127126 other minerals, including coal, lignite, brine, and all minerals known and 3
128127 recognized as commercial minerals underlying the land; 4
129128 (2) "Foreign government" means the same as provided by § 2 -3-5
130129 102; 6
131130 (3) "Interest in agricultura l land" means all direct interest 7
132131 acquired, transferred, or held in agricultural land, including without 8
133132 limitation a lease of agricultural land: 9
134133 (A) For a term of one (1) year or longer; or 10
135134 (B) Renewable by option for terms which, if the options 11
136135 were all exercised, would total one (1) year; 12
137136 (4) "Party" means the same as provided by § 2 -3-102; 13
138137 (5) "Prohibited foreign party" means: 14
139138 (A) A citizen or resident of a country subject to 15
140139 International Traffic in Arms Regulations, 22 C.F.R. § 126. 1; 16
141140 (B) A foreign government formed within a country subject 17
142141 to International Traffic in Arms Regulations, 22 C.F.R. § 126.1; 18
143142 (C) A party other than an individual or a government, that 19
144143 is created or organized under the laws of a foreign government w ithin a 20
145144 country subject to International Traffic in Arms Regulations, 22 C.F.R. § 21
146145 126.1; or 22
147146 (D) Any party other than an individual or a government: 23
148147 (i) That is created or organized under the laws of 24
149148 any state; and 25
150149 (ii) In which a significant interest or substantial 26
151150 control is directly or indirectly held or is capable of being exercised by: 27
152151 (a) An individual referred to in subdivision 28
153152 (5)(A) of this section; 29
154153 (b) A foreign government referred to in 30
155154 subdivision (5)(B) of this section; 31
156155 (c) A party referred to in subdivision (5)(C) 32
157156 of this section; or 33
158157 (d) A combination of the individuals, parties, 34
159158 or governments referred to in this subdivision (5)(D)(ii) of this section; 35
160159 (E) An Entity of Particular Concern design ated by the 36 As Engrossed: S3/15/23 H3/30/23 SB383
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164163
165164 United States Department of State; or 1
166165 (F) An agent, trustee, or other fiduciary of a person or 2
167166 entity enumerated in subdivisions (5)(A) -(E) of this section; 3
168167 (6) "Residence" means a person's principal dwelling place where 4
169168 the person intends to remain permanently for an indefinite period of time; 5
170169 (7) "Resident alien" means a person who: 6
171170 (A) Is not a citizen of the United States; and 7
172171 (B) Is a resident of a: 8
173172 (i) State of the United States; 9
174173 (ii) Territory of the United S tates; 10
175174 (iii) Trusteeship of the United States; or 11
176175 (iv) Protectorate of the United States; and 12
177176 (8) "Significant interest" or "substantial control" means : 13
178177 (A) An interest of thirty -three percent (33%) or more held 14
179178 by: 15
180179 (i) A party referred to in subdivision (5)(D) of 16
181180 this section; 17
182181 (ii) An individual referred to in subdivision (5)(A) 18
183182 of this section; 19
184183 (iii) A party referred to in subdivision (5)(C) of 20
185184 this section; or 21
186185 (iv) A single government referred to in subdivision 22
187186 (5)(B) of this section; 23
188187 (B) An interest of thirty -three percent (33%) or more held 24
189188 whenever the parties, individuals, or governments referred to in subdivision 25
190189 (5)(A) of this section are acting in concert with respect to the interest 26
191190 even though no single individual, party, or government holds an interest of 27
192191 thirty-three percent (33%) or more; or 28
193192 (C) An interest of fifty percent (50%) or more, in the 29
194193 aggregate, held by parties, individuals, or governments referred to in 30
195194 subdivision (5)(A) of this s ection even though the individuals, parties, or 31
196195 foreign governments may not be acting in concert. 32
197196 33
198197 18-11-703. Limitations on owning agricultural land — Violation. 34
199198 (a)(1) Except as provided in § 18 -11-704, a prohibited foreign party 35
200199 shall not acquire by grant, purchase, devise, descent, or otherwise any 36 As Engrossed: S3/15/23 H3/30/23 SB383
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204203
205204 interest in agricultural land in this state regardless of whether the 1
206205 prohibited foreign party intends to use the agricultural land for nonfarming 2
207206 purposes. 3
208207 (2) A party may not hold agricultural land as an agent, trustee, 4
209208 or other fiduciary for a prohibited foreign party in violation of this 5
210209 subchapter. 6
211210 (b) A prohibited foreign party that acquires agricultural land in 7
212211 violation of this subchapter remains in violation as long as the prohibited 8
213212 foreign party holds an interest in the agricultural land. 9
214213 10
215214 18-11-704. Interest in agricultural land owned by prohibited foreign 11
216215 parties — Exceptions — Penalty. 12
217216 (a) A prohibited foreign party who is a resident alien of the United 13
