89R1157 DRS-F
By: Cain H.B. No. 402
A BILL TO BE ENTITLED
AN ACT
relating to the purchase of or acquisition of title to real property
by certain aliens or foreign entities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 64.001(a), Civil Practice and Remedies
Code, is amended to read as follows:
(a) A court of competent jurisdiction may appoint a
receiver:
(1) in an action by a vendor to vacate a fraudulent
purchase of property;
(2) in an action by a creditor to subject any property
or fund to the creditor's [his] claim;
(3) in an action between partners or others jointly
owning or interested in any property or fund;
(4) in an action by a mortgagee for the foreclosure of
the mortgage and sale of the mortgaged property;
(5) for a corporation that is insolvent, is in
imminent danger of insolvency, has been dissolved, or has forfeited
its corporate rights; [or]
(6) in an action by the attorney general under
Subchapter H, Chapter 5, Property Code; or
(7) in any other case in which a receiver may be
appointed under the rules of equity.
SECTION 2. Section 5.005, Property Code, is amended to read
as follows:
Sec. 5.005. ALIENS. Except as provided by Subchapter H, an
[An] alien has the same real and personal property rights as a
United States citizen.
SECTION 3. Chapter 5, Property Code, is amended by adding
Subchapter H to read as follows:
SUBCHAPTER H. PURCHASE OF OR ACQUISITION OF TITLE TO REAL PROPERTY
BY CERTAIN FOREIGN INDIVIDUALS OR ENTITIES
Sec. 5.251. DEFINITIONS. In this subchapter:
(1) "Agricultural land" means land that is located in
this state and that is suitable for:
(A) use in production of plants and fruits grown
for human or animal consumption, or plants grown for the production
of fibers, floriculture, viticulture, horticulture, or planting
seed; or
(B) domestic or native farm or ranch animals kept
for use or profit.
(2) "Control" means ownership of at least 50 percent
of the voting ownership interest of an organization necessary to
elect a governing person or governing authority of an organization.
(3) "Designated country" means a country identified by
the United States Director of National Intelligence as a country
that poses a risk to the national security of the United States in
each of the three most recent Annual Threat Assessments of the U.S.
Intelligence Community issued pursuant to Section 108B, National
Security Act of 1947 (50 U.S.C. Section 3043b).
(4) "Governing authority," "governing person," and
"organization" have the meanings assigned by Section 1.002,
Business Organizations Code.
(5) "Real property" means:
(A) agricultural land;
(B) an improvement located on agricultural land;
(C) a mine or quarry;
(D) a mineral in place; or
(E) standing timber.
Sec. 5.252. EXCEPTIONS: UNITED STATES CITIZENS AND LAWFUL
PERMANENT RESIDENTS; RESIDENCE HOMESTEAD PROPERTY. (a) This
subchapter does not apply to:
(1) an individual who is a citizen or lawful permanent
resident of the United States, including an individual who is a
citizen of a foreign country; or
(2) a company or other entity that is owned by or under
the control of one or more individuals described by Subdivision
(1).
(b) This subchapter does not apply to real property that is
intended for use as an individual's residence homestead, as defined
by Section 11.13(j), Tax Code.
(c) This subchapter does not apply to a leasehold interest
in land or improvements constructed upon a leasehold.
Sec. 5.253. PROHIBITION ON PURCHASE OF OR ACQUISITION OF
TITLE TO REAL PROPERTY. Except as provided by Section 5.252 and
notwithstanding any other law, the following may not purchase or
otherwise acquire title to real property in this state:
(1) a governmental entity of a designated country;
(2) a company or other entity that is:
(A) headquartered in a designated country;
(B) directly or indirectly under the control of
the government of a designated country; or
(C) owned by or under the control of one or more
individuals who are citizens of a designated country;
(3) a company or other entity that is owned by or under
the control of a company or entity described by Subdivision (2); or
(4) an individual who is a citizen of a designated
country.
Sec. 5.254. ATTORNEY GENERAL ENFORCEMENT. If the attorney
general has a reasonable suspicion that the purchase of or
acquisition of title to real property in this state by an individual
or entity in violation of this subchapter creates a risk to the
health, safety, and welfare of the public, the attorney general may
bring an action to enforce this subchapter in a district court in
the county where all or part of the real property that is the
subject of the violation is located.
Sec. 5.255. DISCOVERY; SECRETARY OF STATE INTERROGATORIES
AND RECORDS. (a) The attorney general may conduct discovery in an
action brought under Section 5.254.
(b) The secretary of state shall on request by the attorney
general:
(1) serve interrogatories on an individual or entity
as necessary to determine the ownership or control of a company or
other entity that is the subject of an action by the attorney
general under Section 5.254; and
(2) provide to the attorney general all records held
by the secretary relating to the ownership or control of a company
or other entity that is the subject of an action by the attorney
general under Section 5.254.
Sec. 5.256. DIVESTITURE; APPOINTMENT OF RECEIVER. (a) If
the district court finds that the real property subject to an action
brought under Section 5.254 was purchased or otherwise acquired by
an individual or entity in violation of Section 5.253, the court
shall enter an order that:
(1) states the court's finding;
(2) divests the individual's or entity's interest in
the real property; and
(3) appoints a receiver to manage and control the real
property pending the sale or other disposition of the real
property.
(b) On appointment and qualification, a receiver appointed
under this section has the powers and duties of a receiver under
Chapter 64, Civil Practice and Remedies Code.
SECTION 4. As soon as practicable after the effective date
of this Act, the attorney general shall adopt rules for the
implementation of Subchapter H, Chapter 5, Property Code, as added
by this Act.
SECTION 5. The changes in law made by this Act apply only to
the purchase of or other acquisition of title to real property on or
after the effective date of this Act. The purchase of or other
acquisition of title to real property before the effective date of
this Act is governed by the law in effect immediately before the
effective date of this Act, and that law is continued in effect for
that purpose.
SECTION 6. This Act takes effect September 1, 2025.