Provisions Pertaining to Certain Transactions by Foreign Persons Involving Real Estate in the United States

DEPARTMENT OF THE TREASURY

Office of Investment Security

31 CFR Part 802

[Docket ID TREAS-DO-2023-0006]

RIN 1505-AC82

Provisions Pertaining to Certain Transactions by Foreign Persons Involving Real Estate in the United States

AGENCY:

Office of Investment Security, Department of the Treasury.

ACTION:

Final rule.

SUMMARY:

This final rule adopts without change the proposed rule amending the definition of “military installation” and adding eight military installations to the appendix in the regulations of the Committee on Foreign Investment in the United States that implement the provisions relating to real estate transactions pursuant to the Defense Production Act of 1950, as amended. This rule also makes technical amendments in the form of name changes to five military installations.

DATES:

This final rule is effective September 22, 2023.

FOR FURTHER INFORMATION CONTACT:

For questions about this rule, contact: Meena R. Sharma, Acting Director, Office of Investment Security Policy and International Relations, or James Harris, Senior Policy Advisor, at U.S. Department of the Treasury, 1500 Pennsylvania Avenue NW, Washington, DC 20220; telephone: (202) 622-3425; email:

CFIUS.FIRRMA@treasury.gov.

SUPPLEMENTARY INFORMATION:

I. Background

A. Proposed Definition of Military Installation and Appendix A

On May 5, 2023, the U.S. Department of the Treasury (Treasury Department) published in the

Federal Register

a proposed rule (88 FR 29003) amending the definition of “military installation” and adding eight military installations to the list at appendix A of the regulations in part 802 to title 31 of the Code of Federal Regulations (part 802) that implement the provisions relating to real estate transactions pursuant to section 721 of the Defense Production Act of 1950, as amended (section 721). Part 802 sets forth the processes and procedures of the Committee on Foreign Investment in the United States (CFIUS) for reviewing transactions involving the purchase or lease by, or concession to, a foreign person of certain real estate in the United States. Appendix A identifies, among other things, the bases, ranges, and other installations

that meet the definition of “military installation” at § 802.227. The amendments were proposed as a result of the ongoing evaluation of military installations by the U.S. Department of Defense (Defense Department).

B. Additional Technical Amendments To Update the Names of Certain Military Installations

This final rule also includes technical amendments to update the names of five military installations at appendix A: Fort Cavazos (formerly Fort Hood); Fort Gregg-Adams (formerly Fort Lee); Fort Johnson (formerly Fort Polk); Fort Liberty (formerly Fort Bragg); and Fort Moore (formerly Fort Benning). These are name changes to installations already on the list at appendix A and reflect decisions made by the Defense Department to implement the recommendations of the Defense Department Naming Commission. The military installation name changes in this final rule are those that have officially been changed by the Defense Department as of the publication date of this rule in the

Federal Register

. Additional bases may be renamed in the future, and information on the full list of recommended name changes is available at

https://media.defense.gov/2022/Oct/06/2003092544/-1/-1/1/IMPLEMENTATION-OF-THE-NAMING-COMMISSIONS-RECOMMENDATIONS.PDF

and

https://www.defense.gov/News/News-Stories/Article/Article/3260434/dod-begins-implementing-naming-commission-recommendations/.

C. Additional Guidance

The Treasury Department, in coordination with the Defense Department and the U.S. Department of Commerce's Census Bureau (Census Bureau), makes available a web-based tool to help the public understand the geographic coverage of part 802. This web-based tool is available at

https://mtgis-portal.geo.census.gov/arcgis/apps/webappviewer/index.html?id=0bb1d5751d76498181b4b531987ce263

and allows users to input an address and determine the distance to certain military installations. The tool was developed to assist the public and is provided for reference only; it should not be interpreted as guidance or an advisory opinion by CFIUS with respect to any particular transaction.

