Investors from China acquiring Australian businesses may need approval under two separate regulatory regimes: Australia's foreign investment screening framework and its mandatory merger control regime.
Not every acquisition requires both approvals. Whether either is necessary depends on the investor's ownership structure, the target business, transaction value and applicable notification thresholds. Understanding these requirements early can help investors avoid regulatory delays and compliance risks.
When is FIRB approval required?
Under the Foreign Acquisitions and Takeovers Act 1975 (Cth), certain foreign acquisitions must be notified to the Australian Treasurer, advised by the Foreign Investment Review Board (FIRB).
For 2026, Treasury’s monetary thresholds for an eligible Chinese private investor acquiring a substantial interest (generally 20% or more) in an Australian entity include:
- Non-sensitive businesses: more than A$1.498 billion
- Sensitive businesses: more than A$347 million
Eligibility depends on the jurisdiction of establishment of the immediate acquiring entity. Applicable valuation tests may concern consideration, assets or securities, rather than purchase price alone.
Foreign government investors generally face a zero-dollar threshold when acquiring a direct interest in an Australian business. Acquisitions of direct interests in national security businesses may also require notification regardless of value. A direct interest generally starts at 10%, although smaller interests may qualify. Separate rules apply to agribusiness, media, Australian land and other specified investments. Sensitive businesses and national security businesses are distinct statutory categories.
When is ACCC approval required?
Under Part IVA of the Competition and Consumer Act 2010 (Cth), acquisitions meeting mandatory notification requirements generally cannot complete without ACCC approval or a notification waiver, unless an exemption applies.
The ACCC notification thresholds include:
- Large merged firms: combined Australian revenue of at least A$200 million, plus target Australian revenue of at least A$50 million or global transaction value of at least A$250 million
- Very large acquirers: acquirer group Australian revenue of at least A$500 million and target Australian revenue of at least A$10 million
Additional thresholds may capture serial acquisitions over three years and certain asset acquisitions. Notification depends on the target’s Australian connection and applicable exemptions. Acquisitions below notification thresholds remain subject to section 50, which prohibits acquisitions likely to substantially lessen competition.
How do FIRB and ACCC assessments interact?
A transaction may require both approvals. Neither replaces the other, although reviews may proceed concurrently. Where an acquisition is notified to the ACCC, Treasury must await the ACCC’s notification or waiver decision before finalising the competition aspect of its foreign investment assessment. Treasury may also seek ACCC advice on acquisitions below mandatory merger thresholds. Investors should reflect both processes in approval conditions, completion timetables and termination rights.
What are the consequences of non-compliance?
Failure to meet applicable requirements may result in significant civil penalties, divestiture and other enforcement action. Amendments effective from 16 September 2026 mean that an acquisition completed without mandatory ACCC notification is no longer automatically void solely for that omission. The ACCC may instead seek Federal Court orders declaring it void or requiring divestiture. Automatic voiding remains possible for certain standstill breaches, and the amendments do not retrospectively change the treatment of earlier contraventions. Separate foreign investment penalties and remedies may apply.
What should investors do?
Before signing, investors should assess ownership and government interests, the target’s activities, transaction values, previous acquisitions and applicable exemptions. Agreements should address required approvals, review periods and completion conditions. Early assessment helps avoid delays and completion risk.