Texas 2023 - 88th Regular

Texas Senate Bill SB604 Compare Versions

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1	1	S.B. No. 604
2	2
3	3
4	4	AN ACT
5	5	relating to land services performed by a landman.
6	6	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
7	7	SECTION 1. Chapter 954, Occupations Code, is amended to
8	8	read as follows:
9	9	CHAPTER 954. LAND SERVICES FOR PETROLEUM, [AND] MINERAL, AND OTHER
10	10	ENERGY SOURCES [LAND SERVICES]
11	11	Sec. 954.001. DEFINITIONS. In this chapter:
12	12	(1) "Land services":
13	13	(A) means the performance or supervision of one
14	14	or more of the following activities:
15	15	(i) negotiating the acquisition or
16	16	divestiture of mineral rights or rights associated with other
17	17	energy sources;
18	18	(ii) negotiating business agreements or
19	19	easements to provide for the exploration for or development of
20	20	minerals or other energy sources;
21	21	(iii) ascertaining ownership in mineral
22	22	rights or rights associated with other energy sources and related
23	23	real property through the research of public and private records;
24	24	(iv) reviewing the status of title, curing
25	25	title defects, providing title due diligence, and otherwise
26	26	reducing title risk associated with the ownership, acquisition, or
27	27	divestiture of mineral rights, property associated with minerals,
28	28	or rights associated with other energy sources, excluding:
29	29	(a) administrative functions;
30	30	(b) division order functions; and
31	31	(c) lease analyst functions;
32	32	(v) managing rights or obligations derived
33	33	from ownership of interests in minerals or rights associated with
34	34	other energy sources; or
35	35	(vi) using or pooling mineral interests or
36	36	rights associated with other energy sources; and
37	37	(B) does not include determining, examining, or
38	38	reviewing the status of title in connection with transactions that
39	39	are primarily for:
40	40	(i) the sale, purchase, or encumbrance of
41	41	the surface of the land unassociated with mineral rights or other
42	42	energy sources; or
43	43	(ii) the mortgage of real property used or
44	44	intended to be used primarily for residential purposes.
45	45	(2) "Mineral" has the meaning assigned by Section
46	46	75.001, Property Code. The term includes oil, gas, related
47	47	hydrocarbons, coal, lignite, uranium, and substances classified as
48	48	base, industrial, precious, or strategic minerals.
49	49	(3) "Other energy source" means a natural resource
50	50	other than a mineral that is necessary to produce energy, including
51	51	geothermal, hydroelectric, nuclear, solar, and wind energy.
52	52	Sec. 954.002. EXCEPTION TO PRACTICE OF LAW. For the
53	53	purposes of the definition in Section 81.101, Government Code, the
54	54	"practice of law" does not include engaging in land services [acts
55	55	relating to the lease, purchase, sale, or transfer of a mineral or
56	56	mining interest in real property or an easement or other interest
57	57	associated with a mineral or mining interest in real property] if:
58	58	(1) the acts are performed by a person who does not
59	59	hold the person out as an attorney licensed to practice law in this
60	60	state or in another jurisdiction; and
61	61	(2) the person is not a licensed attorney.
62	62	SECTION 2. Section 1702.324(a), Occupations Code, is
63	63	amended to read as follows:
64	64	(a) For the purposes of this section, "landman" means an
65	65	individual who, in the course and scope of the individual's
66	66	business:
67	67	(1) acquires, divests, or manages petroleum or mineral
68	68	interests; [or]
69	69	(2) performs title or contract functions related to
70	70	the exploration, exploitation, or disposition of petroleum or
71	71	mineral interests; or
72	72	(3) otherwise engages in land services as defined by
73	73	Section 954.001.
74	74	SECTION 3. Section 171.1011(g-11), Tax Code, is amended to
75	75	read as follows:
76	76	(g-11) A taxable entity that is primarily engaged in the
77	77	business of performing landman services shall exclude from its
78	78	total revenue, to the extent included under Subsection (c)(1)(A),
79	79	(c)(2)(A), or (c)(3), subcontracting payments made by the taxable
80	80	entity to nonemployees for the performance of landman services on
81	81	behalf of the taxable entity. In this subsection, "landman
82	82	services" means:
83	83	(1) performing title searches for the purpose of
84	84	determining ownership of or curing title defects related to oil,
85	85	gas, other energy sources, or other related mineral or petroleum
86	86	interests;
87	87	(2) negotiating the acquisition or divestiture of
88	88	mineral rights for the purpose of the exploration, development, or
89	89	production of oil, gas, other energy sources, or other related
90	90	mineral or petroleum interests; or
91	91	(3) negotiating or managing the negotiation of
92	92	contracts or other agreements related to the ownership of mineral
93	93	interests for the exploration, exploitation, disposition,
94	94	development, or production of oil, gas, other energy sources, or
95	95	other related mineral or petroleum interests.
96	96	SECTION 4. The change in law made by this Act to Section
97	97	171.1011(g-11), Tax Code, applies only to a report originally due
98	98	on or after January 1, 2024.
99	99	SECTION 5. (a) Except as provided by Subsection (b) of this
100	100	section, this Act takes effect:
101	101	(1) immediately if this Act receives a vote of
102	102	two-thirds of all the members elected to each house, as provided by
103	103	Section 39, Article III, Texas Constitution; or
104	104	(2) September 1, 2023, if this Act does not receive the
105	105	vote necessary for immediate effect.
106	106	(b) Section 171.1011(g-11), Tax Code, as amended by this
107	107	Act, takes effect January 1, 2024.
108	108	______________________________ ______________________________
109	109	President of the Senate Speaker of the House
110	110	I hereby certify that S.B. No. 604 passed the Senate on
111	111	April 12, 2023, by the following vote: Yeas 31, Nays 0; and that
112	112	the Senate concurred in House amendment on May 11, 2023, by the
113	113	following vote: Yeas 30, Nays 0.
114	114	______________________________
115	115	Secretary of the Senate
116	116	I hereby certify that S.B. No. 604 passed the House, with
117	117	amendment, on May 8, 2023, by the following vote: Yeas 129,
118	118	Nays 13, one present not voting.
119	119	______________________________
120	120	Chief Clerk of the House
121	121	Approved:
122	122	______________________________
123	123	Date
124	124	______________________________
125	125	Governor