The 'national interest' and the screening of foreign direct investment in Australia

Australia provides a liberal regulatory regime in the encouragement of foreign direct investment (FDI). One measure that continues to be used in the screening of inward FDI is that of the 'national interest' criterion. It allows the Australian treasurer the right to veto any project deemed to be 'contrary to the national interest'. This criterion is not defined, open to interpretation and thus potential political influence. This paper rejects the calls for the removal of the criterion, suggesting it is legitimate lever used by government to regulate economic behaviour, however suggestions are made for the establishment of guidelines and detailed 'judgements' to aid in its interpretation allowing for greater transparency in its application.