House of Representatives

Explanatory Memorandum

(Circulated by authority of the Treasurer, the Hon Josh Frydenberg MP)

Chapter 2 - Improving the integrity of the framework and technical amendments

Outline of chapter

2.1 Schedule 1 to the Bill amends Australia's foreign investment review framework to: improve the integrity of the framework, enable greater information sharing aimed at enhancing compliance and addressing national security risks, and make minor and technical amendments to address drafting errors and ensure the legislative framework supports the screening framework as intended.

2.2 The amendments:

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provide that some actions may be significant actions without requiring the change in control test to be met where the foreign person already controls the relevant entity or business;

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provide that increases in actual or proportional holdings of securities, including through company share buybacks or unit trust redemptions, may be notifiable actions or significant actions, or both;

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amend the definition of Australian business to include State and Territory business functions;

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expand the tracing rules to unincorporated limited partnerships;

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give the Treasurer the power to extend or further extend the decision period by up to 90 days;

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ensure the Treasurer can make an order prohibiting a proposal where an earlier purported order is found to be invalid and the decision period has expired; and

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allow for greater information sharing domestically with relevant government agencies and internationally with foreign counterparts.

2.3 Finally, Schedule 1 to the Bill makes a number of minor amendments which clarify the meaning of 'notifiable actions'; the application of fee waivers; and when an agreement is entered into for the purposes of the FATA.

Context of amendments

Improving the integrity of the foreign investment review framework

2.4 The foreign investment review framework must remain fit for purpose in these changing times. It also needs to meet community expectations regarding the acquisitions that fall within the framework. To maximise compliance, it is important that foreign investors understand their obligations under the framework. The amendments outlined below have been guided by these objectives, so that the FATA can appropriately manage the benefits and risks of foreign investment in Australia.

Information sharing

2.5 Information obtained under the FATA or for the purposes of the FATA is protected information. The FATA limits the further use or disclosure of protected information.

2.6 Protected information obtained under the FATA may be disclosed to relevant government officials and employees for the purposes of the Treasurer making a decision under the FATA. The disclosed information remains protected information in the hands of the recipient.

2.7 If a government agency seeks to use such protected information in administering its legislation, a disclosure of the information can be made to a Minister or accountable authority of the Commonwealth, for the purposes of the administration of Acts prescribed by the FATA. Information disclosed in this way is no longer protected information in the hands of the recipient.

2.8 Disclosure of protected information to foreign overseas government counterparts for the purposes of protecting national security (both for the benefit of Australia and for the benefit of overseas government counterparts) is not permitted.

Other technical amendments

2.9 Since the 2015 reforms to the FATA, amendments have been identified which would improve the readability of the existing provisions, rectify inconsistencies and unintended consequences and address feedback from investors seeking greater certainty.

Summary of new law

2.10 Schedule 1 to the Bill amends the circumstances where an investor satisfies the change in control test; deems a foreign person to have acquired an interest in securities in an entity where the person's proportional holdings have increased without the person taking any action; redefines an Australian business so that it also includes certain government activities and functions that are not carried out for profit; and extends the tracing rules to allow interests to be traced through unincorporated limited partnerships.

2.11 Schedule 1 to the Bill also amends Division 3 of Part 7 of the FATA to allow for information sharing with foreign governments, to expand the purposes for which information can be shared within the Commonwealth, and to allow for the ATO to disclose protected information to specific persons appointed by the Commonwealth for the purposes of the FATA.

2.12 The Bill also makes a number of technical amendments.

Comparison of key features of new law and current law

Integrity of the foreign investment review framework

2.13 The following table provides a comparison of the key features of the new law and the current law.

Greater information sharing

2.14 The following table provides a comparison of the key features of the new law and the current law.

Minor and technical amendments

2.15 The following table provides a comparison of the key features of the new law and the current law.

Detailed explanation of new law

Improving the integrity of the foreign investment review framework

Change in control test not relevant in certain situations

2.16 Currently, increases in interests in an Australian business or entity are only significant actions if the acquisition results in a change of control as defined in the FATA. This means that private investors may be able to increase their holdings in a target Australian business or entity over time without enlivening the Treasurer's powers under the FATA.

2.17 The amendments provide that once a foreign person controls an entity or business, the change of control test does not need to be met for an action to be a significant action. This is limited only to acquisitions of interests in securities of an entity, issuing of securities in an entity, and acquisitions of interests in assets of an Australian business. [Schedule 1, items 58 and 59, subsections 40(7) and 41(6) of the FATA]

Example 2.1

Company A, a foreign person under the FATA, currently holds 60 per cent of the securities in Company B, an Australian entity that carries on an Australian business. Under the FATA Company A has control of Company B. The remaining 40 per cent interest is held by Company C, also a foreign person. Company A is proposing to acquire an additional 10 per cent interest in Company B from Company C.

The acquisition by Company A of an additional 10 per cent interest in Company B is a significant action. The change of control test does not need to be met as Company A already controls the entity.

2.18 Schedule 1 to the Bill provides that substantial interests are relevant for the meaning of control. The FATA no longer provides for a person to control an entity or business if the person is one of two or more persons holding an aggregate substantial interest in the entity. The definition of 'aggregate substantial interest' remains relevant for determining whether an entity is a 'foreign person' (see definition of 'foreign person' in section 4). A person may hold a substantial interest in an entity alone or together with one or more associates (see section 17 of the FATA). [Schedule 1, item 71, paragraph 54(4)(b) of the FATA]

2.19 A consequential amendment is made as a result of the change of control test not needing to be met for an action to be a significant action. [Schedule 1, item 61, section 46 of the FATA]

2.20 The amendments to the change in control test apply in relation to actions taken, or proposed to be taken, on or after 1 January 2021. [Schedule 1, item 241]

Passive increases in securities holdings are actions under the FATA

2.21 The amendments deem a person to have taken an action to acquire an interest in securities in an entity if two conditions are met. The first condition is that the person holds an interest of a particular percentage in the entity. The second condition is that the percentage interest increases without the person acquiring interests in securities in the entity. [Schedule 1, item 38, subsection 18A(1) of the FATA]

Example 2.2

Sam is a foreign person who holds 500 Australia Bank shares, which represents a 9 per cent interest. Australia Bank runs a share buyback and Sam does not participate. After the buyback is finalised, Sam's 500 shares now represent a 12 per cent interest. Sam is deemed to have acquired an interests in securities in an entity.

