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Brazil bill could restrict foreign land purchases

* Bill restricts size of foreign land holdings

* No foreigners to buy territory near border

* Non-citizens must be resident for at least 10 years

BRASILIA, Oct 13 (Reuters) - Brazil’s lower house of Congress approved a bill on Tuesday that would restrict foreign ownership of land along the country’s borders and in the Amazon as part of government efforts to boost controls in the region.

The constitution and justice committee voted unanimously in favor of the bill, which now needs Senate approval before President Luiz Inacio Lula da Silva can sign it into law.

The government accuses some foreign groups of industrial spying, undermining the culture of native Indians and biopiracy -- stealing medicinal plants for pharmaceutical purposes.

Nationalists, especially in military and intelligence circles, have long harbored conspiracy theories that foreigners are scheming to take the Amazon forest’s vast resources.

The proposal limits the size of properties foreigners can own in the Amazon to 15 modules, or an average of 1,500 hectares (3,700 acres). Foreigners who own larger land holdings can keep them as long as they are productive, it says.

The bill requires foreigners to have lived in Brazil for at least 10 years before they can acquire land.

It also prohibits foreigners from buying property within 150 km (94 miles) of the country’s borders. Previously, a government commission could grant special authorizations for border areas.

Last year, the army chief for the Amazon warned that Brazil’s borders were vulnerable to incursions through tribal Indian territories harboring foreign aid workers. Farmers in some areas have complained that buying by foreigners has driven up the price of land.

“This is not a xenophobic measure,” Deputy Jose Genoino, who sponsored the bill, told Reuters. “We simply want to have more control over who buys land where.”

Foreigners can circumvent the restrictions if they form a Brazilian company, said Genoino, a member of Lula’s center-left Workers’ Party.

Earlier this year, the government threatened foreign aid groups they would be shut down if they did not provide detailed accounts of their operations and register with half a dozen authorities, including federal police. (Reporting by Raymond Colitt; Editing by John O’Callaghan)