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<ns0:Id>20250SB__117699INT</ns0:Id>
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<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-18</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:MeasureNum>1176</ns0:MeasureNum>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Senator Choi</ns0:AuthorText>
<ns0:AuthorText authorType="COAUTHOR_ORIGINATING">(Coauthors: Senators Dahle, Grove, Ochoa Bogh, Strickland, and Valladares)</ns0:AuthorText>
<ns0:AuthorText authorType="COAUTHOR_OPPOSITE">(Coauthors: Assembly Members Ellis and Johnson)</ns0:AuthorText>
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<ns0:Legislator>
<ns0:Contribution>LEAD_AUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Choi</ns0:Name>
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<ns0:Legislator>
<ns0:Contribution>COAUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Dahle</ns0:Name>
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<ns0:Legislator>
<ns0:Contribution>COAUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Grove</ns0:Name>
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<ns0:Legislator>
<ns0:Contribution>COAUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Ochoa Bogh</ns0:Name>
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<ns0:Legislator>
<ns0:Contribution>COAUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Strickland</ns0:Name>
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<ns0:Contribution>COAUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Valladares</ns0:Name>
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<ns0:Contribution>COAUTHOR</ns0:Contribution>
<ns0:House>ASSEMBLY</ns0:House>
<ns0:Name>Ellis</ns0:Name>
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<ns0:Legislator>
<ns0:Contribution>COAUTHOR</ns0:Contribution>
<ns0:House>ASSEMBLY</ns0:House>
<ns0:Name>Johnson</ns0:Name>
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<ns0:Title> An act to add Chapter 5 (commencing with Section 745) to Title 2 of Part 1 of Division 2 of the Civil Code, relating to property. </ns0:Title>
<ns0:RelatingClause>property</ns0:RelatingClause>
<ns0:GeneralSubject>
<ns0:Subject>Agricultural land: prohibited foreign actors. </ns0:Subject>
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<html:p>Existing law provides that all property has an owner, whether that owner is the state, and the property is public, or the owner is an individual, and the property is private.</html:p>
<html:p>This bill would prohibit a foreign actor from purchasing, acquiring, leasing, or holding a controlling interest, as defined, in agricultural land within the State of California. The bill, among other things, would exempt land held by prohibited foreign actors before January 1, 2027, from that provision. The bill would provide that land transferred in violation of these provisions would be subject to divestiture, as specified. </html:p>
<html:p> The bill would make its provisions operative upon appropriation by the Legislature.</html:p>
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<ns0:VoteRequired>MAJORITY</ns0:VoteRequired>
<ns0:Appropriation>NO</ns0:Appropriation>
<ns0:FiscalCommittee>YES</ns0:FiscalCommittee>
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<ns0:ImmediateEffect>NO</ns0:ImmediateEffect>
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<ns0:Urgency>NO</ns0:Urgency>
<ns0:TaxLevy>NO</ns0:TaxLevy>
<ns0:Election>NO</ns0:Election>
<ns0:UsualCurrentExpenses>NO</ns0:UsualCurrentExpenses>
<ns0:BudgetBill>NO</ns0:BudgetBill>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
<ns0:BillSection id="id_A6FA50AF-3AEE-428E-A4B7-41122E82DC73">
<ns0:Num>SECTION 1.</ns0:Num>
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Chapter 5 (commencing with Section 745) is added to Title 2 of Part 1 of Division 2 of the
<ns0:DocName>Civil Code</ns0:DocName>
, to read:
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<ns0:LawHeading id="id_F2571818-1963-403E-8BF6-976B5779426C" type="CHAPTER">
<ns0:Num>5.</ns0:Num>
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<ns0:LawHeadingText>Foreign Entities: Property Control or Ownership</ns0:LawHeadingText>
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<ns0:Num>745.</ns0:Num>
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<html:p>For purposes of this chapter, the following definitions apply:</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
“Agricultural land” has the same meaning as defined in Section 3508 of Title 7 of the United States Code.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
“Controlling interest” means either of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Possession of 51 percent or more of the ownership interests in an entity.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
A percentage ownership interest in an entity of less than 51 percent, if the foreign actor actually directs the business and affairs of the entity without the requirement or consent of any other party.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
“Interest” means any estate, remainder, or reversion enumerated in Chapter 1 (commencing with Section 761) of Title 2 of Part 2, or portion of the estate, remainder, or reversion, or an option pursuant to which one party has a right to cause legal or equitable title to agricultural land to be transferred.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
“Prohibited foreign actor” means a business, government, or an agent, trustee, or fiduciary of a business or government from a country that is either of the following:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
Designated as a nonmarket economy country pursuant to Section 771(18) of the Tariff Act of 1930 (19 U.S.C. Sec. 1677(18)).
