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Fees – business [GN30]

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Latest update: 21 December 2016

The Foreign Acquisitions and Takeovers Fees Imposition Act 2015 (Fees Imposition Act) and Foreign Acquisitions and Takeovers Fees Imposition Regulation 2015 (Fees Regulation) set the fees for foreign investment applications and notices made under the Foreign Acquisitions and Takeovers Act 1975 (Act) and the Foreign Acquisitions and Takeovers Regulation 2015 (Regulation).

This Guidance Note provides information on fees for foreign investment applications and notices relating to business including interests in non-residential Australian land.

Does a fee apply and when is it paid?

Persons are required to pay a fee for each application made, or notice given, under the Act and Regulation (limited exceptions apply).

The fees that are payable depend on the type of action and whether special fee rules apply.

How is the fee paid?

Once a foreign investment application is lodged, applicants will receive an application receipt. Following this, applicants will receive an application fee details email within one business day. This will include the unique Payment Reference Number (PRN) and details on how to pay the fee. It is important to use the correct PRN provided to you for payment of your application. Missing or incorrect PRN’s may cause a delay to the processing of your application.

Once the fee has been paid, applicants will receive a notification which will include details of the 30 day statutory deadline. Payment options include Government EasyPay, BPay, Direct Credit and transfer from an overseas bank account. Fees paid by cheque will not be accepted. When paying the fee, ensure that monies are in Australian dollars and all applicable transaction fees are accounted for, as a shortfall will delay application processing.

Fee Schedule

Action type Fee Payable
Entity
Acquiring an interest in securities in an entity or a direct interest in an entity which is an agribusiness A foreign government investor acquiring a direct interest in securities in an entity Where the consideration for the acquisition is $1 billion or less: $25,300
Otherwise: $101,500
Acquiring an interest in securities in an entity where prior to the proposed acquisition, the foreign person holds an interest of 50 per cent or more in the entity (but excluding internal reorganisations)
(Note – this does not apply if the action may be characterised in a different way. For example, for an acquisition of an interest in a land entity, a fee may still be payable for an acquisition of an interest in land)
Nil (no fee)
Australian Business
Acquiring interests in assets of an Australian business or a direct interest in an Australian business that is an agribusiness A foreign government investor acquiring a direct interest in an Australian business Where the consideration for the acquisition is $1 billion or less: $25,300.
Otherwise: $101,500.
Commercial land
Acquiring an interest in commercial land that is not vacant $25,300
Acquiring an interest in commercial land that is vacant $10,100
Agricultural land
Acquiring an interest in agricultural land where the price of the acquisition is $1 million or less
($0 – $1,000,000)
$5,000
Acquiring an interest in agricultural land where the price of the acquisition is more than $1 million and less than $2 million
($1,000,001 – $1,999,999)
$10,100
Acquiring an interest in agricultural land where the price of the acquisition is between $2 million and less than $3 million
($2,000,000 – $2,999,999)
$20,300
Acquiring an interest in agricultural land where the price of the acquisition is between $3 million and less than $4 million
($3,000,000 -$3,999,000)
$30,400
Acquiring an interest in agricultural land where the price of the acquisition is between $4 million and less than $5 million
($4,000,000 – $4,999,999)
$40,600
Acquiring an interest in agricultural land where the price of the acquisition is between $5 million and less than $6 million
($5,000,000 – $5,999,999)
$50,700
Acquiring an interest in agricultural land where the price of the acquisition is between $6 million and less than $7 million
($6,000,000 – $6,999,999)
$60,900
Acquiring an interest in agricultural land where the price of the acquisition is between $7 million and less than $8 million
($7,000,000 – $7,999,999)
$71,000
Acquiring an interest in agricultural land where the price of the acquisition is between $8 million and less than $9 million
($8,000,000 – $8,999,999)
$81,200
Acquiring an interest in agricultural land where the price of the acquisition is between $9 million and less than $10 million
($9,000,000 – $9,999,999)
$91,300
Acquiring an interest in agricultural land where the price of the acquisition is $10 million or more
($10,000,000 or more)
$101,500
Mining, production or exploration tenements
Acquiring an interest in a mining or production tenement (except where a foreign person (other than a foreign government investor) is acquiring an interest from an Australian government body or an entity wholly owned by an Australian government body) $25,300
A foreign government investor acquiring a legal or equitable interest in a mining, production or exploration tenement $10,100
A foreign government investor acquiring an interest of at least 10 per cent in securities in a mining, production or exploration entity $10,100
Exemption certificates
Applying for an exemption certificate in relation to a program to acquire interests in Australian land Where the consideration for the acquisition is $1 billion or less: $25,300.
Otherwise: $101,500.
Applying for an exemption certificate to acquire securities through underwriting $25,300
Applying for an exemption certificate to acquire certain interests in tenements or interests in securities in mining, production or exploration entities, if those interests are not interests in Australian land. $25,300 or nil if the person or another entity is a member of the same wholly-owned group (see section 6(2) of the Foreign Acquisitions and Takeovers Fees Imposition Regulation 2015.
Other fee rules
Internal reorganisation $10,100
Foreign government investor starting an Australian business $10,100
Internal reorganisations by foreign government investors involving tenements that are not an interest in Australian land $10,100 (the fee may be nil in particular circumstances).
Entering into an agreement relating to the affairs of an entity and under which one or more senior officers of the entity will be under an obligation to act in accordance with the directions, instructions or wishes of a foreign person who holds a substantial interest in the entity (or of an associate of such a foreign person) $25,300
Altering a constituent document of an entity as a result of which one or more senior officers of the entity will be under an obligation to act in accordance with the directions, instructions or wishes of a foreign person who holds a substantial interest in the entity (or of an associate of such a foreign person) $25,300
Special rules may apply for actions taken by wholly-owned groups – see section 14 of the Foreign Acquisitions and Takeovers Fees Imposition Regulation 2015  
Variations
Applying for a variation of an exemption certificate $5,000
Applying for a variation of a no objection notification $5,000 if for an acquisition of an interest in Australian land.
Otherwise, $10,100.
Fee otherwise would be more than 25 per cent of the consideration (de minimis rule)
Where the fee for one or more of the actions specified above would be more than 25 per cent of the consideration for the proposed acquisition. This excludes:

  • internal reorganisations;
  • entering into an agreement relating to the affairs of an entity mentioned in section 40(2)(d) of the Act;
  • altering a constituent document of an entity mentioned in section 40(2)(e) of the Act; and
  • entering into or terminating a significant agreement with an Australian business.
$1,000
Voluntary notifications
Giving notice of a significant action that is not a notifiable action The same fee that would be payable for a notifiable action of the same acquisition type.

General Guidelines

Statutory timeframe

The statutory timeframe for making a decision will not start until the correct fee has been paid. Applicants should accurately describe their proposed action in their application or notice and determine the expected fee at the time of lodgement.

Understating the consideration or inaccurately describing action(s) for which the application or notice relates may result in the statutory timeframe for considering the application or notice not starting until the correct fee is paid.

If there has been an overpayment, the statutory timeframe will have started when the fee was paid and the overpaid amount will be remitted.

Waivers and remissions

Under section 115 of the Act the Treasurer may waive or remit the whole or a part of a fee that is payable, if they are satisfied that it is not contrary to the national interest to waive or remit the fee. All applications for fee waivers or remissions will be considered on a case-by-case basis.

Generally, fees will not be waived or remitted based on the outcome of an application or notice. Fees will not generally be remitted where a proposal does not get approval from the Treasurer, the applicant changes their mind or the investment has been unsuccessful. For example, a foreign person will not generally receive a fee waiver or remission following an unsuccessful competitive bid process. Similarly, fees for exemption certificates are not likely to be remitted if ultimately no acquisitions are made by foreign persons under the exemption certificate.

Fees will not generally be remitted where an application has been withdrawn. However, for applications or notices that are resubmitted and are substantially the same or similar action, the fee for the latter application or notice may be waived. This will be considered on a case-by-case basis, taking into account the extent that the latter application or notice is similar to the withdrawn application or notice.

