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Latest Case

Assisting on whole of government technology agreements November 2, 2017

Maddocks advised the Commonwealth Government’s Digital Transformation Agency (DTA) on its whole of government purchasing agreement with SAP. The DTA was set up in 2015 to assist government departments and agencies with digital transformation and … Continued

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Winner of the first William Ah Ket Scholarship announced November 21, 2017

Tuesday 21 November 2017 A solicitor in a Victorian government agency is the first winner of the William Ah Ket Scholarship, a $5,000 prize named after the first barrister of Chinese heritage in Australia. K … Continued

Latest Article

Maximum term contracts considered by the Commission: has their use expired? December 11, 2017

Last week, in what is a decision with potentially significant implications, the Fair Work Commission Full Bench has overturned the legal principle underpinning the widespread use of maximum term contracts. These contracts are a common … Continued

FIRB – Change in investment threshold for Singaporeans

Background

Foreign Investment Review Board (FIRB) approval may be required for investments by foreigners in Australia above certain thresholds. These depend on the type of investments and who the foreign investor is.

Certain agreement country investors that have entered into Free Trade Agreements (FTA) with Australia have significantly higher thresholds than investors from other countries, depending on the type of investments and the terms of those FTAs.

There have been recent amendments to the Singapore-Australia Free Trade Agreement (SAFTA) that have changed the thresholds for private Singaporean investors. The amendments came into effect on 1 December 2017.

Commercial land

The threshold for developed commercial land has increased from $55 million (for low threshold commercial land) and $252 million (for non-low threshold commercial land) to $1,094 million.

This is a significant increase and should be welcomed by private Singaporean investors.

However, the threshold for vacant commercial land (as opposed to developed commercial land), remains at $0. This means that all acquisitions of vacant commercial land by private Singaporean investors still need FIRB approval.

There is also no change to the threshold for acquisitions of commercial land by Singaporean foreign government investors. All such acquisitions still require FIRB approval.

Agricultural land

The threshold for agricultural land for Singaporean private investors has been reduced from $50 million to $15 million on a cumulative basis. This $15 million threshold already applies to investors from most other countries.

Therefore, if the investor already holds, say, $14 million worth of agricultural land and proposes to acquire another parcel of agricultural land for $2 million, the acquisition of that next parcel will require FIRB approval.

Businesses (other than agribusinesses)

The threshold for acquisitions of non-sensitive businesses and entities by private Singaporean investors has also increased from $252 million to $1,094 million.

The threshold for sensitive businesses (eg. telecommunications, transport etc) is still $252 million.

Agribusinesses

There has been no change to the threshold of $55 million for agribusinesses.

Threshold increases welcomed

All in all, the threshold increases are significant and should be welcomed by private Singaporean investors. Acquisitions by such investors within the new thresholds, may no longer need to be conditional on FIRB approval and may increase their competitive edge in bids.

Background

Foreign Investment Review Board (FIRB) approval may be required for investments by foreigners in Australia above certain thresholds. These depend on the type of investments and who the foreign investor is.

Certain agreement country investors that have entered into Free Trade Agreements (FTA) with Australia have significantly higher thresholds than investors from other countries, depending on the type of investments and the terms of those FTAs.

There have been recent amendments to the Singapore-Australia Free Trade Agreement (SAFTA) that have changed the thresholds for private Singaporean investors. The amendments came into effect on 1 December 2017.

Commercial land

The threshold for developed commercial land has increased from $55 million (for low threshold commercial land) and $252 million (for non-low threshold commercial land) to $1,094 million.

This is a significant increase and should be welcomed by private Singaporean investors.

However, the threshold for vacant commercial land (as opposed to developed commercial land), remains at $0. This means that all acquisitions of vacant commercial land by private Singaporean investors still need FIRB approval.

There is also no change to the threshold for acquisitions of commercial land by Singaporean foreign government investors. All such acquisitions still require FIRB approval.

Agricultural land

The threshold for agricultural land for Singaporean private investors has been reduced from $50 million to $15 million on a cumulative basis. This $15 million threshold already applies to investors from most other countries.

Therefore, if the investor already holds, say, $14 million worth of agricultural land and proposes to acquire another parcel of agricultural land for $2 million, the acquisition of that next parcel will require FIRB approval.

Businesses (other than agribusinesses)

The threshold for acquisitions of non-sensitive businesses and entities by private Singaporean investors has also increased from $252 million to $1,094 million.

The threshold for sensitive businesses (eg. telecommunications, transport etc) is still $252 million.

Agribusinesses

There has been no change to the threshold of $55 million for agribusinesses.

Threshold increases welcomed

All in all, the threshold increases are significant and should be welcomed by private Singaporean investors. Acquisitions by such investors within the new thresholds, may no longer need to be conditional on FIRB approval and may increase their competitive edge in bids.