By: Kolkhorst, et al. S.B. No. 17
A BILL TO BE ENTITLED
AN ACT
relating to the purchase or acquisition of 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 OR ACQUISITION OF 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, silviculture, viticulture, horticulture,
or planting seed; or
(B) domestic or native farm or ranch animals kept
for use or profit.
(2) "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).
(3) "Governing authority," "governing person," and
"organization" have the meanings assigned by Section 1.002,
Business Organizations Code.
(4) "Real property" includes:
(A) agricultural land;
(B) an improvement located on agricultural land;
(C) commercial property;
(D) industrial property;
(E) groundwater;
(F) residential property;
(G) a mine or quarry;
(H) a mineral in place;
(I) standing timber; or
(J) water rights.
Sec. 5.252. ORGANIZATION UNDER CONTROL OF INDIVIDUAL OR
ANOTHER ORGANIZATION. (a) For purposes of this subchapter, an
organization is under the control of an individual or another
organization if the controlling individual or organization is
authorized to:
(1) direct the activities of the controlled
organization;
(2) make or direct others to make legal commitments on
behalf of the controlled organization; or
(3) hire and fire a principal decision maker of the
controlled organization.
(b) The authority of the controlling individual or
organization under Subsection (a) may derive from:
(1) exercise of a voting ownership interest of the
controlled organization sufficient to elect a governing person or
governing authority of the controlled organization to exercise on
the controlling individual's or organization's behalf the authority
described by Subsection (a); or
(2) a financial, legal, practical, contractual, or
other arrangement that functionally enables the controlling
individual or organization to exercise the authority described by
Subsection (a).
Sec. 5.253. EXCEPTIONS: UNITED STATES CITIZENS AND LAWFUL
PERMANENT RESIDENTS; RESIDENCE HOMESTEAD PROPERTY; LEASEHOLD.
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;
(2) an organization that is owned by or under the
control of one or more individuals described by Subdivision (1);
(3) real property that is intended for use as an
individual's residence homestead, as defined by Section 11.13(j),
Tax Code; or
(4) a leasehold interest in land or improvements
constructed on a leasehold if the duration of the interest is less
than 100 years.
Sec. 5.254. PROHIBITION ON PURCHASE OR ACQUISITION OF REAL
PROPERTY. Except as provided by Section 5.253 and notwithstanding
any other law, the following may not purchase or otherwise acquire
real property in this state:
(1) a governmental entity of a designated country;
(2) an organization 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 domiciled in a designated country;
(3) an organization that is owned by or under the
control of an organization described by Subdivision (2);
(4) an individual who is domiciled in a designated
country; or
(5) an individual who is a member of, associated with,
or acting on behalf of the government of a designated country.
Sec. 5.255. ATTORNEY GENERAL ENFORCEMENT. (a) If the
attorney general has a reasonable suspicion that an individual,
organization, or governmental entity has purchased or otherwise
acquired real property in this state in violation of this
subchapter, the attorney general may bring an in rem action against
real property 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.
(b) The attorney general shall record notice of an action
brought under Subsection (a) in the real property records of each
county where any part of the real property subject to the action is
located.
(c) Except for an acquisition of a leasehold interest not
exempt from this subchapter under Section 5.253(4), a purchase or
acquisition of real property in violation of Section 5.254 is not
void because of the violation, and the validity or enforceability
by any person of a purchase contract for or the conveyance of the
real property is not otherwise affected by the violation.
Sec. 5.256. ATTORNEY GENERAL INVESTIGATION AND DISCOVERY;
SECRETARY OF STATE INTERROGATORIES AND RECORDS. (a) The attorney
general may conduct discovery to investigate a potential action
under Section 5.255 or in an action brought under Section 5.255,
including by:
(1) petitioning for an order authorizing the taking of
a deposition under Rule 202, Texas Rules of Civil Procedure; or
(2) if the attorney general has reason to believe that
a person may be in possession, custody, or control of any
documentary material or other evidence or may have any information
relevant to an investigation of a suspected violation of Section
5.254, issuing in writing and serving on the person a civil
investigative demand requiring the person to:
(A) produce any of the documentary material for
inspection and copying;
(B) answer in writing any written
interrogatories;
(C) give oral testimony; or
(D) provide any combination of civil
investigative demands under Paragraph (A), (B), or (C).
(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 an
organization that is the subject of an action by the attorney
general under Section 5.255; and
(2) provide to the attorney general all records held
by the secretary relating to the ownership or control of an
organization that is the subject of an action by the attorney
general under Section 5.255.
Sec. 5.257. APPOINTMENT OF RECEIVER. (a) If the district
court finds that the real property subject to an action brought
under Section 5.255 was purchased or otherwise acquired by an
individual, organization, or governmental entity in violation of
Section 5.254, the court shall enter an order that:
(1) states the court's finding; and
(2) appoints a receiver to:
(A) manage and control the real property pending
the sale or other disposition of the real property; and
(B) return to the individual, organization, or
governmental entity that purchased or otherwise acquired the
property in violation of this subchapter any proceeds of the sale or
other disposition of the real property after satisfying any
existing liens on the property and recovery of any reasonable costs
incurred by the state in enforcing this subchapter.
(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. The changes in law made by this Act apply only to
the purchase or other acquisition of real property on or after the
effective date of this Act. The purchase or other acquisition of
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 5. This Act takes effect September 1, 2025.