20250SB__117698AMD INTRODUCED 2026-02-18 AMENDED_SENATE 2026-03-23 2025 SB AMD Introduced by Senator Choi (Coauthors: Senators Dahle, Grove, Ochoa Bogh, Strickland, and Valladares) (Coauthors: Assembly Members Ellis and Johnson) LEAD_AUTHOR SENATE Choi COAUTHOR SENATE Dahle COAUTHOR SENATE Grove COAUTHOR SENATE Ochoa Bogh COAUTHOR SENATE Strickland COAUTHOR SENATE Valladares COAUTHOR ASSEMBLY Ellis COAUTHOR ASSEMBLY Johnson

An act to add

Chapter 5 (commencing with

Section 745) to Title of Part of Division of the Civil Code, relating to property. property Agricultural land: prohibited foreign actors. 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. 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. The bill would make its provisions operative upon appropriation by the Legislature. MAJORITY NO YES NO NO NO NO NO NO NO NO The people of the State of California do enact as follows:

SECTION 1.

Chapter 5 (commencing with

Section 745) is added to Title of Part of Division of the Civil Code , to read: 5. Foreign Entities: Property Control or Ownership 745. For purposes of this chapter, the following

definitions apply: (a) “Agricultural land” has the same meaning as defined in

Section of Title of the United States Code. (b) “Controlling interest” means either of the following:

(1) Possession of percent or more of the ownership interests in an entity.

(2) A percentage ownership interest in an entity of less than percent, if the foreign actor actually directs the business and affairs of the entity without the requirement or consent of any other party. (c) “Interest” means any estate, remainder, or reversion enumerated in

Chapter 1 (commencing with

Section 761) of Title 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. (d) (1) “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: (

A) Designated as a nonmarket economy country pursuant to

Section 771(18) of the Tariff Act of 1930 (19 U.S.C.

Sec. 1677(18)). (

B) 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.”

(2) 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). 746. (

a) 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. (

b) This

section does not apply to any of the following:

(1) Any controlling interest in agricultural land held by a prohibited foreign actor before January 1, 2027.

(2) Agricultural land dedicated to agricultural research, development, and demonstration, including, but not limited to, testing, developing, or producing seeds, plants, crop protection products, or crop nutrients.

(3) Any federally recognized tribe. (

c) A transfer of an interest in land in violation of this

section shall be subject to divestiture, as set forth in

Section 746.5. (

d) This

section shall not be applied in a manner inconsistent with any provision of any treaty between the United States and another country. 746.5. (

a) 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 may have occurred, may issue subpoenas requiring the appearance of witnesses, the production of relevant records, and the giving of relevant testimony. (b)

(1) If, after examining the evidence, the Attorney General concludes that a violation of

Section has occurred, the Attorney General shall order the prohibited foreign actor to divest itself of all interests in the land within days after service of the order upon the prohibited foreign actor.

(2) The order of divestiture, described in paragraph (1), shall be served personally or by mail. (c)

(1) If the holder of the interest that is ordered to be divested disputes the determination of the Attorney General that a violation of

Section has occurred, the holder may submit a written request for a judicial determination to the Attorney General.

(2) The written request, described in paragraph (1), shall be delivered to the Attorney General within 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. (d)

(1) 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.

(2) 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.

(3) 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 of the Code of Civil Procedure. (

e) 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 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. (f)

(1) If the court determines that a violation of

Section 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 of Title 10.5 of Part of the Code of Civil Procedure.

(2) The referee shall make a sale of the property and convey the interest to the purchaser.

(3) The proceeds from the sale shall be distributed in the following order: (

A) The payment of authorized costs of the sale, including all approved fees and expenses of the referee and any taxes and assessments due. (

B) The payment, in an amount approved by the court, to the Attorney General for reimbursement of investigation and litigation costs and expenses. (

C) The payment to lienholders who did not have actual knowledge of a violation of

Section in their order of priority, except for liens which under the terms of the sale are to remain on the property. (

D) The payment of a penalty, in an amount determined by the court, not to exceed percent of the sales price of the property, to be paid to the fund designated by the Attorney General for enforcement of this chapter. (

E) The payment to any lienholders not included in subparagraph (

C) in their order of priority. (

F) 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. 747. This

chapter shall become operative upon appropriation by the Legislature for the purpose of implementing the provisions of this chapter.