AUSTRALIA Trends and Developments Contributed by: Scott Colvin, Warren Scott and Lachlan Speirs, Archer Scott Lawyers
Outlook for 2026 and beyond None of this diminishes Australia’s appeal. It remains an open economy with transparent institutions, a sophisticated professional and financial services sec - tor, and deep connections to both Asia and the major Western markets through an extensive free trade net - work. Capital continues to flow into infrastructure, the energy transition, resources, healthcare, technol - ogy, and consumer and franchised businesses, even against a softer regional deal backdrop. What has changed is the premium on preparation. The mandatory merger regime rewards parties who plan competition and foreign investment strategy together and from the outset; the remade Franchising Code rewards franchisors who can demonstrate fair and sustainable systems; and the wider compliance frontier rewards buyers and sellers who diligence and document thoroughly. The transactions that struggle in 2026 will be those that treat these elements as after- thoughts. For international investors, the practical takeaway is straightforward: engage early, build realistic timetables and risk allocation into transaction documents, and choose advisers who can integrate the competition, foreign investment, franchising, employment and tax dimensions of a deal into one strategy. Approached that way, Australia in 2026 is as attractive a place to do business as ever, and a more predictable one for those who come prepared.
cial crime and sustainability into a single coherent transaction strategy. Financing and structuring: the tax overlay Tax is rarely the first thing international investors con - sider when they look at Australia, but it increasingly shapes how acquisitions are structured and financed. Three features in particular warrant early attention in any inbound deal. First, the earnings-based limits on debt deductions, which broadly cap net debt deductions by reference to 30% of tax EBITDA for multinational groups, con - strain how much benefit a buyer can extract from leveraging an Australian acquisition. Highly geared structures that once delivered substantial interest deductions may now see those deductions capped, which affects after-tax returns and the choice between debt and equity funding. Acquisition structures and shareholder loan arrangements should be modelled against these limits at the outset rather than assumed. Second, for large multinational acquirers, the global and domestic minimum tax, which underpins a mini - mum effective rate of 15%, adds a layer of analysis to any structure that touches low-taxed jurisdictions, and it is now a standard item in structuring and diligence for groups above the relevant size. Third, on the dis - posal side, a foreign resident capital gains withholding obligation applies to acquisitions of certain Australian property and relevant interests from foreign residents, at a rate of 15% since 1 January 2025, so buyers and sellers alike now build clearance and withholding mechanics into completion. None of this is prohibi - tive, but each rewards early, joined-up tax and legal planning. Entrants into Australia should also be aware of pro - posed changes to the taxation of Australian trusts (for - merly a common corporate vehicle). The government has proposed a minimum 30% tax on trusts, which would see trusts taxed at the same effective rate as many Australian private companies, lessening their use case in many circumstances.
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