On June 25, 2026, the U.S. Department of Agriculture (USDA) proposed sweeping changes to the Agricultural Foreign Investment Disclosure Act (AFIDA). The proposal would broaden the definition of “agricultural land,” expand reporting requirements, add new obligations for leasehold and easement interests, and sharply increase penalties for noncompliance.
The changes could affect developers, institutional investors, energy developers, and U.S. entities with upstream foreign ownership.
Expanded Definition of “Agricultural Land”
The proposed rule would expand AFIDA reporting by broadening the definition of “agricultural land” to cover:
- Solar and wind energy generation on otherwise qualifying agricultural land.
- Pipeline transportation corridors.
- Farm product warehousing and storage.
- Agricultural and forestry support activities.
- Agricultural biotechnology and agricultural research and development activities.
- Conservation land capable of supporting farming, ranching, forestry, or timber production.
The proposal would also eliminate the long-standing exemption for tracts of 10 acres or less generating under $1,000 in annual agricultural receipts. Easements and rights-of-way for nonagricultural purposes would become reportable interests for the first time.
The USDA also proposes that land meeting the federal definition of agricultural land remain subject to AFIDA reporting regardless of local zoning classifications.
Foreign investors and entities holding interests in farmland, timberland, conservation property, renewable energy projects, pipeline corridors, agricultural infrastructure, and certain agricultural research facilities may face new reporting obligations. Holdings that were previously exempt could require disclosure within 90 days of the rule’s effective date.
Increased Foreign Ownership Transparency
Among the most significant changes to AFIDA are new definitions of “foreign adversary” and “foreign adversary controlled entity.” A foreign adversary would include foreign governments, individuals, or entities from, controlled by, or headquartered in countries identified as foreign countries of concern, including China, Russia, Iran, and North Korea. A foreign-adversary-controlled entity would include any corporation, partnership, trust, association, or other organization owned by, controlled by, or subject to the direction of a foreign adversary. These categories would be subject to heightened reporting and enforcement.
The proposal frames AFIDA data collection as part of a broader national security review by moving the program to the USDA’s Office of Homeland Security.
The proposal also introduces new definitions for “beneficial owner” and “shell corporation” and revises the concept of “significant interest or substantial control.” These changes are intended to move AFIDA reporting beyond identifying the direct legal owner of agricultural land to the individuals or entities that ultimately own, control, direct, or benefit from the investment. Investors using layered ownership structures, holding companies, investment funds, joint ventures, or other complex arrangements may need to provide substantially more information about ownership and control relationships.
Stricter Ownership Disclosures and Penalties
The proposed rule would expand reporting requirements, increase penalties, and narrow penalty leniency tools. Lessees that are not foreign adversaries would need to file a report within 90 days for proposed leases totaling one year or longer, down from the current threshold of 10 years or more. Foreign adversaries holding a lease of any duration would need to file. All foreign persons holding easements or rights-of-way to agricultural land would also need to file an AFIDA report.
The proposal would establish new penalty frameworks for violations involving acquisitions or holdings, transfers or inheritances, and newly reportable interests. It would also shorten the appeal period from 60 to 30 days after notice. Penalties would include an immediate $250 administrative penalty and tiered weekly penalties based on fair market value, with higher penalties for foreign-adversary filers.
Next Steps
Foreign investors, renewable energy developers, and agricultural landholders, and U.S. entities with upstream foreign ownership should consider submitting comments to the USDA. Our Legislative & Public Policy Team can assist affected stakeholders in preparing comments. The public comment period runs through August 10, 2026.
If you have any questions, or would like additional information, please contact one of the attorneys on our Legislative & Public Policy team.
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