The new trade minister, Dan Tehan, has been handed one of the Morrison government’s most demanding roles. Despite a lot of chest-thumping in government circles about the need to stand up to “Chinese bullying”, Tehan’s task will be to find a way to restore a constructive trading partnership with China in the national interest.
Beijing’s trade reprisals for perceived political slights should not be countenanced. However, there is no useful purpose in overreacting to China’s bad behaviour.
The business community, which has been alarmed by a deterioration in the China relationship, will watch Tehan carefully as he outlines his ideas for engagement.
GBM Resources enters joint venture with Novo Resources for Malmsbury Gold Project
Both companies view Malmsbury as one of the most prospective and underexplored high-grade gold projects in the Victorian Goldfields, displaying many of the geological characteristics of the Fosterville epizonal orogenic gold deposit. A diamond drilling program is expected to start in the June quarter 2021.
GBM Resources Limited (ASX:GBZ) has executed a formal purchase and joint venture agreement with Novo Resources Corp (TSE:NVO) for the Malmsbury Gold Project in the prolific Victorian Goldfields.
The Foreign Investment Review Board (FIRB) and Department of Jobs, Precincts and Regions (DJPR) approvals remain as the final steps of the formation of the joint venture (JV) and are expected within the March quarter of 2021.
Australia introduced the
Foreign Acquisitions and Takeovers Act 1975 (Cth) to regulate the acquisition of land and assets in Australia, by foreign persons or entities. It imposed reporting obligations on foreign persons and entities engaging in transactions, and provided the Federal Government extensive powers to monitor and intervene in transactions involving foreign persons.
From 1 January 2021, the following laws have come into force which have amended the current Foreign Investment Review Board (
FIRB) regime:
Foreign Investment Reform (Protecting Australia s National Security) Regulations 2020 (Cth).
National Security Business and National Security Land
The biggest change is to the acquisition of land and businesses deemed to be in the national interest. The reforms require mandatory notification of:
In any other era, the sale of Probuild might have been a simple arrangement.
A Chinese bidder looking to expand its exposure in Australia offers $300 million for an Australian building company and all parties assumed it would proceed, given Probuild’s parent is listed in South Africa and the target is already in foreign hands.
The deal would not have been dissimilar to the sale of John Holland a few years ago to the China Communications Construction Company for three times the price, and that secured Foreign Investment Review Board (FIRB) approval, despite John Holland’s significant defence contracts at the time.
China has lashed out at Australia for blocking a $300million deal that would have seen a Beijing-backed firm with links to the Chinese military in control of a major construction company.
Treasurer Josh Frydenberg shot down the offer made by state-owned China State Construction Engineering Corporation to acquire Australian-based company Probuild over national security concerns.
It s the latest escalation in a diplomatic spat between the two countries which have been at loggerheads since Australia called for an independent inquiry into the role of Chinese officials back in April, in the wake of the coronavirus pandemic which began in Wuhan in November 2019.