There are only limited circumstances where a fee waiver or remission is likely to be granted. These include:

  • Acquisitions by unincorporated consortiums. A partial fee waiver will generally be considered for unincorporated consortiums where there are multiple foreign persons providing notices for one acquisition for which separate fees would be payable (compared with if the consortium was an incorporated joint venture for which one notice and fee would be applicable).
  • Applications for exemption certificates for a program of land acquisitions that were not granted: If an application for an exemption certificate for a program of land acquisitions was not granted by the Treasurer, fees to the value of the original application may be waived for any subsequent applications for an interest in land. If the entity that paid the fee is a holding entity or subsidiary, the fee may be credited towards separate notices of other entities within the same group, with the written consent of an authorised officer of the entity that initially applied for the certificate that was not given.
  • Exempt actions. If an action is exempt and is notified, a fee will be remitted (this does not apply to voluntary notices). Applicants should ensure that they assess whether an application or notice is required before making an application or giving a notice.
  • Small non-land acquisitions. A partial fee waiver will generally be considered where an applicant is making a non-land acquisition of $10 million or less. The fee for these transactions will generally be reduced to $1000.
  • Foreign government investors acquiring developed commercial land. A partial fee waiver will generally be considered where a foreign government investor is acquiring developed commercial land where the consideration is $55 million or less. The fee for these transactions will generally be reduced to $1000.
  • Entities carrying on a business acquiring multiple residential land titles under one agreement: A partial fee waiver will generally be considered where an entity carrying on a business in Australia is purchasing residential land. The fee waiver may be applied so that the entity will only pay the highest fee applicable for multiple actions occurring under one agreement. For example, a property developer acquiring multiple titles of residential land for redevelopment under one agreement may only pay the highest fee, rather than a separate fee for each title of residential land.
  • Entities carrying on a business acquiring securities in an entity that primarily holds residential land: A partial fee waiver will generally be considered where the fee for an entity carrying on a business in Australia acquiring securities in an entity that primarily holds residential land exceeds $25,300. The fee waiver may be applied so that the entity will pay a maximum of $25,300 if the consideration for the transaction is below $1 billion.

Example 1

Amak Corporation is a foreign listed entity which carries on a property development business in Australia. It is paying $100 million for securities in Rovert Limited, a land entity that primarily holds residential land. As residential land is Rovert Limited’s dominant land holding, the fee for giving notice is $1 million. However, a partial fee waiver may be applied to reduce the fee to $25,300.

If a person wants to apply for a fee waiver or remission, they should clearly set out the circumstances in their application and outline why the Treasurer should consider waiving or remitting the fee. Decisions on fee waivers and remissions are not subject to review under the Administrative Decisions (Judicial Review) Act 1977 or the Administrative Appeals Tribunal Act 1975 but can be subject to common law judicial review.

Land

Section 7 of the Fees Imposition Act outlines fees for acquisitions of interests in Australian land. Fees are payable for all notices to acquire an interest in Australian land. This includes acquiring interests in land entities.

There are different fees for acquisitions of interests in residential, agricultural and commercial land, and mining and production tenements. This guidance note covers fees in relation to non-residential land acquisitions. Further information on residential land fees is in Guidance Note 29.

Agricultural land

Agricultural land means land in Australia that is used, or could reasonably be used, for a primary production business (for more information, see Guidance Note 17).

Example 2

A foreign person wishes to buy a 50 per cent interest in agricultural land. The consideration for the overall purchase of the agricultural land is $2 million. The consideration for the acquisition of the 50 per cent interest is $1 million. The fee is calculated based on the consideration for the acquisition of the 50 per cent interest. The fee payable would be $5,000 as the consideration for the acquisition of the interest is $1 million or less.

Multiple titles

Acquisitions of interests in multiple titles of agricultural land from the same vendor in the same agreement will be charged a single fee. The fee will be based on the interest in the title of agricultural land with the highest consideration.

Where the agreement includes an overall purchase price for the land, the consideration should be apportioned amongst the titles on a reasonable basis. This information should be included when giving the notice, so the correct fee can be calculated.

Example 3

A foreign company wants to invest in agricultural land. They want to buy one title of agricultural land for more than $15 million. They give notice and pay the $101,500 fee. They receive a no objection notification and the acquisition goes ahead.

A year later, the company wants to purchase three titles of agricultural land as part of a single agreement with one vendor. The consideration for two of the titles is under $1 million per property. The consideration for the third title is $1.5 million. The foreign company gives a notice for the acquisition of the interest in the three titles of agricultural land and incurs a fee of $10,100. The fee is calculated with respect to the title with the highest amount of consideration.

