There are numerous matters that require careful attention when you are thinking about making an investment. The two most common types are: real estate and business.
All contracts by foreign persons to acquire interests in Australian real estate must be made conditional upon foreign investment approval, unless approval was obtained prior to entering into the contract.
For properties to be purchased at auction, prior foreign investment approval must still be obtained and advice provided whether the parties were successful or not, and if so, a copy of the signed contract forwarded to the Foreign Investment Review Board (FIRB) after the auction.
For more information, visit: www.firb.gov.au.
For investments in Australia, the check-list below would be a guide for you to make sure that important matters have not been overlooked:
- Real estate agent’s report on the subject property
- Planning certificate from the local council as regard to its zoning and lawful use
- If the contract includes a building structure, obtain engineer’s certificate on structural soundness and pest report.
- Valuation report as to its current market value of what you are buying.
- Obtain an insurance quote for the required insurance cover.
- Talk to a Tax Accountant and find out what taxes implications in respect to stamp duty, future capital gains, income tax, goods and services tax, etc.
- Talk to a Lawyer and find out what legal structures you may need to have by way of a company structure, a family or unit trust, and any special conditions required for the contract.
- Talk to a Bank or Financier about any loan funds you require to complete the purchase and find out the rate f interest and the loan terms.
- If a business is involved, you will need to check the inventory and be satisfied as to what items of plant and equipment are included in the purchase price. You can engage an independent stock-take specialist to help you with the inventory.
- Spend time to understand and analyze the business and make sure you have a reasonable period available to conduct “due diligence”.
- Seek help from professional consultants on issues that you not familiar with.
- Have all advices given to you put in writing.
If investing in Australia, China Trade Centre will be able to provide assistance to its members in all the above matters.
Investments in China are much more complicated and Australian businessmen are recommended to contact specialist firms who are qualified to provide expert advice in such matters.
A good starting point can be a reputable accounting or law firm that has been recommended or international firms.
Alternatively, contact China Trade Centre and we, together with the Chinese Enterprises Association in Beijing, would be pleased to assist you with your requirements.