FIRB Approval Delay in Australian M&A: Causes, Timing & Practical Fixes

This article states the law and published guidance as at 10 September 2026. It is general information about Australian law, not legal advice, and the framework is moving: the reform package announced on 19 May 2026 is not yet law.

Delay in obtaining Australian foreign investment approval is a common and costly source of uncertainty in cross-border deals into Australia.  Practitioners speak of “FIRB approval”, but the Foreign Investment Review Board is a non-statutory advisory body. The decision belongs to the Treasurer and, in practice, the Treasurer has delegated decision-making on non-sensitive matters to Treasury and Australian Taxation Office officers. As foreign investment scrutiny intensifies, particularly around national security and critical infrastructure, buyers, sellers, private equity sponsors and their advisers increasingly find deals stalled between signing and completion while Treasury and the Treasurer work through their assessment. This guide sets out, in plain English, why these delays can happen, how the timelines realistically break down, what conditions the Treasurer may impose and, most importantly, the practical drafting and negotiation levers that transactional teams can use to keep a deal alive.

It is written for the practitioners and principals who need answers before the long-stop date arrives.

Executive summary, key takeaways

Where foreign investment approval is slow, parties rarely have the luxury of waiting passively. The practical position can be distilled into a handful of points:

• The Treasurer holds real power.  Under the Foreign Acquisitions and Takeovers Act 1975 (Cth) (FATA) the Treasurer may prohibit a foreign acquisition, impose conditions or require divestment, so a signed deal is not a done deal until clearance is secured. And those powers do not end at completion: an action that was not notified can be called in for national security review for up to 10 years after it is taken and the last resort power allows conditions to be revisited, even after a no objection notification has issued.
• Timelines vary widely. The statutory decision period is 30 days, but it does not begin until the correct fee has been paid in full.  And, the Treasurer may extend that period by up to 90 days by interim order, which is published on the Federal Register of Legislation. Applicants are routinely invited to agree a voluntary extension instead, precisely so that no interim order appears on the public record. A further 10 days is allowed for the decision to be notified. Treasury’s published median processing time for approved commercial proposals was 35 days for the March quarter 2026. Transactions touching critical infrastructure or sensitive technology can extend well beyond the standard period once a national security review is engaged.
• Drafting is your best defence. Long-stop dates, extension mechanics, conditional completion, escrow release triggers and reverse break fees are the core tools for allocating FIRB timing risk between buyer and seller. The endeavours standard imposed on the buyer, and the question of which conditions it must accept, matter as much as the dates.
• Early engagement pays. Pre-notification due diligence and early, confidential, engagement with Treasury materially reduce the risk of surprise delays.
• Completing without approval is dangerous. Taking a notifiable action without first notifying is a criminal offence carrying up to 10 years’ imprisonment for an individual, alongside substantial civil penalties, infringement notices and the prospect of a disposal order.
• The framework is changing again. On 19 May 2026, the Government announced a further package of streamlining and strengthening measures. Most of it requires legislation and none of it is law yet, but a long-stop date set 12 months out today may straddle the change.
• FIRB is no longer the only mandatory clock. Since 1 January 2026, Australia has had a mandatory and suspensory merger control regime. A notifiable acquisition put into effect without the ACCC’s determination is void.

Why foreign investment approvals stall

FIRB advises the Treasurer on applications made under Australia’s foreign investment framework. It is a non-statutory advisory board; Treasury’s Foreign Investment Division carries out the day-to-day assessment.  FIRB remit is broad: it assesses whether a proposed acquisition by a foreign person is contrary to the national interest and, increasingly, whether it raises national security concerns. The legal authority sits with the Treasurer, who, under the FATA, can approve a transaction, approve it subject to conditions or prohibit it outright. That discretion, combined with a screening process that can pull in multiple Commonwealth agencies, is why approval problems can materialise, even where the commercial logic of a deal is sound.