2.22 A person is deemed to propose to take an action to acquire an interest in securities in an entity, if there are reasonable grounds to believe the person's percentage interest may increase without them acquiring interests in securities in the entity. [Schedule 1, item 38, subsections 18A(2) and 18(3) of the FATA]

2.23 Whether or not this deemed action will be a significant action or notifiable action or both, will depend on whether the other conditions which determine whether an action meets these definitions is met. Similarly, the deemed action may be a notifiable national security action if the deemed acquisition relates to a national security business or a reviewable national security action depending on the result of the action vis a vis a foreign person. [Schedule 1, item 38, note after subsection 18A(1) of the FATA]

2.24 Existing provisions are applied to the action with modifications. [Schedule 1, item 38, subsection 18A(4) of the FATA]

2.25 The meaning of 'to acquire an interest of a specified percentage in an entity is modified' for the purpose of passive increases to provide that for the purposes of subsection 20(1) of the FATA the person holds the interest in the entity immediately after the action is taken. [Schedule 1, item 38, table item 1 in the table in subsection 18A(4) of the FATA]

Example 2.3

Nick is a foreign person who holds 18 per cent of Company X. Company X is an Australian corporation carrying on an Australian business. Company X undertakes a share buyback and Nick does not participate. After the buyback is finalised, Nick holds 21 per cent of Company X. Nick has taken an action of acquiring interests in securities in an entity.

2.26 Existing section 81 requires all foreign persons to notify and wait for the Treasurer's approval before taking a notifiable action. However, it may be difficult for a person to predict their percentage shareholding might be where the person is not taking an action.

2.27 The amendments allow a person who takes a notifiable action by way of a passive increase, to notify up to 30 days after the action is taken. For example, in the event of an off-market buyback, a person must notify within 30 days of the buyback. In the event of an on-market buyback, the 30 day period would commence from the final buyback (for example, as indicated on the Australian Securities Exchange lodgement of a final share buy-back notice). [Schedule 1, items 5 and 138, section 3 and subsection 81(1A) of the FATA]

2.28 The requirement to notify the Treasurer before a notifiable action is taken and the corresponding offence and civil penalty does not apply for passive increases. Instead, the person commits an offence and is liable to a civil penalty if they fail to notify within the 30 days after the action is taken. [Schedule 1, items 137, 146, 149, 164 and 167, subsections 81(1), paragraph 84(b), subsection 84(2), section 91 and subsections 91(2) to 91(4) of the FATA]

2.29 A person who takes an action by way of a passive increase, is not subject to the limitation on taking the action after notice is given, nor does the person commit an offence or is liable for a civil penalty if the action is taken before the end of the decision period. [Schedule 1, items 142, 153 and 170, subsections 82(3), 85(c) and section 92 of the FATA]

2.30 The FATA is also modified to provide that a foreign person is only taking a notifiable action if the person did not hold a direct interest or substantial interest immediately before the passive increase. Similarly, the FATA is modified for the purpose of determining whether a passive increase is a notifiable national security action. A passive increase is only a notifiable national security action if the person did not hold a direct interest in the entity that carries on a national security business immediately before the increase. [Schedule 1, item 38, table items 2 and 4 in the table in subsection 18A(4) of the FATA]

Example 2.4

Caitlin is a foreign person who holds 25 per cent of Company Y. Company Y is an Australian corporation carrying on an Australian business with total shares value of $600 million. Company Y undertakes a share buyback and Caitlin does not participate. After the buyback is finalised, Caitlin holds 26.5 per cent of Company Y.

Caitlin has not taken a notifiable action because she held a substantial interest in Company Y prior to the buyback. However, Caitlin may be taking a significant action.

2.31 The FATA is also modified for the purposes of the threshold test. For a deemed acquisition of a direct interest in an Australian entity that is an agribusiness the threshold test becomes the total value, after the action is taken, of all interests held by the person. [Schedule 1, item 38, table item 3 in the table in subsection 18A(4) of the FATA]

2.32 There are some limitations on the Treasurer's powers for deemed acquisitions. The Treasurer will not have the ability to prohibit the action. The Treasurer will have the power to direct the person to dispose of their interests in order to restore the percentage of interests as nearly as possible to what the person held immediately before the increase. [Schedule 1, item 38, table items 5 and 6 in the table in subsection 18A(4) and subsection 18A(5) of the FATA]

2.33 The decision period still applies to passive increases. The FATA is modified to provide that the decision period for a passive increase starts when the Treasurer receives a notice, even if that notice is received in the 30 days after the action. [Schedule 1, item 38, table item 7 in the table in subsection 18A(4) of the FATA]

2.34 The last resort is extended to these deemed actions but only to restore the percentage of interests that the person holds to what it was immediately before it increased. [Schedule 1, item 38, table items 8 and 9 in the table in subsection 18A(4) of the FATA]

2.35 For the purposes of determining whether a tier 2 or tier 3 infringement notice applies where there is a breach of the FATA about a passive increase the threshold is calculated on the total value, after the action is taken, of all interests held by the person. [Schedule 1, item 38, table item 10 in the table in subsection 18A(4) of the FATA]

2.36 Certain provisions of the FATA are not applied for the purpose of passive increases. This includes interim orders and no-objection notifications imposing conditions, because they are not suitable to these types of deemed actions. Also omitted are offences for taking an action while waiting for a decision by the Treasurer. [Schedule 1, item 38, table item 11 in the table in subsection 18A(4) of the FATA]

2.37 Schedule 1 to the Bill allows the FATR to modify the FATA in certain circumstances. The amendments about passive increases effectively add a new action type to the FATA. The intent of the regulation making power is to enable a more straight forward approach to address any unintended consequences from the new type of action. In particular, the amendments should not inappropriately impede the operation of foreign investors or markets. The regulation making power is limited and narrow. [Schedule 1, item 38, subsection 18A(6) of the FATA]

2.38 It only applies to passive increases that have been deemed to occur under the FATA. It is envisaged the regulation making power would be used to ensure the new passive increases action appropriately applied to acquisitions through a land entity.

