Texas SB 17 · Entity and trust buyers
The buyer is an LLC. Who is behind it?
SB 17 prohibits acquisitions by certain individuals, governments, and companies from designated countries, and by entities they control. An LLC name on the contract tells you nothing. The record is the tree behind the name.
An LLC or trust on the contract tells you nothing about who controls it. SB 17 reaches a company owned or controlled by a prohibited person, so the question is the people behind the name. Section 5.252(2) excepts an entity only when United States citizens or permanent residents own or control it.
Which entity buyers does SB 17 reach?
Section 5.253(2) names a company or organization that is headquartered in a designated country, directly or indirectly held or controlled by the government of a designated country, owned by or majority-held or controlled by individuals the section describes, or designated by the governor under Section 5.254. Section 5.253(3) reaches a company owned by or majority-held or controlled by one of those companies. Section 5.251(2) defines company broadly: sole proprietorship, organization, association, corporation, partnership, joint venture, limited partnership, limited liability partnership, or limited liability company, including a wholly owned subsidiary, a majority-owned subsidiary, a parent company, or an affiliate.
When is an entity outside the statute?
Section 5.252(2) is the only entity exception, and it has two halves. The company or organization must be owned by or under the control of one or more individuals who are United States citizens or lawful permanent residents, and of no individual described by Section 5.253. Both halves have to hold. An entity that satisfies the first and not the second is not excepted.
Section 5.252 is titled EXCEPTIONS and states that the subchapter does not apply to three things: an individual who is a citizen or lawful permanent resident of the United States (5.252(1)); a company or organization owned by or under the control of one or more of those individuals and of no individual described by Section 5.253 (5.252(2)); and a leasehold interest in land or improvements constructed on a leasehold with a duration of less than one year (5.252(3)).
S.B. 17, 89th Legislature, Regular Session, enrolled text, sec. 5.252 · Verified
Who counts as a control person?
The statute uses ownership and control without listing the roles that carry them. The Chapter 67 rules the Attorney General proposed on March 27, 2026 treat control as direct or indirect power over an entity's management, policies, or its acquisition of Texas real property. Those rules are proposed, not adopted. ParcelClear's questionnaire asks for general partners, managing members, holders of ten percent or more, and executive officers, and lets the reviewer add anyone else the documents show.
What does a trust buyer change?
Section 5.251(5) gives organization the meaning assigned by Section 1.002, Business Organizations Code, and the subchapter defines no separate test for a trust. The question is the one every entity raises: who holds, and who controls. ParcelClear routes every entity and trust buyer to a human reviewer rather than returning a clean result, because neither the statute nor the proposed Chapter 67 rules say when an entity sits outside the prohibition.
Why is the control tree the record?
If a control person turns out to be a prohibited person, the question later is whether anyone looked. A tree with names, roles, and a reviewer's attestation that it is complete, dated before closing, is the record of what you looked at. A blank file is not. If the tree is not attested the result is HOLD, and the record never shows a clean result on an incomplete tree.
What does a record show for an entity buyer?
The entity's answers, every control person by name and role, the reviewer's attestation that the tree is complete to the best of their knowledge from the documents in the file, an OFAC SDN and Consolidated screen of every name with the list date, the rule set id and version and the result, and a SHA-256 hash. It does not verify ownership documents and it does not check corporate registries. It records what the documents in your file say, and what the sanctions lists said about those names on the day you asked.
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Last verified