Interfunding Transactions Exemption
The submission to the Treasury in response to the draft policy specifications (Draft Specifications) circulated following the 2023–24 Federal Budget announcement that ‘[t]he Government will exempt passive or low-risk interfunding transactions from mandatory notification requirements and fees under the Foreign Acquisitions and Takeovers Act 1975 [(FATA)]’ (Interfunding Exemption),1 was prepared by the Foreign Investment Committee of the Business Law Section of the Law Council of Australia (Committee).
The Committee broadly supports the introduction of the Interfunding Exemption proposed in the Draft Specifications. The Committee understands that the underlying intention of the Interfunding Exemption is to:
- recognise that there are significant administrative and regulatory burdens for internal fund management steps that make up interfunding; and
- to provide relief from those burdens for such low risk interfunding steps.
1 Australian Government, Budget 2023-23 (Budget Measures, Budget Paper No 2, 9 May 2023) 18.