The Capital Markets Division is leading or contributing to a number of key policy priorities and engaging our members through our committees and working groups.
Our priorities cover tax and foreign investment policy, corporate governance and regulation, accounting, and finance affecting the property industry. Recent advocacy updates include:
- Mergers and acquisitions reform: The Treasurer has announced that, following our advocacy, residential property developers and certain commercial property transactions will be exempt from the proposed reforms. The commercial property transactions that are exempt are for any business that is primarily engaged in buying, selling or leasing property and which does not intend to operate a commercial business (other than leasing) on the land. This represents a positive development; however we remain vigilant until the legislative and regulation setting process is complete, including close engagement with Treasury on the drafting of any exemptions. Our priority moves to commercial leases, which will still be notifiable by lessees if they meet the notification thresholds, to ensure the regulatory response is risk-based and does not interfere with members day-to-day business.
- ASX corporate governance: The ASX has been consulting widely with listed entities and members of its Corporate Governance Council on its proposed reforms. We have consistently advocated for a set of principles-based recommendations in the ASX’s next edition of its corporate governance guidelines. We will update members as further information is publicly available, with the next meeting of the Council to take place in November.
- Wholesale investor test inquiry: on 4 October the Capital Markets Division gave evidence at the public hearing into the wholesale investor test. We have maintained our strong opposition to any changes to the test, preferring instead that a review into the sophisticated investor test take place in order to make the test more useful to AFS licensees, and incorporate a training or education component which would alleviate the concerns of some stakeholders.
- The Australian Taxation System: On 11 September 2024, the Senate referred an inquiry into Australia’s taxation system to the Senate Economics References Committee for inquiry and report by 10 December 2024. We made a submission on tax settings that are increasing the cost of housing across the country. We outlined the significant burden taxes add to the flow of capital into Australia.
- FIRB: The Capital Markets Division is continuing its support for lowering fees for foreign investment into the living sectors. We have worked with the Student Accommodation Council and its members in making a submission to Treasury on the unfair fees structure associated with PBSA, compared to BTR.
- Thin Capitalisation: The Australian Tax Office issued consultation into their draft Guideline, following the enactment of the Treasury Laws Amendment (Making Multinationals Pay Their Fair Share—Integrity and Transparency) Act 2024 on 8 April 2024. In our submission we highlighted the continued issues this legislation has and the additional cost it places on developing and purchasing property across Australia.