US appeals court split over Florida ban on Chinese citizens owning property

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A US appeal court on Friday heard counsel for four Chinese immigrants argue that a Florida law restricting their ability to buy property violates their constitutional right to equal protection and federal right to fair housing, while the state’s counsel said the limitation was in the best interests of national security.

The plaintiffs – Yifan Shen, Zhiming Xu, Xinxi Wang, Yongxin Liu and Florida-based real estate firm Multi-Choice Realty – are asking the 11th US Circuit Court of Appeals to block enforcement of the law while a challenge against it makes its way through district court. “Florida’s law discriminates based on national origin in violation of the Fair Housing Act and the equal protection clause. By restricting housing based on Chinese domicile, Florida is unlawfully restricting housing for Chinese people,” Ashley Gorski of the American Civil Liberties Union argued for the plaintiffs. A decision is not expected for a few weeks or months.

Requiring individuals to provide an affidavit establishing their place of domicile and to register the property if they are from certain countries puts a distinct burden on Chinese individuals, Gorski contended. She also told the three-judge panel in Miami that Florida’s law conflicts with the US president’s “ability to speak for the nation with one voice on matters of foreign policy” – an argument that the same court has previously found compelling.

In February, the appeal court approved temporary relief from the law for two of the plaintiffs after a Florida District Court ruled against their motion to block it preliminarily last August.

Florida Governor Ron DeSantis signed the measure, known as SB 264, in May 2023, and it first went into effect last July.

SB 264 restricts Florida property purchases by anyone “domiciled” in a “country of concern” unless they are a US citizen or permanent resident. The designated countries of concern are China, Cuba, Iran, North Korea, Russia, Syria and Venezuela. But the law imposes harsher limits on those domiciled in China. In Florida, one’s domicile is typically defined as where he has a good-faith intent to establish his home permanently or indefinitely, regardless of current physical location.

While those domiciled in the other targeted countries are restricted from owning property within 10 miles (16km) of any military installation or critical infrastructure facility, the Florida law restricts those domiciled in China from owning any property, regardless of proximity. The law does make allowances: a person domiciled in China who either has a valid non-tourist US visa or has been granted asylum in the US is permitted to buy residential property, but only if the property is less than two acres (0.9 hectares) and located farther than five miles from a military installation.

Critics of the law have said that the exception is too narrow, arguing that Florida’s many military bases leave relatively little land accessible to Chinese buyers.

During Friday’s hearing, Judge Charles R. Wilson asked the state’s representative, Nathan Forrester of the Florida attorney general’s office, how many square miles are not within a five-mile radius of a military installation or critical infrastructure facility in Florida. Forrester did not have an answer. Wilson also pressed him about the criminal liability required for realtors who may not be able to ensure that the affidavits signed by potential buyers are accurate. SB 264 provides especially harsh penalties for cases dealing with Chinese buyers – up to five years in prison for people trying to buy a home and up to one year in prison for sellers.

The issue of legal standing was a focus of debate on Friday, as Judge Robert Luck questioned whether some plaintiffs were indeed domiciled in China, given that some had made statements suggesting they intended to stay in the United States. In signing SB 264, DeSantis, who then had aspirations to run for president, said the law was part of the state’s standing up to the Chinese Communist Party, which he called the “greatest geopolitical threat” to the US.

Forrester clung to that justification on Friday: “The concern is that Chinese domiciliaries are uniquely prone to influence by the Chinese government,” he told the court.

Responding to arguments that Florida is pre-empting federal law by taking foreign policy into its own hands, Forrester argued that the Committee on Foreign Investment in the United States – an inter-agency federal body tasked with scrutinising cross-border deals – has limited jurisdiction and resources to deal with “areas that quite plausibly going to raise national security concerns”. He added that Florida’s action “in many respects lines up exactly with things that the federal government has said are of concern”, noting that the FBI highlights the distinct threats posed by China on its website.

Members of Florida’s Asian-American community held a rally outside the courthouse on Friday, protesting the law. “Florida’s SB 264 is a relic from a long history of similarly racist land laws in this country that were wrong then and are wrong now,” said Bethany Li, legal director of the Asian American Legal Defence and Education Fund.

“This law targets Chinese people in clear violation of the Constitution, and its chilling effect reaches even further, hurting all Asian-Americans who call this country home,” she added.

Legislation restricting Chinese property and land purchases have been introduced or enacted in more than two-thirds of US states, most of them Republican-controlled. The spate of laws began with concerns over a rise in Chinese entities buying agricultural land, some located near American military installations. Apprehension has extended to individual Chinese buying property, despite little evidence of a credible threat from the entities or individuals.

Foreign ownership accounts for about 3 per cent of privately held agricultural land in the US, and Chinese entities own less than 1 per cent of that amount. Still, some states have approved bills targeting Chinese land purchases in recent months. In March, South Dakota Governor Kristi Noem signed a bill restricting Chinese nationals and “evil foreign governments” including China from owning land in the state.

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