II. Summary of Comments

The public was provided an opportunity to comment on the proposed rule, and comments were due by June 5, 2023. During the public comment period, the Treasury Department received five comments reflecting a range of views. All comments received are available on the public rulemaking docket at

https://www.regulations.gov

and are addressed herein.

The Treasury Department considered each comment submitted on the proposed rule. One commenter expressed the view that these provisions should be expanded to U.S. developers and realtors to address the overdevelopment of U.S. land located in natural disaster zones. The rule makes no change in response to this comment as it is outside the scope of section 721.

One commenter expressed the view that the regulations should further address risks posed by incompatible development around military installations such as from the construction of obstructions, visual and other interference from certain land uses, and light emissions, among other things. The commenter further expressed a view with respect to adding air installations to appendix A and related operational security risks. The rule makes no change in response to these comments. The Treasury Department and the Defense Department consult on the composition of appendix A and part 802 more broadly, taking into account the statutory requirements under section 721 and a variety of considerations.

One commenter requested guidance regarding whether legal name changes, inherited property, and gifts to relatives would be within the definition of a covered real estate transaction under part 802. The rule makes no change in response to this comment. Consistent with section 721 and as defined in § 802.212(a), a covered real estate transaction includes any purchase or lease by, or concession to, a foreign person of covered real estate that affords the foreign person at least three property rights under § 802.233. Real estate acquired by gift or inheritance is distinct from a purchase, lease, or concession as those terms are defined in part 802. By contrast, a person or entity that amends a property record or document to reflect a legal name change may or may not have engaged in a purchase, lease, or concession as those terms are defined in part 802—further analysis of the underlying reason for the name change would be required. For example, a corporate name change may follow an acquisition transaction, which, depending on the rights conveyed in that transaction, could be a covered real estate transaction (or be subject to CFIUS's jurisdiction relating to foreign investment in U.S. businesses which is detailed in 31 CFR part 800). As a general reminder, the Treasury Department notes that pursuant to § 802.212, the definition of a “covered real estate transaction” includes any transaction, transfer, agreement, or arrangement, the structure of which is designed or intended to evade or circumvent the application of section 721 as it relates to real estate transactions.

One commenter suggested adding Whiteman Air Force Base in Missouri to the list of military installations at appendix A. The rule makes no change in response to this comment. As noted in the proposed rule, the Defense Department will continue on an ongoing basis to assess its military installations and the geographic scope set under the rule to ensure appropriate application in light of national security considerations.

One commenter suggested an amendment to § 802.216(c) to exclude from the definition of “excepted real estate transaction” any purchase, lease, or concession of covered real estate by a person owned by, controlled by, or subject to the jurisdiction or direction of a foreign adversary. The rule makes no change in response to this comment. The Treasury Department and the Defense Department consult on the definition of “excepted real estate transaction” taking into account the statutory requirements under section 721 and a variety of considerations.

No additional comments were received. The final rule therefore adopts the proposed rule without change other than the technical amendments described above.

III. Rulemaking Requirements

Executive Order 12866

This rule is not subject to the general requirements of Executive Order 12866, as amended, which covers review of regulations by the Office of Information and Regulatory Affairs in the Office of Management and Budget (OMB), because it relates to a foreign affairs function of the United States, pursuant to section 3(d)(2) of that order. In addition, this rule is not subject to review under section 6(b) of Executive Order 12866 pursuant to section 1(d) of the June 9, 2023, Memorandum of Agreement between the Treasury Department and OMB, which states that CFIUS regulations are not subject to OMB's standard centralized review process under Executive Order 12866.

Regulatory Flexibility Act

The Regulatory Flexibility Act (RFA) (5 U.S.C. 601

et seq.

) generally requires an agency to prepare a regulatory flexibility analysis, unless the agency

certifies that the rule, once implemented, will not have a significant economic impact on a substantial number of small entities. The final rule makes amendments to part 802 (see 85 FR 3158), which the Treasury Department previously determined would not significantly impact a substantial number of small entities. The amendments in this rule do not change that analysis or determination.

