Federal Government to introduce foreign investment reform

Federal Government to introduce foreign investment reform; Parliamentary Budget Office releases medium-term fiscal projection scenarios; United States launches investigation of digital services taxes; ATO update: Applying the decline in turnover test.

Federal Government to introduce foreign investment reform

The Federal Government says it is reforming Australia’s foreign investment framework to keep “pace with emerging risks and global developments.”

Announced on Friday by Treasurer Josh Frydenberg, the key elements include:

  • a new national security test for foreign investors who will be required to seek approval to start or acquire a direct interest in a ‘sensitive national security business’ – regardless of the value of the investment;
  • a time-bound ‘call in’ power enabling the Treasurer to review acquisitions that raise national security risks outside of proposed acquisitions relating to a ‘sensitive national security business’;
  • a national security last resort power that provides the ability to impose or vary conditions and in extraordinary circumstances order disposal on national security grounds;
  • stronger and more flexible enforcement options including the expansion of infringement notices and higher civil and criminal penalties; and
  • measures to streamline approval for passive investors and investments into non-sensitive businesses.

Draft legislation is expected to be released in July.

More information is available on the Treasury website.

Source: www.kpmg.com.au

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