{
  "id": "tx-sb17",
  "version": "1.0.7",
  "state": "TX",
  "status": "active",
  "$id": "https://www.parcelclear.com/agents/ruleset.json",
  "title": "Texas SB 17: prohibition on acquisition of real property interests by certain foreign persons and entities",
  "effective_date": "2025-09-01",
  "rules_status": "proposed",
  "rules_proposed_date": "2026-03-27",
  "rules_effective_date": null,
  "last_verified": "2026-09-05",
  "outputs": [
    "evidence_pack_pdf",
    "sb17_representation_pdf",
    "oag_complaint_packet_pdf_when_REPORT",
    "audit_event"
  ],
  "sources": [
    {
      "id": "statute",
      "url": "https://statutes.capitol.texas.gov/",
      "cite": "Tex. Prop. Code ch. 5, subch. H (SB 17, 89th Leg., R.S., ch. 956), sec. 5.251 et seq."
    },
    {
      "id": "oag_rules",
      "url": "https://www.texasattorneygeneral.gov/",
      "cite": "Tex. Admin. Code ch. 67 (Office of the Attorney General), proposed 2026-03-27, not adopted as of 2026-09-07"
    },
    {
      "id": "dni",
      "url": "https://www.dni.gov/",
      "cite": "DNI Annual Threat Assessment (three-year lookback for designated countries)"
    },
    {
      "id": "ofac",
      "url": "https://ofac.treasury.gov/",
      "cite": "31 CFR ch. V; OFAC SDN and Consolidated lists"
    }
  ],
  "claims_gate": {
    "allowed": [
      "Records what a party attested and what the OFAC SDN and Consolidated lists said on the date of the screen.",
      "Evaluates those facts against a named, versioned Texas SB 17 rule set.",
      "Produces a time-stamped, hashed evidence pack.",
      "Screens parties and control persons against the OFAC SDN and Consolidated lists."
    ],
    "forbidden": [
      "Makes you SB 17 compliant.",
      "Guarantees no prohibited buyer.",
      "Certifies eligibility.",
      "Replaces underwriter or counsel review."
    ]
  },
  "definitions": {
    "control": "Direct or indirect power over the management or policies of an entity, or over acquisition or disposition of Texas real property by the entity (OAG ch. 67).",
    "interest": "Fee, leasehold of one year or more, mineral and other real property interests. Leasehold of less than one year is excluded.",
    "prohibited_person": "The government of a designated country; an individual domiciled in a designated country who is not a US citizen or lawful permanent resident; an entity headquartered in a designated country or owned or controlled by a prohibited person or government; a transnational criminal organization; a person designated by the Governor as a national security risk.",
    "facilitating_entity": "A person or entity that, in the regular course of business, assists with, brokers, insures, finances, values, or processes a purchase or acquisition of an interest in Texas real property. Includes lenders, title companies, property insurers, appraisers, licensed real estate professionals (OAG ch. 67)."
  },
  "result_semantics": {
    "HOLD": "Human reviewer must confirm facts or disposition a hit before the file is final.",
    "CLEAR": "No rule in this version of the rule set fired on the facts entered. Identity was not verified. This is not a determination that a transaction is lawful.",
    "REPORT": "The facts entered match a prohibited-acquisition pattern in this rule set. Texas AG Chapter 67, which would define a facilitating entity's complaint duty, was proposed 2026-03-27 and is not adopted. Escalate to counsel and to your underwriter. ParcelClear does not file anything with the Attorney General."
  },
  "control_person_tests": [
    { "id": "CP-GP", "test": "General partner of a partnership", "source": "oag_rules" },
    { "id": "CP-MM", "test": "Managing member of an LLC", "source": "oag_rules" },
    { "id": "CP-10", "test": "Holder of 10% or more of voting interests", "source": "oag_rules" },
    { "id": "CP-EO", "test": "Executive officer", "source": "oag_rules" },
    {
      "id": "CP-RIGHT",
      "test": "Any person with a present or future right to acquire or dispose of the entity's Texas real property interest",
      "source": "oag_rules"
    },
    {
      "id": "CP-TRUST",
      "note": "OAG rules left trust treatment open. Collect all three. Return Hold if any is a prohibited person.",
      "test": "Trustee, settlor with revocation power, and beneficiaries of a trust buyer",
      "source": "statute"
    }
  ],
  "designated_countries": {
    "initial": ["CN", "RU", "IR", "KP"],
    "expansion_rule": "Any country identified in the DNI Annual Threat Assessment within the prior three years, plus any country or entity designated by the Governor of Texas.",
    "engine_behavior": "Treat the initial list as authoritative for v1. Any other country of domicile returns Hold with reason DC-EXPAND for reviewer confirmation."
