In general terms only and not specific to individual situations*:-
The Foreign Acquisitions and Takeover Act 1975 is the means by which the government regulates foreign investment within Australia. The body who administers the regulations of this Act is known as the Foreign Investment Review Board (FIRB).
A "Foreign Person" for the purpose of the Foreign Acquisitions and Takeover Act 1975 and as defined by the Foreign Investment Review Board is:
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a natural person not ordinarily resident in Australia;
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a corporation in which a natural person not ordinarily resident in Australia or a foreign corporation holds a controlling interest;
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a corporation in which 2 or more persons, each of whom is either a natural person not ordinarily resident in Australia or a foreign corporation, hold an aggregate controlling interest;
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the trustee of a trust estate in which a natural person not ordinarily resident in Australia or a foreign corporation holds a substantial interest; or
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the trustee of a trust estate in which 2 or more persons, each of whom is either a natural person not ordinarily resident in Australia or a foreign corporation, hold an aggregate substantial interest. See Section 5 of the FATA.
If a foreign person as described above wishes to acquire an interest in Australian land, that person must first obtain the approval of the Foreign Investment Review Board unless exemptions apply to their specific situation. The Foreign Investment Review Board will then examine the situation and ascertain whether the proposed acquisition would be beneficial or contrary to the interests of Australia as a Nation.
The terms of the Standard REIQ Contract provides that the buyer already has FIRB approval or that approval is not required under the Foreign Acquisitions and Takeovers Act.
Therefore it is extremely important for Buyers, should there be any doubt as to whether they require the approval of the Foreign Investment Review Board, to seek legal advice in relation to their purchase prior to signing a Contract, ,
It is important to note that the laws relating to Foreign Investment in Australia are complex and intricate. There are some cases where exemptions will apply and it is imperative for foreign persons to ensure that their own personal situation is fully investigated.
In some cases the nature of the property purchase also plays a significant role in the approval process. For example if the purchase is to be vacant land, a second-hand property or a brand new home such as a house and land package can have a considerable effect.
If in doubt, please seek legal advice or contact The Foreign Investment Review Board for further information. The Foreign Investment Review Board can be contacted on Ph. (02) 6263 3795
*The information contained herein does not constitute legal advice relevant to each individuals' specific situation. The Information contained herein should be used as a guide only and should not be relied upon when considering applying for Foreign Investment Review Board approval. North Lakes Conveyancing advises that all persons considering applying for FIRB approval should contact the Foreign Investment Review Board or their Solicitor to ascertain approval requirements relevant to their specific circumstances.