Delay is rarely a sign that a deal will be refused. More often, it reflects the assessment process itself: requests for further information, inter-agency consultation, the negotiation of undertakings and the sheer volume of applications flowing through Treasury. For sensitive sectors, defence-adjacent technology, data-rich businesses, energy, ports, telecommunications and other critical infrastructure, the assessment is deliberately deeper and that depth translates directly into time.

Foreign investment approval and the other regulators

Foreign investment screening does not operate in isolation. A control transaction may also engage merger review before the Australian Competition and Consumer Commission, disclosure and takeover obligations overseen by the Australian Securities and Investments Commission, the procedural rules of the Takeovers Panel and, for listed targets, the continuous disclosure and scheme timetable requirements administered by the ASX. During a bid period, the Takeovers Panel, not the court, is the practical forum for disputes: the Corporations Act restricts court proceedings in relation to a takeover while the bid is on foot. Each of these processes has its own clock.  Managing them in parallel, rather than sequentially, is essential to avoid one regulator’s timetable compounding another’s.

Australia’s merger control regime changed fundamentally on 1 January 2026. Notification to the ACCC is now mandatory and suspensory where the thresholds are met: broadly, combined Australian turnover of at least $200 million where the target has at least $50 million of Australian turnover or the global transaction value is at least $250 million; or an acquirer group with at least $500 million of Australian turnover acquiring a target with at least $10 million. Acquisitions in the same or substitutable goods or services are aggregated over three years. Phase 1 runs for up to 30 business days and Phase 2 for up to 90 business days. An acquisition put into effect without the ACCC’s determination is void. The merger clock is now a completion condition in the same way the foreign investment clock has always been.

FIRB process, triggers and realistic timelines

The process is broadly sequential. A foreign person makes a notification (mandatory or voluntary) to Treasury and pays the application fee; Treasury acknowledges receipt and begins its assessment; where necessary, Treasury issues requests for further information; sensitive matters may be referred for national security or inter-agency review; and the Treasurer, ultimately, makes a decision, which may be clearance, clearance subject to conditions or prohibition. The decision period does not begin until the correct fee has been paid in full, so a miscalculated fee delays the assessment before it starts. Knowing where a transaction is likely to slow is the key to managing expectations and drafting sensibly around them.  The Treasury and FIRB guidance pages set out the process and formal decision periods in detail.

When notification is mandatory and when it is merely prudent

Whether notification is mandatory turns on the identity of the acquirer, the nature of the target and the value of the transaction. Certain acquisitions, particularly those involving national security businesses, national security land or acquisitions above the relevant monetary thresholds, must be notified before completion. The national security limb has no monetary threshold at all: starting or acquiring a direct interest in a national security business, or acquiring an interest in national security land, is notifiable whatever it is worth. Other acquisitions fall below the thresholds or within sector exceptions and may not require notification at all, though parties sometimes choose to notify voluntarily to obtain certainty and the protection of a formal no-objection outcome. Voluntary notification also takes the transaction outside the Treasurer’s call-in power, which otherwise runs for up to 10 years after the action is taken.  For a below-threshold acquisition with any national security colour, that protection is usually worth the fee, and it is a point a seller should raise, because it is the seller who inherits the uncertainty if the buyer does not.

Because thresholds are indexed annually and vary by acquirer type (with tighter rules, often a nil threshold, for foreign government investors), the notification analysis should be settled early, against current Treasury guidance and the FATA and its regulations, rather than assumed. As at 1 January 2026, the general business threshold is $347 million; for investors from agreement countries acquiring non-sensitive businesses it is $1,498 million; agribusiness is caught at $75 million cumulative; and the threshold is nil for foreign government investors and for national security businesses and national security land.

Typical ministerial decision-making steps

Once an application is lodged, Treasury assesses it against the national interest and, where relevant, national security. That assessment frequently involves consultation with other Commonwealth agencies and, in sensitive cases, the negotiation of undertakings or conditions with the applicant. The Treasurer may extend the decision period by up to 90 days by interim order.  An interim order is published on the Federal Register of Legislation, which for a listed target raises a disclosure question of its own, so applicants are usually invited to agree a voluntary extension first. The output is a formal decision, commonly a no-objection notification, which is generally expressed to be valid for 12 months and may attach conditions the parties must accept and comply with as a condition of completing.

