Australia Orders China-Linked Entities to Divest Rare Earths Stake
The Australian government has ordered six entities with ties to China to sell their shares in Northern Minerals, a rare earths mining company, citing national interest concerns.
Treasurer Jim Chalmers issued the divestment orders on Monday. The six entities, which collectively hold approximately 17% of the company, must sell their shares within two weeks.
The Divestment Order
The six entities ordered to divest are:
- Hong Kong Ying Tak Ltd
- Real International Resources Ltd
- Qogir Trading & Service Co Ltd
- Chuanyou Cong
- Vastness Investment Group Ltd
- Zhongxiong Lin
A spokesman for Treasurer Chalmers stated the decision was made consistent with advice from the Treasury and the Foreign Investment Review Board (FIRB). The rationale cited by the government includes protecting the national interest and ensuring compliance with Australia's foreign investment framework.
The Treasurer stated the government operates "a robust and non-discriminatory foreign investment framework."
Background on Northern Minerals
Northern Minerals is developing the Browns Range Heavy Rare Earths Project in East Kimberley, Western Australia. The project aims to produce dysprosium and terbium—critical heavy rare earth elements used in heat-resistant magnets for clean energy applications, military technology, and computing.
China currently mines approximately 60% of the world's raw rare earth materials and refines 95-98% of the processed supply. Australia's stated objective is to become the first significant non-Chinese source of processed dysprosium, potentially through refining output from Northern Minerals' project at a new Australian refinery. The company has secured approximately $500 million in funding from the Export Import Bank of the United States.
Previous Government Actions
This divestment order is the latest in a series of government interventions regarding Northern Minerals:
- 2023: Treasurer Chalmers blocked Yuxiao Fund from increasing its stake in the company.
- 2024: The government ordered five other China-linked companies to divest their shares.
- 2025: The Treasury took one of the largest shareholders to court for allegedly defying a prior sell order by transferring shares to a director.
The FIRB has indicated that three of the blocked investors from the 2024 order may have breached the order by transferring shares to Hong Kong Ying Tak Ltd. Earlier this year, Vastness Investment Group (one of the six entities in the current order) attempted to remove the company's chairman but later abandoned the bid.
Statements and Responses
John Coyne of the Australian Strategic Policy Institute commented that the government appears to have concluded that several China-based investors ignored repeated directives, and that the move signals Australia's willingness to use investment policy as a tool of economic security.
Northern Minerals has entered a trading halt and stated it is considering the government orders. As of the time of reporting, the ABC was unable to contact the six investors for comment.