A proposed US Department of Agriculture (USDA) rule expanding foreign ownership disclosure requirements for energy infrastructure is drawing criticism from pipeline and renewable energy stakeholders who argue it would impose significant compliance burdens and unintended consequences. Industry groups contend the proposal’s broad definition of agricultural land could sweep in a wide range of energy assets, potentially affecting everything from pipelines to wind and solar projects.
Bracewell’s Scott Segal told Energy Intelligence that the USDA is attempting to modernize the Agriculture Foreign Investment Disclosure Act to address potential national security concerns, but in doing so may have cast the net too broadly.
“USDA set out to try to catch foreign adversaries who might try and own agricultural production, and they ended up casting a net that was wide enough to snag arguably every wind turbine and pipeline in America,” Segal said.
What’s more, Segal explained that the requirements could be “potentially retroactive because it asks companies to reconstruct years of lease and easement histories with respect to real estate – that might be reasonable, but it asks them to get it all done in 90 days. That seems like a little bit of mission creep – and a mission creep with a pretty tough filing deadline.”
