COMMONWEALTH OF AUSTRALIA
Foreign Acquisitions and Takeovers Act 1975
ORDER UNDER SUBSECTION 69(2)
WHEREAS --
(A) Donghang Wang acquired an interest in Australian land situated at
4 Snowden Place, Canterbury, Victoria, 3126 (the land) in 2010;
(B) I am satisfied that Donghang Wang’s acquisition of an interest in the land was a significant action that was taken before 1 December 2015 (see item 6(1) of Schedule 3 to the Foreign Acquisitions and Takeovers Legislation Amendment Act 2015 and also section 43 of the Foreign Acquisitions and Takeovers Act 1975 (FATA));
(C) I am satisfied that the result of that significant action is contrary to the national interest; and
(D) I am also satisfied that the Treasurer would have had the power to make an order under subsection 21A(4) of the FATA (as it was immediately after Donghang Wang acquired an interest in the land) on the following basis:
- Donghang Wang was a foreign person who acquired an interest in Australian urban land; and
- I am satisfied that the acquisition of that interest was contrary to the national interest.
NOW THEREFORE
I, ELIZABETH HARDCASTLE, Assistant Commissioner at the Australian Taxation Office, hereby make an order in accordance with item 7 of the table in subsection 69(2) of the FATA, directing Donghang Wang to DISPOSE of his interest in the land, by midnight (Canberra time) 6 months from the date that this order commences, to one or more persons who are not his associates.
This order commences on the day that is 30 days after it is registered on the Federal Register of Legislation.
Dated 1/2/2017
Elizabeth Hardcastle
Assistant Commissioner, Australian Taxation Office
Overview
The Foreign Acquisitions and Takeovers Act 1975 (FATA) was enacted by the Parliament of Australia to address national security concerns related to foreign ownership of Australian assets, particularly land and businesses that are critical to national security. This legislation provides the Australian Government with the authority to review and, if necessary, block foreign acquisitions and takeovers that could be detrimental to the nation's interests. The 2017 order under subsection 69(2) of the FATA, made by Elizabeth Hardcastle, Assistant Commissioner at the Australian Taxation Office, exemplifies the application of this Act to ensure that significant foreign acquisitions are thoroughly assessed for their potential impact on national security. The policy objective of the FATA is to protect Australia's national security by preventing foreign ownership or control of Australian businesses and land that could adversely affect the nation.
Scope and Application
The Foreign Acquisitions and Takeovers Act 1975 (FATA) applies to foreign persons and entities seeking to acquire interests in Australian land, businesses, or other assets, particularly when these acquisitions are deemed to be contrary to the national interest. The Act imposes obligations on foreign persons to notify the Treasurer of any significant action they take to acquire an interest in Australian assets. The jurisdiction of the Act extends across the Commonwealth of Australia, encompassing federal, state, and territory levels. In this specific case, the notifiable instrument concerns Donghang Wang, a foreign person, who acquired an interest in Australian land located in Canterbury, Victoria. The order mandates that Donghang Wang must dispose of his interest in the specified land within six months to a person or entity not associated with him, to mitigate any perceived threat to the national interest. This directive underscores the federal government's authority to intervene in foreign acquisitions that could potentially undermine national security or economic interests.
Key Provisions
The Foreign Acquisitions and Takeovers Act 1975 (FATA) provides the legal framework for the regulation of foreign acquisitions of Australian assets. Section 69(2) allows for the making of an order by the Assistant Commissioner of the Australian Taxation Office when certain conditions are met. In this case, the Assistant Commissioner has made an order (paragraph 2) requiring Donghang Wang to dispose of his interest in the land at 4 Snowden Place, Canterbury, Victoria (paragraph 1), within six months from the commencement of the order (paragraph 4). This order follows a determination that Wang’s acquisition of the land was contrary to the national interest, as outlined in the order (paragraph 3).
The Act imposes a significant obligation on Wang to dispose of his interest in the land within the specified timeframe. This requirement is crucial as it seeks to mitigate any potential adverse impacts on national security or economic stability that may arise from foreign ownership of Australian assets. Wang must ensure that the disposal is to one or more persons who are not his associates, as per the order (paragraph 4). The Act does not define "associates," but it generally refers to any person or entity that has a significant connection to Wang, including family members, business partners, and any other individual or entity that might influence Wang’s decisions.
Failure to comply with the order can result in serious legal consequences. Although specific offences and penalties are not detailed in the notifiable instrument itself, the Foreign Acquisitions and Takeovers Act 1975 provides for substantial penalties for non-compliance. Under section 138 of the FATA, any person who fails to comply with an order made under section 69 may be liable to a penalty of up to 2,500 penalty units, which, at the time of writing, equates to approximately AUD 455,000. Additionally, the Act provides for both civil and criminal penalties, and breaches can lead to criminal prosecution and imprisonment for up to 10 years under section 139 of the FATA.