CFIUS Expansion Bill Targets Foreign Adversary Purchases of US Agricultural Land and Real Estate

See additional information on the Farm Bill here.

The Protecting U.S. Farmland and Sensitive Sites From Foreign Adversaries Act (the “Moolenaar bill”) would significantly expand federal review of certain real estate, agricultural land, and agriculture-related transactions involving foreign adversaries and related parties. The Moolenaar bill aims to substantially broaden the category of land transactions within the jurisdiction of the Committee on Foreign Investment in the United States (CFIUS), which would impact agricultural landowners, agribusinesses, lenders, developers, and real estate investors. 

The Moolenaar bill reflects continuing federal focus on the intersection of food security, national security, and foreign ownership of US land. Clients with interests in farmland, agricultural biotechnology, ports, airports, energy infrastructure, communications infrastructure, or real estate near military or other sensitive facilities should watch the Moolenaar bill closely, particularly if a transaction could involve an investor, buyer, tenant, or concessionaire connected to a listed foreign adversary. 

What the Moolenaar Bill Would Do

The Moolenaar bill would amend Section 721 of the Defense Production Act of 1950, the statute that governs CFIUS review of certain foreign investments and real estate transactions. The stated purpose of the Moolenaar bill is to protect US food security, give CFIUS greater jurisdiction over land purchases, impose special safeguards against foreign adversary purchases of land near sensitive sites, and expand the definition of sensitive sites. 

The Moolenaar bill would expand CFIUS jurisdiction to cover the purchase or lease by, or concession to, a foreign adversary person of private or public real estate located in the United States, subject to existing statutory limitations and exceptions. This is a central feature of the Moolenaar bill: transactions involving listed foreign adversary-linked parties would receive more direct and stringent federal scrutiny than ordinary real estate transactions involving other foreign persons. 

To implement this increased scrutiny, the Moolenaar bill would create a new category called an “elevated risk real estate transaction.” This category would cover certain real estate transactions involving a foreign adversary person where the real estate is connected to an air or maritime port, is near a sensitive site, could allow intelligence collection on activities at a sensitive site, could otherwise expose national security activities at a sensitive site, or is agricultural land covered by federal agricultural foreign investment reporting requirements under the Agricultural Foreign Investment Disclosure Act of 1978 (AFIDA).¹ 

The Moolenaar bill would mandate that parties submit a declaration to CFIUS for any transaction that falls into the new elevated risk category. This is a significant departure from current law, under which submissions for covered transactions are voluntary. 

In addition, the Moolenaar bill would make elevated risk real estate transactions subject to a presumption of national security concern. Specifically, CFIUS would be required to conduct a national security investigation unless it determines by clear and convincing evidence that the transaction is not a national security risk and notifies specified congressional committees of that determination and the reasons for it. For purposes of CFIUS review or investigation, the transaction would be presumed to present an unresolvable national security risk unless CFIUS determines by clear and convincing evidence that the risk can be resolved without suspending or prohibiting the transaction and provides notice to specified congressional committees. The bill would further presume that risks from elevated risk real estate transactions cannot be resolved through mitigation agreements or conditions unless CFIUS makes a clear-and-convincing evidence determination to the contrary and reports that determination to specified congressional committees. 

Key Definitions 

‘Foreign Adversary’

The Moolenaar bill defines “foreign adversary” to mean the People’s Republic of China, including all Special Administrative Regions; the Republic of Cuba; the Islamic Republic of Iran; the Democratic People’s Republic of Korea; the Russian Federation; and the Bolivarian Republic of Venezuela. This is more expansive than the list of “countries of concern” referenced in the House Farm Bill, which does not include Cuba or Venezuela.

‘Foreign Adversary Person’

The Moolenaar bill defines “foreign adversary person” to include a foreign adversary itself, a foreign person subject to the jurisdiction of or organized under the laws of a foreign adversary, and a foreign person owned, directed, or controlled by a foreign adversary or by a foreign person tied to a foreign adversary. The definition is designed to reach not only the listed countries themselves, but also companies, entities, and persons with legal, ownership, direction, or control connections to those countries.

