N.D. Cent. Code § 10-06.1-12.2

10-06.1-12.2. Authorized livestock farm corporation or authorized livestock farm

limited liability company allowed to engage in the business of farming or ranching -

Requirements.

This chapter does not prohibit an authorized livestock farm corporation or an authorized

livestock farm limited liability company from owning or leasing farmland or ranchland and

engaging in the business of farming or ranching if the authorized livestock farm corporation

meets all the requirements of chapter 10-19.1 or the authorized livestock farm limited liability

company meets all the requirements of chapter 10-32.1 which are not inconsistent with this

chapter. The following requirements also apply:

1. a. If an authorized livestock farm corporation, the corporation may not have more

than ten shareholders.

b. If an authorized livestock farm limited liability company, the limited liability

company may not have more than ten members.

2. a. If an authorized livestock farm corporation, shareholders holding seventy-five

percent or more of the shares entitled to vote and the shares entitled to

distributions must be individuals who are actively engaged in the business of

farming or ranching, farming or ranching corporations, or farming or ranching

limited liability companies.

b. If an authorized livestock farm limited liability company, members holding fifty-one

percent or more of interests entitled to vote and interests entitled to distributions

in the limited liability company must be individuals who are actively engaged in

the business of farming or ranching, farming or ranching corporations, or farming

or ranching limited liability companies.

3. a. If an authorized livestock farm corporation:

(1) All shareholders who are individuals must be citizens of the United States,

permanent resident aliens of the United States, or an authorized person

under section 47-10.1-02.

(2) All shareholders that are persons otherwise eligible under this chapter, and

any controlling individual or organization of the person, must be organized in

the United States and one hundred percent of the stock must be owned by

citizens of the United States, permanent resident aliens of the United States,

or an authorized person under section 47-10.1-02.

b. If an authorized livestock farm limited liability company:

(1) All members who are individuals must be citizens of the United States,

permanent resident aliens of the United States, or an authorized person

under section 47-10.1-02.

(2) All members that are persons otherwise eligible under this chapter, and any

controlling individual or organization of the person, must be organized in the

United States and one hundred percent of the interests must be owned by

citizens of the United States, permanent resident aliens of the United States,

or an authorized person under section 47-10.1-02.

4. The authorized livestock farm corporation or authorized livestock farm limited liability

company may not own, lease, or otherwise have an interest in more than one hundred

sixty acres [64.75 hectares] of farmland or ranchland.

5. a. If an authorized livestock farm corporation, none of its shareholders may hold

direct or indirect interests in other authorized livestock farm corporations or in

authorized livestock farm limited liability companies that in combination with the

corporation own, lease, or otherwise have an interest in more than six hundred

forty acres [259 hectares] of farmland or ranchland.

b. If an authorized livestock farm limited liability company, none of its members may

hold direct or indirect interests in other authorized livestock farm limited liability

companies or in other authorized livestock farm corporations that in combination

with the limited liability company own, lease, or otherwise have an interest in

more than six hundred forty acres [259 hectares] of farmland or ranchland.

c. This section does not restrict the number of acres [hectares] of farmland or
irect or indirect interests in other authorized livestock farm limited liability

companies or in other authorized livestock farm corporations that in combination

with the limited liability company own, lease, or otherwise have an interest in

more than six hundred forty acres [259 hectares] of farmland or ranchland.

c. This section does not restrict the number of acres [hectares] of farmland or

ranchland directly owned or leased by shareholders or members who are

individuals, farming or ranching corporations, farming or ranching limited liability

companies, or partnerships that meet the requirements of subsection 2 of section

10-06.1-02.

6. a. If an authorized livestock farm corporation, the officers and directors of the

corporation must be shareholders who are individuals and who are actively

engaged in operating the corporation.

b. If an authorized livestock farm limited liability company, the governors, managers,

and members authorized under a statement of authority, must be members who

are individuals and who are actively engaged in operating the limited liability

company.

7. An annual average of at least sixty-five percent of the gross income of the authorized

livestock farm corporation or authorized livestock farm limited liability company over

the previous five years, or for each year of its existence, if less than five years, must

have been derived from livestock backgrounding, livestock finishing, or the production

of poultry or poultry products, milk or dairy products, or swine or swine products.

8. The income of the authorized livestock farm corporation or authorized livestock farm

limited liability company from nonfarm rent, nonfarm royalties, dividends, interest, and

annuities may not exceed twenty percent of the gross income of the authorized

livestock farm corporation or authorized livestock farm limited liability company.

9. The authorized livestock farm corporation or authorized livestock farm limited liability

company may not engage in the production of crops or the grazing of livestock on

farmland or ranchland.

10. If the authorized livestock farm corporation or authorized livestock farm limited liability

company is intended to primarily comprise an animal feeding operation or

concentrated animal feeding operation on farmland or ranchland, the corporation or

limited liability company must:

a. Begin construction of the facilities used in the animal feeding operation or

concentrated animal feeding operation within one year of obtaining the

agricultural landholding; and

b. Have a fully operational animal feeding operation or concentrated animal feeding

operation within six years of obtaining the farmland or ranchland.

11. An authorized livestock farm corporation or limited liability company violating this

section, or which is inactive for three consecutive years as determined by the

agriculture commissioner, is subject to the divestment provisions of section

10-06.1-24.