Congressional Review Act

This rule has been submitted to the OMB's Office of Information and Regulatory Affairs, which has determined that the rule is not a “major” rule under the Congressional Review Act.

List of Subjects in 31 CFR Part 802

Foreign investments in the United States, Federal buildings and facilities, Government property, Investigations, Investments, Investment companies, Land sales, National defense, Public lands, Real property acquisition, Reporting and recordkeeping requirements.

For the reasons set forth in the preamble, the Treasury Department amends 31 CFR part 802 as follows:

PART 802—REGULATIONS PERTAINING TO CERTAIN TRANSACTIONS BY FOREIGN PERSONS INVOLVING REAL ESTATE IN THE UNITED STATES

1. The authority citation for part 802 continues to read as follows:

Authority:

50 U.S.C. 4565; E.O. 11858, as amended, 73 FR 4677.

Subpart B—Definitions

§ 802.227

[Amended]

2. Amend § 802.227, in paragraph (m), by removing the words “Oregon, Nevada, Idaho, Wisconsin, Mississippi, North Carolina, or Florida” and adding in their place “Arizona, California, Florida, Idaho, Iowa, Mississippi, Nevada, North Carolina, North Dakota, Oregon, South Dakota, Texas, or Wisconsin”.

3. Revise parts 1 and 2 of appendix A to part 802 to read as follows:

Appendix A to Part 802—List of Military Installations and Other U.S. Government Sites

Site name

Location

Part 1

Adelphi Laboratory Center

Adelphi, MD.

Air Force Maui Optical and Supercomputing Site

Maui, HI.

Air Force Office of Scientific Research

Arlington, VA.

Andersen Air Force Base

Yigo, Guam.

Army Futures Command

Austin, TX.

Army Research Lab—Orlando Simulations and Training Technology Center

Orlando, FL.

Army Research Lab—Raleigh Durham

Raleigh Durham, NC.

Arnold Air Force Base

Coffee County and Franklin County, TN.

Beale Air Force Base

Yuba City, CA.

Biometric Technology Center (Biometrics Identity Management Activity)

Clarksburg, WV.

Buckley Air Force Base

Aurora, CO.

Camp MacKall

Pinebluff, NC.

Cape Cod Air Force Station

Sandwich, MA.

Cape Newenham Long Range Radar Site

Cape Newenham, AK.

Cavalier Air Force Station

Cavalier, ND.

Cheyenne Mountain Air Force Station

Colorado Springs, CO.

Clear Air Force Station

Anderson, AK.

Creech Air Force Base

Indian Springs, NV.

Davis-Monthan Air Force Base

Tucson, AZ.

Defense Advanced Research Projects Agency

Arlington, VA.

Eareckson Air Force Station

Shemya, AK.

Eielson Air Force Base

Fairbanks, AK.

Ellington Field Joint Reserve Base

Houston, TX.

Fairchild Air Force Base

Spokane, WA.

Fort Belvoir

Fairfax County, VA.

Fort Bliss

El Paso, TX.

Fort Campbell

Hopkinsville, KY.

Fort Carson

Colorado Springs, CO.

Fort Cavazos

Killeen, TX.

Fort Detrick

Frederick, MD.

Fort Drum

Watertown, NY.

Fort Gordon

Augusta, GA.

Fort Gregg-Adams

Petersburg, VA.

Fort Knox

Fort Knox, KY.

Fort Leavenworth

Leavenworth, KS.

Fort Leonard Wood

Pulaski County, MO.

Fort Meade

Anne Arundel County, MD.

Fort Moore

Columbus, GA.

Fort Riley

Junction City, KS.

Fort Shafter

Honolulu, HI.

Fort Sill

Lawton, OK.

Fort Stewart

Hinesville, GA.

Fort Yukon Long Range Radar Site

Fort Yukon, AK.

Francis E. Warren Air Force Base

Cheyenne, WY.