  },
  "questionnaire_fields": [
    "party_role",
    "party_type",
    "legal_name",
    "aliases",
    "dob_or_formation_date",
    "us_citizen",
    "lawful_permanent_resident",
    "lawfully_present_in_us",
    "domicile_country",
    "citizenship_countries",
    "entity_hq_country",
    "entity_formation_country",
    "government_country",
    "control_persons",
    "control_tree_attested",
    "interest_type",
    "lease_term_months",
    "intended_homestead",
    "interest_held_before_2025_09_01",
    "post_closing_transfer_planned",
    "transferee_details"
  ],
  "penalties_for_display": {
    "civil": "Greater of $250,000 or 50% of the property's market value (verify as adopted).",
    "leases": "Leases in violation are void or voidable.",
    "criminal": "State jail felony for knowing violations (verify as adopted).",
    "divestiture": "AG may seek receivership and forced divestiture.",
    "facilitating_entity": "Failure to report may be referred to the licensing or disciplinary authority."
  },
  "rules": [
    {
      "id": "EXC-LEASE-SHORT",
      "when": { "interest_type": "leasehold", "lease_term_months_lt": 12 },
      "order": 10,
      "reason": "Leasehold of less than one year is outside SB 17.",
      "result": "CLEAR",
      "source": "statute"
    },
    {
      "id": "EXC-USC",
      "when": { "party_type": "individual", "us_citizen": true },
      "order": 20,
      "reason": "US citizen is exempt.",
      "result": "CLEAR",
      "source": "statute"
    },
    {
      "id": "EXC-LPR",
      "when": { "party_type": "individual", "lawful_permanent_resident": true },
      "order": 21,
      "reason": "Lawful permanent resident is exempt.",
      "result": "CLEAR",
      "source": "statute"
    },
    {
      "id": "EXC-PRIOR",
      "when": {
        "transaction_is_new_acquisition": false,
        "interest_held_before_2025_09_01": true
      },
      "order": 30,
      "reason": "Interests held before 2025-09-01 may be held, managed, leased and sold under prior law. Confirm the current transaction is not a new acquisition.",
      "result": "CLEAR",
      "source": "statute"
    },
    {
      "id": "PP-GOV",
      "when": {
        "party_type": "government",
        "government_country_in": "designated_countries"
      },
      "order": 40,
      "reason": "Government of a designated country is a prohibited person.",
      "result": "REPORT",
      "source": "statute"
    },
    {
      "id": "PP-IND-DOM",
      "when": {
        "party_type": "individual",
        "us_citizen": false,
        "domicile_country_in": "designated_countries",
        "lawful_permanent_resident": false
      },
      "order": 50,
      "reason": "Individual domiciled in a designated country who is not a US citizen or LPR is a prohibited person.",
      "result": "REPORT",
      "source": "statute",
      "override_by": ["EXC-HOMESTEAD"]
    },
    {
      "id": "EXC-HOMESTEAD",
      "when": {
        "party_type": "individual",
        "interest_type": "fee",
        "intended_homestead": true,
        "lawfully_present_in_us": true
      },
      "order": 51,
      "reason": "Statute provides a homestead exception for an individual lawfully present in the US. UNVERIFIED exact scope. Reviewer confirms visa status, lawful presence, and homestead intent against statute text.",
      "result": "HOLD",
      "source": "statute",
      "verify_live": true
    },
    {
      "id": "PP-IND-CIT",
      "when": {
        "party_type": "individual",
        "us_citizen": false,
        "domicile_country_not_in": "designated_countries",
        "lawful_permanent_resident": false,
        "citizenship_countries_any_in": "designated_countries"
      },
      "order": 55,
      "reason": "Citizen of a designated country domiciled elsewhere. Statute keys on domicile. Reviewer confirms domicile evidence.",
      "result": "HOLD",
