Hefner Bill Bans The Purchase, Leaves The Lease

The text as introduced · 1,177 words

89R8449 DRS-D

By: Hefner
H.B. No. 17

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; creating a criminal offense.

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) "Company" means a sole proprietorship,

organization, association, corporation, partnership, joint

venture, limited partnership, limited liability partnership, or

limited liability company, including a wholly owned subsidiary,

majority-owned subsidiary, parent company, or affiliate of those

entities or business associations, that exists to make a profit.

(2) "Designated country" means:

(A) China, Iran, North Korea, or Russia; or

(B) a country designated by the governor under

Section 5.254.

Sec. 5.252. EXCEPTIONS: UNITED STATES CITIZENS AND CERTAIN

LAWFUL RESIDENTS; LEASEHOLD PROPERTY. This subchapter does not

apply to:

(1) an individual who is:

(A) a citizen or lawful permanent resident of the

United States; or

(B) a citizen of a foreign country who is not

domiciled in a designated country;

(2) a company or other entity that is owned by or under

the control of:

(A) one or more individuals described by

Subdivision (1); and

(B) no individual described by Section 5.253; or

(3) 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. 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 held or controlled by

the government of a designated country; or

(C) owned by or the majority of stock or other

ownership interest of which is held or controlled by individuals

described by Subdivision (4);

(3) a company or other entity that is owned by or the

majority of stock or other ownership interest of which is held or

controlled by a company or entity described by Subdivision (2); or

(4) an individual who is domiciled in a designated

country.

Sec. 5.254. DESIGNATION OF COUNTRY AS SUBJECT TO

PROHIBITION ON PURCHASE OF OR ACQUISITION OF TITLE TO REAL

PROPERTY. (a) The governor, after consultation with the public

safety director of the Department of Public Safety, may designate a

country of which a governmental entity, company or other entity, or

citizen shall be subject to this subchapter.

(b) The governor shall consult the Homeland Security

Council established under Subchapter B, Chapter 421, Government

Code, for purposes of making a designation under this section.

Sec. 5.255. INVESTIGATION AND ENFORCEMENT BY ATTORNEY

GENERAL; LAW ENFORCEMENT REFERRAL. (a) The attorney general shall

establish procedures to examine a transfer of real property and

determine whether an investigation of a possible violation of this

subchapter is warranted.

(b) If the attorney general determines that an

investigation of a transfer of real property is warranted under

this section, the attorney general:

(1) shall investigate the transfer of real property

and determine whether a violation of this subchapter occurred;

(2) 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; and

(3) may refer the matter to the appropriate local,

state, or federal law enforcement agency.

Sec. 5.256. DIVESTITURE; APPOINTMENT OF RECEIVER;

DISTRIBUTION OF SALE PROCEEDS. (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 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.

(c) Proceeds from the sale or other disposition of real

property under an order described by Subsection (a) shall be

applied first to satisfy any existing liens on the property and then

to pay a fine assessed under Section 5.257(c). The remaining

proceeds shall be remitted to the comptroller for deposit in the

general revenue fund.

Sec. 5.257. OFFENSE; PENALTY. (a) A person commits an

offense if the person:

(1) is an individual domiciled in a designated

country; and

(2) intentionally or knowingly purchases or otherwise

acquires title to real property in this state.

(b) An offense under Subsection (a) is a state jail felony.

(c) A company or entity that the attorney general determines

under Section 5.255(b) to have violated this subchapter shall pay

to this state a fine equal to the greater of:

(1) $250,000; or

(2) 50 percent of the market value of the real property

that is the subject of the violation.

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.