2.39 Separately, Schedule 1 to the Bill provides that an entity does not acquire an interest in itself if it buys back a security. [Schedule 1, item 29, subsection 9(6) of the FATA]

2.40 Consequential amendments are made to clarify that for an action to be a significant action, the action must in most cases be taken by a foreign person. This clarifies that a passive increase may be a significant action. [Schedule 1, items 1 and 57, sections 3 and 39 of the FATA]

2.41 Consequential amendments are made as a result of the modifications to the offences and civil penalty provisions for passive increases. These include inserting new subheadings and subsection numbers, and correcting references. [Schedule 1, items 144, 145, 148, 161, 162 and 165, sections 84 and 91 of the FATA]

2.42 The amendments that deem passive increases in securities holdings to be actions under the FATA apply in relation to a percentage interest in an entity that increases on or after 1 January 2021. The amendments that deem passive increases in securities holdings to be proposed actions under the FATA apply in relation to a percentage interest in an entity that may increase on or after 1 January 2021. [Schedule 1, item 239]

Extending the tracing rules to apply to unincorporated limited partnerships

2.43 Currently, section 19 of the FATA provides for substantial interests in a corporation or trust to be traced back through the ownership of relevant entities. This process can be applied multiple times so that a person's interest can be traced through many entities.

2.44 The current tracing rules cannot be applied to unincorporated limited partnerships. This means that where there is an ownership structure with an unincorporated limited partnership, the interest cannot be traced through that unincorporated limited partnership to the higher entities that the Treasurer may be seeking to impose conditions on.

2.45 Schedule 1 to the Bill amends the tracing rules so that the tracing rules can be applied to unincorporated limited partnerships in the same manner as they apply to corporations and trusts. The amendments allow interests to be traced back through the ownership structure. This means that limited partners, alone or together with one or more associates, can be deemed to hold a substantial interest in an Australian entity. [Schedule 1, items 39 and 40, section 19 (heading), subsections 19(1) and 19(2) of the FATA]

2.46 The amendments achieve this by providing for the measurement of a partner's interest in an unincorporated limited partnership. The interest is determined using one of the following metrics: the partner's voting power or the partner's proportion of the distribution of property. This means that a limited partner can be deemed to hold an interest in the unincorporated limited partnership. [Schedule 1, items 31, 35, 36 and 37, section 11A, section 17 (heading), subsections 17(2A) and 17(3) of the FATA]

2.47 These amendments enable the Treasurer to impose conditions on higher entities in the ownership structure as required, to ensure that an acquisition is not contrary to the national interest.

Example 2.5 : Tracing through unincorporated limited partnerships

Company A and Company B are foreign persons (who are not foreign government investors) and limited partners that each hold an interest in the Limited Partnership, an unincorporated limited partnership.

BikCo would be required to notify the Treasurer of its proposed acquisition of the Australian Target if the action is a notifiable action. Assuming that the action was acquiring a substantial interest in the Australian Target, by virtue of the acquisition being carried out and the tracing rules, Company A and Company B would also be taken to be acquiring a substantial interest in the Australian Target. The Treasurer may impose conditions on Company A, Company B, the General Partner on behalf of the Limited Partnership and BikCo in any no objections notification. This is set out in Diagram 2.1.

Example 2.6 : Tracing through multiple unincorporated limited partnerships

Limited Partner 1, Limited Partner 2 and Limited Partner 3 are foreign persons (who are not foreign government investors) that are limited partners of an unincorporated limited partnership. Limited Partner 2 and Limited Partner 3 each hold a substantial interest in the unincorporated limited partnership of 65% and 20% respectively.

BikCo would be required to notify the Treasurer of its proposed acquisition of the Australian Target if the action is a notifiable action. Assuming that the action was acquiring a substantial interest in the Australian Target, by virtue of the acquisition being carried out and the tracing rules, Limited Partner 2 and Limited Partner 3 would also be taken to have a substantial interest in the Australian Target. The Treasurer may impose conditions on Limited Partner 2, Limited Partner 3, the General Partner B of Limited Partnership B, Company A, the General Partner of Limited Partnership A and BikCo. This is set out in diagram 2.2.

2.48 The amendments enable tracing through unincorporated limited partnerships where the general partner of an unincorporated limited partnership is another unincorporated limited partnership. Where the general partner of an unincorporated limited partnership is another unincorporated limited partnership, the general partner is an intermediate partnership. This allows tracing through an unincorporated limited partnership (that is a general partner) to a higher party in the ownership structure. This process can be applied multiple times.

2.49 For ownership structures with multiple unincorporated limited partnerships, reapplying the rules means there may be multiple intermediate partnerships that are looked at to determine whether a general partner (the intermediate partner) of any of those intermediate partnerships controls the voting power or holds interests in the lower party. The tracing rules allow tracing through the intermediate partnerships and the person will be taken to control the voting power or hold the interest in the lower party that the intermediate partner controls or holds. The Treasurer may exercise powers against this person. [Schedule 1, item 40, subsections 19(2A) and 19(2B) of the FATA]

Example 2.7 : Tracing through multiple unincorporated limited partnerships where the general partner is another unincorporated limited partnership

Limited Partner 1, Limited Partner 2 and Limited Partner 3 are foreign persons (who are not foreign government investors) that are limited partners of an unincorporated limited partnership. Limited Partner 2 and Limited Partner 3 each hold a substantial interest in the unincorporated limited partnership of 65% and 20% respectively.

BikCo is proposing to acquire the Australian Target. BikCo would be required to notify the Treasurer of its proposed acquisition of the Australian Target if the action is a notifiable action. General Partner A of Limited Partnership A is an unincorporated partnership (an intermediate partnership). The general partner of the intermediate partnership is General Partner I. General Partner I holds the shares in BikCo as general partner of the intermediate partnership as general partner of Limited Partnership A.

Assuming that the action was acquiring a substantial interest in the Australian Target, by virtue of the acquisition being carried out and the tracing rules, Limited Partner 2 and Limited Partner 3 would also be taken to have a substantial interest in the Australian Target. The Treasurer may impose conditions on Limited Partner 2, Limited Partner 3, the General Partner B of Limited Partnership B, Company A, General Partner I as general partnership of the intermediate partnership as general partner of Limited Partnership A and BikCo. This is set out in diagram 2.3.

