Rural

Rural Land is land that is used wholly and exclusively for carrying on a substantial business of primary production. A 'substantial primary production business' has a commercial purpose or character and is not merely carried on as a hobby or for recreation purposes and is involved in activities related to the cultivation of land; animal husbandry/farming; horticulture; fishing; forestry; viticulture or dairy farming. Primary production for the purpose of the rural land definition does not include vacant land (even if zoned 'rural'), hobby farms, land used for stock agistment or mining.

The definition of primary production is taken from the Income Tax Assessment Act 1936 which states "primary production means production resulting directly from:

* the cultivation of land;

* the maintenance of animals or poultry for the purpose of selling them or their bodily produce, including natural increase;

* fishing operations;

* forest operations; or

* horticulture;

and includes the manufacture of dairy produce by the person who produced the raw material used in that manufacture."

If land cannot be considered rural land then it is defined as urban land. Therefore, acquisitions by foreign interests of 'hobby farms', 'rural residential' blocks, land used for stock agistment and vacant land with rural zoning are included within the urban land category. Most acquisitions of rural and urban land by foreign interests require foreign investment approval.

Generally, where a foreign interest proposes to acquire a business of primary production valued at less than $100 million, the transaction is exempt from requiring foreign investment approval.
Acquisitions of such businesses valued at $100 million or more (or the relevant threshold for US investors or offshore takeovers) require prior approval and are normally approved unless considered contrary to the national interest.

Where the investment is by a foreign government or one of its agencies, foreign investment approval is required irrespective of the size of the investment.