United States: Florida Broadens Its E-Verify Requirement, Enacts Prohibitions Against Certain Foreign Ownership of Real Estate and Other Immigration-Related Restrictions

Beginning July 1, employers who are subject to the new law must use the federal E-Verify system to check the employment eligibility of new hires within three days of hire.  If the E-Verify system is not available, employers must complete USCIS Form I-9 and retain documentation of E-Verify’s unavailability, such as an announcement of system maintenance or a screenshot showing the system is not operational.

Employers who use E-Verify to check employment eligibility (or Form I-9 and documentation of E-Verify’s unavailability) will benefit from a rebuttable presumption that they are not knowingly hiring or continuing to employ an unauthorized worker. The rebuttable presumption also benefits employers with fewer than 25 employees who voluntarily use E-Verify.

Employers must retain for at least three years copies of the employment eligibility verification documentation provided by employees and any official verification generated from the E-Verify system.

Enforcement and penalties for noncompliance. SB 1718 creates new state civil and criminal penalties for employing individuals who are not authorized to work in the United States, and permits state authorities to audit employers’ compliance with employment eligibility verification requirements. Beginning on July 1, 2024, if the Florida Department of Economic Opportunity (DEO) determines that an employer failed to use E-Verify in compliance with SB 1718, the department must notify the employer of the determination of noncompliance and provide the employer with 30 days to cure the noncompliance. An employer who fails to use the E-Verify system as required by SB 1718 three times in any 24-month period is subject to a fine of $1,000 per day and suspension of state-issued licenses until the noncompliance is cured.

Other key provisions of SB 1718. The new law prohibits the recognition in Florida of driver’s licenses issued by other U.S. states to individuals without immigration status. In addition, the law requires hospitals to collect data on immigration status from persons seeking treatment, and report that data to state authorities.

Separately, Gov. DeSantis signed into law SB 264, which prohibits certain foreign entities and individuals from owning or acquiring interests in real estate in Florida and restricts state and local government entities from contracting with certain foreign countries of concern. In general, the prohibitions apply to nationals and entities of China, Cuba, Iran, North Korea, Russia, Syria, and Venezuela, with exemptions for U.S. citizens and lawful permanent residents.

Restrictions on acquisition of agricultural property. Effective July 1, 2023, SB 264 prohibits foreign principals from one of the seven countries of concern from directly or indirectly owning, acquiring, or have a controlling interest in Florida agricultural land, other than a de minimis interest. A de minimis interest is defined as an ownership interest of less than five percent in registered equities of a publicly traded company that owns the land or a noncontrolling interest in an entity controlled by a company that is registered as an investment adviser and is not a foreign entity.

Affected foreign principals who acquired such land before July 1, 2023 may continue to own or hold it but may not purchase or acquire any additional land or interest in Florida. They are required to register their ownership or holdings with the Florida DEO.

Restrictions on ownership interest in real property near military installations or critical infrastructure facilities. Under the new law, a foreign principal of one of the countries of concern may not directly or indirectly own, have a controlling interest in, or acquire any interest in real property on or within 10 miles of a military installation or critical infrastructure facility in Florida, other than a de minimis interest (defined above). 

Affected foreign principals who acquired such land before July 1, 2023 may continue to own or hold such property, but are prohibited from acquiring additional such property in Florida. Those who own or hold an interest in covered property (other than a de minimis interest) must register with the Florida DEO.

Notwithstanding these restrictions, foreign individuals from a country of concern may purchase one residential real property of up to two acres if (1) the property is not on or within five miles of a military installation in the state; (2) the individual has a valid U.S. visa (other than a tourist visa) or has documentation confirming that the person has been granted asylum, and such visa or documentation authorizes them to be legally present in Florida; and (3) the property is purchased in the name of the individual.

Prohibition against acquisition of real property by certain Chinese nationals and entities.  The new law prohibits the following persons or entities from directly or indirectly owning, having a controlling interest in, or acquiring real property in Florida, other than a de minimis interest or  for a permitted diplomatic purpose: (1) the People’s Republic of China; (2) the Chinese Communist Party; (3) any official or member of the People’s Republic of China or the Chinese Communist Party; (4) any other political party or member of a political party or a subdivision of a political party in the People’s Republic of China; (5) a partnership, association, corporation, organization, or any other combination of persons organized under the laws of or having its principal place of business in the People’s Republic of China, or a subsidiary of such entity; and (6) any person who is domiciled in the People’s Republic of China, other than a citizen or lawful permanent resident of the United States.

An exception to the prohibition exists for individuals who purchase one residential property of up to two acres if (1) the property is not on or within five miles of a military installation in Florida; (2) the individual has a valid U.S. visa (other than a tourist visa) or has documentation confirming that the person has been granted asylum, and such visa or documentation authorizes them to be legally present in Florida; and (3) the purchase is in the name of the person.

A Chinese national or entity who owns or acquires an interest in Florida real property before July 1, 2023 may continue to hold it but may not acquire any other property in the state and must register their ownership with the Florida DEO.

The impact of many aspects of the new Florida laws – including the effect on property interests in the EB-5 context – are unknown. Both statutes are likely to be challenged in federal court on constitutional and antidiscrimination grounds, and could be enjoined while any litigation proceeds. However, employers with 25 or more employees in Florida who do not currently use E-Verify and do not currently retain copies of an employee’s verification documents should prepare to do so by July 1, 2023, in the event that the new statutes take effect as scheduled.

Fragomen is closely monitoring the new Florida laws and will provide updates as developments occur.