On Saturday 2 May 2015, the Prime Minister and Treasurer announced measures to strengthen the integrity of the foreign investment framework. Included in the announcement was an intention to undertake further consultation on options to simplify the foreign investment framework.
The Modernisation Options Paper seeks views on proposed options to modernise and simplify Australia's foreign investment framework. The proposed options include:
- Incorporating policy only notification and prior approval requirements under Australia's Foreign Investment Policy (the Policy) into the legislative framework.
- Updating the legislation to reflect current administrative practices and regulatory concepts, as well as for modern business and corporate finance practices.
- Exempting proposals that are unlikely to affect the national interest and increase the consistency of exemptions across the different acquisition types.
- Amending the legislation so that it applies irrespective of the transaction structuring (for example, moving from shares to securities, inclusive of units in trusts, and providing similar outcomes whether a direct or indirect acquisition (for example, acquiring a property or its holding company)).
The Government also intends for these options to be considered in line with its commitment to reduce red tape and the compliance burden on business.
The Modernisation Options Paper is related to the 25 February 2015 Options Paper Strengthening Australia's Foreign Investment Framework.
The options outlined in this paper have not received Government approval and are obviously not yet law. As a consequence, this paper is merely a guide to options that might be adopted.