Overview
Title
To direct the President to take such actions as may be necessary to prohibit the purchase of public or private real estate located in the United States by citizens and entities of the People's Republic of China, and for other purposes.
ELI5 AI
S. 176 is a rule that wants to stop people and businesses from China from buying land in America because it might be unsafe for the country. It makes the President decide who can't buy it, but lets some people like refugees keep their homes.
Summary AI
S. 176 seeks to prevent citizens and entities from the People's Republic of China from purchasing real estate in the United States. The bill directs the President to take necessary actions to stop these purchases and, if deemed a national security risk, to require the sale of such properties within a year. There are exceptions for Chinese citizens who entered the U.S. as refugees or were granted asylum, as well as for properties held for personal use by U.S. citizens or permanent residents. Additionally, the bill amends penalty provisions under the Agricultural Foreign Investment Disclosure Act of 1978 to establish a penalty range for violations.
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AnalysisAI
General Summary of the Bill
The proposed legislation, known as "S. 176," is intended to restrict the acquisition of public and private real estate in the United States by citizens and entities of the People's Republic of China. Introduced by Senator Tom Cotton and co-sponsored by Senators Kevin Cramer and Katie Britt, the bill outlines measures aimed at curbing foreign influence and potential national security risks associated with such real estate purchases. The bill provides exceptions for Chinese citizens who are refugees or have been granted asylum in the United States. Additionally, the bill amends the Agricultural Foreign Investment Disclosure Act of 1978 to introduce a minimum penalty for non-compliance related to foreign investments.
Summary of Significant Issues
One of the critical issues with the bill is the broad power it grants to the President to assess and determine national security risks associated with Chinese-owned properties without providing specific criteria or guidance on how these risks should be evaluated. This could lead to inconsistencies in application and pose legal challenges.
Furthermore, the definition of "covered foreign entity" within the bill is notably complex. The multi-layered criteria could make it difficult for enforcement authorities and affected entities to interpret and apply the legislation effectively. Similarly, the term "foreign person" is defined broadly and vaguely, which might inadvertently affect a wide array of individuals, complicating enforcement processes.
The bill's provisions require the sale of certain properties considered a security risk within a year, yet it offers no substantial enforcement mechanisms or consequences for non-compliance, leaving questions about execution.
Another area of concern lies in the amendment to the penalty provisions of the Agricultural Foreign Investment Disclosure Act, where a new minimum penalty of 10 percent is introduced. The bill does not provide a rationale for this change, which might lead to perceptions of arbitrary adjustments or questions regarding legislative intent.
Impact on the Public
Overall, the bill aims to address national security concerns by tightening control over foreign real estate investments in the U.S., specifically targeting Chinese citizens and entities. While this could potentially safeguard national security interests, it might also have broader implications on international relations and economic dynamics.
For the general public, the bill could mean heightened scrutiny and less foreign investment in local real estate markets, possibly affecting supply and demand dynamics in these markets. However, consolidating property ownership among domestic entities could lead to economic growth driven by local ownership.
Impact on Specific Stakeholders
The stakeholders most directly affected by this bill include Chinese citizens and entities looking to invest in U.S. real estate, as well as those already owning such properties. This group may face significant legal and financial obstacles, potentially leading to a decrease in international investment inflows from China.
Refugees from China who have been granted asylum might feel relief because they are exempt from these restrictions, although it is unclear how they will be identified and verified, which could lead to implementation challenges and concerns about fairness.
U.S. real estate markets might experience changes in investment patterns, with possible valuation implications as the buying power from a significant segment—Chinese investors—is curtailed. Moreover, the broad and undefined penalties in the bill could deter foreign investors from other regions who might fear being inadvertently affected.
Overall, while the bill is positioned as a measure to protect national security, its interpretation and application could have wide-ranging effects on various stakeholders, potentially bringing unintended legal and economic consequences.
Issues
The bill gives the President the power to prohibit property purchases by certain foreign individuals and entities (Section 2). However, it lacks clear guidelines on how the President should determine the national security risk posed by current real estate ownership, which could lead to inconsistent applications and potential legal challenges.
The definition of 'covered foreign entity' in Section 2(a)(1)(B) is complex, being multi-layered and potentially difficult for enforcement bodies and affected entities to interpret clearly, raising concerns about the bill's precision and effectiveness.
The term 'foreign person' as defined in Section 2(c)(2) is broad and vague, referring to any non-United States person. This could lead to legal ambiguity, complicating the bill's enforcement and potentially affecting a wide group of individuals inadvertently.
Section 2(b)(1) provides an exception for refugees, but it does not clarify the process for identifying and verifying these individuals, which could lead to challenges in application and questions about fairness.
The bill mandates a sale of real estate within one year if deemed a national security risk (Section 2(a)(2)), yet it does not specify enforcement mechanisms for compliance or consequences for non-compliance, leading to uncertainty regarding its execution.
The introduction of a minimum penalty of 10 percent in Section 3 under the Agricultural Foreign Investment Disclosure Act of 1978 lacks a stated rationale, which may raise questions about the legislative intent and could be perceived as arbitrary or inconsistent with previous practices.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section of the Act gives it a short title, stating that it can be referred to as the “Not One More Inch or Acre Act”.
2. Prohibition on purchase of public or private real estate located in the United States by citizens and entities of the People's Republic of China Read Opens in new tab
Summary AI
The bill prohibits citizens and entities from the People's Republic of China from purchasing real estate in the United States, with exceptions for Chinese refugees and those granted asylum. It also requires the President to mandate the sale of property owned by such individuals or entities if deemed a national security risk.
3. Penalty amount under Agricultural Foreign Investment Disclosure Act of 1978 Read Opens in new tab
Summary AI
The amendment to the Agricultural Foreign Investment Disclosure Act of 1978 changes the penalty for failing to comply from a maximum of 25% to a range where it cannot be less than 10% and cannot be more than 25% of the property’s value.