2.50 Schedule 1 to the Bill provides that only substantial interests are traced. The FATA no longer provides for the tracing of aggregate substantial interests. The definition of 'aggregate substantial interest' remains relevant for determining whether an entity is a 'foreign person' (see definition of 'foreign person' in section 4). A person may hold a substantial interest in an entity alone or together with one or more associates (see section 17 of the FATA). [Schedule 1, item 40, subsection 19(1) of the FATA]

2.51 Consequential amendments extend the voting power rules, the definitions of 'constituent document', 'general meeting', 'interest', 'substantial interest', and 'associate', and the application of the FATA provision to unincorporated limited partnerships. Definitions of 'general partner', 'limited partner' and 'limited partnership' are inserted into the FATA. [Schedule 1, items 10, 13, 14, 15, 17, 18, 21, 22, 23, 28, 30 and 42 to 53 , section 4, subsection 6(3), note 2 after subsection 9(1), note 2 after sections 10 and 11, note after subsection 21(1), sections 22 and 23, and 29 of the FATA]

2.52 A consequential amendment is made to the simplified outline of Division 4 so that it no longer references the holding of an aggregate substantial interest. [Schedule 1, item 65, section 50 of the FATA]

2.53 The amendments to the tracing rules apply in relation to actions taken, or proposed to be taken on or after 1 January 2021. [Schedule 1, item 240]

Oversight of government asset sales of national security businesses and national security land

2.54 Existing subsection 8(1) of the FATA provides that an Australian business is a business that is carried on in anticipation of profit or gain. Schedule 1 to the Bill modifies the requirement for anticipation of profit or gain requirement as it applies to activities carried on by government. The definition of business or Australian business includes activities carried on by government.

2.55 Schedule 1 to the Bill amends section 4 of the FATA to provide that the definition of business includes an activity carried on by the Commonwealth, a State, a Territory, or a local governing body, or by an entity wholly owned by the Commonwealth, a State, a Territory or local governing body. [Schedule 1, item 8, section 4 of the FATA]

2.56 Schedule 1 to the Bill amends section 8 of the FATA to provide that the definition of Australian business includes a business, whether or not it is carried on in anticipation of profit or gain, that is carried on by the Commonwealth, a State, a Territory, or a local governing body, or by an entity wholly owned by the Commonwealth, a State, a Territory or local governing body. [Schedule 1, item 26, subsection 8(3) of the FATA]

2.57 The amendments also provide that an activity carried on by a government can be both a business and an Australian business, if the activity would, or could, be carried on in anticipation of profit or gain by someone other than an Australian government, or a foreign government, or a separate government entity. [Schedule 1, item 26, paragraph 8(3)(b) of the FATA]

2.58 These amendments, in conjunction with proposed amendments to the FATR, will mean that the privatisation of certain government functions will not be exempt from being significant and notifiable actions.

2.59 Subsection 31(1) of the FATR excludes Australian business carried on by, or land acquired from, government bodies from the FATA. This exemption is moderated by subsection 31(2) of the FATR, which has the effect of reapplying the FATA to certain acquisitions.

2.60 The operation of subsections 31(1) and (2) of the FATR is not affected by the amendments to section 8 of the FATA. The amendments to section 8 expand the definition of 'Australian business', which will affect only the scope of the actions that subsections 31(1) and (2) of the FATR apply to.

2.61 Proposed amendments to the FATR will expand the scope of subsection 31(2) to reapply the FATA to certain acquisitions that would otherwise be covered by subsection 31(1). It is proposed that the amendments to the FATR would provide that, where a foreign person acquires from Government an interest in a national security business, national security land, or an Australian business the assets of which include an exploration tenement that is on national security land, the acquisition will not be exempt from the operation of the FATA.

2.62 The proposed amendments to the FATR would ensure that assets relevant to national security do not avoid scrutiny, including where the acquisition is from the Commonwealth, a State, a Territory or local governing body. These amendments will be made after Schedule 1 to this Bill has received Royal Assent.

2.63 The amendment to the definition of Australian business to include businesses carried on by the Commonwealth, States, Territories or local governing bodies applies in relation to actions taken, or proposed to be taken, on or after 1 January 2021. [Schedule 1, item 238]

Treasurer's power to extend the statutory decision period

2.64 Schedule 1 to the Bill amends the FATA to allow the Treasurer to extend or further extend the decision period under section 77 of the FATA by up to 90 days. The total period by which the Treasurer can extend the decision period is 90 days. However, multiple extensions may be made to reach the maximum 90 days. [Schedule 1, item 129, subsections 77A(1) and 77A(2) of the FATA]

2.65 The Treasurer must provide a reason to the applicant for the extension [Schedule 1, item 129, subsection 77A(3) of the FATA]

2.66 The amendments are intended to provide more efficient processing of sensitive or significant applications than the current methods of extension, such as issuing an interim order. Interim orders are costly, involve a lengthy process, and make a proposed acquisition public (because interim orders must be published on the government gazette).

2.67 The amendments enable the Treasurer to extend the decision period more efficiently where more time is required to consider the national interest including national security. This is not uncommon in cases of sensitive or significant applications, where a longer decision period is necessary to consult with Commonwealth, State or Territory bodies, consider their expert input or develop bespoke conditions.

2.68 The natural justice hearing rule will not apply to decisions by the Treasurer to use this power. On balance this is appropriate, as it allows the Treasurer to balance the needs of the applicant with the potential harm to the national interest of rushing consideration of the application. The detriment to the applicant is relatively minor; any foreseeable delay can be managed by the submission of an early application. Further, affording natural justice by way of seeking the applicant's comments would be akin to the existing mechanism under paragraph 77(5)(b) of the FATA and may create further delays. [Schedule 1, item 129, subsection 77A(4) of the FATA]

2.69 While the Treasurer is not required to consult with a person before extending the decision period, the person will still be afforded natural justice at other times in the decision making process, such as if the Treasurer will apply conditions to the no objection notification.

2.70 The amendment applies to events set out in the table in subsection 77(6) (as inserted by this Schedule) that occur on or after 1 January 2021. Section 77, as in force immediately before its repeal by this Schedule, continues to apply in relation to notices received by the Treasurer before 1 January 2021. [Schedule 1, item 244]

Time limits on making orders and decisions, and remaking invalid orders

2.71 Schedule 1 to the Bill also repeals and replaces existing section 77 to clarify the operation of decision periods, and to fix an unintended consequence relating to orders invalidated by a court. The amendments also ensure there are decision periods that start for the new national security actions inserted by Schedule 1 to this Bill. [Schedule 1, item 129, section 77 of the FATA]

2.72 The Treasurer must make an order or decision under Division 2 within the decision period. The decision period is usually 30 days after the day the Treasurer was notified that a significant action is proposed to be taken. The Treasurer is restricted from making orders or decisions after the decision period ends with limited exceptions. [Schedule 1, item 129, subsection 77(1) of the FATA]

2.73 The decision period can be extended by the making of an interim order. The interim order must be made and registered before the end of the decision period to be valid. [Schedule 1, item 129, subsection 77(2) of the FATA]

2.74 The decision period can also be extended if, before the end of that period, the person requests in writing that the Treasurer extend the period, or the Treasurer extends the decision period using the Treasurer's new power to extend the decision period by 90 days. [Schedule 1, item 129, paragraph 77(8)(b) and subsection 77(9) of the FATA]

2.75 If the action is taken before the end of the decision period, the Treasurer is no longer restricted by the time limits. [Schedule 1, item 129, subsection 77(3) of the FATA]

Example 2.8

Tomas is a foreign person who proposes to purchase a house on residential land in Hobart. This action is a notifiable action and a significant action under the FATA, and Tomas notifies the Treasurer. However Tomas purchases the house only 10 days after notifying, and without receiving the Treasurer's approval.

