On 29 March, the Treasury announcedexternal link changes to Foreign Investment Review Board (FIRB) measures reducing the scrutiny level from $250 million to $0. By temporarily reducing the foreign investment thresholds, the Australian Government is ensuring appropriate oversight over all proposed foreign investment during this time, to protect Australia’s national interest during the economic impact arising from the spread of COVID-19.
To ensure sufficient time for screening applications, the FIRB will be working with existing and new applicants to extend timeframes for reviewing applications from 30 days to up to six months.
Treasury has advised that this is not an investment freeze. Australia is open for business and recognises investment at this time can be beneficial if in the national interest.
Business Innovation and Investment Program (BIIP) applicants have always been subject to FIRB regulations though the vast majority of business purchases and investments were below scrutiny thresholds.
Investors:
- Investor stream visa holders investments (AU$1.5 million) into State and Territory governments bonds will be subject to FIRB approval.
- Significant Investor Visa (SIV) investments (AU$5 million) into managed funds will be subject to FIRB approval.
Business Owners:
- Business Innovation stream visa holder’s business purchases will be subject to FIRB scrutiny.
- Significant Business History and Venture Capital Entrepreneur visa holders will not be affected by the increased FIRB scrutiny as they are permanent residents.
Entrepreneurs:
- Entrepreneur visa stream holders should not be affected by the FIRB changes as they should be establishing a new business to comply with the streams requirements.
Treasury advice is that the purchase of a business would be subject to FIRB approval. There are also other business activities that may be affected by the changes to the FIRB thresholds, including, but not limited to, commercial leases or property purchases.
Further Information:
- Temporary measures in response to the coronavirus [Guidance Note 53external link]
- Exemption certificates for a program of acquisitions of interests in kinds of land [Guidance Note 21external link]
- Exemption certificates (business) [Guidance Note 26external link]