{"id":"F2026L00383","name":"Regional Investment Corporation (Drought Hardship Loans) Rules 2026","slug":"regional-investment-corporation-drought-hardship-loans-rules-2026","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":443227,"registerId":"F2026L00383-fast-fetch-1775958118093","compilationNumber":null,"startDate":"2026-04-12","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Regional Investment Corporation (Drought Hardship Loans) Rules 2026","content":"---\nmeta-content-style-type: text/css\nmeta-content-type: application/xhtml+xml; charset=utf-8\n---\n\n?xml version=\"1.0\" encoding=\"utf-8\" standalone=\"no\"?>\n\n![Commonwealth Coat of Arms of Australia](image.001.jpeg)\n\n \n\nRegional Investment Corporation (Drought Hardship Loans) Rules 2026\n\nWe, Julie Collins, Minister for Agriculture, Fisheries and Forestry, and Katy Gallagher, Minister for Finance, make the following rules.\n\nDated 25 March 2026\n\n \n\n| Julie Collins | Katy Gallagher |\n| --- | --- |\n| Minister for Agriculture, Fisheries and Forestry | Minister for Finance |\n\n\n \n\n \n\n \n\n \n\n \n\nContents\n\nPart 1—Preliminary\n\n1 Name\n\n2 Commencement\n\n3 Authority\n\n4 Definitions\n\nPart 2—Drought Hardship Loans Program\n\nDivision 1—Prescribing Drought Hardship Loans Program\n\n5 Drought Hardship Loans Program prescribed\n\n6 Constitutional basis for program\n\n7 Additional operation of program\n\nDivision 2—Making drought hardship loans\n\n8 Making loans\n\n9 Eligibility for loan\n\n10 Application for loan\n\n11 Informing applicant of outcome of applications for loan\n\nDivision 3—Terms and conditions of loans\n\n12 Maximum amount of loan\n\n13 Other terms and conditions of loan\n\nDivision 4—Loan management\n\n14 Mediation\n\n15 Waiver decisions\n\n16 Loan foreclosure decisions\n\n17 Charging of transaction costs\n\nDivision 5—Funding of loans\n\n18 Funding of loans\n\n19 Corporation to pay amounts collected to Commonwealth\n\nDivision 6—Involvement of responsible Ministers\n\n20 Quarterly reporting to responsible Ministers\n\n21 Directions by responsible Ministers\n\nPart 3—Other functions relating to program\n\nDivision 1—Corporation functions\n\n22 Preparing and publishing guidelines relating to program\n\n23 Provision of information and advice\n\nDivision 2—Board functions\n\n24 Ensuring internal review of decisions about loans\n\n25 Developing and applying loan management policies and procedures\n\n \n\nPart 1—Preliminary\n\n \n\n1  Name\n\n  This instrument is the Regional Investment Corporation (Drought Hardship Loans) Rules 2026.\n\n2  Commencement\n\n (1) Each provision of this instrument specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.\n\n \n\n- Commencement information\n- Column 1 Column 2 Column 3\n- Provisions Commencement Date/Details\n- 1. Sections 1 to 4 and anything in this instrument not elsewhere covered by this table The day after this instrument is registered. 27 March 2026\n- 2. Sections 5 to 21 30 March 2026. 30 March 2026\n- 3. Section 22 The day after this instrument is registered. 27 March 2026\n- 4. Sections 23 and 24 30 March 2026. 30 March 2026\n- 5. Section 25 The day after this instrument is registered. 27 March 2026\n\n\nNote: This table relates only to the provisions of this instrument as originally made. It will not be amended to deal with any later amendments of this instrument.\n\n (2) Any information in column 3 of the table is not part of this instrument. Information may be inserted in this column, or information in it may be edited, in any published version of this instrument.\n\n3  Authority\n\n  This instrument is made under the Regional Investment Corporation Act 2018.\n\n4  Definitions\n\nNote: A number of expressions used in this instrument are defined in the Act, including the following:\n\n(a) Board;\n\n(b) Corporation;\n\n(c) Desertification Convention;\n\n(d) responsible Ministers.\n\n  In this instrument:\n\nAct means the Regional Investment Corporation Act 2018.\n\naffected area has the same meaning as in the Desertification Convention.\n\ncommercial debt means debt established on commercial terms, at commercial interest rates.\n\nmaximum loan amount for a business has the meaning given by section 12.\n\npermanent resident has the same meaning as in the Australian Citizenship Act 2007.\n\nprogram means the Drought Hardship Loans Program prescribed by section 5.\n\ntotal debt of a business has the meaning given by section 12.