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
Identified as a country that poses a risk to the national security of the United States in the most recent annual report on worldwide threats issued by the Director of
National Intelligence pursuant to Section 108B of the National Security Act of 1947 (50 U.S.C. 3043b), commonly known as the “Annual Threat Assessment.”
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
A “prohibited foreign actor” is not a corporation, professional corporation, nonprofit corporation, limited liability company, partnership, or limited partnership that is organized under the laws of a country other than the United States and that is not identified in subparagraphs (A) or (B) of paragraph (1).
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<ns0:LawSection id="id_CB270216-5627-4680-91D5-6DBD98D5EEA1">
<ns0:Num>746.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
Notwithstanding any other law, on and after January 1, 2027, a prohibited foreign actor shall not purchase, acquire, lease, or hold any controlling interest in agricultural land in the State of California.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
This section does not apply to any of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Any controlling interest in agricultural land held by a prohibited foreign actor before January 1, 2027.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Agricultural land dedicated to agricultural research, development, and demonstration, including, but not limited to, testing, developing, or producing seeds, plans, crop protection products, or crop nutrients.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Any federally recognized tribe.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
A transfer of an interest in land in violation of this section shall be subject to divestiture, as set forth in Section 746.5.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
This section shall not be applied in a manner inconsistent with any provision of any treaty between the United States and another country.
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<ns0:LawSection id="id_CF57C43A-A740-4B55-9C06-5DF401CFC869">
<ns0:Num>746.5.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
The Attorney General, upon the request of any person or upon receipt of any information which leads the Attorney General to believe that a violation of Section 746 may have occurred, may issue subpoenas requiring the appearance of witnesses, the production of relevant records, and the giving of relevant testimony.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
If, after examining the evidence, the Attorney General concludes that a violation of Section 746 has occurred, the Attorney General shall order the prohibited foreign actor to divest itself of all interests in the land within 90 days after service of the order upon the prohibited foreign actor.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The order of divestiture, described in paragraph (1), shall be served personally or by mail.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
If the holder of the interest that is ordered to be divested disputes the determination of the Attorney General that a violation of Section 746 has occurred, the holder may submit a written request for a judicial determination to the Attorney General.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The written request, described in paragraph (1), shall be delivered to the Attorney General within 60 days after service of the order of divestiture. If no written request is received within this time, the determination of the Attorney General shall become final.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
If
the prohibited foreign actor fails to divest itself of all interests pursuant to subdivision (b), or if a holder of the interest submits a written request pursuant to subdivision (c), the Attorney General shall bring an action in superior court to divest the interest.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Venue for the action described in paragraph (1) shall either be the County of Sacramento or a county in which a portion of the subject land is located, as determined by the Attorney General.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The Attorney General shall promptly record with the county recorder of each county in which any portion of the land is located a notice of pendency of the action pursuant to Title 4.5 (commencing with Section 405) of Part 2 of the Code of Civil Procedure.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
If the
holder of the interest has submitted a written request pursuant to subdivision (c), the court shall conduct an evidentiary hearing to determine, by a preponderance of the evidence, if a violation of Section 746 has occurred, prior to taking any other action. If the court determines that there has been no violation, the court shall dismiss the action and expunge the notice of pending action.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
If the court determines that a violation of Section 746 occurred, the court shall order that the land be sold. Unless the court determines for good cause that another procedure for conducting the sale is appropriate, the court shall appoint a referee pursuant to Article 1 (commencing with Section 873.010) of Chapter 4 of Title 10.5 of Part 2 of the Code of Civil Procedure.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The referee shall make a sale
of the property and convey the interest to the purchaser.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The proceeds from the sale shall be distributed in the following order:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
The payment of authorized costs of the sale, including all approved fees and expenses of the referee and any taxes and assessments due.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The payment, in an amount approved by the court, to the Attorney General for reimbursement of investigation and litigation costs and expenses.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
The payment to lienholders who did not have actual knowledge of a violation of Section 746 in their order of priority, except for liens which under the terms of the sale are to remain on the property.
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
The payment of a penalty, in an amount determined by the court, not to exceed 10 percent of the sales price of the property, to be paid to the fund designated by the Attorney General for enforcement of this chapter.
</html:p>
<html:p>
(E)
<html:span class="EnSpace"/>
The payment to any lienholders not included in subparagraph (C) in their order of priority.
</html:p>
<html:p>
(F)
<html:span class="EnSpace"/>
All remaining proceeds to the prohibited foreign actor, in an amount that shall not exceed the original amount paid by the prohibited foreign actor for the property, payable to the person or entity that held the interest.
</html:p>
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<ns0:LawSection id="id_8D191A03-9CF8-4FF8-B794-C14D5ED2B449">
<ns0:Num>747.</ns0:Num>
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<html:p>This chapter shall become operative upon appropriation by the Legislature for the purpose of implementing the provisions of this chapter.</html:p>
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