A lease and a lease are considered separate acts for FATA purposes. Prior to the amendments, the entry into a lease of industrial land operated by a foreign company required the approval of the BRIF if the term of the lease was likely to be longer than five years and the total amount of rent over the term was US$275 million or more or, in certain circumstances, to $60 million. The FIRB framework applies to leases from Australian countries which, including all option conditions, are likely to exceed five years if the tenant is a foreign entity. This will apply to many leases nationwide. Since the notification threshold for farmed industrial land (i.e., the total value of lease money inside a building) has increased from either $275 million or US$60 million depending on the nature of the transaction, to 0,$US, this is now the case where a permit is required for all leases exceeding a five-year term. This must be requested by the tenant before entering the rental contract. Priority is given to processing investment applications that protect and support Australian businesses and Australian jobs. In particular, the potential impact on the Community and on employment will be taken into account when examining applications. Similarly, more routine transactions, such as entering into a new lease for farmed industrial land, are properly prioritised given the potential link to the protection and support of Australian businesses and Australian jobs. If the treasurer does not accept the request, the acquisition of the shares in the lease cannot take place. Accordingly, all new proposals and leases should include a condition of FIRB authorisation. FIRB confirmed that there was as yet no directive on waiving or reducing the usual application fees.
The application fee is based on the highest property value (i.e. the rents over time). A total lend-lease application with a term not exceeding $10 million will require an application fee of $2,000 $US. If the total rent exceeds $10 million, the application fee rises to $US 26,200. Subeta Pty Ltd (Subeta) is a foreign person who operates a shop that sells clothes in a shop in a shopping centre in Canberra. In 2017, Subeta entered into a 6-year lease to lease the stores to the owner of the mall. Subeta is temporarily closing its shop during the coronavirus crisis for a period of 4 months and has agreed with the mall owner to vary the lease for a 50 percent reduction in rents in the next 12 months. This rent reduction is not considered a « substantial » change within the meaning of FATA, so Subeta is not required to announce new measures under FATA. The FIRB website confirms that these new measures do not apply to agreements concluded before 22:30 AEDT on 29 March 2020, including with regard to acquisitions that have not yet taken place, whether or not there are conditions not met. As a general rule, the establishment of businesses by non-state foreign investors (i.e. an Australian subsidiary) is not subject to FIRB`s authorisation to carry on an Australian business. However, if a subsequent substantial transaction is proposed (i.e.
the newly created company participates in activities such as entering into lease agreements or acquiring securities in companies for the acquisition of which it was created), that transaction may require prior authorization. . . .