The Treasurer may issue a disposal order. As the action has been taken the Treasurer is no longer restricted by a 30 day decision period.

2.76 Once an initial order (other than an interim order) is made for an action, there is no time limit on any subsequent orders. The FATA expressly contemplates that there might be a subsequent exercise of power under Division 2 following the initial exercise of power within the section 77 time limit. For example, where a prohibition order is made, and then the action is taken in contravention of such a prohibition order, the Treasurer is able to make subsequent orders that are not restricted by the section 77 time limit. [Schedule 1, item 129, subsection 77(4) of the FATA]

Example 2.9

Anan is a foreign person who proposes to acquire agricultural land in Western NSW for a consideration of $18 million. This is a significant action and notifiable action and Anan notifies the Treasurer before making the acquisition. The Treasurer considers that the proposed acquisition, if taken, will be contrary to the national interest and the national interest risks identified could not be mitigated by imposing conditions on the acquisition.

Within 30 days of being notified of the proposed acquisition, the Treasurer issues a prohibition order directing Anan not to acquire the said agricultural land in Western NSW. Despite the prohibition order, Anan purchases the agricultural land. The Treasurer then decides to issue a disposal order to Anan regarding the agricultural land. The Treasurer is allowed to do this under subsection 77(4) of the FATA.

2.77 Subsections 77(5) and (6) work together to allow later decision periods for the same action (in certain circumstances). Subsection 77(5) allows the Treasurer to make an order or decision after the initial decision period has ended. Subsection 77(6) resets the decision period, meaning that the time limits and restrictions still apply to the Treasurer. The table at subsection 77(6) sets out when decision periods start for certain actions. It covers new actions created by the Bill. [Schedule 1, item 129, subsections 77(5) and 77(6) of the FATA]

2.78 Subsection 77(6) also fixes an unintended consequence of the current law. The Treasurer cannot make an order or decision after the decision period has ended, unless he has already made an order or decision. If an order is successfully challenged in a court, it may be found to be invalid and so be taken as never having been made. By the time of the court's decision it is almost certain that the original 30 day decision period would have expired, and the Treasurer would be prohibited from making any orders. Item 5 of subsection 77(6) fixes this by allowing a later decision period if such an event takes place. [Schedule 1, item 129, table item 5 in the table in subsection 77(6) of the FATA]

2.79 Subsection 77(7) is the same as the repealed subsection 77(4) of the current FATA. It provides that the decision period does not include any days affected by the giving of a section 133 notice. [Schedule 1, item 129, subsection 77(4) of the FATA]

2.80 Consequential amendments are made to other provisions of the FATA that refer to section 77 to correct references. [Schedule 1, items 12 and 213, sections 4 and note after subsection132(2) of the FATA]

2.81 The amendment applies to events set out in the table in subsection 77(6) (as inserted by this Schedule) that occur on or after 1 January 2021. The amendments apply to orders or decisions the Treasurer purported to make under Division 2 of Part 3 of the FATA that are set aside by a court, on or after 1 January 2021. Section 77, as in force immediately before its repeal by this Schedule, continues to apply in relation to notices received by the Treasurer before 1 January 2021. [Schedule 1, item 244]

Information sharing

Information sharing about decisions where the Commonwealth, State or Territory Minister or body provided information

2.82 Schedule 1 to the Bill provides that protected information under the FATA may be shared with a Minister, an officer or employee of the Commonwealth, State or Territory or an officer or employee of the Commonwealth, State or Territory body (the recipient), if the information is about a decision or order that the Treasurer has made under Part 3 of the FATA. The recipient or otherwise another officer or employee of the Commonwealth, State or Territory body must have provided information for the purposes of making the relevant decision. [Schedule 1, item 205, subsections 123A(a), 123A(b) and 123A(c) of the FATA]

2.83 The protected information may only be disclosed if the discloser reasonably believes the disclosure may assist the recipient with the performance of their duties or functions or exercise of their power. [Schedule 1, item 205, subsection 123A(d) of the FATA]

2.84 One example of protected information that may be disclosed that relates to a decision made under Part 3 of the FATA, is a no objection notification letter that was provided to the applicant. The information sharing to the recipient is necessary as the outcome of the Treasurer's decision may impact on the recipient's duties, functions or exercise of power. The sharing will inform the recipient of the no objection notification, including any conditions.

Example 2.10

Company H submitted a FIRB application to acquire agricultural land in NSW. Department of Mining was consulted on and provided relevant information to the Treasurer. On the basis of the information that was provided from Department of Mining the Treasurer issues a no objection notification with conditions under section 74. A Treasury officer considers the sharing of the no objection notification with conditions with the Department of Mining would reasonably assist the Department of Mining with the performance of its duties or functions or exercise of power. On this basis, Treasury may share the no objection notification with the Department of Mining.

Information sharing with foreign governments

2.85 Schedule 1 to the Bill provides that protected information under the FATA may be shared with foreign governments in limited circumstances where national security risks may exist, where it is not contrary to the national interest, subject to agreements in place between the Commonwealth and the foreign counterpart.

2.86 The amendments authorise the disclosure of protected information to foreign governments and separate government entities and provide that:

•

a person may disclose protected information in performing the person's functions or duties or exercising the person's powers under the FATA; and

•

the person is satisfied that the disclosure of information will assist the foreign government entity to perform a function or duty, or exercise a power of the government entity.

