Conveyances to Foreign Entities Act

As of July 1st of this year the State of Florida passed a law limiting or restricting the ability to purchase real property by people that are considered Foreign Principals of a Country of Concern. A Foreign Principal is widely defined under the law – everything from a government to an official of a government of a foreign Country of Concern to a company organized and existing under a foreign Country of Concern and as to an individual who is domiciled (living or residing primarily) in a foreign Country of Concern and is not a citizen or lawful permanent resident of the United States.

The following are the foreign Countries of Concern – People’s Republic of China, the Russian Federation, the Islamic Republic of Iran, the Democratic Peoples’ Republic of Korea (North), Syrian Arab republic, the Republic of Cuba, and the Venezuelan regime of Nicolas Maduro - this also includes any agency or entity of significant control by such Country of Concern.

What land/real estate is restricted from purchase by Foreign Principals of a Country of Concern – All Agricultural land (as classified by the Property Appraiser for each County in this State) and land/real estate on or within a radius of 10 miles of a “Critical Infrastructure Facility” or a “Military Installation.”

A Critical Infrastructure Facility as defined under the law employs measures such as fences, barriers, or guard posts that are designed to exclude unauthorized persons. Some examples of these facilities are – an electrical power plant; a water treatment facility; a seaport, and an airport. A Military Installation is defined as a base, camp, post, station, yard, or center encompassing at least ten (10) contiguous acres that is under the jurisdiction of the Department of Defense or its affiliates.

Foreign Principals owning affected real property as of July 1st, 2023 will have to register their ownership with the State of Florida. For agricultural land Foreign Principals owning agricultural land must register with the Florida Department of Agriculture and Consumer Services (“FDACS”) by Jan. 1, 2024. For non-agricultural land Foreign Principals owning land within ten (10) miles of any Military Installation or Critical Infrastructure Facility must register with The Florida Department of Commerce (“FDOC”) by February 3, 2024.

For any Buyer that violates this law in a transaction after July 1st, 2023 they are facing both criminal and civil penalties. Any Seller or Closing Agent that knowingly violates this law in a transaction after July 1st, 2023 also faces criminal penalties. In addition, the failure by a Foreign Principal to timely register properties owned by them before July 1st, 2023 timely can result in fines of $1,000.00 per day and ultimately the possibility of losing their properties if such a fine is not paid timely.

Our office has been filing these registrations for our clients with the State for properties that were acquired before July 1st, 2023. We are consulting with Buyers and Sellers all the time about new or pending transactions and whether or not this law applies to them and providing guidance to them to help them understand these requirements. We have also been featured on a Podcast recently talking extensively about this new law and its impact on real estate transactions here in the State of Florida. Here is a link to this Podcast below.

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