Law & Principles

Legislature votes to address foreign land ownership

June 3, 2024

Ray Carter

A measure to provide additional teeth to existing restrictions on foreign land ownership has been signed into law by Gov. Kevin Stitt.

Senate Bill 1705, by state Sen. Brent Howard and House Speaker Charles McCall, amends existing law that restricts foreign-land ownership in Oklahoma to specify that no “foreign government adversary” may purchase land in Oklahoma, and defines that term to include any country designated by the United States Secretary of State as hostile or a Country of Particular Concern (CPC).

During a Senate floor debate, Howard noted that Oklahoma has restricted foreign land ownership for more than 100 years, but he said the advent of medical marijuana incentivized foreign actors to find ways to evade that restriction.

“We had a lot of criminal elements that came in with medical marijuana,” said Howard, R-Altus. “We had direct ownership by eastern-bloc nations, possibly by Russia, definitely known (ownership) by Central American nations, Central American illegal actors, and the Chinese Communist Party, that were coming in, taking advantage of the loose, Wild West laws that we had within the state related to medical marijuana.”

However, some lawmakers said the bill did not go far enough.

State Sen. David Bullard, R-Durant, said state law needs to better define “resident.”

“If we do not define what a bona fide resident is, right now the gate is still pretty much wide open,” Bullard said.

State Sen. Warren Hamilton, R-McCurtain, noted that foreign entities could still legally purchase oil and gas rights in Oklahoma under SB 1705.

He also suggested the law’s enforcement provisions are not strong enough, including provisions requiring a sworn affidavit from certain landowners.

“I want to make sure that the penalties for falsifying that, for being a straw purchaser, are at least as stringent as the penalties for falsifying a Form 4473, which we fill out every time we purchase a firearm,” Hamilton said. “If you falsify information on that, that’s a felony offense.”

Numerous states across the country have recently passed or considered new restrictions on foreign purchases of land due to national security concerns.

In 2021, the Center for Strategic & International Studies noted that foreign ownership of U.S. agricultural land doubled from 2009 to 2019, based on U.S. Department of Agriculture (USDA) records. Oklahoma was among the top five states for foreign purchases of agricultural land, according to the center.

While those figures reflect foreign land purchased by entities and individuals from countries across the world, the growth of land purchases by China has grabbed policymakers’ attention.

At a March 20 hearing conducted by the U.S. House Committee on Agriculture, Nova J. Daly, former deputy assistant secretary for investment security of the U.S. Treasury, noted that Chinese land acquisitions had “increased fivefold over the past decade and 30 percent from 2019-2020.”

In his written testimony, Daly warned that China’s agricultural acquisitions “pose multiple national economic security risks.”

“In the first part, such acquisitions have been found to be specifically designed as export platforms for the Chinese market,” Daly wrote. “As an example, following the Smithfield takeover, the WH Group significantly increased its share of exports to China, leading to potential increases in U.S. retail pork prices due to tightening supply. Such supply diversion represents potential risks to U.S. agricultural security, as food security in many countries remains vulnerable to economic and geopolitical shocks, which contribute to economic strains that stoke regional conflicts and instability.”

SB 1705 passed the Oklahoma Senate on a 27-16 vote on May 30. Nearly all opponents were Republicans who felt the bill did not go far enough, and Democratic lawmakers provided the votes that secured the bill’s passage.

The bill had an easier time in the Oklahoma House of Representatives when it was brought up later the same day, passing on a 73-10 vote. In that chamber, all opponents were Democrats.

Stitt signed the bill into law on May 31.