2.87 This ensures that information can only be shared with foreign governments and separate government entities, when it is relevant to the purposes of the FATA or if the information will assist the foreign government. [Schedule 1, item 205, paragraph 123B(1)(a) of the FATA]

2.88 Information sharing with foreign governments may only take place if three key tests are met. All three tests need to be satisfied before the information can be shared. These tests provide appropriate safeguards to ensure that information is only shared when necessary and appropriate. The three tests are:

•

information can only be shared if it relates to national security;

•

sharing the information must not be contrary to the national interest; and

•

an agreement regarding information sharing must be in place between the Commonwealth and the foreign government.

2.89 Information can only be disclosed if a person is satisfied that the information relates to national security and disclosing the information is not contrary to the national interest. The person must also be satisfied that the information will only be used in accordance with the agreement between the Commonwealth and the foreign government and that the information will not be further disclosed unless in accordance with that agreement. [Schedule 1, item 205, paragraphs 123B(1)(b) to (e) of the FATA]

2.90 The national security test facilitates the Treasurer's assessment of cases related to national security. The Treasurer needs to be able to share protected information if there are relevant national security considerations domestically or internationally. This is enabled by the amendments in Schedule 1 to the Bill. [Schedule 1, item 205, paragraph 123B(1)(b) of the FATA]

2.91 Information sharing with foreign governments or separate government entities is subject to the existing national interest test. [Schedule 1, item 205, paragraph 123B(1)(c) of the FATA]

2.92 Information sharing with foreign government entities is subject to separate individual agreements between the Commonwealth and the foreign government or separate government entity. These agreements will set out mutually agreed standards for the handling of personal information that provides privacy protection and, where relevant, limitations surrounding public disclosure of commercial in confidence information. The agreements will also specify that the information provided can only be used for the purpose for which it was provided - that is, to assist the foreign government to perform a function or duty, or exercise a power of the government or entity. This will provide certainty for regulators and investors and appropriately protect information, including possibly personal or commercial information. [Schedule 1, item 205, subsection 123B(2) of the FATA]

2.93 For example, an agreement could have specific arrangements for disclosure to the foreign entity; what the disclosed information can be used for; the categories of personal information that may be disclosed under the agreement; and that the foreign government or separate government entity must take reasonable steps to destroy or de-identify personal information where the overseas recipient no longer needs the information.

2.94 Notwithstanding that an agreement is in place, the Treasurer may impose in writing specific conditions on a foreign government or separate government entity for the handling of disclosed protected information. Any conditions imposed by the Treasurer are not a legislative instrument within the meaning of section 8 of the Legislation Act 2003. The Treasurer may impose specific conditions tailored to the circumstances of a particular disclosure of particular information if necessary. These conditions must not conflict with obligations under the Privacy Act 1988. [Schedule 1, item 205, subsections 123B(3) and (4) of the FATA]

2.95 Protected information is defined in section 120 of the FATA to mean information obtained under and in accordance with the FATA (with certain exceptions). Protected information can include personal information as defined under the Privacy Act 1988. The Australian Privacy Principles apply to the disclosures made under section 123B of the FATA. The amendments authorise cross-border disclosure of personal information that complies with Australian Privacy Principle 8.2(c), the disclosure is authorised under law. In addition, personal information disclosed under the amendments must have been obtained in accordance with the FATA, in the performance of the person's functions or duties or exercising of the person's powers under the FATA.

Information sharing within the Commonwealth

2.96 Existing section 122 provides that protected information could be disclosed under the FATA to a Minister or an accountable authority of the Commonwealth for the purposes of the administration of the prescribed list of Acts and for particular matters. Schedule 1 to the Bill replaces section 122 with a new provision which overlaps considerably with former section 122. The section describes who the information can be shared with, and ensures the list of prescribed Acts is in alphabetical order.

2.97 Schedule 1 to the Bill expands the prescribed list of Acts and adds three new matters for permitted sharing of protected information within the Commonwealth. Protected information may be disclosed to a person for the purposes of administering the prescribed list of laws or for the purposes of a Minister discharging the Minister's responsibilities for a particular matter. A person who may receive this information includes:

•

a Commonwealth Minister who has responsibility for administering that law or particular matter;

•

a person employed by the Minister under the Members of Parliament Act 1984, who is a member of staff of the Minister, or a consultant for the Minister; and

•

an officer or employee of a Department of State or an authority or agency of the Commonwealth administered by such a Minister. An officer may also include the Secretary of a Department and the Commissioner of Taxation. [Schedule 1, item 204, subsections 122(1) and (2) of the FATA]

2.98 The list of prescribed Acts in repealed section 122 is replicated. However three new Acts have been inserted in alphabetical order.

2.99 The Competition and Consumer Act 2010, the Foreign Relations (Effect of State and Territory Arrangements) Act 2020 and the Northern Australia Infrastructure Facility Act 2016 have been added to the list of prescribed laws, allowing for disclosures to the relevant person for the purposes of administrating that law. This provision has also been redrafted for clarity and the Acts listed alphabetically. [Schedule 1, item 204, subsection 122(3) of the FATA]

2.100 The inclusion of the Competition and Consumer Act 2010 ensures that information can be shared with the Minister responsible for the ACCC, a person employed by the Minister or an officer or employee of the ACCC for the purposes of administering the Competition and Consumer Act 2010. The national interest test considers competition to be one of the factors that should be considered when determining whether or not an acquisition is contrary to the national interest. Appropriate sharing of protected information will ensure the ACCC can properly administer the Competition and Consumer Act 2010 to determine whether certain transactions would have an impact on competition. [Schedule 1, item 204, paragraph 122(3)(h) of the FATA]

2.101 The inclusion of the Foreign Relations (Effect of State and Territory Arrangements) Act 2020 ensures that information can be shared with the Minister for Foreign Affairs and Trade, a person employed by the Minister or an officer or employee of the Department of Foreign Affairs and Trade for the purposes of administering the Foreign Relations (Effect of State and Territory Arrangements) Act 2020.

