Overview
Title
To amend the Defense Production Act of 1950 to require the Committee on Foreign Investment in the United States to review and prohibit certain transactions relating to agriculture.
ELI5 AI
S. 903 is a plan to make sure that when people from other countries want to buy farms or land near important places like military bases in the U.S., smart grown-ups double-check to make sure it's safe. If it's not safe, they can say no to the buy.
Summary AI
S. 903 aims to change the Defense Production Act of 1950 to make sure certain agricultural transactions involving foreign parties are reviewed and possibly prohibited by the Committee on Foreign Investment in the United States. The bill wants to stop foreign entities, especially those linked to national security concerns, from buying or controlling U.S. agricultural land or businesses near sensitive sites like military installations. It also includes specific rules for how these reviews should happen and allows the President to waive prohibitions if it's considered in the nation's interest. The bill sets deadlines for creating these new regulations and ensures they apply to transactions occurring after the regulations go into effect.
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AnalysisAI
Summary of the Bill
The proposed bill, titled the "Promoting Agriculture Safeguards and Security Act" (PASS Act), seeks to amend the Defense Production Act of 1950. Its main objective is to require the Committee on Foreign Investment in the United States (CFIUS) to review and possibly prohibit foreign investments in U.S. agricultural land and businesses if deemed a national security risk. The bill underlines that such transactions are of particular concern if they occur near critical military or government sites. Additionally, it grants the President the authority to waive prohibitions on a case-by-case basis if considered in the national interest. The bill outlines a timeline for the enforcement of these regulations, ensuring that the rules are implemented within a year after the Act's enactment.
Significant Issues and Considerations
Several potential issues arise from this bill, primarily concerning clarity and administrative execution:
Ambiguity in Definitions: The criteria for defining what constitutes a "covered foreign person" or "covered country" may need further clarification. A lack of precision in these definitions could lead to confusion and inconsistent application, potentially affecting the enforcement of the bill's provisions.
Presidential Waiver: The bill allows the President to exempt certain transactions from prohibition, which might be seen as a loophole. This authority could lead to transparency and accountability issues in decision-making processes, as it may be exercised without a clear, consistent rationale.
Regulatory Delays: With a timeline of up to one year for issuing detailed regulations, there could be a delay in implementing necessary oversight, possibly undermining the protective intentions of the bill.
Proximity Determinations: The lack of explicit criteria to determine "proximity" to sensitive U.S. sites could result in uneven applications of the law, affecting national security strategies and potentially leading to legal challenges.
Economic Consequences: The prohibition of transactions involving foreign entities might have economic implications, particularly affecting international trade relationships and market dynamics in the agriculture sector.
Broad Public Impact
The PASS Act is designed to safeguard U.S. interests by tightening control over foreign investments in agriculture, a sector that is vital for national security. The bill signifies an attempt to ensure that these investments do not pose threats to the United States, especially in strategic locations near military installations.
For the general public, such measures could enhance national security and prevent critical resources from being influenced or controlled by foreign adversaries. However, the bill may also influence the agriculture market in terms of foreign investment, potentially leading to reduced foreign capital inflow, which could impact economic activity in the sector.
Impact on Specific Stakeholders
Agricultural Sector: Domestic agricultural businesses might benefit from reduced foreign competition and potential security from foreign interference. However, they might also face decreased investment opportunities from foreign entities, which could impact their growth prospects.
Foreign Investors: The bill imposes restrictions on foreign parties, especially those from specific countries deemed adversarial. These limitations might deter investment interest, affecting diplomatic relations and possibly leading to retaliatory economic policies from affected nations.
Government Agencies: Agencies responsible for overseeing foreign investments will have increased responsibilities. The need to quickly and effectively implement the bill’s provisions could strain resources, although the endeavor may bolster overall national security measures.
Overall, while the PASS Act aims to protect important national interests by emphasizing agricultural security, it necessitates a balanced approach in its execution to ensure that it does not inadvertently hinder economic opportunities or international relations.
Issues
The criteria for defining a 'covered foreign person' and 'covered country' in Section 2 might require additional clarification to avoid ambiguity about which entities are included. This could impact the scope and enforcement of the bill, potentially leading to confusion and inconsistency in its application.
The President's waiver authority in Section 2 allows for case-by-case exceptions to prohibitions of transactions, which might be considered a loophole or lead to inconsistencies in enforcement. This could raise concerns about transparency and accountability in the decision-making process.
The bill defines 'reportable agricultural land transaction' in Section 2, but the criteria could be too broad or vague, potentially leading to confusion about its application. This could impact various stakeholders in the agricultural sector and affect the market dynamics.
The regulation issuance timeline of up to one year in Section 2 might delay the implementation of necessary oversight mechanisms, thus potentially compromising the intended protections and safeguards.
Section 2 provides no clear provision on how spending plans from departments or agencies are reviewed or assessed, leading to potential issues with transparency and accountability in financial oversight.
The lack of detail on how proximity to a U.S. military installation or sensitive government facility is determined in Section 2 could result in inconsistent application, possibly affecting national security and leading to legal challenges.
The prohibition of transactions involving 'covered foreign persons' in Section 2 may have economic implications not fully addressed within this section, potentially affecting international trade relationships and economic stability.
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 section provides the short title of the Act, stating that it may be referred to as the “Promoting Agriculture Safeguards and Security Act” or simply the “PASS Act”.
2. Review and prohibitions by Committee on Foreign Investment in the United States of certain transactions relating to agriculture Read Opens in new tab
Summary AI
The section amends the Defense Production Act to require the Committee on Foreign Investment in the United States (CFIUS) to review and potentially prohibit foreign transactions involving U.S. agricultural land or businesses if they pose national security risks, especially when these lands are near sensitive U.S. military or government sites. It includes a clause allowing the President to waive prohibitions in the national interest and specifies that the regulations enforcing these rules must be implemented within one year.