Commercial land

Commercial land means land in Australia (or the seabed of the offshore area) other than land:

  • used wholly and exclusively for a primary production business;
  • on which there is at least one dwelling (except commercial residential premises); or
  • on which the number of dwellings that could reasonably be built is less than 10.

Land is vacant if there is no substantive permanent building on the land that can be lawfully occupied by persons, goods or livestock. For more information, see Guidance Note 14.

Multiple titles

Acquisitions of interests in multiple titles of commercial land from the same vendor under the same agreement will be charged a single fee. The fee will be based on the interest in the title of commercial land which attracts the highest fee.

Example 4

A foreign person wants to acquire two blocks of commercial land neighbouring each other, in the same agreement from the same vendor. One block has an office building on the land and the other is a multi‑storey commercial car park. Rather than paying a $25,300 fee for acquiring the interest in the office building and a $25,300 fee for acquiring the interest in the multi-story commercial car park, the foreign person will incur a single fee of $25,300.

Example 5

A foreign person frequently invests in commercial land in Australia. The foreign person wants to buy a shopping centre that is for sale in Sydney, and vacant commercial land for a 600 apartment development in Melbourne. The agreements and vendors of the properties are different. The foreign person gives two notices on the same day and pays total fees of $35,400 ($25,300 for commercial land that is not vacant plus $10,100 for vacant commercial land).

Mining, production and exploration tenements

The fee for providing a notice to acquire an interest in a mining or production tenement is $25,300 (for more information, see Guidance Note 24).

Foreign government investors

Section 7 of the Fees Regulation outlines fees for foreign government investors related to mining, production or exploration tenements and entities.

Acquisitions by a foreign government investor of one of the following interests will incur a $10,100 fee:

  • a legal or equitable interest in a mining, production or exploration tenement; or
  • an interest of at least 10 per cent in a mining, production or exploration entity.

If the applicable fee would otherwise be more than 25 per cent of the consideration, the foreign person will incur a fee of $1,000 (see de minimis rule in the fee schedule).

  • The fee is determined based on the consideration for the interest in the tenement, not the value of any separate freehold or leasehold interests of land within the area of the tenement.
  • Where the acquisition is being undertaken by applying to an Australian government body or an entity wholly owned by an Australian government body for the issue or grant of the tenement, consideration will be based on the sum of all monies to be paid for the issue or grant, including any fees and charges. It does not include minimum spend requirements that are included as conditions attaching to the tenement.

Where there are multiple notifiable actions under one agreement, the action with the highest fee is payable.

Example 6

A foreign government investor wants to purchase a mining tenement from a private company. In this case, there are two notifiable actions:

  • the acquisition of an interest in a mining tenement ($25,300 fee); and
  • the acquisition of a legal interest in a mining tenement by a foreign government investor ($10,100 fee).

The applicable fee is not more than 25 per cent of the consideration. The foreign government investor submits a notice and pays $25,300, as this is the highest fee payable for the two actions.

Internal reorganisations by foreign government investors involving tenements

Under section 12 of the Fees Regulation, a $10,100 fee is payable if a foreign government investor acquires a legal or equitable interest in a tenement that is not an interest in Australian land from another entity and any of the following applies:

  • both entities are subsidiaries of the same holding entity;
  • the other entity is the holding entity of the first entity;
  • the other entity is a subsidiary of the first entity.

However, the fee payable by the foreign government investor is nil if another fee is payable by the foreign government investor or an entity of the same wholly-owned group in relation to an internal reorganisation under section 10 of the Act, and the acquisition of tenements that are not an interest in Australian land forms part of the same internal reorganisation. For further information on internal reorganisations, see section under ‘Entities and Australian businesses.’

Land entities

The fee for acquiring interests in securities in an entity is $25,300 if the consideration is $1 billion or less, otherwise the fee will be $101,500. However, section 12 of the Act provides that acquiring an interest in securities in an Australian land corporation or Australian land trust, or an interest in an agricultural land corporation or agricultural land trust, also means acquiring an interest in Australian land.

This means that for an action for which a notice is given that is both acquiring securities in an entity and acquiring securities in a land entity, and neither acquisition is otherwise exempt, the fee will be calculated based on the highest fee applicable (special rules apply if the interest in the land entity is an interest in residential land).

