Buying an established Australian business can be one of the cleanest ways into the market. The brand, the customers and the team already exist, and Australia welcomes foreign buyers in most industries. The acquisitions that go well, and the ones that go wrong, usually divide on a few things that look like friction at the start but are actually protection. Knowing what they are before you begin makes the whole process easier.
Shan Lai, who advises in Mandarin, Cantonese and English, spent 15 years practising in Beijing and has practised in Australia for 14 years, leads our work with Chinese buyers. She has acted on deals from small business purchases to cross-border transactions worth hundreds of millions. Here is what she tells Chinese buyers to expect.
Why the contract is so long, and why that is good for you
The first surprise is the size of the documents. A share sale agreement in Australia can run to 70 pages, and to a buyer used to a lighter contracting style that can feel excessive, even suspicious.
It is the opposite of a problem. A detailed contract is how an Australian deal gives both sides certainty, and much of that length exists to protect you, the buyer. Warranties, indemnities and conditions are the tools that put the risk where it belongs, on the seller, for things that were the seller’s responsibility. A buyer who pushes back on the documentation to make it shorter is often arguing away their own protection. The better move is to understand what each part does, which is exactly what a good adviser is for.
How the deal is structured: share sale or business sale
One of the first decisions in any acquisition is how it is structured. An Australian business can be bought as a share sale, where you buy the company that owns the business, or as a business sale, sometimes called an asset sale, where you buy the assets and the business itself but not the company. The two routes carry different consequences for tax, for which liabilities come across to you, for which contracts and employees transfer, and for what due diligence needs to cover. Which one suits you depends on the specific business and your plans for it, and the difference is significant enough that it is worth being fully across before you commit. A good legal team will walk you through the choice and what it means for your transaction.
Due diligence is where you find what you are really buying
Some buyers see due diligence as a delay, a box to tick before they get the deal done. Shan sees what happens when it is skipped. The checks are how you find the liabilities that are not obvious from the outside: tax exposure, employee entitlements, contracts that do not transfer, a brand that is not properly owned. Find them before completion, and you can deal with them, through the price, through indemnities, or by holding an amount back until a risk passes. Miss them, and you inherit them.
There is a balance to strike. A buyer who investigates carefully and asks sensible questions protects themselves. A buyer who demands everything, with no sense of what matters, can exhaust a seller and lose the deal. Shan has seen a buyer insist on copies of every bank statement, every entry, every customer, until the seller walked away. The skill is knowing which questions are worth asking, and a good legal team brings that judgement.
Will you need government approval?
Many Chinese buyers assume every purchase needs Foreign Investment Review Board approval. For most private buyers of an ordinary business, that is not the case. From 1 January 2026, private investors from countries with a free trade agreement with Australia, which includes China, are screened only above a high monetary threshold, so a typical small or mid-sized business purchase often sits below it.
The important exceptions are worth knowing. State-owned enterprises are screened on every deal, whatever the size. Sensitive sectors, such as media, telecommunications and defence-related industries, and agricultural land and agribusiness, are screened at much lower levels. So whether you need approval depends on who is buying and what they are buying. It is one of the first questions to settle, because it affects your timeline.
Planning how the money moves
The constraint you already know is the one most likely to affect the deal: getting funds out of China takes time. The controls are strict and tightened again from the start of 2026, and a large purchase has to climb through layers of approval. Australian sellers often do not understand why this takes so long, and can mistake the delay for a loss of interest.
Where this goes wrong is when the timing is left unsaid and the seller is left guessing. The deals that hold together plan for it openly, build a realistic payment timeline in early, and find a payment structure that works for both sides. What that structure looks like depends on the size of the deal, the sector, and how patient the seller is, so it is worth taking advice on before you commit to dates. A deal that assumes the money will move quickly often does not survive the wait.
