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Australian land and land-rich entities

4.1 Australian land and interests in Australian land

The concept of Australian land covers four separate categories of land, being agricultural land, commercial land, residential land (which we will not consider), and mining or production tenements.

The legislation deems various things to be an interest in Australian land – including:

  • interests under a lease or licence giving rights to occupy land for an unexpired term of more than five years (inclusive of any options to renew); and

  • interests in the following land-rich entities:
  • an Australian land corporation or Australian land trust, if interests in Australian land account for more than 50% of the corporation or trust’s total assets by value; and
  • an agricultural land corporation or agricultural land trust, if interests in agricultural land account for more than 50% of the corporation or trust’s total assets by value (see further paragraph 5.2).

Land which falls into any one or more of these categories can also constitute national security land. National security land is generally land which is defence premises or where it is publicly known (or could be known upon the making of reasonable enquiries) that a national intelligence agency has an interest in the land. The acquisition of an interest in national security land requires approval – because the acquisition of an interest in national security land is a notifiable national security action irrespective of value.

4.2 Thresholds for Australian land

Unless an exemption applies, foreign persons must obtain approval for all acquisitions of interests in Australian land or of securities in land-rich entities where the value of the consideration for the interest to be acquired exceeds the thresholds. Note that there is no minimum percentage stake (except for listed entities, as noted in the table below).

In broad terms, foreign persons require FIRB approval to acquire interests in land as follows:

1

Type of Land

National security land

Type of Transaction

All

Threshold

No threshold – notifiable regardless of value

2

Type of Land

Residential land [2]

Type of Transaction

All

Threshold

No threshold – notifiable regardless of value

3

Type of Land

Any land, where acquirer of interest in land is a foreign government investor

Type of Transaction

All, except acquisitions of less than 10% (for listed entities) or 5% (for unlisted entities that do not invest in established dwellings) where there is no influence over management or policy

Threshold

No threshold – notifiable regardless of value

4

Type of Land

Commercial land that is vacant [3]

Type of Transaction

All

Threshold

No threshold – notifiable regardless of value

5

Type of Land

Mining or production tenement

Type of Transaction

All, except acquisitions by certain FTA Country investors (US, NZ, Chile) which are covered in item 10

Threshold

No threshold – notifiable regardless of value

6

Type of Land

Interests in an Australian land corporation or Australian land trust where 10% or more of the value of its total assets comprise:

(a) residential land [2];

(b) vacant commercial land [3]; or

(c) mining or production tenements.

Type of Transaction

All, except acquisitions of less than 10% (for listed entities) or 5% (for unlisted entities that do not invest in established dwellings) where there is no influence over management or policy

Threshold

No threshold – notifiable regardless of value

7

Type of Land

Agricultural land (including interest in any agricultural land corporation or agricultural land trust)

Type of Transaction

All, whether by acquiring interests in the land or in a share or unit in an agricultural land corporation or trust, except:

  • acquisitions by certain FTA Country investors (US, NZ, Chile) which are covered in item 11; and
  • acquisitions by an enterprise or national of Thailand in land used wholly and exclusively for a primary production business which are covered in item 12

Threshold

$15 million calculated by adding the consideration to the value of agricultural land that the acquirer already holds

8

Type of Land

Commercial land that is not vacant [3], or an aged care facility, retirement village or student accommodation, where in each case the interest acquired gives a right to occupy the land, and the land:

(a) will be leased to an Australian government entity (other than most corporate Commonwealth entities, including Australian Broadcasting Corporation, Australian Postal Corporation and Civil Aviation Safety Authority) or houses public infrastructure;

(b) is used for an identified sensitive purpose (eg conducting a sensitive business, regulated production and storage, airports, banking); or

(c) houses certain telecommunications infrastructure or data facilities; or

(d) a mining operation will operate on the land

Type of Transaction

All, except:

  • acquisitions by FTA Country investors which are covered in item 11 (excluding FTA Country investors from Peru or Hong Kong as they are subject to the $61 million threshold); and
  • acquisitions by foreign government investors which are covered in item 3

Threshold

$61 million calculated by reference to the value of the interest in the land

9

Type of Land

Interests in an Australian land corporation or trust where less than 10% of the value of its total assets comprise:

(a) residential land [2];

(b) vacant commercial land [3]; and

(c) mining or production tenements

Type of Transaction

All, except:

  • acquisitions of less than 10% (for listed entities) or 5% (for unlisted entities that do not invest in established dwellings) where there is no influence over management or policy;
  • acquisitions by certain FTA Country investors (US, NZ, Chile) which are covered in item 11; and
  • acquisitions to which item 7 or item 12 applies

Threshold

If Australian land corporation or trust has land of the type listed in item 8: $61 million calculated by reference to the value of the interest to be acquired in the Australian land corporation or trust

Otherwise: $281 million calculated by reference to the value of the interest to be acquired in the Australian land corporation or trust

10

Type of Land

Mining or production tenement

Type of Transaction

Acquisitions by certain FTA Country Investors (US, NZ, Chile), except foreign government investors who are covered in item 3

Threshold

$1,216 million calculated by reference to the value of the interest in the land

11

Type of Land

Land described in item 7, 8 or 9 Other land (not listed above)

Type of Transaction

In respect of item 7: acquisitions by certain FTA Country investors (US, NZ, Chile)

In respect of items 8 and 9 and other land (not listed above): acquisitions by FTA Country investors, except foreign government investors who are covered in item 3

Threshold

$1,216 million calculated by reference to the value of the interest in the land (or, where interest in an Australian land corporation or trust is to be acquired, by reference to the value of that interest)

12

Type of Land

Land used wholly and exclusively for a primary production business (excluding interests in any Australian land corporation or trust which has interests in such land)

Type of Transaction

An acquisition by an enterprise or national of Thailand and used wholly and exclusively for a primary production business

Threshold

$50 million calculated by reference to the value of the interest in the land

13

Type of Land

All other land (not listed above)

Type of Transaction

All other circumstances not listed above

Threshold

$281 million calculated by reference to the value of the interest in the land

Note that special rules apply in determining the type of land on which a wind or solar power station is, or is proposed to be, located.

4.3 Exemption certificates for land

The FATA provides for the grant of exemption certificates covering one or more interests in Australian land (including national security land), where the Treasurer is satisfied that the acquisition would not be contrary to the national interest. The comments in paragraph 3.6 regarding exemption certificates for businesses and entities also apply here.


2 Excludes aged care facilities, retirement villages and student accommodation.

3 Land is 'vacant' if there is no permanent substantive building on the land that can be lawfully occupied by persons, goods or livestock, but land is not considered vacant if a wind or solar power station is located on the land's surface.

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