Streamlined Foreign Investment Process: A New Coalition Proposal

The Coalition pushes for faster approvals while the government strengthens national security checks.

Minister for Industry, Energy and Emissions Reduction Angus Taylor at a press conference at Parliament House in Canberra, Australia on Feb. 17, 2022. AAP Image/Mick Tsikas

The Coalition has pledged to introduce a streamlined approval process for foreign investors from key allies, including Quad, Five Eyes, and AUKUS partners.

Shadow Treasurer Angus Taylor announced that a dedicated taskforce would be established to design a “white list” system, reducing paperwork and speeding up approvals for trusted investors.

“Foreign investment screening remains crucial, and rigorous national security checks will stay in place. This is about smarter screening, not weaker oversight—a faster yes and a faster no,” he said in a statement released on March 4.

Taylor said the goal is to cut red tape by minimising the number of times trusted investors must go through the approval process and reducing associated fees.

Taylor also announced that the Coalition will task the Productivity Commission with an annual stocktake of regulatory costs.

According to the Opposition, compliance costs for some listed companies now exceed $1 billion, acting as a “hidden tax” on consumers.

It also stifles innovation by shifting resources toward regulatory compliance rather than fostering growth.

The Productivity Commission will assess the economic impact of regulations, rank them based on their burden, and recommend legislative reforms to ease compliance costs.

According to the latest ABS data, foreign investment in Australia increased by $62.8 billion to $4.66 trillion, while Australian investment abroad rose by $170.3 billion to $3.82 trillion in 2023. Data for 2024 is expected in June 2025.

Government’s Foreign Investment Framework

The announcement comes almost a year after the Albanese government implemented reforms to Australia’s foreign investment framework, granting the Treasurer authority to approve, impose conditions, prohibit, or require divestment of investments deemed contrary to the national interest.

Assessment factors include national security, competition, economic impact, and investor character.

While announcing the changes, Treasurer Jim Chalmers said changes were being made to protect sensitive industries, supply chains, critical infrastructure, data, and critical minerals. The reforms also included a more robust examination of how proposed projects relate to the national interest.

“If a supply chain or an industry is controlled more by overseas interests, it has the capacity to be manipulated or interfered with. In some cases, the most extreme cases, to attract sabotage or espionage. We need to be very careful about that, particularly in our critical industries, whether it’s critical minerals, critical data, or critical infrastructure,” Chalmers said.

Asked whether changes to the system were directed at China, the treasurer said the government was not focusing on one country or another.

“The tests that we apply to investments apply equally to investments from all parts of the world. Where there’s investment in sensitive areas, or in sensitive places, or sensitive industries, people can expect that to attract much more scrutiny.”

Foreign Investment Rises, but Housing Market Faces Curbs

The latest Treasury report on foreign investment approvals showed that in the last quarter, 377 commercial investment proposals worth $46.6 billion were approved, with the United States leading at $22.9 billion, followed by Singapore at $4.6 billion, and Canada at $1.8 billion.

Commercial real estate attracted the highest investment at $24.1 billion, followed by services at $10.3 billion.

In the residential sector, 1,123 real estate proposals worth $1.3 billion were approved, with China as the largest investor at $0.4 billion. Commercial investments had a median approval time of 34 days, while residential proposals were processed in five days.

However, to curb foreign ownership, the government has implemented a two-year ban starting in April 2025, which will bar non-residents, including temporary workers and students, from buying existing homes in Australia until March 31, 2027.

The Investment Debate: Coalition vs Government

The Coalition argues that its proposed measures will enhance investment certainty, drive job creation, and improve productivity, positioning its economic management as an alternative to Labor’s current regulatory framework.

The upcoming election is set to test whether voters see these changes as necessary economic reform.

Bran Black of the Business Council of Australia notes that what really counts in making Australia an attractive investment destination is getting the fundamentals right—industrial relations, the tax system, planning, and regulatory systems.

He also highlights that energy costs remain a critical issue.

“There’s little evidence of progress in these basic big-picture reforms. Instead, it’s the reverse, despite global competition becoming more intense. When I talk to CEOs and directors, their No.1 concern is that Australia is not competitive enough to win investment from other countries,” Black said.