Certain entities would face limits on South Dakota property interests

A prohibited entity would be barred from holding or obtaining a direct or indirect interest in South Dakota real property. The rule covers entities defined as prohibited under section 43-2A-1 and applies while a military installation exists in South Dakota. The rule would also bar direct or indirect control, financing, or ownership of another entity that holds a South Dakota property interest. The restrictions would not apply to the listed exemptions, including certain federal security clearances, local-government-approved transactions, some secured debts, qualifying public-company stock, and interests held by people with specified U.S. citizenship or lawful status. The restriction would apply after any applicable divestment period and while a military installation exists in the state. Interests received through inheritance would have to be sold within three years; other violating acquisitions would have to be sold within two years after acquisition.

The attorney general would investigate and enforce alleged violations and could ask a circuit court to void, forfeit, or terminate an unlawful property interest. The process would concern real property interests allegedly held in violation of the chapter and would occur in the county where the property is located. The attorney general could subpoena transaction, title, financing, ownership, party, and other information after beginning an enforcement action. A court could not order forfeiture or termination if the action began more than three years after evidence of the violation was referred to the attorney general. If property is sold, sale costs, approved enforcement costs, taxes, and priority lien claims would be paid before any remaining money goes to the person who held the interest before judgment. The attorney general would record a notice of the court case when an action begins. A court judgment would make the interest void as of the judgment date and would order forfeiture or termination if a violation is found.

People and entities that are not prohibited entities generally would not have to investigate another person's status under the chapter. The protection covers nonprohibited people and entities unless the chapter expressly provides otherwise. A nonprohibited person or entity could not be held liable under this chapter merely for failing to make that inquiry. The chapter would not create a lawsuit against the state or limit the attorney general's choice not to sue. Existing penalties or remedies concerning agricultural land would remain available. The listed protections and limits would apply under this chapter, subject to its express exceptions.