Gov mandates Australians to get first dibs at agricultural land

The Federal Government has indicated in a press statement that it has has acted to ensure Australians will get every opportunity to purchase agricultural land holdings by introducing tough new rules that mandate vendors to advertise and market agricultural land to Australians first.

This statement comes after concerns were raised following the the sale of the Kidman cattle empire to the Gina Rinehart-led Australian Outback Beef which led to an increase Chinese investment on Australian agricultural land by 2.6 million hectares. At the moment, the Chinese investors own a third of Australian Outback Beef. In addition, that purchase made China the second largest owner of Australian farmland in 2017. The UK remains the largest owner.

The Federal Government says that it is “committed” to ensuring that Australians have the opportunity to purchase agricultural land.

“We welcome foreign investment in Australian agricultural land where it is not contrary to the national interest. Our foreign investment rules facilitate investment while making sure Australia’s national interest is protected. This includes ensuring adequate opportunity for Australians to invest in Australian land,” said Treasurer Scott Morrison.

He mentioned that concerns around the ability of Australians to participate in the sale process of agricultural land acquisitions have been a factor in his previous foreign investment decisions, including approval of the sale of S. Kidman & Co Limited.

Therefore now, the ruling indicates that subject to exceptional circumstances, foreign investors will need to demonstrate that agricultural land they intend to acquire has been part of a public sales process and marketed widely to potential Australian bidders for a minimum of 30 days, and Australian bidders have had an opportunity to participate in the sale process.

This means that all acquisitions of agricultural land by foreign investors for residential development will also be subject to standard development conditions requiring development to commence within a five year period to prevent land banking. This condition already applies to acquisitions of vacant land.


Morrison also mentioned that last July, the government introduced a range of amendments to the foreign investment framework to reduce red tape and facilitate business investment. A key measure was the introduction of business exemption certificates to streamline the approvals process for low risk investors, such as large investment funds, undertaking a program of investment.

“These certificates do not exempt foreign investors from the usual scrutiny and are targeted at investment that supports growth, jobs and innovation. Applicants will be expected to demonstrate the potential benefits of the proposed investment and will be subject to reporting conditions,” said Morrison.

“Business exemption certificates will not be granted for investment in sensitive areas such as critical infrastructure, and will no longer be granted for agribusinesses. They will usually have total acquisition caps of below $1 billion.”

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