Bill Text: TX HB2825 | 2021-2022 | 87th Legislature | Comm Sub


Bill Title: Relating to reporting requirements for certain loan and title insurance transactions involving foreign companies and real property located near military bases.

Spectrum: Slight Partisan Bill (Republican 2-1)

Status: (Introduced) 2021-05-12 - Placed on General State Calendar [HB2825 Detail]

Download: Texas-2021-HB2825-Comm_Sub.html
  87R12934 SRA-F
 
  By: Bonnen, Morales of Maverick, Cyrier H.B. No. 2825
 
  Substitute the following for H.B. No. 2825:
 
  By:  Buckley C.S.H.B. No. 2825
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to reporting requirements for certain loan and title
  insurance transactions involving foreign companies and real
  property located near military bases.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subtitle Z, Title 3, Finance Code, is amended by
  adding Chapter 282 to read as follows:
  CHAPTER 282. CERTAIN LOANS FOR REAL PROPERTY NEAR MILITARY BASES
         Sec. 282.001.  DEFINITIONS. In this chapter:
               (1)  "Commission" means the Texas Military
  Preparedness Commission.
               (2)  "Company" and "scrutinized company" have the
  meanings assigned by Section 2270.0001, Government Code.
               (3)  "Financial institution" means:
                     (A)  a bank as defined for any purpose by Section
  201.002(a)(4), whether chartered under the laws of this state,
  another state, the United States, or another country, including a
  state savings bank;
                     (B)  a savings and loan association chartered
  under Chapter 62 or similar laws of another state;
                     (C)  a federal savings and loan association,
  federal savings bank, or federal credit union; or
                     (D)  a credit union chartered under Chapter 122 or
  similar laws of another state.
               (4)  "Reportable company" means a company described by
  Section 282.003(a).
         Sec. 282.002.  APPLICABILITY. This chapter applies only to
  a loan made by a financial institution for the purchase, lease,
  development, or renovation of real property that:
               (1)  is located within 25 nautical miles of the
  boundaries of a military base located in this state; and
               (2)  is not zoned or intended to be used for residential
  use only.
         Sec. 282.003.  NOTICE AND REPORTING OF LOAN TRANSACTIONS
  INVOLVING CERTAIN FOREIGN COMPANIES. (a) Before approving a loan
  application to which this chapter applies, a financial institution
  shall determine if the company applying for a loan is:
               (1)  a scrutinized company; 
               (2)  owned by or the majority of stock or other
  ownership interest of the company is held or controlled by:
                     (A)  individuals who are citizens of China, Iran,
  North Korea, or Russia; or
                     (B)  a company or other entity, including a
  governmental entity, that is owned or controlled by citizens of or
  is directly controlled by the government of China, Iran, North
  Korea, or Russia; or
               (3)  headquartered in China, Iran, North Korea, or
  Russia.
         (b)  Subsection (a) applies regardless of whether:
               (1)  the reportable company's or its parent company's
  securities are publicly traded; or
               (2)  the reportable company or its parent company is
  listed on a public stock exchange as a Chinese, Iranian, North
  Korean, or Russian company. 
         (c)  In making a determination if a loan applicant is a
  scrutinized company under Subsection (a), a financial institution
  may rely on the list maintained by the comptroller under Section
  2270.0201, Government Code.
         (d)  If a financial institution determines that the
  applicant is a reportable company, the financial institution shall
  promptly notify the seller or lessor of the real property of that
  fact.
         (e)  Not later than December 31 of each year, each financial
  institution shall submit a report to the commission that identifies
  each loan to which this chapter applies that is made to a reportable
  company.
         (f)  This section does not prohibit a financial institution
  from approving an application for a loan submitted by a reportable
  company.
         SECTION 2.  Subchapter C, Chapter 436, Government Code, is
  amended by adding Section 436.1031 to read as follows:
         Sec. 436.1031.  TRANSACTION INFORMATION INVOLVING REAL
  PROPERTY NEAR MILITARY BASES. (a) The commission shall include in
  the biennial report required under Section 436.103:
               (1)  a list of the financial institutions and title
  insurance companies that have, during each biennium, reported a
  transaction to the commission under Section 282.003, Finance Code,
  or Section 2704.153, Insurance Code; and 
               (2)  the name of the reportable company involved in
  each transaction.
         (b)  Information under this section is confidential and not
  subject to disclosure under Chapter 552.
         SECTION 3.  Chapter 2704, Insurance Code, is amended by
  adding Subchapter D to read as follows:
  SUBCHAPTER D. TITLE INSURANCE FOR REAL PROPERTY NEAR MILITARY BASES
         Sec. 2704.151.  DEFINITIONS. In this subchapter:
               (1)  "Commission" means the Texas Military
  Preparedness Commission.
               (2)  "Company" and "scrutinized company" have the
  meanings assigned by Section 2270.0001, Government Code.
               (3)  "Reportable company" means a company described by
  Section 2704.153(a).
         Sec. 2704.152.  APPLICABILITY. This subchapter applies only
  to a title insurance policy or contract issued by a title insurance
  company for real property that:
               (1)  is located within 25 nautical miles of the
  boundaries of a military base located in this state; and
               (2)  is not zoned or intended to be used for residential
  use only.
         Sec. 2704.153.  NOTICE AND REPORTING OF POLICY AND CONTRACTS
  INVOLVING CERTAIN FOREIGN COMPANIES. (a) Before approving the
  policy or contract application to which this subchapter applies, a
  title insurance company shall determine if the applicant for a
  title insurance policy or contract is:
               (1)  a scrutinized company; 
               (2)  owned by or the majority of stock or other
  ownership interest of the company is held or controlled by:
                     (A)  individuals who are citizens of China, Iran,
  North Korea, or Russia; or
                     (B)  a company or other entity, including a
  governmental entity, that is owned or controlled by citizens of or
  is directly controlled by the government of China, Iran, North
  Korea, or Russia; or
               (3)  headquartered in China, Iran, North Korea, or
  Russia.
         (b)  Subsection (a) applies regardless of whether:
               (1)  the reportable company's or its parent company's
  securities are publicly traded; or
               (2)  the reportable company or its parent company is
  listed on a public stock exchange as a Chinese, Iranian, North
  Korean, or Russian company. 
         (c)  In making a determination if a policy or contract
  applicant is a scrutinized company under Subsection (a), a title
  insurance company may rely on the list maintained by the
  comptroller under Section 2270.0201, Government Code.
         (d)  If a title insurance company determines that the policy
  or contract applicant is a reportable company, the title insurance
  company shall promptly notify the seller or lessor of the real
  property of that fact.
         (e)  Not later than December 31 of each year, each title
  insurance company shall submit a report to the commission that
  identifies each title insurance policy or contract to which this
  subchapter applies that is made to a reportable company. 
         (f)  This section does not prohibit a title insurance company
  from approving an application for a title insurance policy or
  contract submitted by a reportable company.
         SECTION 4.  Chapter 282, Finance Code, and Subchapter D,
  Chapter 2704, Insurance Code, as added by this Act, apply only to an
  application for a loan or title insurance policy or contract
  submitted on or after the effective date of this Act.
         SECTION 5.  This Act takes effect September 1, 2021.
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