strengthening australias foreign investment framework
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Foreign Investment in Australia 2015 ProposalsFIRBAustraliaForeign InvestmentResidential Real EstateReformsAgribusinessAgricultural LandTreasury material used 'as supplied'.Source: The Australian Government the Treasury.
Options Paper February 2015
Commonwealth of Australia 2015
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Page iii
REQUEST FOR FEEDBACK AND COMMENTS
Interested parties are invited to lodge written submissions on the issues raised in this paper.
Submissions will be made available on the Treasury website unless you clearly indicate that you
would like all or part of your submission to remain confidential. Automatically generated
confidentiality statements in emails do not suffice for this purpose. A request made under the
Freedom of Information Act 1982 for access to a submission marked confidential will be determined
in accordance with that Act.
Submissions should include the name of your organisation (or your name if the submission is made
as an individual) and contact details for the submission, including an email address and contact
telephone number where available. While submissions may be lodged electronically or by post,
electronic lodgement is strongly preferred. For accessibility reasons, please email responses in a
Word or RTF format. An additional PDF version may also be submitted.
Closing date for submissions: Friday 20 March 2015
Email: ForeignInvestmentConsultation@treasury.gov.au
Mail: Manager
International Investment & Trade Unit
Foreign Investment & Trade Policy Division
Markets Group
Enquiries: Enquiries can be initially directed to Megan Thomas (02 6263 3725) or
Stewart Nixon (02 6263 2764)
Page iv
1. INTRODUCTION ..................................................................................................................1
2. AUSTRALIAS FOREIGN INVESTMENT REVIEW FRAMEWORK ...........................................................3
2.1 Foreign investment in Residential real estate .......................................................................... 4
2.2 Penalties for non-compliance ................................................................................................... 5
2.3 Cost of administration .............................................................................................................. 5
2.4 Further information .................................................................................................................. 6
3. PROPOSED RESIDENTIAL REAL ESTATE REFORMS ........................................................................7
3.1 New compliance and enforcement area in the Australian Taxation Office.............................. 7
4. PENALTY REGIME ...............................................................................................................9
4.1 Extending civil penalties and infringement notices to business applications ........................11
5. INTRODUCING FEES ON FOREIGN INVESTMENT APPLICATIONS ........................................................ 13
6. ADVANCED OFF-THE-PLAN CERTIFICATES ................................................................................. 17
7. IMPLEMENTATION OF AGRICULTURE COMMITMENTS ................................................................. 18
7.1 Agribusiness investments .....................................................................................................18
7.2 Definition of agricultural land ...............................................................................................19
7.3 Definition of urban land ........................................................................................................20
7.4 Other land .............................................................................................................................21
7.5 Agricultural land register ........................................................................................................22
8. MODERNISING AND SIMPLIFYING THE FOREIGN INVESTMENT FRAMEWORK ..................................... 24
ATTACHMENT A CONSOLIDATED CONSULTATION QUESTIONS ........................................................ 25
New compliance and enforcement area in the Australian Taxation Office ......................................25
Penalty regime ..................................................................................................................................25
Introducing fees on foreign investment applications .......................................................................26
Advanced off-the-plan certificates ....................................................................................................26
Implementation of Agriculture Commitments ..................................................................................26
Modernising and Simplifying the Foreign Investment Framework ...................................................27
ATTACHMENT B FOREIGN INVESTMENT THRESHOLD CHANGES ....................................................... 29
1. The Government welcomes foreign investment because it plays an important and beneficial
role in the Australian economy.
Foreign investment provides additional capital for economic growth, creates
employment opportunities, improves consumer choice and promotes healthy
competition, while increasing Australias competitiveness in global markets.
Foreign investment can help deliver improved competitiveness and productivity by
introducing new technology, providing much needed infrastructure, allowing access to
global supply chains and markets, and enhancing Australias skills base.
2. The Government, like previous governments, supports a case-by-case approach to the
consideration of foreign investment proposals to ensure that they are not contrary to the
national interest. This case-by-case approach, underpinned by Australias Foreign Investment
Policy and associated legislation, is designed to maximise investment inflows while serving to
protect Australias national interest.
Additional information regarding Australias foreign investment framework is provided
in Section 2 of this options paper.
3. While this framework provides scope to review and if necessary, block or impose conditions
upon certain foreign investment proposals, the Government recognises that there is still a
high level of public interest and community concern regarding ownership of certain types of
Australian assets and businesses.
Foreign ownership of Australian agricultural land and agribusinesses in particular
consistently attracts strong public interest, and ignites broader debate as to the benefits
foreign investment in agriculture provides to Australia.
Similarly, there has been growing community concern around foreign investment in
residential real estate in recent years, particularly in the context of rising house prices in
major cities.
4. The House of Representatives Standing Committee on Economics Report on Foreign Investment
in Residential Real Estate (House Economics Committee report) found that the current
framework (which distinguishes between purchases of new and established dwellings) should
be retained, but made a number of recommendations to improve data collection, compliance
and enforcement activities.
5. In this regard, the Government is considering the following proposed reforms:
increasing compliance and enforcement activities around foreign investment in
residential real es
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