Protecting the brand you are buying
For many buyers, the brand and its goodwill are the point of the purchase. Make sure the deal actually transfers them: that the trademarks are properly owned and registered, that the goodwill passes to you, and that you can keep using the brand after completion. This is something due diligence and the contract handle together, and it is worth getting right, because the brand is often the most valuable thing you are paying for.
The buyers who get it right
Shan’s clearest example of a buyer doing it well is one who came in, did the due diligence, took proper advice early, did not cut corners to save a little at the start, and set out to operate the business properly in the Australian way rather than forcing their own approach onto it. That buyer succeeded. The pattern is consistent: respect the process, understand what each step protects, and the deal tends to go your way.
A practical first step
Before you commit, settle 3 questions: whether your purchase needs FIRB approval, a realistic timeline for moving your funds, and the scope of due diligence that fits the deal. Each is straightforward with the right local team, and costly to get wrong without one.
Common questions about buying a business in Australia
Can a foreigner buy a business in Australia?
Yes. Buying an established Australian business is one of the cleanest ways into the market, and foreign buyers are welcome in most industries. The brand, the customers and the team already exist. The deals that go well, and the ones that go wrong, usually divide on a few things that look like friction at the start but are actually protection. Knowing what they are before you begin makes the whole process easier.
Do I need FIRB approval to buy a business in Australia?
Often not, if you are a private buyer of an ordinary business. From 1 January 2026, private investors from countries with a free trade agreement with Australia, which includes China, are screened only above a high monetary threshold, so a typical small or mid-sized purchase often sits below it. The exceptions matter though: state-owned enterprises are screened on every deal, and sensitive sectors are screened at much lower levels.
Which purchases always need government approval in Australia?
Two situations to watch. State-owned enterprises are screened on every deal, whatever the size. And sensitive sectors, such as media, telecommunications and defence-related industries, plus agricultural land and agribusiness, are screened at much lower levels than an ordinary business. So whether you need approval depends on who is buying and what they are buying. It is one of the first questions to settle, because it affects your timeline.
Why is an Australian share sale agreement so long?
Because the length is doing a job, and much of it protects you as the buyer. A share sale agreement here can run to 70 pages. Warranties, indemnities and conditions are the tools that put the risk where it belongs, on the seller, for things that were the seller’s responsibility. A buyer who pushes back to make the contract shorter is often arguing away their own protection. The better move is to understand what each part does.
Should I buy the shares or the business assets?
It depends on the business and your plans for it. An acquisition can be structured as a share sale, where you buy the company that owns the business, or a business sale (an asset sale), where you buy the assets and the business but not the company. The two routes differ on tax, on which liabilities transfer to you, and on which contracts and employees come across. The difference is significant, so it is worth being across it with a good legal team before you commit.
What is due diligence when buying a business?
It is how you find what you are really buying. The checks surface liabilities that are not obvious from the outside: tax exposure, employee entitlements, contracts that do not transfer, a brand that is not properly owned. Find them before completion and you can deal with them, through the price, through indemnities, or by holding an amount back until a risk passes. Miss them and you inherit them. The skill is knowing which questions are worth asking.
How does moving money out of China affect buying a business?
It affects the timing, and it is the constraint most likely to touch the deal. The controls are strict and tightened again from the start of 2026, so a large purchase has to climb through layers of approval. Australian sellers often mistake the delay for a loss of interest. Where it goes wrong is leaving the timing unsaid. The deals that hold together plan for it openly and build a realistic payment timeline in early, with a structure that fits the size of the deal and the seller, which is worth taking advice on before you commit to dates.
What to do next
If you are looking at buying a business in Australia, it helps to have a legal team that understands both the Australian deal and where you are coming from. Shan Lai leads our work with Chinese buyers, advises in Mandarin, Cantonese and English, and has handled acquisitions at every level.
Download our free guide, Doing Business in Australia: Setting Up, Buying and Selling, for the full picture on what to plan for.
Or book a call with Shan and our team, and we will walk you through the process and what to plan for first.
Last reviewed: 21 August 2026.
