Foreign Acquisitions and Takeovers (Prohibition of Proposed Action) Order (No. 1) 2023
I, Dr Jim Chalmers, Treasurer of the Commonwealth of Australia, being satisfied of the matters in subsection 67(1A) of the Foreign Acquisitions and Takeovers Act 1975, make the following instrument.
Dated 15 February 2023
Dr Jim Chalmers
Treasurer
Contents
1 Name
2 Commencement
3 Authority
4 Order prohibiting proposed action
5 Additional order
1 Name
This instrument is the Foreign Acquisitions and Takeovers (Prohibition of Proposed Action) Order (No. 1) 2023.
2 Commencement
(1) Each provision of this instrument specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information |
Column 1 | Column 2 | Column 3 |
Provisions | Commencement | Date/Details |
- Sections 1 to 4 and anything in this instrument not covered elsewhere by this table
| The day this instrument is registered. | |
2. Section 5 | The day that is 30 days after this instrument is registered. | |
Note: This table relates only to the provisions of this instrument as originally made. It will not be amended to deal with any later amendments of this instrument.
(2) Any information in column 3 of the table is not part of this instrument. Information may be inserted in this column, or information in it may be edited, in any published version of this instrument.
3 Authority
This instrument is made under section 67 of the Foreign Acquisitions and Takeovers Act 1975.
Note: A number of expressions used in this instrument are defined in the Foreign Acquisitions and Takeovers Act 1975, including the following:
(a) acquire;
(b) interest;
(c) proposes;
(d) security.
4 Order prohibiting proposed action
The whole of the proposed acquisition by Yuxiao Fund Pte. Ltd. of an additional 9.92 per cent interest in Northern Minerals Limited, which, on the basis of the notification to the Treasurer on 17 August 2022, would increase its interest to 19.9 per cent, is prohibited.
5 Additional order
Yuxiao Fund Pte. Ltd. is directed not to increase the proportion of interests in issued securities in Northern Minerals Limited beyond the 9.98 per cent interest it held as of 17 August 2022.
Overview
The Foreign Acquisitions and Takeovers (Prohibition of Proposed Action) Order (No. 1) 2023 was enacted to address national security concerns arising from foreign acquisitions and takeovers of Australian businesses. Dr Jim Chalmers, the Treasurer of the Commonwealth of Australia, issued this notifiable instrument under section 67 of the Foreign Acquisitions and Takeovers Act 1975. The order specifically targets the proposed acquisition by Yuxiao Fund Pte. Ltd. of an additional 9.92 per cent interest in Northern Minerals Limited, which would increase the fund's total interest in the company to 19.9 per cent. The enactment of this order seeks to prevent the acquisition on the basis that it may be contrary to Australia's national security.
Scope and Application
The Foreign Acquisitions and Takeovers (Prohibition of Proposed Action) Order (No. 1) 2023, made under section 67 of the Foreign Acquisitions and Takeovers Act 1975, imposes a prohibition on the proposed acquisition of an additional 9.92 per cent interest in Northern Minerals Limited by Yuxiao Fund Pte. Ltd., effectively increasing its interest to 19.9 per cent. This order applies to Yuxiao Fund Pte. Ltd. and the proposed acquisition of additional shares in Northern Minerals Limited, with the specific aim of preventing the increase in the fund's interest in the company beyond the 9.98 per cent it held as of 17 August 2022. The order's jurisdictional reach is national, extending throughout the Commonwealth of Australia, and it applies to the conduct and transactions of the specified entities as outlined in the order. The order became effective on the day it was registered, with certain provisions taking effect 30 days after registration. There are no stated exclusions or exemptions in this particular order, and the prohibition is absolute as per the provisions of the Foreign Acquisitions and Takeovers Act 1975.
Key Provisions
The Foreign Acquisitions and Takeovers (Prohibition of Proposed Action) Order (No. 1) 2023, issued under section 67 of the Foreign Acquisitions and Takeovers Act 1975, specifically addresses the prohibition of a proposed acquisition. This particular instrument targets the acquisition by Yuxiao Fund Pte. Ltd. of an additional 9.92 per cent interest in Northern Minerals Limited, which would elevate its total interest to 19.9 per cent (Section 4). The order also mandates that Yuxiao Fund Pte. Ltd. must not increase its proportion of interests in issued securities in Northern Minerals Limited beyond the 9.98 per cent interest it held as of 17 August 2022 (Section 5).
This legislation imposes clear obligations on Yuxiao Fund Pte. Ltd., prohibiting it from proceeding with the acquisition that would raise its interest in Northern Minerals Limited to 19.9 per cent. Furthermore, it mandates that Yuxiao Fund Pte. Ltd. must maintain its current level of interest in Northern Minerals Limited, specifically not exceeding 9.98 per cent. The restrictions are designed to ensure that the acquisition does not proceed in a manner that could potentially compromise national security or other significant interests of Australia.
Failure to comply with the provisions outlined in this Order may result in civil or criminal penalties. While the specific penalties are not detailed within the text of the Order, breaches of the Foreign Acquisitions and Takeovers Act 1975 generally attract severe consequences, including substantial fines and imprisonment. The exact penalties would be determined in the context of broader legislative provisions and any subsequent legal proceedings.