Foreign Acquisitions and Takeovers Amendment Regulations 2011 (No. 1)

Administered by Department of the Treasury

Legislation au F2011L02620 Regulations Not in force Legislative Instrument

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EXPLANATORY STATEMENT

Select Legislative Instrument 2011 No. 275

Issued by authority of the Deputy Prime Minister and Treasurer

Foreign Acquisitions and Takeovers Act 1975

Foreign Acquisitions and Takeovers Amendment Regulations 2011 (No. 1)

The Foreign Acquisitions and Takeovers Act 1975 (the Act) provides the legislative framework for Australia's foreign investment screening regime.

Section 39 of the Act provides that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.

The Act allows the Treasurer or his delegate - usually the Assistant Treasurer - to review investment proposals to decide if they are contrary to Australia's national interest.  The Treasurer can block proposals that are contrary to the national interest or apply conditions to the way proposals are implemented to ensure they are not contrary to the national interest.

Section 26A makes it compulsory for foreign persons to notify the Treasurer before acquiring an 'interest in Australian urban land'.  Section 5 defines 'Australian urban land'.  This definition encompasses non-residential developed commercial real estate.  Section 12A defines what is meant by an 'interest in Australian urban land.'  Subsection 12A(8) allows regulations to be made to exempt certain acquisitions of interests in Australian urban land from the application of the Act. 

The Foreign Acquisitions and Takeovers Regulations 1989 (the Principal Regulations) generally establish classes of exemptions.  Regulation 3 of the Principal Regulations lists those acquisitions of an interest in Australian urban land that are exempt from notification under the Act.  Regulation 13 sets out a formula for indexing particular thresholds on an annual basis.  This formula is based on the proportionate increase in the GDP implicit price deflator against the previous year.      

Sub-subparagraph 3(p)(ii)(C) of the Principal Regulations specifies a threshold amount under which an exemption from notification of an acquisition under the Act, of an interest in non-residential commercial land or land that comprises of specified accommodation facilities, and is not vacant, applies.  This threshold amount does not apply to acquisitions by prescribed investors or to heritage listed real estate. 

The purpose of the Amendment Regulations was to amend the Principal Regulations for the purpose of indexing the threshold of $50 million contained in sub‑subparagraph 3(p)(ii)(C), using the formula contained in regulation 13.  This indexation applies for calendar years later than 2011.

The Amendment Regulations implemented the Government's response to Recommendation 3.1 of the Productivity Commission's fifth Annual Review of Regulatory Burdens on Business, which was released on 13 September 2011.

The amendment to regulation 13 was a minor technical change to correct a reference in sub-regulation 13(2) within the definition of the GDP implicit price deflator value, to a table published by Australian Bureau of Statistics. 

Further details of the Amendment Regulations are contained in Attachment A.

The Amendment Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003 (the Legislative Instruments Act).

In relation to Part 3 (Consultation Before Making Amendments) of the Legislative Instruments Act, the Productivity Commission undertook extensive consultation with the business and consumer services sector when preparing its fifth Annual Review of Regulatory Burdens on Business.  In addition, the amendments were minor in nature.

The Regulations commenced on the day after they were registered on the Federal Register of Legislative Instruments.

Attachment A

Details of the Foreign Acquisitions and Takeovers Amendment Regulations 2011 (No. 1)

Regulation 1 – Name of Regulations

This regulation provides that the title of the Regulations is the Foreign Acquisitions and Takeovers Amendment Regulations 2011 (No. 1).

Regulation 2 – Commencement

This regulation provides that the amended Regulations commence on the day after they are registered.

Regulation 3 – Amendment of Foreign Acquisitions and Takeovers Regulations 1989

This regulation provides that the Foreign Acquisitions and Takeovers Regulations 1989 (the Principal Regulations) are amended as set out in Schedule 1.

Schedule 1 – Amendment of Foreign Acquisitions and Takeovers Regulations 1989

Item [1] – Sub-subparagraph 3(p)(ii)(C)

Sub‑paragraph 3(p)(ii) of the Principal Regulations provides that acquisitions involving non-residential commercial land or land that comprises of specified accommodation facilities, do not need to be notified where the land is valued below an applicable specified monetary threshold and is not vacant.  Three thresholds are provided in this regard.   The first threshold contained in sub-subparagraph 3(p)(ii)(A) pertains to acquisitions by prescribed foreign investors.  The second threshold contained in sub-sub-paragraph 3(p)(ii)(B) pertains to heritage listed real estate.  The third threshold contained in sub-subparagraph 3(p)(iii)(C) applies in any other case (the general threshold).    

Regulation 13 sets out a formula for indexing particular thresholds on a calendar year basis, which is based on the proportionate increase in the GDP implicit price deflator against the previous year. 

