Thinking | 30 March 2020

COVID-19: temporary changes to FIRB notifications and foreign investment

By Conrad Smith

In a major development for the flow of foreign investment into Australia, all proposed foreign investments must now be notified to the Foreign Investment Review Board (FIRB) and receive a statement of no objection before they can proceed.

This is a temporary change intended to remain in place for the duration of the COVID-19 crisis, and comes as the Federal Government seeks to protect distressed Australian assets from the economic fallout of the coronavirus pandemic.

This change to Australia’s foreign investment framework means that all proposed acquisitions of, or investments in, Australian land, assets or businesses by those classed as ‘foreign persons’ (being foreign governments and their related entities (which include state-owned enterprises), foreign-controlled corporations and trusts, and individuals not ordinarily resident in Australia) will be subject to scrutiny by the FIRB regardless of the value or nature of the investment.

To accommodate this increased scrutiny, and the inevitable growth in the FIRB’s workload, the timeframe in which the FIRB will have to consider each notification will be increased from 30 days to six months, with urgent applications for investments that protect and support Australian business and Australian jobs being given priority.

Contact

Conrad Smith

Conrad is a corporate & commercial lawyer with experience in mergers & acquisitions, restructures, succession, and insolvency.

Related practices

You might be also interested in...

Corporate Governance | 1 Apr 2020

Holding AGMs during the COVID-19 crisis

The current coronavirus pandemic (COVID-19) has many entities with a 31 December financial year end rethinking their Annual General Meeting (AGM) arrangements for 2020. In light of the new COVID-19 gathering restrictions, entities must now consider either postponing their AGM or conducting it in a different way, such as holding a hybrid or virtual AGM.

Corporate Governance | 1 Apr 2020

Raising capital amidst the COVID-19 crisis

We are all aware that the COVID-19 pandemic is having a massive impact on the business operations of many Australian listed companies and Australian and global securities markets. With many businesses needing additional capital to sustain or evolve their operations through the next six months (or longer), raising new capital will be crucial for the survival of many listed entities.