Review timelines by transaction type

The table below sets out the statutory position alongside what practitioners typically see. Treasury publishes quarterly data: for the March quarter 2026 the median processing time for approved commercial proposals was 35 days, against a departmental target of deciding half of commercial proposals within the 30-day statutory period. Medians conceal the tail and it is the tail that breaks deal timetables.

Transaction type	Statutory position and what is typically seen	Factors that extend time	Common outcomes / conditions
Commercial real estate / agribusiness	Around the statutory period, often extended	National security land or strategic assets may add months	Use restrictions, ownership limits, conditions
Private equity buyouts / standard corporate acquisitions	30-day statutory period; Treasury median for approved commercial proposals 35 days (March quarter 2026)	Cross-ownership, sector sensitivity (tech, critical supply) extends time	Undertakings, monitoring, possible conditions
Critical infrastructure or sensitive technology	Materially longer (national security review likely)	Extensive inter-agency review; mitigations often required	Structural or behavioural conditions; potential prohibition
Below-threshold transactions	No statutory clock unless notified voluntarily	May still be a notifiable national security action, in which case there is no monetary threshold	Clearance, or no notification at all — but exposed to the call-in power for up to 10 years

The practical lesson is that the further a target sits toward the critical infrastructure or sensitive technology end of the spectrum, the more headroom the deal timetable needs.

Common causes of delay

Most delay traces back to a limited set of recurring issues, many of them avoidable with disciplined preparation:

• Fee errors. The decision period does not start until the correct fee is paid in full. An underpaid or misclassified fee is the most avoidable delay of all and it is invisible to the parties until Treasury raises it.
• Incomplete notifications. Applications that omit ownership charts (including all ultimate beneficial owners), funding details or a precise description of the target’s activities invite immediate requests for further information, each of which can effectively pause or extend the assessment. Ownership charts should identify any foreign government investor interest expressly, because that is the first thing the assessment will test.
• Late discovery of sensitive assets. A target’s data holdings, defence adjacencies, land near sensitive sites or critical-supply-chain role may only surface mid-process, forcing a reclassification and deeper review.
• Opaque cross-jurisdictional ownership. Layered offshore holding structures and foreign government interests complicate the acquirer analysis and slow verification.
• Missing or immature undertakings. Where conditions are likely, failing to anticipate and pre-negotiate undertakings leaves the parties negotiating them at the eleventh hour.
• Lender and financing complexity. Security arrangements that themselves confer control or step-in rights can raise their own foreign investment questions.
• Consultation beyond Treasury. Tax conditions settled with the ATO, consultation with state and territory agencies and, in sensitive matters, advice from the national intelligence community, each add elapsed time that is outside the applicant’s control and largely outside its visibility.

Illustrative examples

The following are composites drawn from recurring patterns, not accounts of particular matters.

• The overlooked data asset. A private equity buyer acquiring a services business assumed a standard corporate timeline, only for the target’s large personal-data holdings to trigger a national security lens and a materially longer review.
• The layered acquirer. A consortium with an offshore fund structure faced repeated information requests to establish whether a foreign government investor was involved, delaying acknowledgement of a complete application by weeks.

Practical steps for buyers and sellers

The single most effective response to approval delay is front-loading. The work that de-risks the timetable is done before, not after, signing.  That means completing FIRB-focused due diligence early, mapping the acquirer chain, identifying any sensitive assets and engaging Treasury on a confidential basis where the analysis is finely balanced. Early engagement allows the parties to flush out likely conditions, scope potential undertakings and calibrate the deal timetable to reality rather than to optimism.

Where a buyer expects a programme of acquisitions – a private equity sponsor building out a platform, or a foreign government investor caught by the nil threshold – an exemption certificate obtained ahead of the deal can take the approval off the critical path altogether. The May 2026 package proposes to widen these certificates further, including the ability to adjust tracing and associate rules for low-risk investors.