Item 1 substitutes a revised sub-subparagraph 3(p)(ii)(C) of regulation 3 with the effect that the general threshold amount of $50 million is indexed using the formula in regulation 13 for any calendar year later than 2011.

Item [2] - Subregulation 13 (2), definition of GDP implicit price deflator value

This item omits the reference to Table 7 and inserts a reference to Table 8 in order to correct a reference to the location of the GDP implicit price deflator value published by the Australian Bureau of Statistics in the publication Australian System of National Accounts (cat. 5204.0).

 

Overview

The Foreign Acquisitions and Takeovers Amendment Regulations 2011 (No. 1) were issued by the Deputy Prime Minister and Treasurer under the authority of the Foreign Acquisitions and Takeovers Act 1975. This Act establishes the framework for Australia's foreign investment screening regime, enabling the Treasurer to review and potentially block or condition investment proposals that may be contrary to Australia's national interests. One significant aspect of this framework is the requirement for foreign persons to notify the Treasurer before acquiring an 'interest in Australian urban land,' with certain exemptions outlined in the Foreign Acquisitions and Takeovers Regulations 1989. The 2011 Amendment Regulations were introduced to address minor technical adjustments and to implement the government's response to a recommendation from the Productivity Commission's fifth Annual Review of Regulatory Burdens on Business. Specifically, these regulations index the $50 million threshold for certain non-residential commercial land acquisitions, ensuring it is updated annually based on the GDP implicit price deflator. The policy objective of these amendments is to maintain the integrity and relevance of the regulatory framework in line with economic changes, while also ensuring compliance with minor technical corrections.

Scope and Application

The Foreign Acquisitions and Takeovers Act 1975, supplemented by the Foreign Acquisitions and Takeovers Amendment Regulations 2011 (No. 1), forms the cornerstone of Australia's foreign investment screening regime, providing a legislative framework that governs the review of investment proposals by foreign persons to ensure they do not jeopardise national security or other critical national interests. This Act applies to all foreign entities and individuals proposing to acquire an interest in Australian urban land, encompassing non-residential developed commercial real estate, as well as to transactions that may be subject to scrutiny by the Treasurer. The geographic scope of the Act is national, extending across the Commonwealth of Australia, thereby ensuring a unified approach to the regulation of foreign investments. While the Act generally mandates notification for acquisitions of interests in Australian urban land, certain acquisitions are exempt from notification if they fall below specified monetary thresholds, as detailed in the Foreign Acquisitions and Takeovers Regulations 1989. Notably, the 2011 Amendment Regulations introduced an indexation mechanism for the monetary thresholds, ensuring they keep pace with economic changes beyond the year 2011. Furthermore, these regulations correct a technical error in referencing statistical data published by the Australian Bureau of Statistics.

Key Provisions

The Foreign Acquisitions and Takeovers Amendment Regulations 2011 (No. 1) make technical amendments to the Foreign Acquisitions and Takeovers Regulations 1989 (Principal Regulations) to adjust the thresholds under which foreign investors may acquire interests in Australian urban land without notifying the Treasurer. These regulations, under section 39 of the Foreign Acquisitions and Takeovers Act 1975, aim to index the monetary threshold for certain acquisitions of non-residential commercial land or land comprising specified accommodation facilities to reflect economic changes. Specifically, regulation 13 of the Principal Regulations contains a formula for indexing particular thresholds on an annual basis based on the proportionate increase in the GDP implicit price deflator against the previous year. The Amendment Regulations update sub-subparagraph 3(p)(ii)(C) to index the general threshold amount of $50 million using this formula for any calendar year later than 2011. These regulations impose obligations on foreign investors to ensure they are aware of and comply with the updated thresholds for notifying the Treasurer of acquisitions. The primary obligation is for foreign persons to notify the Treasurer before acquiring an 'interest in Australian urban land' if the value exceeds the indexed threshold set out in the regulations. Additionally, these regulations require that the formula for indexing the threshold, as outlined in regulation 13, be correctly applied to ensure that the thresholds are updated annually based on economic data. Failure to comply with the notification requirements can lead to civil and criminal consequences. Under section 121 of the Foreign Acquisitions and Takeovers Act 1975, a person who contravenes a notification requirement can be liable to a civil penalty of up to $504,000 for an individual or $2,520,000 for a body corporate. Furthermore, section 122 of the Act provides for criminal penalties, including fines of up to $5,040,000 for an individual and $25,200,000 for a body corporate, or imprisonment for up to five years, or both, for serious breaches. These penalties reflect the importance of compliance with the foreign investment screening regime to protect Australia's national interests.

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Foreign Investment Law
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Regulation
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Regulatory Standards
Enforcement Powers
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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.