      "source": "statute",
      "verify_live": true
    },
    {
      "id": "PP-ENT-HQ",
      "when": {
        "party_type_in": ["entity", "trust"],
        "entity_hq_country_in": "designated_countries"
      },
      "order": 60,
      "reason": "Entity headquartered in a designated country is a prohibited person.",
      "result": "REPORT",
      "source": "statute"
    },
    {
      "id": "PP-ENT-CONTROL",
      "when": {
        "party_type_in": ["entity", "trust"],
        "any_control_person_result_in": ["REPORT"]
      },
      "order": 61,
      "reason": "Entity owned or controlled by a prohibited person. Control determined per OAG ch. 67 control-person tests.",
      "result": "REPORT",
      "source": "oag_rules"
    },
    {
      "id": "PP-ENT-CONTROL-HOLD",
      "when": {
        "party_type_in": ["entity", "trust"],
        "any_control_person_result_in": ["HOLD"]
      },
      "order": 62,
      "reason": "One or more control persons require reviewer confirmation.",
      "result": "HOLD",
      "source": "oag_rules"
    },
    {
      "id": "PP-ENT-INCOMPLETE",
      "when": {
        "party_type_in": ["entity", "trust"],
        "control_persons_complete": false
      },
      "order": 63,
      "reason": "Control-person tree incomplete. Reasonable due diligence requires the full tree. Fail closed.",
      "result": "HOLD",
      "source": "oag_rules"
    },
    {
      "id": "PP-ENT-NO-ATTEST",
      "when": {
        "party_type_in": ["entity", "trust"],
        "control_tree_attested_not": true
      },
      "order": 64,
      "reason": "The control-person tree has not been attested as complete by the reviewer. Fail closed.",
      "result": "HOLD",
      "source": "oag_rules"
    },
    {
      "id": "PP-ENT-REVIEW",
      "when": { "party_type_in": ["entity", "trust"] },
      "order": 65,
      "reason": "Entity and trust buyers route to a human reviewer. Neither the statute nor the proposed Chapter 67 rules define when an entity is outside the prohibition, so this rule set does not make that determination. Confirm the ownership documents and the control-person tree, then decide with your underwriter.",
      "result": "HOLD",
      "source": "internal",
      "reviewer_note": true,
      "verify_live": true
    },
    {
      "id": "SCREEN-HIT",
      "when": { "any_party_screen_result_in": ["POTENTIAL_MATCH"] },
      "order": 70,
      "reason": "Potential match on OFAC SDN or Consolidated list. Reviewer dispositions the hit before any other result is final.",
      "result": "HOLD",
      "source": "ofac"
    },
    {
      "id": "SCREEN-STALE",
      "when": { "list_age_days_gt": 7 },
      "order": 71,
      "reason": "Screening list older than 7 days. Fail closed until ingest succeeds.",
      "result": "HOLD",
      "source": "internal"
    },
    {
      "id": "POST-CLOSE",
      "when": { "post_closing_transfer_planned": true },
      "order": 80,
      "reason": "OAG ch. 67 extends the complaint duty to post-closing transfers to affiliates structured to effect or conceal a prohibited acquisition. Evaluate transferee as a party.",
      "result": "HOLD",
      "source": "oag_rules"
    },
    {
      "id": "DC-EXPAND",
      "when": {
        "party_type": "individual",
        "us_citizen": false,
        "domicile_country_not_in": "designated_countries",
        "domicile_country_not_in_2": ["US"],
        "lawful_permanent_resident": false
      },
      "order": 90,
      "reason": "Domicile outside the designated countries. Reviewer note: confirm the country is not on the DNI expansion list.",
      "result": "HOLD",
      "source": "dni",
      "reviewer_note": true
    },
    {
      "id": "DEFAULT",
      "when": {},
      "order": 999,
      "reason": "No rule produced a determination. Fail closed.",
      "result": "HOLD",
      "source": "internal"
    }
  ]
}