Coordination is equally important. Where the thresholds for the merger regime are met, the ACCC process should run in parallel from the outset. Under the regime that commenced on 1 January 2026, this is not merely good practice: the ACCC’s determination is a precondition to a valid acquisition and its statutory phases can outrun the foreign investment clock.

For listed targets, the disclosure and scheme timetable interacts with the FIRB clock and must be sequenced carefully. An interim order, once published on the Federal Register of Legislation, may itself be market-sensitive.

Stakeholder engagement plan

Delays touch more than the buyer and seller. A workable engagement plan assigns responsibility across the deal ecosystem: the buyer leads the FIRB application and any undertaking negotiations; the seller and target management provide the data and access needed for a complete application and maintain the business during any interim period; and lenders are kept informed so that financing commitments and drawdown conditions remain aligned with a shifting completion date. In most transactions, the seller will want a contractual right to information about the application’s progress.

Clear ownership of the FIRB workstream, with a single point of contact for Treasury, prevents the fragmentation that itself causes delay.

Document and data preparation checklist for faster processing

• Complete ownership and control chart, identifying any foreign government investor interests.
• Precise description of the target’s business, assets, land holdings and data holdings.
• Funding and structure details for the acquisition, including security arrangements.
• Fee calculation, and evidence of payment in full, so that the decision period starts on lodgement rather than weeks later.
• Draft undertakings or a conditions position paper where sensitivity is anticipated.
• A view on the tax conditions likely to be imposed and the data the ATO will want to see.
• A national security self-assessment flagging any critical infrastructure or sensitive-technology exposure.
• A parallel-regulator map covering ACCC, ASIC, Takeovers Panel and ASX touchpoints.
• A post-completion plan for Register of Foreign Ownership of Australian Assets notices, which are generally due within 30 days of the relevant event.

Contract drafting and negotiation, clauses to manage FIRB timing risk

Good drafting is where approval delay is absorbed, rather than allowed to break a deal. The core clauses allocate timing risk, define what happens if approval is slow and set the point at which either party may walk away. Negotiation typically turns on who bears the risk of delay, how long the parties will wait and what compensation flows if the deal fails for want of clearance.

Model clause summaries

• Extension clause. Permits automatic or elective extension of the long-stop date where FIRB assessment is continuing in good faith, avoiding a premature termination right. The trigger must be objective. “Continuing in good faith” or “under active assessment” invites a dispute at exactly the moment the parties are least aligned; tie the extension to identifiable events – lodgement of a complete application, the making of an interim order, an outstanding request for information – and cap the total extension.
• Conditional completion clause. Makes completion conditional on receipt of a no-objection notification (and satisfaction of any conditions the Treasurer imposes), with clear mechanics for what happens if conditions are onerous. “Onerous” is where the negotiation actually happens. A buyer will want to walk away from any condition that is materially adverse; a seller will press for a hell-or-high-water obligation to accept whatever is imposed. Most deals settle on a defined list of condition categories rather than a general reasonableness test, because a general test is unenforceable in the time available.
• Reverse break / termination fee clause. Compensates the seller if the deal fails because the buyer cannot obtain FIRB approval, aligning incentives to pursue clearance diligently. Two constraints are regularly missed. Where the target is listed, deal protection is subject to the Takeovers Panel’s guidance on break fees, under which a fee payable by the target above 1% of its equity value attracts scrutiny; the guideline is directed at target-paid fees, but the Panel can examine any deal protection with a coercive or anti-competitive effect. And the fee should be framed as a genuine pre-estimate or reimbursement of the seller’s costs rather than as a sanction for failing to obtain approval, so that it is not vulnerable to challenge as a penalty.
• Interim access and conduct covenant. Governs how the target is run between signing and completion, ensuring the buyer takes no control-like actions before clearance is granted. This cuts both ways. Pre-completion integration steps can amount to taking a significant action before approval and, under the merger regime that commenced in January 2026, to gun jumping.

