Document ID: chunk:federal_register_of_legislation:F2023L01671:clause:2_8
Version: federal_register_of_legislation:F2023L01671
Segment Type: clause
Provision Reference: sch 2 cl 8
Character Range: 6083–8907

8  Matters to be considered when making Investment Decisions
 (1) Before making an Investment Decision, the Facility must take into account such views on the proposed Investment Decision as are notified to the Facility under section 16 and subsections 17(1) and 17(2).
 (2) Before making an Investment Decision, the Facility must be satisfied of all of the following matters:
 (a) the Investment Proposal meets all applicable Mandatory Criteria;
 (b) there is alignment between the Investment Proposal and one or more of the Government Policy Priorities;
 (c) the return on any financial assistance provided under the Investment Decision is likely to cover at least the Facility's administrative costs and the Commonwealth's cost of borrowing;
 (d) the Facility will not be the sole holder of financial risk in the Project;
 (e) there is a reasonable allocation of risk for the Project between the Facility and other sources of finance for the Project;
 (f) it can appropriately manage the Facility's risk exposure in the Project, including via methods such as covenants or reporting mechanisms;
 (g) the Facility's risk exposure in the Project, as identified through its due diligence, amounts to an acceptable level of risk in the Project.
 (3) Before making an Investment Decision, the Facility must have regard to all of the following matters:
 (a) the Risk Appetite Statement;
 (b) the extent of any concession that may be offered for the Project, in accordance with section 10 of this Direction;
 (c) an appropriate interest rate or target rate of return for the financial assistance to be offered;
 (d) the inherent risk of the Project and its capital structure;
 (e) the potential effect of the Project on other economic infrastructure;
 (f) the potential effect of the investment on the Australian infrastructure financing market;
 (g) the potential effect of the investment on the activities of other Commonwealth entities;
 (h) the potential of the investment to encourage private sector participation in financing the Project;
 (i) the costs and benefits of the Investment Decision as compared with other Investment Proposals the Facility has under consideration;
 (j) the advantages of a diversified portfolio of investments, including with respect to industry sector and geographic spread across the jurisdictions that comprise Northern Australia;
 (k) the extent to which the Project addresses identified economic infrastructure needs, as noted through Commonwealth, State or Territory assessment processes, pipelines, or priority lists;
 (l) the extent to which the Project contributes, or would contribute to, the material improvement to the infrastructure of a region;
 (m) the extent to which the Project contributes, or would contribute to, the provision of public benefit to the residents of a region.