Example 7

A foreign person proposes to acquire a 25 per cent interest in units in an Australian land entity for $400 million. The Australian land entity only holds interests in commercial land that is not vacant.

The acquisition constitutes the following actions:

  • an acquisition of a substantial interest in an Australian entity ($25,300 fee); and
  • an acquisition of an interest in commercial land that is not vacant ($25,300 fee).

Rather than paying separate fees for the two actions, and separate fees for each acquisition of an interest in commercial land that is not vacant, the fee will be calculated based on the higher fee that is payable for the actions. Given the actions incur the same fee; a single fee of $25,300 is applicable.

Land entities holding more than one type of Australian land

Under section 11 of the Fees Regulation, for land entities that hold more than one type of land, the fee for the acquisition of the interest in securities in a land entity will be based on the entity’s dominant land holding.

To determine the entity’s dominant land holding, a reasonable assessment of the value of interests in land held by the entity in agricultural land, commercial land, residential land and mining and production tenements should be made.

If the value of the land is greatest for a type of land other than commercial land, the kind of land whose value is assessed as being the greatest will be the entity’s dominant land holding. If the value of the land is greatest for commercial land, a reasonable assessment of the value of interests held by the entity in commercial land that is vacant and commercial land that is not vacant should be made. The fee will be based on the type of commercial land that is dominant.

This special rule applies only for working out a fee where an entity holds more than one kind of land. This special rule does not apply if a fee is payable under section 9(2)(a) of the Fees Act (actions of more than one kind) and the fee is higher than the fee worked out under this special rule.

Example 8

A foreign person proposes to acquire an interest in securities in an Australian land entity. The action does not constitute a substantial interest in an Australian entity.

The Australian land entity holds 75 per cent of its interests in Australian land (thus making it an Australian land trust). Of the interests in Australian land:

  • 70 per cent of the interests are in commercial land; and
  • 30 per cent of the interests are in residential land.

As the land entity holds more than one type of Australian land, the foreign person must make a reasonable assessment of the entity’s dominant land holding.

As the dominant land holding is in commercial land, the foreign person must make a reasonable assessment of the interest held by the entity in commercial land that is vacant and commercial land that is not vacant. Of the interests in commercial land:

  • 60 per cent of the interests are in commercial land that is vacant; and
  • 40 per cent of the interests are in commercial land that this not vacant.

The dominant land holding is in commercial land that is vacant.

The fee is calculated based on the interest in commercial land that is vacant. The fee for the acquisition is $10,100.

Entities and Australian businesses

Section 8 of the Act defines Australian business as a business that is carried on wholly or partly in Australia in anticipation of profit or gain.

Sections 7 and 8 of the Fees Imposition Act outlines fees with respect to agreements related to entities and Australian businesses.

Securities in an entity

The fee for foreign persons proposing to acquire securities in an entity (such as securities in a listed company or unit trust, or interests in an unlisted company or unit trust), including securities in an agribusiness, is $25,300 where the consideration for the acquisition is $1 billion or less, or $101,500 otherwise.

Example 9

A foreign person wishes to acquire an interest in an Australian entity where the consideration for the acquisition is $500,000. As the consideration is $1 billion or less, the fee for notification is $25,300.

Majority investors

When the foreign person holds an interest of more than 50 per cent in the entity, there will be no fee for the proposed acquisition (unless the action is part of an internal reorganisation, or the action may be characterised in a different way such as the acquisition of an interest in a land entity or the acquisition of a direct interest in an Australian entity by a foreign government investor).

The acquisition of interests in securities in a land entity is also an acquisition of an interest in Australian land. See the section on ‘Land’ above for more information on the fee rules that may apply.

Australian business

A business that is carried on wholly or partly in Australia in anticipation of profit or gain is an Australian business. A person who has an interest in a mining or production tenement is taken to carry on a business in Australia of exploiting that tenement in anticipation of profit or gain.

The fee for foreign persons acquiring assets of an Australian business or a direct interest in an Australian business that is an agribusiness is $25,300 where the consideration for the acquisition is $1 billion or less, or $101,500 otherwise.