‘Sensitive Site’

The Moolenaar bill defines “sensitive site” broadly. The term includes traditional national security locations such as military installations and certain defense-related airspace, but it also extends to a wide range of infrastructure and research assets, including airports, maritime ports, NASA facilities, federally funded research and development centers, certain communications facilities, electric power plants, and other sites designated by the Secretary of Defense or the Secretary of Homeland Security.

‘Elevated Risk Real Estate Transaction’

An “elevated risk real estate transaction” is defined as a covered real estate transaction involving a foreign adversary person where the real estate falls into one or more specified categories. Those categories include real estate that is or will function as part of an air or maritime port, real estate in close proximity to a sensitive site, real estate that could reasonably allow intelligence collection on activities at a sensitive site, real estate that could otherwise expose national security activities at a sensitive site, and agricultural land covered by federal agricultural foreign investment reporting requirements. All elevated risk real estate transactions would be subject to mandatory CFIUS declarations from the parties thereto and a presumption of a national security concern by CFIUS.

‘Agricultural Land’

The Moolenaar bill does not appear to create a new standalone definition of “agricultural land.” Instead, it refers to agricultural land covered by reporting requirements under AFIDA. 

The Moolenaar Bill vs. the House-Passed Farm Bill

There are certain similarities between the Moolenaar bill and the Farm, Food, and National Security Act of 2026 passed by the House in April: (1) both respond to national security concerns about foreign ownership or control of US agricultural land and sensitive sites, food security, and agricultural biotechnology, and (2) both would formally add the Secretary of Agriculture to CFIUS for transactions involving agricultural land, agriculture biotechnology, and any other transaction related to the US agriculture industry, reinforcing the intent to treat food security and agricultural technology as national security concerns. However, the bills diverge when it comes to covered country lists, person definitions, agricultural land definitions, transaction triggers, and agency roles. 

The Farm Bill would build an information, reporting, investigation, and referral infrastructure around the existing AFIDA framework. This would include recurring national security reporting on agricultural land ownership by covered foreign persons, a USDA investigative and compliance function, a digitized database of foreign agricultural land ownership, and a USDA-to-CFIUS notification and consideration mechanism for certain agricultural land transactions. The Moolenaar bill, by contrast, is a more substantive CFIUS expansion and restriction bill because it expands CFIUS jurisdiction over foreign-adversary real estate transactions, creates the elevated risk real estate transaction category, mandates declarations, and imposes presumptions that make clearance or mitigation more difficult. 

Why The Moolenaar Bill Matters for Agricultural Landowners and Real Estate Investors

Both bills are particularly relevant to the agricultural sector because they would expressly add US food security considerations to the CFIUS analysis. In addition, under the Moolenaar bill, CFIUS would be directed to consider current and long-term requirements for sources of food, water, and other agricultural products in the United States. This analysis would be done both in the aggregate and at the local and regional levels by assessing the effects a covered transaction may have on US food security, including through foreign adversary acquisition of biotechnology related to agriculture.

For agricultural landowners, real estate investors, and developers, the practical takeaway is that any real estate transaction involving a foreign adversary person, even one that would not trigger review under existing frameworks, could be subject to scrutiny under the Moolenaar bill’s broader reach. Importantly, this would affect not only outright sales of farmland but also leases or other arrangements if they fall within the bill’s real estate transaction provisions and involve a foreign adversary person. 

For real estate investors and developers, the Moolenaar bill would be relevant to projects near a broad range of sensitive locations. The Moolenaar bill’s definition of sensitive site includes military installations, military training routes, certain US Department of Defense-managed airspace, controlled firing areas, military operations areas, facilities with Defense Department security clearances, openly owned or operated intelligence community facilities, NASA facilities, federally funded research and development centers, Department of Defense university-affiliated research centers, and science and technology reinvention laboratories. It also includes airports listed by the Federal Aviation Administration, maritime ports determined by the Secretary of Transportation, certain electronic or telecommunications facilities, electric power plants determined by the Secretary of Homeland Security, and any other site determined by the Secretary of Defense or the Secretary of Homeland Security. 

