SYDNEY (Reuters) - Australia will require all foreign investment proposals to be assessed by its Foreign Investment Review Board (FIRB) during the duration of the coronavirus crisis to prevent a fire sale of distressed corporate assets.
Treasurer Josh Frydenberg said on Monday the temporary reduction to zero of the deal value that triggers a FIRB review was to safeguard the national interest during the coronavirus outbreak.
“This is not an investment freeze. Australia is open for business and recognizes investment at this time can be beneficial if in the national interest,” Frydenberg said in a statement.
“These measures are necessary to safeguard the national interest as the coronavirus outbreak puts intense pressure on the Australian economy and Australian businesses.”
On Sunday, Prime Minister Scott Morrison announced further restrictions on public gatherings and advised people they should stay at home as much as possible.
The FIRB will work with existing and new applicants to extend timeframes for reviewing applications from 30 days to up to six months.
Previously there were monetary thresholds in place, which varied according to the type of business involved, where a deal could be done without requiring FIRB approval. For example, a business acquisition worth up to A$275 million ($170 million) did not require approval.
Reporting by Renju Jose in Sydney; Editing by Daniel Wallis
Our Standards: The Thomson Reuters Trust Principles.