Tennessee Senate Bill SB2424

Tennessee 2025-2026 Regular Session

• Introduced: 2/2/26
• Engrossed: 3/19/26
• Enrolled: 3/26/26
• Passed: 4/13/26
• Chaptered: 5/4/26

Caption

AN ACT to amend Tennessee Code Annotated, Title 66, Chapter 2, Part 3, relative to real property ownership.

Summary

SB2424 revises Tennessee’s restrictions on certain foreign ownership interests in real property, specifically non-agricultural land. The bill bars a “prohibited foreign party” or a “prohibited foreign-party-controlled business” from acquiring such land, prohibits holding title through agents, trustees, or other fiduciaries, and requires divestiture within two years after a violation is found. Violations are made a Class A misdemeanor, and the attorney general and reporter may bring an enforcement action if divestiture does not occur. The bill also creates a registration regime for covered foreign parties and foreign-party-controlled businesses that hold non-agricultural land in Tennessee on or after January 1, 2025. Registrants must disclose identifying information about the foreign party and related entities, the purpose of the business and land interest, and certain holdings elsewhere in the United States. The secretary of state is tasked with receiving registrations, identifying violations, and assessing civil penalties for failure to timely register. The bill further amends definitional provisions to clarify that a “qualified alien” is not included in the prohibited category and ties that term to federal immigration law.

Impact

The bill amends Tennessee Code Annotated Title 66, Chapter 2, Part 3, substantially expanding and clarifying the state’s foreign-ownership restrictions for non-agricultural land. It adds new registration, disclosure, penalty, and enforcement provisions, shifts administrative responsibilities to the secretary of state, and authorizes the attorney general and reporter to pursue violations. The act takes effect July 1, 2026, and will affect foreign investors, foreign-controlled businesses, landowners, and entities holding Tennessee non-agricultural real estate.

Sentiment

The voting record shows strong support for the bill. It passed the Senate Commerce and Labor Committee unanimously, then cleared floor votes overwhelmingly, including a 33-0 vote on third consideration and a final 81-3 passage. The available record suggests broad bipartisan agreement on the measure’s general purpose of limiting certain foreign land ownership and increasing transparency.

Contention

The main policy tension is between state efforts to restrict foreign ownership of land for national security and economic reasons and concerns about how broadly the prohibition and reporting requirements reach. The bill’s detailed disclosure obligations, criminal penalty, and enforcement mechanism could raise concerns for affected foreign parties, foreign-controlled businesses, and real estate interests, while supporters appear to view the measure as a necessary safeguard. The amendment clarifying that qualified aliens are excluded from the prohibited category also suggests attention to avoiding overbreadth in the law’s application.