US state passes bill banning property sales to ‘foreign adversaries’

South Carolina’s Senate has passed legislation that aims to prevent the state’s real estate from falling into the hands of people or corporations from China, Russia and other countries deemed to be “foreign adversaries.”

The bill, which passed on Thursday by a 31-5 vote, reflects deteriorating US relations with China, according to its backers. The Pentagon has pegged China as the nation’s top security threat. Dozens of Chinese-owned companies already operate in South Carolina, which is also home to thousands of Chinese immigrants and college students.

“There’s been a growing trend across the country generally where China’s become much more belligerent to the United States and our interests,” Senator Josh Kimbrell, a Spartanburg Republican, said earlier this month. “Our objective is not to expose ourselves politically and economically any more than possible to the Chinese government or communist party.”

South Carolina recruited Chinese companies in years past to help bring jobs to the state, but as Kimbrell noted, the mood toward Beijing has clearly shifted. Since 2011, Chinese companies have announced investments that will create an estimated 5,300 jobs.

The state won’t try to force divestitures of land purchased by foreign businesses and individuals in years past. The bill was reportedly introduced to block a Chinese company’s planned purchase of 500 acres in South Carolina.

“We need to look inside that wooden horse before we let it in the gate,” Senate Majority Leader Shane Massey told the Associated Press last week. “And there are some countries that have given us more of a reason to look inside the wooden horse before we let it in the gate.”

The five adversarial nations, as classified by the US Department of Commerce, are China, Russia, Iran, Cuba and North Korea.

Legislatures in at least 11 other US states are considering bills that would limit or ban real estate ownership by foreign adversaries. After last month’s controversy over an alleged Chinese spy balloon that crossed the US, lawmakers have raised concerns that enemy nations could use land ownership to advance their surveillance operations.

The South Carolina bill would ban property purchases by companies with greater than 20% ownership by citizens of adversary nations. Citizens of those countries also would be barred from buying property. Such foreigners would be allowed to open businesses in the state, but their companies wouldn’t be able to own the properties they occupy.