Liberal chair of the House of Representatives inquiry into foreign property investment, Kelly O’Dwyer, has today flagged stricter rules and tighter enforcement of foreign property purchases, amid admissions that the current monitoring and enforcement system is failing. From the ABC:
O’Dwyer, told the ABC criminal penalties were in place but no prosecutions were being pursued by the Foreign Investment Review Board because of the burden of proof, where intent must be demonstrated.
“We believe it is worth investigating whether civil penalties ought to be applied and whether more significant fines ought to be applied for people who are contravening the law,” Ms O’Dwyer said.
“Evidence has been presented to the committee that [the possible $85,000 fine] is simply seen as the cost of doing business for some individuals and organisations who might wish to contravene the current framework.
“We are going to look at what might be a more appropriate figure in our final recommendations to government”…
Ms O’Dwyer believes rules are being broken, but says it is unclear how widespread the issue is.
The committee has heard that detailed statistics on foreign investment in real estate are not gathered.
“I am not prepared to put a figure on it. These are some of the questions we are asking and we are yet to get conclusive information on this,” she said.
“Suffice to say, it is a very real concern. Evidence has been presented to the committee that would give us cause for that concern.
“Part of the concern we have is that if the structure, the enforcement and the compliance isn’t in place, then potentially that number could be reasonably significant.”
It’s good to see O’Dwyer making such admissions, rather than attempting to sweep the problem under the rug.
Blind Freddy can see that the official data on foreign property investment is dodgy, as noted by the ABS, real estate agents, and industry professionals alike. Moreover, when combined with the fact that the Foreign Investment Review Board (FIRB) has, since 2010, failed to prosecute any foreign buyer for breaching the foreign ownership rules, and the admission by FIRB that it is incapable of monitoring/enforcing whether a foreign temporary resident has sold their home within three months of departing Australia, then it is clear that fundamental reform of the foreign investment regime is desperately required in order to restore faith and integrity to the system.
Let’s hope the Parliamentary Inquiry is up to the task.