Internal reorganisation

An internal reorganisation is an acquisition by an entity (first entity) of:

  • An interest in securities in another entity if:
  • both entities are subsidiaries of the same holding entity; or
  • the other entity is a subsidiary of the first entity; or
  • An interest in an asset or Australian land from another entity if:
  • both entities are subsidiaries of the same holding entity; or
  • the other entity is the holding entity of the first entity; or
  • the other entity is a subsidiary of the first entity.

A fee of $10,100 is payable in relation to a notice that is for one or more actions that are acquisitions that constitute an internal reorganisation.

For information on internal reorganisations by foreign government investors involving tenements, please see section above under ‘Mining, production and exploration tenements.’

Starting an Australian business

A fee of $10,100 is payable by foreign government investors seeking approval to start an Australian business. For more information, Guidance Note 23.

Agreement or constituent documents

An application fee of $25,300 is payable by foreign persons seeking approval to:

  • Enter into an agreement relating to the affairs of the entity, under which one or more senior officers will be under an obligation to act in accordance with the directions, instructions or wishes of a foreign person who holds a substantial interest of the entity.
  • Alter a constituent document (that is, any rules or other document constituting or establishing the entity or governing its activities, such as a constitution of a corporation or a trust deed for a unit trust) of the entity as a result of which one or more senior officers will be under an obligation to act in accordance with the directions, instructions or wishes of a foreign person substantial interest holder.
  • Enter or terminate a significant agreement with an Australian business. A significant agreement with an Australian business is an agreement relating to:
    • the leasing of, the letting on hire of, or the granting of other rights to use, assets of the business; or
    • the participation by a person in the profits or central management and control of the business.

Actions taken by wholly-owned groups

Under section 14 of the Fees Regulation, the fee payable by an entity is lowered to nil if:

  • the fee is payable for the acquisition of certain interests in an agribusiness, securities, assets of an Australian business, interests in Australian land or tenement; and
  • one or more entities from the same wholly-owned group have or are to acquire, one or more of the same interests; and
  • the acquisitions are dealt with in a single agreement or a notice is given stating that the entities propose to acquire the interests; and
  • a fee is paid by one of the other entities, in relation to that entity’s acquisition of the interests mentioned in the second dot point above.

Example 10

Four entities in a wholly-owned group give notice to acquire interests in securities in non‑agribusiness Corporation A, to increase the interest held by the wholly‑owned group in Corporation A from 25 to 51 per cent (the consideration for the additional 26 per cent interest is less than $1 billion). If one of the entities in the wholly‑owned group giving notice pays the fee, then the fees for the other entities are lowered to nil. Only one fee is paid although four entities have given notice to acquire an interest in securities in Corporation A.

Fees involving more than one action

Section 9 of the Fees Imposition Act outlines how fees are calculated where more than one action is taken.

Where one agreement covers more than one action, the single highest fee for those actions will apply. This does not include interests in residential land where a separate fee is payable for each action.

Where multiple actions in one agreement would incur the same fee, a single fee will apply. If multiple actions are taken in separate agreements, a separate fee for each action will apply.

Example 11

A foreign person wants to purchase a block of vacant commercial land (usual fee $10,100), a block of developed commercial land (usual fee $25,300) and agricultural land that is valued at $500,000 (usual fee $5,000) within a single agreement.

The fee payable would be $25,300, as this is the highest fee that would be payable for any of the acquisitions.

If the agreement was also covering residential land valued at $1 million or less, the total fee payable for the application would be $30,300 (the highest fee for the non‑residential land of $25,300 plus $5,000 for the residential land).

If a single action is either or both of the following, the fee payable in relation to the single action is the highest of the amounts that apply:

  • more than one of the following kinds of actions:
    • a significant action – entities (subsection 40(2) of the Act: this covers five actions including acquiring or issuing securities in an entity, entering an agreement relating to the affairs of an entity and altering a constituent document of an entity);
    • a significant action – businesses (subsection 41(2) of the Act: this covers three actions in relation to an Australian business);
    • the acquisition of an interest in Australian land;
    • to take a significant action that is prescribed under the regulations for the purposes of section 44 of the Act;
  • a single action relating to land that satisfies more than one subsection in section 52 of the Act. That is more than one of:
    • land without a threshold value (nil monetary threshold);
    • agricultural land where the total value of interests in agricultural land is above $15 million; or
    • other land where the value of the interest is above the threshold value (for example, non-vacant commercial land where the threshold will be one of $50 million, $55 million, $252 million or $1,094 million depending on the circumstances).

