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  • Foreign Investment Stakeholder Group key messages 16 July 2020

    Foreign investment policy reform update

    James McLean Dreyfus, Foreign Investment Division, Treasury

    The exposure draft of the FATA amendment bill is on track to be released in July 2020. The exposure draft will also include proposed regulation covering the definition of 'national security businesses'. The rest of the regulation bill is anticipated for release in August 2020.

    Treasury will roll out a series of consultation sessions made up of broadly two streams:

    • national security and investor exemption measures
    • compliance, integrity and fees. Treasury will provide further information on these sessions and how stakeholders can participate in due course.

    Temporary changes to the foreign investment framework update

    James McLean Dreyfus, Foreign Investment Division, Treasury

    With the introduction of the new reforms, the intent remains that the temporary $0 screening be removed to allow a seamless transition to the new framework once legislated. This is anticipated to be 1 January 2021, subject to passage of the amendments and any adverse developments with the coronavirus.

    Treasury continues to increase resourcing to manage the increased caseload resulting from the temporary $0 screening.

    The new streamlined exemption certificates initiative is up and running to help reduce regulatory burden on investors. See Temporary measures in response to the coronavirus [GN53] for more detail. Thank you to those who have contributed in shaping the outcome of this initiative.

    Register of Foreign Ownership of Land and Water Reports update

    Jennifer Farley, Internationals Foreign Investment Program, ATO

    Two key reports about the foreign ownership of agricultural land and water entitlements were published on the FIRB websiteExternal Link on 19 June 2020.

    The release of these reports continues the government’s commitment to increasing scrutiny and transparency of foreign ownership in the agriculture sector and foreign holdings of Australia’s water assets. The two reports are:

    Following the release of the reports, the ATO emailed all active registrants on the Registers of Foreign ownership of Water and Agricultural Land as at 30 June 2019 to remind foreign persons that part of their obligations includes updating their Registration if they are no longer a foreign person or their ownership of their property has changed.

    Consultation with the Department of Agriculture, Water and the Environment and the Treasury is underway for both reports for registrations as at 30 June 2020.

    Work is continuing to be progressed in relation to the first publication of insights into the level of foreign ownership of residential real estate during the 2018–19 year.

    FIRB website updates and portal changes

    Zoe Zeller, Foreign Investment Division, Treasury

    New and revised foreign Investment Review Board Guidance notes have been published on

    • Agricultural land investments [GN17]
    • Fees - residential land [GN29]
    • Fees - business and non-residential land [GN30]
    • Compliance - reporting requirements for compliance and other purposes [GN51]
    • Compliance - independent audit conditions [GN52]
    • Temporary measures in response to the coronavirus [GN53]

    FIRB website outage:

    System updates are progressively being made to the FIRB application portal. Short outages to the FIRB application portal will occur over the coming months during deployment.

    ATO Approach to Foreign Investment Compliance in the year ahead

    Jennifer Farley, Internationals Foreign Investment Program, ATO

    ATO Approach to Foreign Investment Compliance

    The ATO adopts a risk-based approach to residential compliance work. The approach is governed by a compliance strategy which was developed in response to an ANAO recommendation in its 2018 Report on Compliance with Foreign Investment Obligations for Residential Real Estate and informed by our experience in administering residential real estate provisions.

    The aim is to achieve a balance between providing assurance that investors are complying with their obligations and detecting and remedying non-compliance, while encouraging and supporting foreign investors to do the right thing.

    The ATO uses a range of compliance products tailored to the foreign investor’s characteristics, ranging from education products, prevention campaigns, infringement notices and disposal to meet this aim.

    This approach to compliance is also underpinning a shift to focus on more sophisticated investors and developing our commercial compliance capability.

    Stakeholder engagement questionnaire

    Zoe Zeller, Foreign Investment Division, Treasury

    The Regulator Performance framework requires Commonwealth regulators to undertake an annual self-assessment of their performance annually using six key outcomes-based performance indicators (KPIs). This framework was established to encourage regulators to undertake their functions with the minimum impact necessary to achieve regulatory objectives and to effect positive ongoing and lasting cultural change within regulators.

    As part of the process a stakeholder engagement questionnaire will be sent to a range of stakeholders including the foreign investment stakeholder group by Treasury in July 2020 to help assess performance against the six KPI’s for the 2019–20 year.

    Results will be published in the Foreign Investment Review Board (FIRB) 2019–20 Regulatory Performance framework report and published on the FIRB website in due course

    Feedback gathered from the questionnaire will also be used to inform process improvement.

      Last modified: 11 Aug 2020QC 63392