Guam Tracking Station

Inarajan, Guam.

Hanscom Air Force Base

Lexington, MA.

Holloman Air Force Base

Alamogordo, NM.

Holston Army Ammunition Plant

Kingsport, TN.

Joint Base Anacostia-Bolling

Washington, DC.

Joint Base Andrews

Camp Springs, MD.

Joint Base Elmendorf-Richardson

Anchorage, AK.

Joint Base Langley-Eustis

Hampton, VA and Newport News, VA.

Joint Base Lewis-McChord

Tacoma, WA.

Joint Base McGuire-Dix-Lakehurst

Lakehurst, NJ.

Joint Base Pearl Harbor-Hickam

Honolulu, HI.

Joint Base San Antonio

San Antonio, TX.

Joint Expeditionary Base Little Creek-Fort Story

Virginia Beach, VA.

Kaena Point Satellite Tracking Station

Waianae, HI.

King Salmon Air Force Station

King Salmon, AK.

Kirtland Air Force Base

Albuquerque, NM.

Kodiak Tracking Station

Kodiak Island, AK.

Los Angeles Air Force Base

El Segundo, CA.

MacDill Air Force Base

Tampa, FL.

Malmstrom Air Force Base

Great Falls, MT.

Marine Corps Air Ground Combat Center Twentynine Palms

Twentynine Palms, CA.

Marine Corps Air Station Beaufort

Beaufort, SC.

Marine Corps Air Station Cherry Point

Cherry Point, NC.

Marine Corps Air Station Miramar

San Diego, CA.

Marine Corps Air Station New River

Jacksonville, NC.

Marine Corps Air Station Yuma

Yuma, AZ.

Marine Corps Base Camp Lejeune

Jacksonville, NC.

Marine Corps Base Camp Pendleton

Oceanside, CA.

Marine Corps Base Hawaii

Kaneohe Bay, HI.

Marine Corps Base Hawaii, Camp H.M. Smith

Halawa, HI.

Marine Corps Base Quantico

Quantico, VA.

Mark Center

Alexandria, VA.

Minot Air Force Base

Minot, ND.

Moody Air Force Base

Valdosta, GA.

Naval Air Station Joint Reserve Base New Orleans

Belle Chasse, LA.

Naval Air Station Oceana

Virginia Beach, VA.

Naval Air Station Oceana Dam Neck Annex

Virginia Beach, VA.

Naval Air Station Whidbey Island

Oak Harbor, WA.

Naval Base Guam

Apra Harbor, Guam.

Naval Base Kitsap Bangor

Silverdale, WA.

Naval Base Point Loma

San Diego, CA.

Naval Base San Diego

San Diego, CA.

Naval Base Ventura County—Port Hueneme Operating Facility

Port Hueneme, CA.

Naval Research Laboratory

Washington, DC.

Naval Research Laboratory—Blossom Point

Welcome, MD.

Naval Research Laboratory—Stennis Space Center

Hancock County, MS.

Naval Research Laboratory—Tilghman

Tilghman, MD.

Naval Station Newport

Newport, RI.

Naval Station Norfolk

Norfolk, VA.

Naval Submarine Base Kings Bay

Kings Bay, GA.

Naval Submarine Base New London

Groton, CT.

Naval Surface Warfare Center Carderock Division—Acoustic Research Detachment

Bayview, ID.

Naval Support Activity Crane

Crane, IN.

Naval Support Activity Orlando

Orlando, FL.

Naval Support Activity Panama City

Panama City, FL.

Naval Support Activity Philadelphia

Philadelphia, PA.

Naval Support Facility Carderock

Bethesda, MD.

Naval Support Facility Dahlgren

Dahlgren, VA.

Naval Support Facility Indian Head

Indian Head, MD.

Naval Weapons Station Seal Beach Detachment Norco

Norco, CA.

New Boston Air Station

New Boston, NH.