218217 States shall have the right to acquire and hold agricultural land in the 14
219218 state upon the same terms as a citizen of the United States during the 15
220219 continuance of his or her residence in the State of Arkansas. 16
221220 (b)(1) If a prohibited foreign party is no longer a resident alien 17
222221 under subsection (a) of this section, he or she shall have two (2) years to 18
223222 divest of the agricultural land. 19
224223 (2) If the prohibited foreign party does not divest of the 20
225224 agricultural land as required by subdivision (b)(1) of this section, the 21
226225 Attorney General shall commence an action in circuit court within the 22
227226 jurisdiction of the agricultural land. 23
228227 (3) If the agricultural land is held in violation of this 24
229228 section, the circuit court shall order that the agricultural land be sold 25
230229 through judicial foreclosure. 26
231230 (c)(1) When the Office of Agricultural Intelligence determines a 27
232231 prohibited foreign party has acquired agricultural land in Arkansas in 28
233232 violation of this subchapter, the office shall report the violation to the 29
234233 Attorney General. 30
235234 (2) Upon receiving notice under subdivision (c)(1) of this 31
236235 section or upon receipt of information that leads the Attorney General to 32
237236 believe that a violation of this subchapter may exist, the Attorney General 33
238237 may issue subpoenas requiring the: 34
239238 (A) Appearance of witnesses; 35
240239 (B) Production of relevant records; and 36 As Engrossed: S3/15/23 H3/30/23 SB383
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244243
245244 (C) Giving of relevant testimony. 1
246245 (3) If as a result of the investigation under subdivision (c)(2) 2
247246 of this section the Attorney General concludes that a violation of this 3
248247 subchapter has occurred, the Attorne y General shall commence an action in 4
249248 circuit court within the jurisdiction of the agricultural land. 5
250249 (4) If the agricultural land is held in violation of this 6
251250 subchapter, the circuit court shall order that the agricultural land be sold 7
252251 through judicial foreclosure. 8
253252 (d)(1) The proceeds of the sale of agricultural land by judicial 9
254253 foreclosure authorized under this section shall be disbursed to lien holders, 10
255254 in the order of priority, except for liens which under the terms of the sale 11
256255 are to remain on the agricultural land. 12
257256 (2) The Attorney General shall promptly record a copy of the 13
258257 following in the local land records: 14
259258 (A) Upon commencement, notice of the pendency of an action 15
260259 brought under subdivisions (b)(2) and (c)(2) of this section; and 16
261260 (B) The order for the sale of the agricultural land under 17
262261 subdivisions (b)(3) and (c)(3) of this section. 18
263262 (e) A prohibited foreign party owning agricultural land subsequent to 19
264263 the passage of this subchapter and not listed under one (1) of the exceptions 20
265264 set out in subsections (a) and (b) of this section shall upon conviction be 21
266265 guilty of a felony punishable by not more than two (2) years imprisonment in 22
267266 the custody of the Division of Correction or a fifteen thousand dollar 23
268267 ($15,000) fine, or both. 24
269268 (f) It is an affirmative defense to prosecution under this section 25
270269 that a prohibited foreign party is a resident alien of the State of Arkansas. 26
271270 (g) Title to agricultural land is not invalid or subject to 27
272271 divestiture due to a violation of this subchapter by: 28
273272 (1) Any former owner; or 29
274273 (2) Other person holding or owning a former interest in the 30
275274 agricultural land. 31
276275 (h) No person not subject to this subchapter shall be required to 32
277276 determine or inquire into whether another person is or may be subject to th is 33
278277 subchapter. 34
279278 35
280279 18-11-705. Office of Agricultural Intelligence – Creation – Duties. 36 As Engrossed: S3/15/23 H3/30/23 SB383
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285284 (a) There is created within the Department of Agriculture the Office 1
286285 of Agricultural Intelligence. 2
287286 (b) The office is authorized and directed to: 3
288287 (1) Collect and analyze information concerning the unlawful sale 4
289288 or possession of agricultural land by prohibited foreign parties; and 5
290289 (2) Administer and enforce the provisions of this subchapter, 6
291290 including without limitation the reporting of a violation of this subchapt er 7
292291 to the Attorney General under § 18 -11-704(c). 8
293292 (c) The Secretary of the Department of Agriculture may designate 9
294293 employees of the Department of Agriculture who meet the requirements of § 25 -10
295294 38-203(a)(12) to perform the duties of the office under subsection (b) of 11
296295 this section. 12
297296 (d) The office shall operate under the direction of the Secretary of 13
298297 the Department of Agriculture. 14
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