The Treasurer has announced changes to Australia’s foreign investment review framework, effective from 10.30pm AEDT on Sunday 29 March 2020, relating to monetary thresholds and timeframes for reviewing applications. Details are available in our Guidance Note number 53, which addresses the effects of the changes. All material on this website should be read in light of the Treasurer’s announcement.

Land exemption certificates

Under the foreign investment framework it is a requirement that each proposed acquisition of an interest in land by a foreign person be separately notified, unless otherwise exempt. However, a longstanding feature of the framework is that foreign persons making multiple acquisitions can apply for an up-front approval for a program of land acquisitions without the need to seek separate approvals.

Section 58 of the Foreign Acquisitions and Takeovers Act 1975 allows a foreign person to apply for a certificate in relation to acquisitions of one or more kinds of interests in Australian land, and the Treasurer to grant such a certificate, if satisfied that the acquisitions of the kinds of interests by the foreign person is not contrary to the national interest.

When may an exemption certificate be applicable?

The certificate is a mechanism available to minimise the regulatory burden of foreign investment screening that would otherwise apply to each acquisition covered by a certificate. It is intended for foreign persons with a high volume of acquisitions of interests in land (this generally would not include individuals). A certificate will not usually be granted where the number of likely acquisitions is small and it would be reasonable for the foreign person to notify the acquisitions separately.

A certificate will generally specify the maximum value of interests that can be acquired and also the period during which acquisitions can be made. While certificates have previously been for a default 12 months, certificates may now be issued for shorter or longer periods depending on the circumstances.