Transaction Approval Process and Practical Burden

The Moolenaar bill would not simply require additional reporting — it would also change the posture of CFIUS review for elevated risk real estate transactions. If the Moolenaar bill is enacted, parties looking to undertake a covered transaction involving a foreign adversary person would likely face more deal uncertainty, longer timelines, and a higher risk of suspension or prohibition than a standard real estate transaction. Under the Moolenaar bill framework, parties would need to address CFIUS risks as a fundamental aspect of the deal structure, assessing CFIUS risks in term sheets, purchase agreements, leases, financing documents, and closing timelines.

Penalties and Consequences for Non-Compliance

The Moolenaar bill does not set forth its own standalone penalty provision for non-compliance. Instead, the Moolenaar bill focuses on the process that must be undertaken to overturn the presumption that an elevated risk real estate transaction is a national security concern. As outlined in this article, that process includes the mandatory CFIUS filing requirements, required national security investigations, presumptions against mitigation, and the possibility that a transaction will be suspended or prohibited unless CFIUS can make the required findings. 

From a practical perspective, failure to identify and properly declare a covered transaction would create significant deal risk even if the Moolenaar bill does not itself add a separate penalty schedule. The mandatory declaration requirement means that, with respect to any transaction, parties would need to implement a reliable process to determine whether a transaction involves a foreign adversary person and whether the property falls within the elevated-risk category. 

State Law Restrictions Would Remain Important

The Moolenaar bill expressly preserves certain state laws restricting or prohibiting the purchase, lease, or acquisition of real estate or agricultural land by foreign adversary persons. Specifically, it states that nothing in the statute, as amended by the Moolenaar bill, may be construed to preempt or supersede a state law that restricts or prohibits such transactions, so long as the state law is generally applicable within that state and does not purport to apply to a specific transaction or party.

Accordingly, if the Moolenaar bill is passed, parties would need to undertake a bifurcated analysis covering both federal CFIUS review and state-level foreign ownership restrictions. A transaction that clears national security review may still need to satisfy another applicable legal regime if a state law imposes restrictions on foreign adversary ownership or leasing of agricultural land or real estate.

Open Questions and Practical Implications

• Existing Holdings: The Moolenaar bill does not address how existing holdings would be treated if they were acquired before enactment. 

• Pending Transactions: Pending deals could be affected if the Moolenaar bill is enacted before closing or if transaction documents allocate risk by reference to changes in law. Consequently, for transactions involving agricultural land, sensitive sites, or foreign adversary-linked parties, parties may want to build in flexibility around timing, closing conditions, regulatory approvals, and termination rights. 

Key Takeaways for Clients

The Moolenaar bill is still in the earliest stages of the legislative process — it has been referred to but not yet considered by three House committees: Financial Services, Foreign Affairs, and Energy and Commerce — but the bipartisan support for this legislation provides it with a definite advantage. With the midterm elections and associated extended recesses drawing ever nearer and major legislation already filling Congress’ agenda, it is unlikely that the Moolenaar bill will be enacted as a stand-alone bill. However, it is possible that some or all of its provisions could be added to the Farm Bill as it continues to make its way through the legislative process or to the annual defense authorization legislation.

The Moolenaar bill is not simply a farmland bill. It would also affect real estate tied to transportation, defense, intelligence, space, research, communications, energy, and other sensitive infrastructure, and would materially expand federal scrutiny of real estate and agricultural transactions involving foreign adversary persons.

For agricultural landowners and real estate investors, the most important practical step is early identification of potential CFIUS issues. That means understanding who the buyer, tenant, investor, or concessionaire is; whether any party has a connection to a listed foreign adversary; whether the property is agricultural land covered by federal reporting requirements; and whether the property is near or connected to a sensitive site.

AFS will continue to monitor the Farm Bill’s progress and the Moolenaar bill’s progress to advise clients of the necessary precautions and steps to take in their transactions.

If you have questions about a pending or proposed transaction, please contact one of the authors.

[1] In January, the US Department of Agriculture (USDA) solicited and is now reviewing comments regarding potential changes to the AFIDA regulations. Specific topics of interest included who should be required to file reports under AFIDA, what information should be required, and how the USDA can best ensure the completeness and accuracy of the information it receives. We expect to see an announcement of the results of the USDA’s review soon, which may include a new proposed rule.