2.102 The Foreign Relations (Effect of State and Territory Arrangements) Act 2020 established a legislative scheme to enable the Commonwealth to oversee and regulate the negotiation of, and entry into, arrangements between State and Territory governments and foreign governments. Arrangements considered under the Foreign Relations (Effect of State and Territory Arrangements) Act 2020 could also be investments screened under the FATA. Appropriate sharing of protected information will ensure a consistent and whole-of-government approach on approving certain acquisitions where there is overlap. [Schedule 1, item 204, paragraph 122(3)(f) of the FATA]

2.103 The inclusion of the Northern Australia Infrastructure Facility Act 2016 ensures that information can be shared with the Minister for Resources, Water and Northern Australia or an officer or employee employed by the Department of Industry, Science, Energy and Resources for the purposes of administering the Northern Australia Infrastructure Facility Act 2016. The Northern Australia Infrastructure Facility Act 2016 offers financial assistance to encourage and assist private sector investment in the Northern Territory, and the responsible agency may need protected information to determine if financial assistance is appropriate. Applicants for assistance are assessed against particular criteria to determine their eligibility and these assessments would benefit from protected information obtained under the FATA. [Schedule 1, item 204, paragraph 122(3)(p) of the FATA]

2.104 Schedule 1 to the Bill provides that protected information can be shared for the purposes of discharging particular responsibilities of Commonwealth Ministers. Three new matters have been added to the list of prescribed responsibilities: infrastructure, telecommunications, and water. This ensures that protected information can be shared with the relevant Minister to assist that Minister to discharge his or her duties. This provision has also been redrafted for clarity. The list of matters in repealed section 122 is replicated and includes the following matters: agriculture; water; infrastructure; telecommunications; industry policy; investment promotion; taxation policy and foreign investment in Australia. [Schedule 1, item 204, subsection 122(5) of the FATA]

2.105 The provisions focus on relevant matters, rather than agencies or legislation, to ensure the operation of information sharing is not hampered when changes are made to portfolios or legislation.

2.106 Current paragraph 122(1)(w) allows regulations to prescribe other Acts for the administration of which information may be shared. Schedule 1 to the Bill changes the regulation making power to an instrument making power. This provides the Treasurer with the ability to prescribe any other Acts, by legislative instrument. This amendment allows for a more streamlined process and more flexibility, as it ensures information can be shared in a timely manner. [Schedule 1, item 204, subsection 122(4) of the FATA]

2.107 The Treasurer cannot delegate this power. [Schedule 1, item 219 and 220, subsection 137(1) and note at the end of subsection 137(1) of the FATA]

2.108 Where a disclosure under section 122 of the FATA includes personal information, Australian Privacy Principle 6.2(b) authorises the disclosure as it is an Australian law authorising the disclosure of personal information. However, other Australian Privacy Principles continue to apply, in particular, Australian Privacy Principle 11.1, which requires that an Australian Privacy Principle entity must take reasonable steps to protect personal information from misuse, interference or loss, and from unauthorised access, modification or disclosure.

Information sharing between the Commissioner of Taxation and the FIRB

2.109 Schedule 1 to the Bill amends the TAA to provide the Commissioner with the ability to disclose protected information to persons appointed by the Commonwealth for the purposes of the FATA.

2.110 Currently, only members of the FIRB are persons appointed for the purposes of the FATA. FIRB plays a key role in advising the Treasurer on matters about foreign investment. Enabling the Commissioner to disclose information directly to FIRB allows for a more efficient and streamlined process. The amendments to the TAA ensure that the Commissioner is able to disclose protected tax information to FIRB if it is for the purpose of advising the Treasurer about the administration of the FATA. [Schedule 1, item 226, table item 7A of subsection 355-65(4) in Schedule 1of the Tax Administration Act]

2.111 Schedule 1 to the Bill makes amendments to paragraph 120(2)(c) of the FATA to ensure that information that is provided to the FIRB members remains FATA protected information and is subject to Division 3 of Part 7, which governs how protected information under the FATA is treated. [Schedule 1, item 226, paragraph 120(2)(c) of the FATA]

2.112 The definition of Commonwealth entity has been repealed, as it is no longer used. [Schedule 1, item 226, definition of Commonwealth entity in section 4 of the FATA]

Amendments to section 124

2.113 Current section 124 of the FATA authorises disclosures of periodic aggregate information. A person may disclose protected information if it is specified in the FATR for the purposes of reporting on the administration of the FATA and if the information does not or could not identify a person.

2.114 Schedule 1 to the Bill repeals and replaces section 124 of the FATA and provides that protected information can be disclosed as long as it does not identify a person and is not reasonably capable of identifying a person. [Schedule 1, item 206, section 124 of the FATA]

2.115 The replacement of section 124 of the FATA ensures that the provision is not limited to disclosures made for the purposes of reporting on the FATA. Regulations will no longer need to be made to specify and allow for the sharing of protected information as long as the information does not or could not reasonably identify a person. Removing the regulation making power and not limiting information disclosure to the reporting on the administration of the FATA allows protected information to be disclosed as long as it does not or could not identify a person.

2.116 Protected information disclosed under section 124 could include a range of statistical or summarised information that relates to foreign investment in Australia, including information regarding the screening process, the administration of the regime and any trends in applications and decisions. Any disclosures would not contain personal information.

2.117 Examples of the types of quantitative protected information that may be shared in a given time period, that would not identify a person include:

•

the numbers of approvals with or without conditions;

•

the numbers of approvals or dollar value of investments in a particular sector, such as agriculture, mining or commercial real estate;

•

dollar value of certain exemption certificates;

•

the number of approvals or dollar value of investments from particular countries;

•

the number of withdrawals;

•

the number of variations received;

•

the number of exemption certificates received;

•

the number of orders made;

•

a specified value or total value; and

•

case processing time and trends.

2.118 Other examples of protected information that may be shared could include de-identified conditions that indicate what sector and type of investment. For example a redacted copy of a no objection notification with conditions. The sharing would be for the purposes of showing examples of the kinds of conditions that are imposed on particular sectors.

2.119 Examples of who the information could be shared to ranges from within government, and to the public if requested. For example, the information could be shared annually and publicly in the FIRB annual report. The FIRB annual report details proposed investment in particular sectors and details the source country of proposed investments. The information is usually in the form of statistics.

2.120 The information may also be shared, as requested, with federal, state and territory government officials. Information may also be shared, if requested, with Australian universities. Australian universities from time to time may seek specific data for research and academic purposes. Such sharing may consist of aggregate information, statistical information or summarised information when in the national interest.

2.121 For example, Treasury could share aggregate information on the value of exemption certificates given during a certain time period to another agency. The sharing would be for the purpose of sharing trends on exemption certificates and how their value may have changed over time. This could help inform the other agency of foreign investment trends.