Sample model clause (practitioner draft, adapt to the transaction and obtain local legal advice):

“If the FIRB Condition has not been satisfied or waived by the Long-Stop Date, and the Buyer has lodged a complete application, paid the applicable fee in full and complied with clause [X], the Long-Stop Date is automatically extended by two further periods of 30 days each, and by any further period the parties agree in writing. The Buyer must accept any condition attaching to a no objection notification unless it is a Materially Adverse Condition. Within 3 Business Days after the FIRB Condition is satisfied, the Escrow Agent must release the Escrow Amount to the Seller against a copy of the no objection notification and a notice from the Buyer confirming that any conditions have been accepted; if the Buyer does not give that notice within 2 Business Days after the FIRB Condition is satisfied, the Seller may give it on the Buyer’s behalf.”

This kind of extension-plus-escrow-release mechanism gives the parties time without leaving the purchase price stranded and ties release cleanly to the moment clearance (and any conditions) is secured.  It is only as good as its triggers: every one of them should be a document the parties can put their hands on.

Remedies, enforcement and when to consider termination or variation

Where clearance simply does not arrive, the contract usually provides the primary remedy: a right to terminate if the FIRB condition is not satisfied by the long-stop date.

Beyond termination, parties may negotiate substitute remedies, an extended timetable, a price adjustment or acceptance of conditions that were not originally contemplated. Injunctive relief to force a completion is generally not a realistic route where a statutory approval is outstanding, because taking a notifiable action without first notifying is an offence under the FATA and attracts civil penalties and, potentially, a disposal order.  A court will not order a party to do an act the statute prohibits.

Challenging a foreign investment decision is harder than the draft phrase “administrative law review” suggests. Decisions under the FATA are expressly excluded from review under the Administrative Decisions (Judicial Review) Act 1977 (Cth), so any challenge must be brought as judicial review in the Federal Court under the Judiciary Act, on grounds of legal error rather than merits. There is no general merits review of a conclusion that an investment is contrary to the national interest. The narrow exception is a review in the Administrative Review Tribunal, which replaced the Administrative Appeals Tribunal in October 2024, of a national security risk determination underpinning the last resort power. None of this is a realistic answer within a deal timetable. In control transactions, the Takeovers Panel is the practical forum for conduct disputes during a bid period and it works to its own tight timetable.

In most cases, the sensible path is to escalate constructively with Treasury, negotiate acceptable conditions and use the contractual extension and termination architecture to manage the outcome.

Recent reforms, ministerial practice and case highlights

The clear direction of travel in Australian foreign investment policy is toward sharper national security scrutiny.

Treasury and FIRB guidance has increasingly emphasised the screening of acquisitions touching critical infrastructure, sensitive data and strategically significant sectors, and ministerial practice reflects a greater willingness to impose conditions and undertakings rather than to grant unconditional clearance. This heightened focus is a principal reason approval delay has moved from a peripheral concern to a central deal-planning issue. Treasury has also signalled a risk-based approach that aims to streamline low-risk applications while devoting greater resources to sensitive ones.

On 19 May 2026, the Government announced a further package of reforms. On the streamlining side: a target of deciding all low-risk applications within 30 days from 1 January 2027; no objection notifications valid for 24 months rather than 12; wider exemption certificates, including power to adjust tracing and associate rules for trusted investors; a higher monetary threshold for acquisitions of non-sensitive businesses by investors that are not foreign government investors; and removal of the duplicate Register reporting for commercial land, businesses and entities. On the strengthening side: expanded mandatory notification for sensitive sectors, the call-in power extended to non-ownership arrangements such as offtake and lending, a lower threshold for the last resort power, a wider definition of associates and a lower anti-avoidance threshold. Most of this requires legislation.

None of it is law yet and exposure draft legislation had not been released at the date of this article. For a deal signing today, the practical point is that a long-stop date set 12 months out may straddle a change in the rules – which is an argument for extension mechanics that do not assume the framework stands still.

