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Foreign land ownership in the United States has long been a contentious issue, with approximately 28 states as of the 2025 legislative session enacting laws to restrict such ownership. Today, laws restricting such ownership rights have resurfaced in the context of national security and geopolitical concerns, prompting a wave of state-level restrictions. While federal law—through frameworks like the Foreign Investment Risk Review Modernization Act (FIRRMA)—already regulates foreign investment near sensitive sites, states have increasingly enacted laws limiting property purchases by individuals and entities from "countries of concern," such as China, Russia, Iran and North Korea.
In 2023, Arkansas became the first state to enforce such laws with Arkansas Acts 636 and 174, restricting land ownership by entities tied to certain foreign countries and ordering Chinese-owned seed company Syngenta to divest farmland. Litigation followed in Jones Eagle LLC v. Arkansas Department of Agriculture, where a federal court issued an injunction, citing constitutional concerns; the case is now on appeal to the Eighth Circuit.
Lawsuits in this area continue to be filed, including two recent federal district court cases in Texas and Florida. In Shen v. Simpson, pending in the Northern District of Florida and on appeal to the Eleventh Circuit, plaintiffs challenge Florida's SB 264, which restricts land ownership by nationals of certain foreign countries. The Eleventh Circuit granted a partial injunction, finding a "substantial likelihood of success" on claims that SB 264 is preempted by federal law governing foreign investment and may violate the Equal Protection Clause. The court emphasized potential conflicts with FIRRMA and noted that state-based alien land restrictions, once upheld under early 20th-century precedent, may no longer withstand constitutional scrutiny.
By contrast, Wang v. Paxton, filed in the Southern District of Texas, was dismissed for lack of standing. Plaintiffs sought to block Texas' SB 17, which prohibits property ownership by nationals from designated adversary countries. The court concluded that the law did not apply to the plaintiffs, who were legally residing in Texas, and therefore they could not demonstrate injury. This outcome underscores a key procedural hurdle in such challenges: plaintiffs must show imminent harm, which may be difficult when statutes include exemptions for lawful residents.
These laws and cases demonstrate the complicated interplay of interstate commerce and foreign investment, along with state restrictions that result in a patchwork of property regulations. Conversely, successful constitutional challenges may reaffirm federal supremacy in foreign affairs and investment regulation, limiting states' ability to legislate in this domain. As more states adopt similar measures, the tension between national security concerns and constitutional protections will likely intensify, setting the stage for eventual Supreme Court review.
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