Treasurer Wayne Swan said some screening requirements on foreign investors impose unnecessary compliance costs on businesses.

He added that fixed foreign investment screening thresholds captured ever more low-value foreign investment proposals each year that did not raise any national interest issues.

“This can act as a major disincentive where overseas investors are seeking to set up businesses in Australia which put more Australians in jobs and create more activity in our economy,” he said.

The government aims to replace the current four lowest thresholds applying to foreign business investment to a single threshold.

For Australian businesses worth less than $219 million, the new threshold will allow overseas businesses to buy a stake of more than 15% without a review.

This will replace the lowest $100 million threshold that triggers reviews.

“Based on 2008-09 figures, the changes will reduce the number of applications screened by the Foreign Investment Review Board by about 20 per cent,” Swan said.

The head of Deloitte’s merger and acquisition advisory group, Tony Garrett, is already supporting the proposed reform.

“Currently, our M&A and market looks more favourable than it has for few months as confidence restores,” he said.

“This move by our government will enhance Australia’s solid reputation to foreign investors.

“It should be of particular benefit to those in the resource sector and is likely to improve liquidity levels in mid-sized commercial property deals.

“The new and higher approval-free threshold also buys a substantially greater amount of assets than it did 12 months ago.

“The revised arrangements are likely to open our market to greater levels of review of investment opportunities by international buyers, which in turn should increase Australian investment volumes over the next 12 months.”

Another proposed reform will abolish the current requirement for foreign investors to notify the government if establishing a new business worth more than $10 million.

Bowen Energy is the latest Australian coal junior subject to a takeover, with Bhushan Steel’s current offer of 14c per share closing August 26.

Bhushan has boosted its stake from 22.23% to 56.49%.

Various press reports indicate some Bowen shareholders were not satisfied with the takeover offer while the Australian Securities Exchange has referred shareholder complaints to the Australian Securities and Investments Commission due to matters relating to corporations law.

Coal junior takeover targets Rey Resources and Caledon Resources fall under the $219 million threshold.

Based on current market cap, other Australian Securities Exchange-listed coal juniors under the proposed $219 million threshold include Cockatoo Coal, Northern Energy, Coalworks, Resource Generation and Tiaro Coal.