Strengthening Australia’s Foreign Investment Framework
The Federal Government released an options paper titled “Strengthening Australia’s Foreign Investment Framework” at the end of February. The paper contains proposals on reforms to the foreign investment framework.
One of the key proposals in the paper is the introduction of foreign investment application fees. The current framework doesn’t require any fees or charges to be paid to make a foreign investment application. Instead, the cost of administering the foreign investment framework is borne by the Australian taxpayer. The government is proposing to require foreign investors to pay the following application fees before their foreign investment application is processed:
- For residential real estate proposals and rural land acquisitions, a fee of up to $5,000 would apply to properties valued under $1 million. Applications to purchase a property equal to or greater than $1 million would be subject to a fee of up to $10,000.This would then increase in increments of up to $10,000 for each additional $1million in property value;
- Property developers seeking an advanced off-the-plan certificate would be levied an application fee based on the number of dwellings sold to foreign investors; and
- Business, commercial real estate and agribusiness investments would be subject to application fees between $10,000 up to $100,000 depending on the size and sector.
The Government is seeking comment on the introduction of fees on foreign investment applications, including comments on:
- should the Government charge application fees;
- are there any alternative approaches that should be considered;
- is the level of fees appropriate; and
- will the fees be a barrier to foreign investment
Interested parties are invited to comment on the consultation paper prior to 20 March 2015.