Application of information sharing provisions

2.122 The amendments apply to the recording, disclosure, or use of information on or after 1 January 2021, regardless of whether the information was obtained before, on or after that day. [Schedule 1, item 249]

2.123 For the purposes of satisfying the requirement that information can be shared with foreign governments in accordance with an agreement, the agreement can be a pre-existing agreement. [Schedule 1, item 249]

Minor and technical amendments

Ensuring that interests acquired by entering agreements or acquiring options are treated in accordance with policy intent

2.124 For the purposes of the FATA, an interest is generally considered to have been acquired if an agreement to acquire an interest has been entered into, regardless of whether or not an interest has been legally acquired (i.e. whether or not completion of the transaction has occurred). This is intended to encourage foreign investors to seek approval before entering into a binding agreement.

2.125 The amendment repeals and replaces the note after subsection 15(5) to clarify that, where an agreement to acquire or sell an interest is conditional on obtaining a no objection notification, the agreement would become binding only (and therefore the action taken) when the Treasurer has given the no objection notification. [Schedule 1, item 33, note after subsection 15(5) of the FATA]

Example 2.11

Company K, a foreign corporation, begins negotiations with, an Australian corporation, to purchase a 25 per cent interest in that entity. This acquisition is a significant action and a notifiable action and requires approval. To avoid breaching the FATA, Company K should notify the Treasurer before entering into an agreement. Alternatively, Company K can avoid a potential breach by entering an agreement where the acquisition of the 25 per cent interest in the Australian corporation is conditional on foreign investment approval and seek the foreign investment approval prior to acquiring the interest in the Australian corporation. This means that until the Treasurer has made a decision, the action remains a proposed action. The Treasurer may choose to issue a prohibition order to prevent the acquisition, or approve the action. If the action is approved, the FIRB approval condition is satisfied and Company K has taken the action at that point in time, provided all other conditions in the agreement have already been satisfied.

2.126 Section 15 is also amended to recognise that Part 4 also includes notices for notifiable national security actions and notices that may be given for other actions that are inserted into the FATA as part of this Bill. [Schedule 1, item 32, paragraph 15(4)(a) of the FATA]

Court powers for contraventions of section 95 in accordance with policy intent

2.127 Currently under section 132 of the FATA, the Federal Court, the Federal Circuit Court and the Supreme Court of a State or Territory may make a broad range of orders if a person has committed an offence or contravened a civil penalty provision in Part 5. A court may make such an order regardless of whether the offender has been convicted of an offence or a civil penalty order has been made, and regardless of whether other proceedings relating to the contravention have been or are to be instituted.

2.128 The FATA also provides additional enforcement options to achieve its objectives. For example, where a civil penalty order is sought, the Treasurer may also seek an order restraining any dealings in property connected to the alleged breach so that the property is available to satisfy payment of a civil penalty order.

2.129 The amendments expand subsection 132(1) to enable a court to make orders as it thinks fit on the basis of a contravention of section 95, that is, for holding interests in established dwellings for the purpose of preserving the interest which gave rise to the contravention. This is consistent with the kinds of orders a court can currently make in respect of a contravention involving a failure to comply with section 81 or section 82 of the FATA. [Schedule 1, item 210, paragraph 132(1)(ab) of the FATA]

2.130 Orders for the purpose of 'preserving the interest' would include, for example, orders restraining a foreign person from dealing with the established dwelling in question. This may assist in ensuring that the dwelling to which the interest relates is available to satisfy a civil penalty order.

2.131 Further consequential amendments are made to reflect the inclusion of contraventions of section 95 as a trigger for court's power to make orders under section 132. The current section heading for section 132 is amended to reflect the availability of section 132 in respect of a breach of section 95, which would not necessarily involve any orders made by a court. This is also the case currently in respect of a contravention covered by paragraph 132(1)(a). [Schedule 1, items 208, section 132 (heading) of the FATA]

2.132 The table in subsection 132(3) which sets out the kinds of orders a court may make is amended to reflect the inclusion of section 95 contraventions, which are for 'the holding of an interest in Australian land' as distinct from 'the acquisition of an interest in Australian land'. [Schedule 1, item 212, table item 3 in the table in subsection 132(3) of the FATA]

2.133 The amendment applies to contraventions occurring on or after 1 January 2021. [Schedule 1, item 250]

2.134 Consequential amendments are also made to section 132 to reflect that some acquisitions of residential land could fall within the description of the new national security actions. [Schedule 1, items 209 and 211, subsection 132(1) of the FATA]

Amendments to correct previous drafting errors

2.135 Section 51 of the FATA outlines the threshold test for acquiring an interest in entities and businesses. Schedule 1 to the Bill removes the word 'significant' from section 51 of the FATA, aligning it with section 52. This clarifies that the threshold test as outlined in section 51 applies to notifiable actions, as well as significant actions. [Schedule 1, items 66 and 67, section 51 and heading to column 1 in the table in section 51 of the FATA]

2.136 Schedule 1 to the Bill clarifies that under subsection 53(1), where multiple actions are taken under one agreement and one action meets the threshold test, only that particular action meets the threshold test. The other actions are not deemed to meet the threshold test simply because they are covered under an agreement where a different action has met the test. [Schedule 1, item 69, subsection 53(1) of the FATA]

2.137 Subsection 53(2) is amended to correct the reference to the 'threshold test is met'. [Schedule 1, item 70, subsection 53(2) of the FATA]

2.138 Consequential amendments are made to the simplified outline in section 50 of the FATA, and to the table in section 51 of the FATA. A new table item has been inserted to put beyond doubt that a notifiable action of acquiring a substantial interest in an Australian entity is covered. [Schedule 1, items 64 and 68, section 50 and item 2A in the table in section 51 of the FATA]

2.139 Currently, subsection 37(5) of the FATA refers erroneously to 'paragraph 4(a)'. Schedule 1 to the Bill corrects the typographical error, so that subsection 37(5) refers to 'subsection (4)'. [Schedule 1, item 54, subsection 37(5) of the FATA]

2.140 Existing section 47 of the FATA sets out the conditions of a notifiable action. Schedule 1 to the Bill clarifies that in paragraph 47(2)(a) the first condition is that the action is either: to acquire a direct interest in an Australian entity that is an agribusiness; or to acquire a direct interest in an Australian business that is an agribusiness. [Schedule 1, item 62, paragraph 47(2)(a) of the FATA]

2.141 Schedule 1 to the Bill amends subsection 47(4) to only reference the new subparagraph of 47(2) that deals with 'Australian entities that are agribusinesses'. [Schedule 1, item 63, subsection 47(4) of the FATA]

2.142 Section 114 of the FATA is amended to remove a redundant reference to 'remitted', as a fee cannot be remitted if it has not yet been paid. [Schedule 1, item 189, section 114 of the FATA]