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Doing business
Australia
Setting up a company | FDI in figures | Why you should choose to invest | Procedures relative to foreign investment | Finding assistance for further information
Setting up a company
Legal business entities
| Types of companies and capital (max/min) | Number of partners/shareholders and liability | Maximum and/or minimum capital | Liabilities | Registration fees |
| Sole trader | 1 person | No minimum capital. | The liability of the sole trader is unlimited. | Registration fees vary from state to state. They can go up to AUD 1,500. The average standing at AUD 650-750. |
| Private or Proprietary Company | Between 2 partners and 50 partners maximum. | No minimum capital. | The partners' liability is limited to the amount of capital contributed. | Registration fees vary from state to state. They can go up to AUD 1,500. The average standing at AUD 650-750. |
| Public Company | 5 partners minimum. | No minimum capital. | The partners' liability is limited to the amount of capital contributed. | Registration fees vary from state to state. They can go up to AUD 1,500. The average standing at AUD 650-750. |
| Partnership | 20 partners maximum. | No minimum capital. | Their liability is joint and unlimited. | Registration fees vary from state to state. They can go up to AUD 1,500. The average standing at AUD 650-750. |
| Limited Partnership | 20 partners maximum. There are two types of partner: active partners and silent partners. |
No minimum capital. | The active partners' liability is unlimited. The silent partners' liability is limited to the amount of capital contributed as long as they do not take part in the management of the company. | Registration fees vary from state to state. They can go up to AUD 1,500. The average standing at AUD 650-750. |
- Business setup procedures
- Company charters, made up of the Memorandum of Association and the Articles of Association, must be written in English.
The statutes must be filed with the Australian Securities and Investment Commission (ASIC). The Business name must be registered in the State or the Territory where the company is operating from. The National Business Names Office issues an identification number (Australian Company Number). As soon as it receives the Certificate of Incorporation, the company can start business. The Business name registration is valid throughout federal territory and the incorporated company can develop its business all over Australia, without any other formalities. - The competent organization
- Australian Security and Investment Commission (ASIC)
FDI in figures
| Foreign Direct Investment | 2007 | 2008 | 2009 |
| FDI inward flow (millions USD) | 45,477 | 46,722 | 22,572 |
| FDI stock (millions USD) | 385,041.9 | 305,518.8 | 328,090.4 |
| Performance Index*, ranking on 141 economies | 70 | 61 | 69 |
| Potential Index**, ranking on 141 economies | 20 | 21 | - |
| Number of Greenfield investments*** | 177 | 239 | 252 |
| FDI inwards (in % of GFCF****) | 16.8 | 15.3 | 7.2 |
| FDI stock (in % of GDP) | 40.5 | 29.5 | 33.5 |
Source:
Note: * The UNCTAD Inward FDI Performance index is based on a ratio of the country's share in global FDI inflows and its share in global GDP. ** The UNCTAD Inward FDI Potential index is based on 12 economic and structural variables such as GDP, foreign trade, FDI, infrastructures, energy use, R&D, education, country risk. *** Green field investments are a form of foreign direct investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up. **** Gross fixed capital formation (GFCF) measures the value of additions to fixed assets purchased by business, government and households less disposals of fixed assets sold off or scrapped.
Why you should choose to invest Australia
- Strong points
- The customary Australian dynamism, its economic robustness, its strong growth, stable and juridically reassuring business environment and position as a practical access platform for certain markets, like New Zealand and the Pacific islands, make this country a choice target for establishment.
- Weak points
- Reduced competition in some sectors can limit returns on scale. Lack of investment in transport and telecommunication infrastructures sometimes slows down growth in some sectors.
- Government measures to motivate or restrict FDI
- Foreign companies get assistance, especially for productive investment, R&D, professional training and job creation. For many years, the amount of administrative formalities for setting up foreign companies has been reduced.
- Bilateral investment conventions signed by Australia
- Yes
Procedures relative to foreign investment
- Freedom of establishment
- Yes
- Acquisition of holdings
- There is a mixed regime which has been made more flexible since it was set up in 1975. However, the purchase of a local firm by a foreign company can always be refused by the controlling authority, on the grounds that it would be contrary to national interests.
Consult the FIRB (Foreign Investment Review Board) website. - Obligation to declare
-
The agency for the promotion of foreign investment in the country gives information about the authorizations necessary for setting up. Some investments must be declared to the FIRB.
Acquisitions, substantiel acquisitions of holdings, and taking control of Australian companies whose assets are valued at more than 50 million AUD; the creation or setting up of a new business when it goes over 10 million AUD (over 100 million AUD of investment the FIRB will make a detailed study); direct investments carried out by foreign governments must be declared.
- Competent organization for the declaration
-
FIRB
- Requests for specific authorizations
- The media, the banking sector, air transport and mining concessions are subject to restrictions; the FIRB can provide details.
Finding assistance for further information
- Investment aid agency
-
Invest Australia
Invest Victoria
- Other useful resources
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Last updates: September 2010
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