Australia relaxes approval process for foreign LPs

Private equity funds with foreign investors are no longer required to notify the Australian government of each individual acquisition they make, according to a client note from Australian law firm Clayton Utz.

Instead funds with foreign investors can apply for an exemption certificate in which the Treasurer can grant pre-approval for multiple purchases in one application.

Funds will be subject to series of legal tests laid out in the Foreign Acquisitions and Takeovers Regulation. These include a national interest test on the investor, the target business and relevant industry.

The Treasurer will then carry out a risk assessment before an exemption is granted.

The changes came into force on July 1.