into and threat to continued state regulation of business entities, which if not intercepted by further state action would result in state regulation being usurped by the federal government. In response to these concerns, the 2023 Oklahoma legislature passed Senate Bill 212 (“SB 212”) with the stated goal of amending Oklahoma statutes regarding alien land ownership. Prior to this act going into effect, foreign owners could acquire property indirectly through a business entity. That would allow the alien to remain in compliance with the Oklahoma Constitution and statutes, as long as it was either formed in Oklahoma or domesticated with the Secretary of State to conduct business in Oklahoma. However, the most significant provision of SB 212 restricted indirect ownership of land by aliens and non-residents and any business entity engaging in regulated interstate commerce in accordance with federal law. SB 212 further required that any deed given to a county clerk for recording must have an accompanying affidavit of the grantee’s citizenship. SB 212 did allow for the AG’s office to, in their discretion, exempt any deed when deemed necessary. Accordingly, 60 O.S. §121 was amended 25 to comply with the new SB 212 requirements. Notably, §121(A) added a provision that no alien or person who is not a citizen of the United States shall acquire title to or own land in this state either directly or indirectly through a business entity or trust. Previously, indirect ownership was not prohibited. That statue also now provides that the requirements of §121(A) shall not apply to a business entity that is engaged in regulated interstate commerce in accordance with federal law. In addition, 60 O.S. §121(B) added the requirement that any deed recorded with a county clerk shall include an affidavit, added as an exhibit to the deed, executed by the person or entity coming into title (i.e. the Grantee), attesting that this person, business entity, or trust is obtaining the land in compliance with the requirements of §121(A) and that no funding source is being used in the sale or transfer in violation of this section or any other state or federal law. The statute specifically provides that a county clerk shall not accept and record any deed without this affidavit. The statute specifically directs the AG to promulgate a separate affidavit form for individuals and for business entities or trusts to comply with the requirements of this section, with an exception for those deeds which the AG deems necessary when promulgating the affidavit form.
It did not take long for chaos to ensue. For a very brief period, following the effective date of SB 212, county clerks would hesitate to accept conveyances because they had not established what forms of the affidavit would be acceptable. Eventually, the AG posted approved Affidavit forms, including those for individuals and trust or business entities. 26 These forms may NOT be modified, except by the AG 27 , regardless of how poorly they, as drafted, (1) pertain to a specific grantee or transaction, and (2) otherwise conform to existing Oklahoma law. That is a directive that county clerks have taken very seriously. 28 However, even with the approved Affidavit forms, there was confusion across the 77 counties in Oklahoma as to what type of title documents required the alien affidavit. Here are some questions that arose: • What qualifies as a “deed”? o Would a Final Decree from a court in a probate action count?
o What about a Transfer on Death Deed? o What about an Affidavit of Surviving Joint Tenant or Remainderman? o What about a Ground Lease (which is in actuality a deed of a fee simple determinable, in contrast to a term lease covering a tenancy)? o What about a Contract for Deed (which is deemed by statute to constitute a promissory note, mortgage, and deed in a
25.) Effective, November 1, 2023, 26.) The most recent version of the Affidavits can be found here: www.oag.ok.gov/public-forms. 27.) In our experience, county clerks have been very strict on modification. Earlier versions of the Affidavit included the Affiant’s state as “Oklahoma” when in reality Grantees come from many states. However, when presented with a modified state on the Affidavit, county clerks were rejecting affidavits properly modified. Thankfully, the most current version of the form leaves a blank for the state and county of the Affidavit, rectifying this issue. 28.) In our experience, county clerks have been very strict on modification. Earlier versions of the Affidavit included the Affiant’s state as “Oklahoma” when in reality Grantees come from many states. However, when presented with a modified state on the Affidavit, county clerks were rejecting affidavits properly modified. Thankfully, the most current version of the form leaves a blank for the state and county of the Affidavit, rectifying this issue.
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G rowth T hrough E ducat i on - A pr i l / M ay / J une 2024
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