FIRB application fees set to double from 29 July 2022
On 21 July 2022, the Foreign Acquisitions and Takeovers Fees Imposition Amendment (Fee Doubling) Regulations 2022 (Cth) were issued by the Federal Government for the purpose of doubling the Foreign Investment Review Board (FIRB) application fees for applications lodged on or after 29 July 2022. The Federal Government estimates that the price increase will generate an additional $455 million in Budget revenue.
As a result of the increase, the maximum cap for application fees has doubled from $522,500 to $1,045,000 for all acquisitions requiring FIRB approval.
The main laws that regulate foreign investment in Australia are the Foreign Acquisitions and Takeovers Act 1975 (Cth) and the Foreign Acquisitions and Takeovers Regulation 2015 (Cth). These laws and regulations provide the federal Treasurer with the authority to review, block or impose conditions on particular foreign investment transactions in Australia. FIRB assists the Treasurer by examining foreign investment proposals and advising the Treasurer on the national interest implications of foreign investments.
If certain thresholds are met, foreign investors are required to submit applications to FIRB for approval prior to undertaking a foreign investment transaction in Australia (for example, prior to acquiring certain interests in an Australian entity, business, commercial land, residential land, agricultural land or a mining tenement). Fees payable to FIRB on those applications will increase from 29 July 2022.
The new fees were implemented following the Federal Government’s pre-election commitment to increase foreign investment fees and penalties, although increases to penalties have not yet been announced.
SUMMARY OF THE FEE CHANGES
The below table outlines a summary of certain fees payable pre and post 29 July 2022 for a single action.
The fees will be subject to indexing each financial year based on the average of the Consumer Price Index. It is important to ensure the correct fees are paid to avoid potential issues in lodging and progressing applications.
For further information regarding the above, please get in touch with an author or any member of our Corporate & Commercial team(s).
This information and the contents of this publication, current as at the date of publication, is general in nature to offer assistance to Cornwalls’ clients, prospective clients and stakeholders and is for reference purposes only. It does not constitute legal or financial advice. If you are concerned about any topic covered, we recommend that you seek your own specific legal and financial advice before taking any action.