When considering investing in an exploration project, foreign investment regulation is a key regulatory hurdle. Learn more about the important steps a company should take before committing to any foreign investment.


McCullough Robertson, established in 1926, is a full service commercial law firm with proven capacity and capability to handle the complex legal issues facing business today. With a complement of over 400 partners, lawyers and support staff, McCullough Robertson was recently named ‘Brisbane Law Firm of the Year’, ranked as Queensland’s largest law firm and listed in the BRW Top 20 law firms in Australia. One of its many specialist areas is the mining and resources sector.


Any investment involving foreign investors into mining tenements or land in any way (including indirectly) should carefully consider Foreign Investment Review Board notification and approval requirements.  Set out below is a broad overview of foreign investment regulation in the exploration sector.


Foreign investment in Australia is regulated by the Federal Government through the Foreign Investment Review Board (FIRB).  FIRB examines proposals by foreign investors undertaking direct investment in Australia, and makes recommendations to the Treasurer about whether those proposals are contrary to Australia’s national interest, under the Government’s foreign investment policy.

FIRB oversees the administrations of the legislation governing foreign investment, the Foreign Acquisitions and Takeovers Act 1975 (Cth) and the Foreign Acquisitions and Takeovers Regulation 2015 (Cth).  As a general rule, the Australian Government, through FIRB, must be notified of all proposed foreign investment activity above certain thresholds, unless a specific exemption applies.

Foreign investment activities requiring approval include investment over a prescribed monetary threshold in:

  • Australian assets;
  • Australian businesses (including agribusinesses);
  • shares in an Australian company;
  • units in an Australian trust, and
  • Australian land (including mining or production tenements, commercial land, residential land and agricultural land).


A foreign person for FIRB purposes is wider than the general understanding.  A company can be foreign even if they are incorporated and based in Australia, and an individual can be foreign even if they have a long stay visa.

If a foreign government, or an entity associated with a foreign government, is involved in a FIRB applicant (including owning a portion of the applicant, or one of the applicant’s parent companies), the applicant may be deemed to be a foreign government investor, with special rules applying.


As a general rule, acquisitions of interests in mining or production tenements by foreign persons require FIRB approval regardless of value, except for in certain circumstances acquisitions by foreign persons from the United States, New Zealand and Chile, for which the monetary threshold is $1,154 million.

Acquisitions of interests in the land underlying mining, production or exploration tenements may need approval depending on the nature of that underlying land.


Importantly, acquisitions of interests by foreign persons (except foreign government investors) in an exploration tenement may not need FIRB approval under the regime.  However, each tenement will confer different rights and obligations and should be closely examined if the acquiring entity is a foreign person under the FIRB legislation.  Foreign persons who are foreign government investors need to notify FIRB and seek approval for the acquisition of any interest in a prospecting, exploration, mining or production tenement (including where that tenement is being obtained on initial grant).


The Treasurer, through FIRB, is generally required to make a decision on an application within 30 days of receipt of the application and fee, and respond to the application within a further 10 days.   The time frame does not begin until the correct application fee has been paid in full.  However, if FIRB needs additional time to consider an application, they can seek the applicant’s consent to an extension of time.

If the extension is not agreed to, FIRB has the power to prevent the investment for a period of up to 90 days while it further considers the application.  Interim orders to this effect are made public and are generally to be avoided wherever possible.

FIRB is a complicated area, and investors should remember to get FIRB advice early in a proposed acquisition, because it may impact the structure of an acquisition.  Investors should also remember that just because a company is Australian, or even listed on the ASX, it may still be a foreign person for FIRB purposes, and need approval.

Last updated: June 2019