Offutt Air Force Base

Bellevue, NE.

Oliktok Long Range Radar Site

Oliktok, AK.

Orchard Combat Training Center

Boise, ID.

Peason Ridge Training Area

Leesville, LA.

Pentagon

Arlington, VA.

Peterson Air Force Base

Colorado Springs, CO.

Picatinny Arsenal

Morris County, NJ.

Piñon Canyon Maneuver Site

Tyrone, CO.

Pohakuloa Training Area

Hilo, HI.

Point Barrow Long Range Radar Site

Point Barrow, AK.

Portsmouth Naval Shipyard

Kittery, ME.

Radford Army Ammunition Plant

Radford, VA.

Redstone Arsenal

Huntsville, AL.

Rock Island Arsenal

Rock Island, IL.

Rome Research Laboratory

Rome, NY.

Schriever Air Force Base

Colorado Springs, CO.

Seymour Johnson Air Force Base

Goldsboro, NC.

Shaw Air Force Base

Sumter, SC.

Southeast Alaska Acoustic Measurement Facility

Ketchikan, AK.

Tin City Long Range Radar Site

Tin City, AK.

Tinker Air Force Base

Midwest City, OK.

Travis Air Force Base

Fairfield, CA.

Tyndall Air Force Base

Bay County, FL.

U.S. Army Natick Soldier Systems Center

Natick, MA.

Watervliet Arsenal

Watervliet, NY.

Wright-Patterson Air Force Base

Dayton, OH.

Part 2

Aberdeen Proving Ground

Aberdeen, MD.

Air Force Plant 42

Palmdale, CA.

Camp Shelby

Hattiesburg, MS.

Cape Canaveral Air Force Station

Cape Canaveral, FL.

Dare County Range

Manns Harbor, NC.

Dyess Air Force Base

Abilene, TX.

Edwards Air Force Base

Edwards, CA.

Eglin Air Force Base

Valparaiso, FL.

Ellsworth Air Force Base

Box Elder, SD.

Fallon Range Complex

Fallon, NV.

Fort Greely

Delta Junction, AK.

Fort Huachuca

Sierra Vista, AZ.

Fort Irwin

San Bernardino County, CA.

Fort Johnson

Leesville, LA.

Fort Liberty

Fayetteville, NC.

Fort Wainwright

Fairbanks, AK.

Grand Forks Air Force Base

Grand Forks, ND.

Hardwood Range

Necehuenemedah, WI.

Hill Air Force Base

Ogden, UT.

Iowa National Guard Joint Force Headquarters

Des Moines, IA.

Lackland Air Force Base

San Antonio, TX.

Laughlin Air Force Base

Del Rio, TX.

Luke Air Force Base

Glendale, AZ.

Mountain Home Air Force Base

Mountain Home, ID.

Naval Air Station Meridian

Meridian, MS.

Naval Air Station Patuxent River

Lexington Park, MD.

Naval Air Weapons Station China Lake

Ridgecrest, CA.

Naval Base Kitsap—Keyport

Keyport, WA.

Naval Base Ventura County—Point Mugu Operating Facility

Point Mugu, CA.

Naval Weapons Systems Training Facility Boardman

Boardman, OR.

Nellis Air Force Base

Las Vegas, NV.

Nevada Test and Training Range

Tonopah, NV.

Pacific Missile Range Facility

Kekaha, HI.

Patrick Air Force Base

Cocoa Beach, FL.

Tropic Regions Test Center

Wahiawa, HI.

Utah Test and Training Range

Barro, UT.

Vandenberg Air Force Base

Lompoc, CA.

West Desert Test Center

Dugway, UT.

White Sands Missile Range

White Sands Missile Range, NM.

Yuma Proving Ground

Yuma, AZ.

Paul M. Rosen,

Assistant Secretary for Investment Security.

[FR Doc. 2023-17678 Filed 8-22-23; 8:45 am]

BILLING CODE 4810-AK-P