SB 2424

Present law prohibits a prohibited foreign-party-controlled business from acquiring an interest in non-agricultural land in this state, even with a party who is acting as an agent, trustee, or other fiduciary on their behalf. A prohibited foreign-party- controlled business must divest itself of the interest in non-agricultural land within two years of the date the entity is found to be in violation and remains in violation as long as such business holds an interest in the land. If a prohibited foreign-p ar ty-controlled business does not divest itself of the interest in the land, then the attorney general may commence an action. A violation is a Class A misdemeanor, punishable by a fine of $1,500; a term of imprisonment of no more than 11 months and 29 day s; or both. This bill applies the present law described in this paragraph to prohibited foreign parties. "PROHIBITED FOREIGN PARTY"" DEFINED Present law defines a ""prohibited foreign party"" as any of the following: (1) A citizen or resident of a country subject to international traffic in arms regulations under certain federal law; a foreign government formed within such a country, a party other than an individual or a government that is created or organized under the laws of a foreign government within such a country. Such countries include, but are not limited to, Belarus, Burma, China (PRC), Cuba, Iran, North Korea, Syria, and Venezuela. (2) A party other than an individual or a government (i) that is created or organized under the laws of a state, federal district, or territory of the United States and (ii) in which a significant interest or substantial control is directly or indirectly held or is capable of being exercised by an individual, a foreign government, a party, or a combination of the individuals, parties, or governments referred to in (1). (3) An entity of particular concern; or (4) An agent, trustee, or other fiduciary of a person or entity referred to in (1). However, present law clarifies that ""prohibited foreign party"" does not mean a person who is not a citizen of the United States and is a resident of a state of the United States, a federal district of the United States, a territory of the United States, a possession of the United States, a trusteeship of the United States, or a protectorate of the United States. REGISTRATION OF INTERESTS IN LAND Present law requires a prohibited foreign-party-controlled business that holds an interest in non-agricultural land in this state on or after January 1, 2025, to register the interest in such land with the secretary of state. The registration must be ma de in such form and manner as prescribed by the secretary of state, and within the later of 60 days after January 1, 2025, or the date the prohibited foreign-party-controlled business acquires the interest in non-agricultural land. This bill applies the pr esent law described in this paragraph to prohibited foreign parties. This bill requires the secretary of state to require such registrations to include the following information for prohibited foreign parties as well as prohibited foreign-party-controlled businesses:  The legal name, street address, mailing address, if different, and the birthplace and nationality of the prohibited foreign party or the prohibited foreign party that owns a controlling interest in the prohibited foreign-party-controlled business that owns the interest in non-agricultural land.  The legal name, street address, mailing address, if different, and the birthplace and nationality of the agent, trustee, or fiduciary of the prohibited foreign party or prohibited foreign-party-controlled business, if specifically they are authorized to purchase the non-agricultural land or supervise the daily operations on the non-agricultural land.  A statement of the purpose for conducting business in this state.  A description of the purpose of the interest in non-agricultural land in this state as it relates to the stated business purpose.  The legal name, street address, and mailing address of any parent of the registering party, including the legal name, street address, and mailing address of any subsidiary or intermediary of the parent.  The legal name, street address, and mailing address of any subsidiary of the registering party.  A listing of all other interests in non-agricultural land that are held directly or indirectly by the registering party, parent of the registering party, or subsidiary or intermediary of the parent in the United States that exceeds, in the aggregate, 250 acres. If the secretary of state finds that a prohibited foreign-party-controlled business or prohibited foreign party has acquired or holds title to or an interest in non-agricultural land in this state in violation of this bill, then this bill requires the se cretary of state to report the violation to the attorney general. If the secretary of state finds that a prohibited foreign-party-controlled business or a prohibited foreign party violated this bill by failing to timely register, then the secretary of st at e must assess a civil penalty not to exceed $2, 000 for each violation. ON MARCH 19, 2026, THE SENATE ADOPTED AMENDMENT #1 AND PASSED SENATE BILL 2424, AS AMENDED. AMENDMENT #1 a dds a short title to this bill, the ""Sen. Frank Niceley National Security and Economic Protection Act."" This amendment revises this bill's registration deadlines to be w ithin the later of 60 days after: ( 1 ) For a prohibited foreign-party-controlled business, January 1, 2025; ( 2 ) For a prohibited foreign party, January 1, 2027; or ( 3 ) The date the prohibited foreign-party-controlled business or the prohibited foreign party acquires the interest in non-agricultural land . Present law that prohibits prohibited foreign parties from acquiring certain land in Tennessee exempts resident aliens. Present law defines ""resident alien"" to mean a non-citizen who i s a resident of a: ( 1 ) State of the United States; ( 2 ) Federal district of the United States; ( 3 ) Territory of the United States; (4 ) Possession of the United States; ( 5 ) Trusteeship of the United States; or ( 6 ) Protectorate of the United States . This amendment replaces the exemption for resident aliens with an exemption for qualified aliens, which are generally defined by federal law as aliens who qualify for a federal public benefit."