The Australian and United States Approaches to National Security and Foreign Investment Regulation

Foreign investment is an area that governments seek to strictly regulate due to perceived and real threats to national security. Governments also acknowledge that a hardline approach to regulation can reduce the economic benefits of investment. Both the United States and Australia have foreign investment schemes that seek to create an environment that protects national security interests and encourages investment. Although the recent reforms to Australia’s national security test are a step in the right direction, this article seeks to critique Australia’s national interest test in the Foreign Acquisitions and Takeovers Act 1975 (Cth), arguing it is too broad when compared with the narrower and more precise approach of the United States. It does so by comparing the regimes and looking in particular to the application on critical infrastructure