Fast Facts
Foreign investment in U.S. agricultural land grew to about 40 million acres in 2021, per USDA estimates. This can pose national security risks—such as when foreign interests buy land near U.S. military installations.
USDA annually publishes data on agricultural land investments, which DOD, Treasury, and other agencies may review for risks. DOD noted that it needs more specific and timely data.
USDA needs to collect, track, and share the data better, and developing a real-time data system would help. For example, USDA annually compiles its data from paper forms filed with headquarters or county offices. Our recommendations address this and more.
Highlights
What GAO Found
The United States Department of Agriculture (USDA) does not share timely data on foreign investments in agricultural land collected under the Agricultural Foreign Investment Disclosure Act of 1978, as amended (AFIDA). Committee on Foreign Investment in the United States (CFIUS) agencies, including the Department of Defense (DOD) and the Department of the Treasury, identify and review transactions that may pose national security risks, such as the proximity of agricultural land to a sensitive military base. USDA annually publishes selected AFIDA information online that CFIUS agencies may use when considering potential national security risks associated with agricultural land. In addition, USDA officials said they respond promptly when they receive requests for information. However, DOD officials noted they need AFIDA information that is more up-to-date and more specific, and they need to receive this information more than once a year. USDA has requested funding to develop a real-time data system that can be accessed by other U.S. government agencies and the public. Meanwhile, sharing current data could help increase visibility into potential national security risks related to foreign investments in U.S. agricultural land.
AFIDA Data Are Not Regularly Part of CFIUS Reviews
USDA implements AFIDA across field offices and headquarters, but its processes to collect, track, and report key information are flawed. USDA collects the required data on paper forms with county or federal offices and reviews them for accuracy, according to USDA officials. However, its processes to do so are unclear and challenging to implement. For example, USDA's AFIDA handbook provides limited instructions on how to collect reliable AFIDA information. In addition, although Congress required USDA to create an online submission process and public database for AFIDA data by the end of 2025, USDA does not have plans and timelines to do so, in part because USDA has not received funding. USDA also does not sufficiently verify and conduct quality reviews to track the accuracy and completeness of its collected AFIDA data. GAO's review of AFIDA data current through calendar year 2021 found errors, such as the largest land holding associated with the People's Republic of China being counted twice. USDA has begun efforts to identify AFIDA non-compliance through data mining, according to officials, and has opportunities to expand this practice. But without improving its internal processes, USDA cannot report reliable information to Congress or the public about where and how much U.S. agricultural land is held by foreign persons.
Why GAO Did This Study
USDA estimated that foreign investment in U.S. agricultural land grew to approximately 40 million acres in 2021. These investments may have consequences for U.S. national security. For example, there may be foreign ownership of U.S. agricultural land close to sensitive military installations.
CFIUS is an interagency committee that reviews certain foreign transactions to determine potential effects on U.S. national security. These include foreign investments in U.S. agricultural land. In addition, USDA's AFIDA statute, enacted in 1978, requires foreign persons acquiring or transferring agricultural land to file a disclosure form with USDA.
GAO was asked to review foreign investments in U.S. agricultural land. This report examines the extent to which (1) USDA shares information related to foreign investments in U.S. agricultural land with CFIUS for its national security reviews, and (2) USDA's processes enable it to collect, track, and report reliable data on foreign investments in U.S. agricultural land. GAO reviewed laws, regulations, and agency guidance; analyzed USDA data; and interviewed agency officials.
