PERTH (miningweekly.com) – Federal Parliament on Wednesday passed legislation giving effect to reforms to the Foreign Acquisitions and Takeovers Act 1975, for the first time in nearly 50 years.

The reforms, which will commence on January 2021, ensure that Australia’s foreign investment framework kept pace with emerging risks and global developments, including similar changes to foreign investment regimes in comparable countries, the Treasury said in a statement.

The new provisions will strengthen Australia’s foreign investment regime and ensure the country continues to realise the benefits of foreign investment.

In particular, the reforms would require foreign investors to seek approval for all investments in sensitive national security land or businesses, including starting such a business, regardless of value, and be subject to enhanced monitoring and investigation powers, as well as stronger and more flexible enforcement options and penalties.

Foreign investors would also continue to bear the costs of administering the foreign investment regime, under a reformed fee framework that will be fairer and simpler for foreign investors.

The federal government in April this year announced temporary changes to the foreign investment review framework aimed at protection Australia’s national interest, as reports emerged that Chinese entities could attempt to make a play for Australian businesses and assets while the country dealt with the fallout of the Covid-19 pandemic.

The decision was taken that all proposed foreign investments into Australia subject to the Foreign Acquisitions and Takeovers Act would require approval, regardless of value or the nature of the foreign investor. 

The Treasury on Wednesday noted that with effect from January 2021, the current temporary A$0 monetary screening thresholds that were introduced in response to the coronavirus will be removed. However, mandatory screening of investments in sensitive national security businesses would continue at the current A$0 monetary threshold.

“Australia will continue to welcome foreign investment for the significant benefits it provides but also ensure that investments are not contrary to the national interest,” the federal government said in a statement.

“While the temporary thresholds have enabled greater scrutiny of investments, Australia has remained an attractive destination for foreign investment. Foreign investment inflows have remained robust during the pandemic, supporting Australia’s economic recovery.”