The "FARM Act" aims to protect U.S. agriculture by including it in the Committee on Foreign Investment in the United States, requiring scrutiny of foreign investments in agriculture, and mandating annual reports on foreign influence in the U.S. agriculture industry.
Ronny Jackson
Representative
TX-13
The FARM Act aims to protect U.S. agriculture by including it in the Committee on Foreign Investment in the United States, adding the Secretary of Agriculture to the committee, and mandating reviews of foreign investments in U.S. agricultural businesses. It designates agricultural systems and supply chains as critical infrastructure and technologies. The Act also requires annual reports to Congress on foreign influence and potential threats in the U.S. agriculture industry, including espionage and intellectual property theft.
FARM Act Adds Agriculture to Foreign Investment Reviews, Starting in 2025
The Foreign Adversary Risk Management (FARM) Act aims to fold U.S. agriculture into the national security reviews conducted by the Committee on Foreign Investment in the United States (CFIUS). Basically, it's treating farmland and food production as critical infrastructure, similar to how we view energy or telecommunications.
Digging into the Details
The FARM Act, effective immediately, makes some significant changes:
- The Secretary of Agriculture gets a seat at the table: The Secretary of Agriculture is now a member of CFIUS, ensuring agricultural expertise is part of national security evaluations (SEC. 2).
- Foreign investments in U.S. agriculture face new scrutiny: Any foreign investment – mergers, acquisitions, or agreements – that could result in foreign control of a U.S. agricultural business or involve "agricultural systems and supply chains" will be reviewed by CFIUS (SEC. 2). This is a big deal because it expands the scope of what's considered critical.
- Annual Report on Foreign Influence: The Secretary of Agriculture and the Comptroller General have to report to Congress annually on foreign investments in the U.S. agriculture industry. This report will detail potential harms to our food supply, identify the biggest international threats, and outline methods of espionage or theft used by foreign governments, including intellectual property theft. The first report is due one year after this act becomes law (SEC. 3).
Real-World Impact
Imagine a foreign company wants to buy a major U.S. seed producer. Under the FARM Act, this deal would be reviewed to see if it poses a risk to national security. Or, say a foreign entity invests in a company that provides critical software for farm equipment. That, too, could trigger a CFIUS review. The act even calls out attempts by foreign governments to steal U.S. agricultural intellectual property, like new seed varieties or farming techniques, as a threat to watch (SEC. 3).
For a farmer, this could mean increased protection of their intellectual property and potentially more stability in the supply chain. For a food processing company, it might mean navigating a more complex regulatory landscape when seeking foreign investment. The inclusion of "agricultural systems and supply chains" as critical infrastructure (SEC. 2) is broad, and how it's interpreted will be key.
Challenges on the Horizon
While the FARM Act aims to protect a crucial sector, it also introduces potential complications. Defining "agricultural systems and supply chains" precisely will be crucial to avoid unintended consequences for businesses. The increased scrutiny could also slow down or even block foreign investment that might otherwise benefit the U.S. agricultural sector. The annual reporting requirement, while valuable for oversight, places an additional burden on the Secretary of Agriculture and the Comptroller General, and the first report is due just one year after enactment (SEC. 3).