A new risk-based approach to foreign investment will see more scrutiny of investment proposals around critical infrastructure, minerals and technology and a more streamlined approval process for known investors.
Early applications and greater participation will be encouraged through a fee-refund scheme for unsuccessful foreign investment applications with Treasury set a new target of processing 50 percent of cases within 30 days.
Announcing the changes Federal Treasurer Jim Chalmers said the reform of the foreign investment framework would benefit investors, the economy and our national interest.
“We are taking action to strengthen the regime where we need to, streamline it where we can, and make it more transparent,” Minister Chalmers said.
Among the changes are more resources to screen foreign investment in critical infrastructure, critical minerals, critical technology, including those that involve sensitive data sets, and investment in close proximity to defence sites.
Minister Chalmers said there would updated guidance about tax arrangements to ensure foreign investors paid their fair share of tax and a bigger focus on cross-Government collaboration to ensure foreign investment settings could better deal with emerging risks and were aligned with other regulatory frameworks.
A major focus of the reforms is streamlining approvals for known investors that are making investments in non-sensitive sectors and have a good compliance record.
Minister Chalmers said in assessing whether an application was low risk, Treasury would consider the investor, the target of their investment, and the structure of the transaction.
He said Treasury would adopt a new target of processing 50 percent of cases within the 30 days from January 1 next year.
The reforms incentivise early applications and greater participation of foreign capital by providing a fee refund for foreign investment applications that were unsuccessful in a competitive bid process.
Business Council of Australia Chief Executive Bran Black said the Council had long advocated for improvements to Foreign Investment Review Board processes and a proactive plan to attract more capital, but called on more changes.
“Australia is competing for global investment opportunities, which create jobs and economic opportunities locally, and these FIRB changes announced today are a step in the right direction,” Mr Black said.
“(But) the Government (should) go further and undertake a proactive investment strategy, built off the back of a Harrington-style review which was conducted in the UK.
“We want the Treasurer to follow through on his early signals and include a whole-of-government investment strategy, a single ‘front door’ for investors and tax incentives for investment, in the upcoming Budget.”
Read the Government’s updated foreign investment policy document.
