Investing in Australia's food and agribusiness sector | KPMG | VN

A guide to investing in Australia's food and agribusiness sector

Investing in Australia's food and agribusiness sector

Australia has an international reputation for producing safe, healthy and high quality food, has a diverse and secure supply of raw ingredients, and is located close to fast growing Asian markets. However, significant changes are occurring.

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Purpose of this guide

The purpose of this guide is to outline the various options available to investors for structuring investments in Australia’s food and agribusiness sector.

There are many reports on the WHAT (such as, what are the issues and opportunities?) and the WHY (such as, why is investment needed?). This guide is about the HOW: how does an investor structure an entry to the Australian food and agribusiness sector?

A key theme of this guide is that any investment structure must ensure:

  • ƒƒthere is an alignment of interests between investors and managers/operators; and
  • ƒƒthe structure is “fit for purpose”, in the sense that the structure meets the commercial objectives of the investor.

Drivers for investing in Australia’s food and agribusiness sector

Demand for food and other agricultural products is expected to grow substantially, and Australia is ideally placed to capitalise on these trends, due to its:

  • ƒƒproximity to growth markets in Asia;
  • ƒƒreputation for producing high quality and safe food and other agricultural products;
  • ƒƒrobust biosecurity system; and
  • ƒƒskilled workforce.

Foreign investment rules

  • Overview of the Foreign Acquisitions and Takeovers Act 1975
  • Thresholds for notifications for agricultural investments
  • Application fees and foreign ownership register

Other tax considerations

  • Foreign investor’s tax consideration
  • Land tax
  • Stamp duty
  • R&D Tax Incentive scheme
  • Thin capitalisation

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