Introduction of the national Agricultural Land Register

Australia’s Foreign Investment Policy- June 2015 (Policy) establishes the new national Agricultural Land Register, which is administered by the Australian Taxation Office (ATO).

From 1 July 2015 all foreign persons (including foreign government investors) are required to register on the Agricultural Land Register, regardless of value, details of:

  1. any newly acquired agricultural land interest within 30 days of completion of the acquisition; and
  2. by 31 December 2015 all existing agricultural land interests.

Similarly all foreign persons are required to update the Agricultural Land Register within 30 days of ceasing to have an interest in agricultural land.

Why has the Agricultural Land Register been introduced?

The Agricultural Land Register is part of the Commonwealth Government’s recently introduced measures to strengthen reporting requirements around and to provide a clear and accessible picture of, foreign investment in Australian agricultural land and to give the Australian community greater confidence in the foreign investment regime.

Is registration only required if the Commonwealth Treasurer’s approval is (or was) required to the rural land interest acquisition?

No. The obligation to register agricultural land interests on the Agricultural Land Register is presently a separate obligation from the obligation to notify the Commonwealth Treasurer of certain proposed acquisitions of an interest in Australian rural land under the Foreign Acquisitions and Takeovers Act 1975(Cth) (FATA).

Further because the concept of agricultural land extends to a broader range of Australian land than the concept of Australian rural land under FATA, the obligation to register acquisitions of interests in agricultural land applies even if at the time of acquisition the Commonwealth Treasurer’s approval of the acquisition was not required.

It will be interesting to observe whether the Commonwealth amends FATA in light of creation of the Agricultural Land Register to replace the current rural land concept with the concept of agricultural land. If this occurs the notification of future agricultural land interests to the Commonwealth Treasurer and the registration obligation on the Agricultural Land Register may be brought into alignment, but this would involve a significant rethink of the concepts of FATA which currently treats rural land not used wholly and exclusively for carrying on a business of primary production as “Australian urban land”.

What is agricultural land and how is it different from rural land?

The Policy defines agricultural land as Australian land that is used, or that could be reasonably used, for a primary production business.

A primary production business includes a business that cultivates and propagates plants, maintains animals for the purpose of selling them or their bodily produce, manufactures dairy produce from produced raw material, conducts fishing operations or conducts forestry operations.

The agricultural land concept extends to a broader range of Australian land than does the Australian rural land concept under FATA , which only captures Australian land that is used wholly and exclusively for carrying on a business of primary production.

What agricultural land interests need to be registered on the Agricultural Land Register?

The Policy does not provide any guidance on what agricultural land interests need to be registered on the Agricultural Land Register. 

The ATO’s registration form at www.ato.gov.au/aglandregister indicates freehold and leasehold agricultural land interests are required to be registered.  After further consultation with the ATO it has advised us that all agricultural land interests need to be registered including any lease or licence where the remaining term (including option terms and extensions) at 1 July 2015 is reasonably likely to exceed 5 years.

What information is required to register agricultural land interests on the Agricultural Land Register?

To register an agricultural land interest on the Agricultural Land Register you will need to know:

  1. the foreign person’s details;
  2. the address of the agricultural land;
  3. the title details of the agricultural land;
  4. whether it is freehold, leasehold or licenced agricultural land;
  5. if it is leasehold or licenced agricultural land, the term of the lease or licence;
  6. the date the event occurred that triggered the registration requirement (for example, the date of the acquisition of the interest in agricultural land);
  7. the percentage interest the foreign person acquired in the agricultural land;
  8. if FATA approval was obtained, the approval number;
  9. the purchase price of the agricultural land interest if it was acquired as part of an arm’s length transaction within the past 12 months or, if it was not, its value calculated on a reasonable basis having regard to its market value; and
  10. what percentage of the agricultural land is currently used for crops, livestock, intensive horticulture, forestry, other farming and non-farming.

How are agricultural land interests registered on the Agricultural Land Register?

Registration of agricultural land interests is made online at www.ato.gov.au/aglandregister

There is no charge to register an agricultural land interest on the Agricultural Land Register

What happens if I forget to register within time?

There is currently no penalty for failing to register agricultural land interests on the Agricultural Land Register. However, we expect when changes are made to FATA to formalise the introduction of the Agricultural Land Register a penalty will be introduced for failure to register or update the Agricultural Land Register in respect of agricultural land interests.

Is it possible to review the Agricultural Land Register?

Currently, it is not possible to review or search the Agricultural Land Register.  However, the Commonwealth Government is committed to making the register available to the public from 2016.