In the past year, an increase in scrutiny of foreign investment in US agricultural land was noted by both federal and state governments. In light of significant findings regarding deficiencies in the current process, it is expected that this will remain a key focus in the upcoming year. On January 18th a report was released by the Government Accountability Office assessing the Department of Agriculture’s efforts to gather, track, and disseminate information on foreign investments in the US agricultural sector. This report was a response to an October 2022 letter from a bipartisan group of 130 Congress members. They demanded the GAO to scrutinize the US government’s endeavors to monitor foreign investment in US agricultural land and its implications for national security.
Amid the increased scrutiny, the existing procedures and reporting practices of the USDA have been called into question as they currently do not allow for effective tracking and reporting of foreign investment in US agricultural land. As a result last year, lawmakers focused on preventing a repeat of the Fufeng transaction incident.
A number of legislative changes have been proposed, with over a half dozen bills relating to foreign investment in land put forward in the 118th Congress. Notably, one of these proposed bills would position the Secretary of Agriculture on the Committee on Foreign Investment in the United States (CFIUS).
The report by the Government Accountability Office highlighted key findings and takeaways. It stated that CFIUS does not typically receive disclosures from the Agricultural Foreign Investment Disclosure Act (AFIDA) in a timely manner. GAO highlighted inaccuracies and lack of complete information in AFIDA filings, and reported that many entities required to do so have not made AFIDA filings. Although CFIUS jurisdiction doesn’t overlap fully with acquisitions requiring AFIDA filings, the report underlined that CFIUS has the ability and the obligation to leverage AFIDA data for its national security review process.
The full report, findings and additional author information can be read at Bloomberg Law.