Practical implications for current transactions

For deals in the current environment, the national security lens will remain prominent, particularly for technology, data and infrastructure targets – the May 2026 package expressly extends mandatory notification in sensitive sectors even as it accelerates low-risk matters. The practical effect is a widening gap between the two ends of the spectrum: faster decisions for repeat investors in unremarkable sectors, and longer assessment windows, more conditions and a premium on early, well-prepared, applications everywhere else.

Parties should build generous timetables, anticipate undertakings and treat FIRB as a workstream to be managed from the first day of the deal, not a formality to be cleared at the end. This is especially so given the merger control regime that commenced on 1 January 2026, which adds a second mandatory approval clock to plan around.

Practical checklist and sample timeline for an SPA negotiation

• Pre-sign (buyer): complete FIRB due diligence and confirm whether notification is mandatory, and whether an exemption certificate is the better route.
• Pre-sign (buyer): engage Treasury confidentially where the analysis is finely balanced.
• Pre-sign (buyer): calculate the application fee and budget for it; a fee shortfall delays the start of the decision period.
• Pre-sign (seller): assemble the target data pack to support a complete application.
• Pre-sign (both): test the ACCC thresholds and, if they are met, build the merger timetable into the same critical path.
• At signing: include a FIRB condition precedent to completion.
• At signing: set a realistic long-stop date with built-in extension periods.
• At signing: define which conditions the buyer must accept and what makes a condition materially adverse.
• At signing: agree escrow arrangements and release triggers tied to clearance.
• At signing: negotiate reverse break / termination fee allocation.
• Post-sign (buyer): lodge a complete application promptly; respond to information requests quickly.
• Post-sign (both): maintain interim conduct covenants; keep lenders aligned.
• On clearance: confirm acceptance of any conditions, then complete and release escrow.
• Post-completion: give the Register of Foreign Ownership notices, and diarise compliance reporting against any conditions.

Conclusion

Delays in Australian foreign investment approval are no longer an edge case: they are a mainstream deal-planning reality driven by heightened national security scrutiny and a Treasurer armed with broad statutory powers. The current reform direction is two-speed – faster for the low-risk, slower and more conditional for everything the Government regards as sensitive – and the sensible planning assumption is that your deal will be assessed on the slower track until it is clear it is not.

The parties who navigate these best are those who treat FIRB as a workstream from day one: doing the due diligence early, engaging Treasury proactively, sequencing parallel regulators sensibly and, above all, drafting a contract that allocates timing risk through long-stop dates, extension mechanics, conditional completion, escrow triggers and reverse break fees. Handled that way, a FIRB delay becomes a managed contingency rather than a deal-breaker, and buyers and sellers alike retain the certainty they need to close.

Need Legal Advice?

This article was produced by Global Law Experts. For specialist advice on this topic, contact David Walker at 3D Corporate Law, a member of the Global Law Experts network.

Sources

• Foreign Acquisitions and Takeovers Act 1975 (Cth), Federal Register of Legislation
• Australian Government, Foreign Investment Review Board / Treasury foreign investment guidance — in particular Guidance Note 1 (Overview), Guidance Note 8 (National Security), Guidance Note 10 (Fees) and Guidance Note 15 (Register of Foreign Ownership of Australian Assets)
• Treasury, Quarterly report on foreign investment, 1 January to 31 March 2026 (processing times)
• Treasury, Further streamlining and strengthening the foreign investment framework (May 2026)
• Treasury, 2026 monetary screening thresholds (effective 1 January 2026)
• Australian Securities and Investments Commission
• Australian Competition and Consumer Commission, merger control regime: thresholds and exemptions for acquisition notification; assessment process and review timelines
• Australian Takeovers Panel, Guidance Note 7 (Deal protection), issue 5, 8 August 2023
• ASX, Listing rules and compliance guidance
• Administrative Decisions (Judicial Review) Act 1977 (Cth), Schedule 1
• Commonwealth Attorney-General’s Department