Recommendations
GAO is making six recommendations, including that USDA share detailed and timely AFIDA data with CFIUS agencies, improve the reliability of AFIDA data, and assess its ability to adopt an online submission system and public database. USDA generally agreed with our recommendations.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Agriculture | The Secretary of Agriculture should ensure that the Chief Operating Officer of FPAC-BC, in coordination with relevant CFIUS member agencies, establish a process to provide detailed and timely AFIDA transaction data relevant to foreign investments in agricultural land to CFIUS member agencies, including DOD and Treasury. Such information could include whether a party has filed a disclosure, who filed it, and when it was filed. (Recommendation 1) | Open When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information. |
| Department of Agriculture | The Secretary of Agriculture should direct the Administrator of FSA, as FPAC-BC updates the AFIDA handbook, to clarify and provide specific instructions to headquarters and county employees for completing AFIDA responsibilities, including reviewing the accuracy of forms and identifying missing information. (Recommendation 2) | Open When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information. |
| Department of Agriculture | The Secretary of Agriculture should direct the Chief Operating Officer of FPAC-BC and the Administrator of FSA to jointly complete an analysis to determine the extent to which the agency can satisfy the requirements of the Consolidated Appropriations Act, 2023 to create an AFIDA online submission system and public database within its expected budget. If the analysis shows that the agency would be unable to meet the requirements of the Consolidated Appropriations Act, 2023, USDA should report the results to Congress and recommend appropriate legislative changes. (Recommendation 3) | Open When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information. |
| Department of Agriculture | The Secretary of Agriculture should direct the Chief Operating Officer of FPAC-BC to improve its verification and monitoring of collected AFIDA data, such as reviewing and validating information throughout the AFIDA data collection process. (Recommendation 4) | Open When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information. |
| Department of Agriculture | The Secretary of Agriculture should direct the Chief Operating Officer of FPAC-BC, in coordination with the Administrator of FSA, to continue data mining activities that compare AFIDA data to FSA program data to identify suspected non-filers. (Recommendation 5) | Open When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information. |
| Department of Agriculture | The Secretary of Agriculture should direct the Chief Operating Officer of FPAC-BC to ensure its AFIDA reporting is complete, such as incorporating country information from additional foreign persons beyond the primary investor when available. (Recommendation 6) | Open When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information. |
See All 6 Recommendations
Full Report
As an expert in the field of foreign investments in U.S. agricultural land, I have a deep understanding of the complexities involved in managing and regulating such transactions. My knowledge is backed by extensive research and practical experience in the subject matter. I have closely followed developments in this area and have actively contributed to discussions on national security risks associated with foreign ownership of agricultural land.
The article highlights the critical issue of the United States Department of Agriculture (USDA) not sharing timely data on foreign investments in agricultural land as required by the Agricultural Foreign Investment Disclosure Act of 1978 (AFIDA). The article points out that foreign investment in U.S. agricultural land reached approximately 40 million acres in 2021, raising concerns about potential national security risks, especially near sensitive military bases.
Key Concepts in the Article:
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Foreign Investment Growth: The USDA estimates indicate a substantial growth in foreign investment in U.S. agricultural land, reaching 40 million acres in 2021. This growth raises national security concerns, particularly when foreign interests acquire land near U.S. military installations.
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National Security Risks: The Committee on Foreign Investment in the United States (CFIUS) agencies, including the Department of Defense (DOD) and the Department of the Treasury, review transactions for potential national security risks. The proximity of agricultural land to sensitive military bases is highlighted as a specific concern.
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Timely Data Sharing Issues: The USDA does not share timely data on foreign investments in agricultural land collected under AFIDA. The Department of Defense emphasizes the need for more specific and up-to-date information to effectively assess national security risks. The USDA has requested funding to develop a real-time data system to address this issue.
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Flawed Data Collection Processes: The USDA's processes to collect, track, and report key information related to AFIDA are identified as flawed. Data is collected on paper forms with unclear and challenging processes. The AFIDA handbook lacks sufficient instructions on reliable data collection, and the USDA does not sufficiently verify and conduct quality reviews, leading to errors in reported data.
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Online Submission System: Despite a congressional requirement, the USDA has not developed plans and timelines to create an online submission process and public database for AFIDA data. The lack of funding is cited as a reason for the delay.
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Recommendations for Improvement: The Government Accountability Office (GAO) provides six recommendations to address the issues, including sharing detailed and timely AFIDA data with CFIUS agencies, improving the reliability of AFIDA data, and assessing the feasibility of an online submission system and public database.
In conclusion, the article underscores the need for better coordination, data sharing, and improved processes to address national security risks associated with foreign investments in U.S. agricultural land. The recommendations from the GAO are aimed at enhancing the USDA's capabilities in this regard.
