Debunked! Will Chinese-owned property in Australia be "confiscated by the government"?

Australia has long been favoured by property investors worldwide thanks to its unique natural environment, excellent education resources, stable political and economic climate, and sound investment conditions — with Chinese buyers being particularly prominent. As the pandemic has been effectively brought under control in Australia, global buyers are now gradually returning to the Australian property market. Recently, however, numerous social media posts have claimed that "Chinese buyers may have their Australian properties confiscated." Could it be that the Australian government intends to seize vacant properties and turn them into affordable rental housing?

Australian property law specialists have provided the following professional analysis:

• Under what circumstances would the Australian government acquire personal assets?

• Are the claims that Chinese-owned vacant properties in Australia could be forcibly acquired for affordable housing true or false?

Private property is the most fundamental of civil rights — a defining feature that makes citizens citizens, society society, and allows a political system to remain stable.

Australia has established relevant provisions within its constitution, property law, criminal law and other legislation to protect citizens' rights. This article cannot cover every aspect comprehensively, but it will illustrate common situations arising under criminal law and property law with examples.

Under what circumstances would the Australian government acquire personal assets

1. Criminal Law

In Australia, criminal law can authorise the government to confiscate personal assets. For example, under the Proceeds of Crime Act 2002 (Cth) (hereinafter "the Act"), regardless of a person's nationality, if they commit an offence within Australia or overseas, their assets in Australia may be subject to a restraining order.

The purpose of a restraining order is to prevent the proceeds of crime from being removed or disposed of. 

 Sections 17, 18, 19, 20 and 20A of the Act stipulate that restraining orders may be issued against persons who have been convicted or charged, persons suspected of committing a serious offence, persons whose property is suspected to be the proceeds of an indictable offence, persons suspected of deriving literary proceeds from an indictable offence, and persons with unexplained wealth.

· Section 37: After receiving a restraining order, no person may dispose of or otherwise deal with the restrained assets, or they will face 5 years' imprisonment or a fine of A$63,000, or both.

· Section 45: A restraining order will cease to have effect if the suspect is not convicted or charged within 28 days of the order being issued.

·Section 47: If a restraining order has been in effect for at least 6 months, it may become one of the conditions for the court to issue a forfeiture order.

2. Property Law / Administrative Law / Constitutional Law

Take Queensland as an example. Under the Property Law Act 1974 (Qld), where a borrower is unable to repay a loan, the mortgaged assets may be sold by auction, placed under receivership, or the equity of redemption may be foreclosed.

Of course, in a democratic nation like Australia, when the federal government declares a national state of emergency — such as in the case of war, national defence, terrorist attacks, or natural disasters — federal powers are expanded and may restrict citizens' basic rights, such as personal freedom. Section 51(xxxi) of the Australian Constitution grants the government, within the scope of its powers, the ability to acquire personal property (including both movable and immovable property).

Australian courts have not provided a clear and precise definition of "acquisition." However, from the case of Wurridjal v Commonwealth (2009) 252 ALR 232, we know that under the Northern Territory's emergency response legislation, the Northern Territory imposed a compulsory 5-year land lease on Aboriginal people, and the High Court ruled that this lease constituted an "acquisition."

Are Chinese-owned vacant properties in Australia being forcibly acquired for affordable housing?

In response to the online rumours that vacant properties are "being confiscated," we randomly opened a WeChat article with over 30,000 views. As the screenshot below shows, the confiscation claim is said to originate from a Reuters news report dated 12 May.

However, we were unable to find any related article published by Reuters around 12 May. This is clearly another fabricated news story crafted amid a particular international climate.

In fact, as the search records in the image below show, this news story has been "circulating" as far back as 2018. The same recipe, the same flavour — recycled every year whenever international friction arises.

In summary: the claim that Chinese buyers will have their Australian properties confiscated, and that vacant homes will be acquired for affordable housing, is a complete and utter rumour!!
The policy the Australian government introduced in 2017 states that "if a property in Australia is left vacant and unoccupied for more than 183 days per year, a vacancy tax will be levied,"  aimed at cracking down on property speculation and avoiding the waste of resources.