Exemption certificates

Section 6 of the Fees Imposition Act and section 6 of the Fees Regulation outlines fees that are payable in relation to exemption certificates.

New dwelling exemption certificate

Persons such as property developers can apply for an exemption certificate under section 57 of the Act to sell new dwellings in a development to foreign persons, without each foreign person purchaser being required to seek their own approval. For more information, see Guidance Note 8.

The initial application fee for this exemption certificate is $25,300, plus a fee for each new dwelling acquired by foreign persons.

The fee that is payable for each new dwelling acquisition by foreign persons is the amount that would have been payable if the foreign persons sought approval individually. For more information on residential land fees, see Guidance Note 29.

Example 12

A developer wants to obtain an exemption certificate to sell new dwellings in its development to foreign persons. The developer applies for the exemption certificate and pays the initial fee of $25,300. After the developer is granted an exemption certificate, foreign persons acquire four new dwellings. Three new dwellings are each purchased for $600,000 and one new dwelling is purchased for $1.2 million.

For the reconciliation, the developer pays $5,000 for each new dwelling acquired by a foreign person valued at $1 million or less and pays $10,100 for the new dwelling acquired for $1.2 million. The total fee payable is $25,300.

Exemption certificate for a program of acquisitions of land

Foreign persons can apply for an exemption certificate under section 58 of the Act for a program of acquisitions of interests in one or more kinds of Australian land (residential, agricultural, commercial and mining or production tenements). For more information, see Guidance Note 21.

The application fee for this exemption certificate is $25,300 where the consideration specified in the application for the program of acquisitions is $1 billion or less, and $101,500 otherwise.

If an application for an exemption certificate for a program of land acquisitions was not granted by the Treasurer, fees to the value of the original application will be waived for any subsequent applications for an interest in land. If the entity that paid the fee is a holding entity or subsidiary, the fee may be credited towards separate notices of other entities within the same group, with the written consent of an authorised officer of the entity that initially applied for the certificate that was not given.

Example 13

A foreign person applied for an exemption certificate for a program of acquisitions totalling less than $1 billion and paid the $25,300 fee. The Treasurer was not satisfied that giving the certificate would not be contrary to the national interest and so declined to give the certificate.

The foreign person later gave notice to acquire an interest in developed commercial land. Taking into account the fee already paid for the exemption certificate application which was not successful, the Treasurer exercised his power to waive the full $25,300 fee that would have otherwise applied to the notice.

Exemption certificate for underwriters

Foreign persons can apply for an exemption certificate under section 42 of the Regulation where the foreign person proposes to acquire interests in securities in the course of their business of underwriting securities. For more information, see Guidance Note 26.

The application fee for this exemption certificate is $25,300.

Exemption certificate for certain interests in tenements and mining, production or exploration entities

Foreign persons can apply for an exemption certificate under section 43 of the Regulation to acquire one or more kinds of interests in a tenement, or one or more kinds of interests in securities in a mining, production or exploration entity if those interests are not interests in Australian land.

The application fee for this exemption certificate is $25,300. However, no fee will apply if another fee is payable in relation to an application for an exemption certificate under section 58 of the Act (exemption certificate for a program of acquisitions of land) by the person or an entity that is a member of the same wholly-owned group and the applications under section 43 and 58 were made within 7 days of each other.

Indexation

Section 12 of the Fees Imposition Act explains how the fees for financial years from 2016-17 onwards are to be worked out. Where this results in an increase in certain fees for a financial year, the new fees will apply to applications made and notices given from 1 July of that financial year.

Penalties

Strict penalties (including civil and criminal penalties) may apply for breaches of Australia’s foreign investment rules.

Further information

Further information is available on the FIRB website or by contacting +61 2 6263 3795.


Important notice: This Guidance Note provides a summary of the relevant law. As this Note tries to avoid legal language wherever possible it may include some generalisations about the law. Some provisions of the law referred to have exceptions or important qualifications, not all of which may be described here. The Commonwealth does not guarantee the accuracy, currency or completeness of any information contained in this document and will not accept responsibility for any loss caused by reliance on it. Your particular circumstances must be taken into account when determining how the law applies to you. This Guidance Note is therefore not a substitute for obtaining your own legal advice.