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of Australia | Gazette |
Published by the Commonwealth of Australia | GOVERNMENT NOTICES |
COMMONWEALTH OF AUSTRALIA
Foreign Acquisitions and Takeovers Act 1975
ORDER UNDER SUBSECTION 22(1)
WHEREAS —
(A) Australia YMCI Pty Ltd is a foreign person for the purposes of section 21A of the Foreign Acquisitions and Takeovers Act 1975 (‘the Act’); and
(B) Australia YMCI Pty Ltd proposes to acquire developed commercial properties located in Lidcome, New South Wales and referred to in the notice furnished on 30 October 2015 under section 26A of the Act.
NOW THEREFORE, I, Jared Henry, Manager of the Agriculture and Commercial Review Unit of the Foreign Investment and Trade Policy Division of the Treasury and authorised to make this order for and on behalf of the Treasure pursuant to subsection 22(1) of the Act, for the purpose of enabling consideration to be given as to whether an order should be made under subsection 21(A)(2) of the Act in respect of the proposed acquisition, PROHIBIT the proposed acquisition for a period not exceeding ninety days after this order comes into operation.
Dated this 30th day of November 2015
Jared Henry
Manager
Agriculture and Commercial Review Unit
Overview
The Foreign Acquisitions and Takeovers Act 1975 was introduced by the Parliament of Australia to regulate foreign investment in Australian businesses and assets, ensuring that such investments are in the national interest. The Act aims to maintain and enhance Australia's economic strength and national security by preventing or modifying acquisitions that may be detrimental to these interests. This legislative framework empowers the Treasurer to assess and control foreign acquisitions and takeovers, thereby allowing for the protection of critical industries and strategic assets. In the context of the specific order mentioned, the prohibition of the proposed acquisition of developed commercial properties in Lidcombe, New South Wales, by Australia YMCI Pty Ltd, a foreign entity, reflects the Act's objective to scrutinise foreign investments that could potentially pose a risk to national security or economic well-being.
Scope and Application
The Foreign Acquisitions and Takeovers Act 1975 applies to foreign persons and their proposed acquisitions of Australian assets, including businesses, land, and shares in Australian entities. The Act's application extends to entities controlled by foreign persons, and it encompasses a wide range of industries and transactions. Geographically, the Act applies across the Commonwealth of Australia, covering both state and territory jurisdictions. Certain transactions may be exempt from notification or assessment under the Act if they meet specified thresholds or fall within designated categories. The Act can also be extended or restricted through subordinate instruments, allowing for adjustments to the scope of its application based on changing economic or national security considerations. The order made by Jared Henry under the Act demonstrates its application to specific transactions, in this instance involving the acquisition of developed commercial properties in Lidcome, New South Wales by a foreign entity, Australia YMCI Pty Ltd.
Key Provisions
The Foreign Acquisitions and Takeovers Act 1975 (the Act) plays a pivotal role in regulating foreign investment in Australia, particularly in sensitive sectors and assets. Section 22(1) of the Act allows the Treasurer to prohibit a proposed acquisition if it is deemed to be contrary to national security or the public interest. In this instance, the Minister, Jared Henry, has exercised this power under section 22(1) to prohibit the acquisition of developed commercial properties in Lidcombe, New South Wales by Australia YMCI Pty Ltd, a foreign person as defined in section 21A. This prohibition is effective for a period not exceeding ninety days from the date of the order, allowing time for thorough review and consideration.
The Act imposes specific obligations on foreign persons and entities proposing significant acquisitions. Section 26A requires such entities to notify the Treasurer of the proposed acquisition, providing detailed information about the nature and implications of the acquisition. In this case, Australia YMCI Pty Ltd complied with this requirement by furnishing a notice on 30 October 2015. The Act also mandates that the Treasurer consider the potential impact on national security, the public interest, and the broader economy when evaluating such notifications. The obligation to provide comprehensive information and the requirement for the Treasurer to assess national security and public interest concerns are central to the Act’s regulatory framework.
Breaching the provisions of the Act can lead to significant legal consequences. Section 22(1) of the Act, under which the prohibition order was made, allows for such orders to be issued to prevent acquisitions that may be detrimental to national security or the public interest. The Act does not specify penalties for non-compliance with notification requirements or for contravening a prohibition order; however, breaches can result in substantial civil and criminal penalties. For instance, failure to notify the Treasurer of a proposed acquisition as required under section 26A can result in fines and imprisonment. Similarly, attempting to proceed with a prohibited acquisition can lead to criminal charges and associated penalties, reflecting the seriousness with which the Act treats its provisions.