The Agriculture Foreign Investment Disclosure Act (AFIDA) was passed in 1978. The act states that all foreign persons (and entities) who acquire, hold, or transfer agricultural land interests must report those holdings and/or transactions to the Secretary of Agriculture (part of the US Department of Agriculture). Those who fail to do so are subject to penalties from the USDA’s Farm Service Agency, the entity tasked with the public inspection. As of December 31, 2020, the Farm Service Agency reported that foreign-held acres numbered 37.6 million. While that might sound like a considerable amount, those who track foreign investments posit this number is severely under-counted.
A bipartisan act introduced by Jon Tester, a Democrat from Montana, and Mike Braun, a Republican from Indiana, aims to strengthen AFIDA. The Protecting America’s Agricultural Land from Foreign Harm Act of 2023 would prohibit the purchase of land by anyone directly associated with a host of governments – namely, North Korea, Iran, China, and Russia. Support for the measure has strengthened as cases of Chinese Communist Party (CCP) affiliated entities acquiring property adjacent to American military bases come to light.
High-profile examples such as a prominent Chinese agriculture company, Fufeng Group, attempting to purchase property near Grand Forks Airbase (North Dakota) and a billionaire tightly connected to the CCP successfully acquiring hundreds of thousands of acres near the Texas Val Verde Air Force base rung alarms. The USDA is being scrutinized more heavily after some members of Congress uncovered improper management and reporting of foreign purchases. The new reform would raise the maximum fine to 30 percent (from 25 percent) of the property’s value and permit the USDA to impose liens on the property in extreme cases.
Moreover, the bill pressures the Government Accountability Office (GAO) to take a more active role in assessing the effectiveness of AFIDA and its administration. For a government as big as the United States, from 2000 to 2022 there were only a handful of employees working directly on AFIDA. This is clearly insufficient. Supporters of the bill point to data transparency as one of the critical improvements. To access the USDA’s annual reports on US foreign land investment one must make a Freedom of Information Act request. This bill, however, requires the USDA to make the AFIDA database completely public, thus bypassing an often-onerous administrative step (that few engage in).
The farm bill is up for reauthorization this year. It is expected that the Protecting America’s Agricultural Land from Foreign Harm Act will be added as an amendment to the bill, part of a set of legislation passed every five years.