\n\nPart 2—Drought Hardship Loans Program\n\nDivision 1—Prescribing Drought Hardship Loans Program\n\n5  Drought Hardship Loans Program prescribed\n\n (1) For the purposes of paragraph 8(1)(g) of the Act, the Drought Hardship Loans Program is prescribed.\n\nPurpose of program\n\n (2) The purpose of the program is for the Corporation to make concessional loans to farm businesses that are in financial need of those loans, and are experiencing a financial impact as a result of prolonged drought, to assist those businesses to manage or recover from the impact of drought.\n\nScope of program\n\n (3) The program consists of the following:\n\n (a) making loans under this instrument in accordance with Division 2;\n\n (b) determining under Division 3 the terms and conditions on which those loans are made;\n\n (c) taking security for those loans;\n\n (d) charging applicants for those loans, and recipients of those loans, transaction costs incurred by the Corporation in relation to the program;\n\n (e) collecting and dealing with payments of interest on, and repayments of principal of, those loans;\n\n (f) managing those loans, and, if required, enforcing security taken for those loans or taking foreclosure action in relation to those loans;\n\n (g) reviewing periodically those loans and the terms and conditions on which they are made;\n\n (h) dealing with debts relating to those loans;\n\n (i) reporting to the responsible Ministers on those loans in accordance with Division 6;\n\n (j) other matters incidental to a matter in an earlier paragraph.\n\nNote: See also Division 5 (about funding of loans).\n\n6  Constitutional basis for program\n\n  For the purposes of paragraph 8(5)(a) of the Act, the program relies on the Commonwealth’s legislative powers under paragraph 51(xxix) (external affairs) of the Constitution as it relates to giving effect to Australia’s obligations under the Desertification Convention.\n\n7  Additional operation of program\n\n (1) For the purposes of paragraph 8(5)(a) of the Act, and in addition to section 6 of this instrument, the program also has effect as provided by this section.\n\nConstitutional trade and commerce\n\n (2) The program also has the effect it would have if a reference to primary production activities in paragraph 9(2)(c) were expressly confined to primary production activities undertaken in the course of:\n\n (a) trade or commerce between Australia and places outside Australia; or\n\n (b) trade or commerce among the States; or\n\n (c) trade or commerce within a Territory, between a State and a Territory or between 2 Territories.\n\nCorporations\n\n (3) The program also has the effect it would have if a reference to primary production activities in paragraph 9(2)(c) were expressly confined to primary production activities undertaken by a corporation to which paragraph 51(xx) of the Constitution applies.\n\nTerritories\n\n (4) The program also has the effect it would have if a reference to primary production activities in paragraph 9(2)(c) were expressly confined to primary production activities undertaken in a Territory.\n\nDivision 2—Making drought hardship loans\n\n8  Making loans\n\n  The Corporation may make a loan under this instrument to a business if:\n\n (a) the business is eligible for the loan; and\n\n (b) the business makes an application in accordance with section 10.\n\n9  Eligibility for loan\n\n (1) A business is eligible for a loan under this instrument if the requirements of this section are satisfied in relation to the business.\n\nNature of business\n\n (2) A requirement is that:\n\n (a) the business is a farm business; and\n\n (b) either\n\n (i) the business is located in an affected area; or\n\n (ii) the business is not located in an affected area and the Corporation is satisfied that the area the business is located in is affected by drought; and\n\n (c) all primary production activities of the business are undertaken wholly within Australia.\n\nEffect of drought on business\n\n (3) Another requirement is that the Corporation is satisfied that there has been a material reduction in the turnover of the business from farm activities because of the business being impacted by drought.\n\n (4) Another requirement is that the Corporation is satisfied that:\n\n (a) for a period of at least 24 months before the business makes the application in accordance with section 10, the business was affected by drought but had continued to operate; and\n\n (b) the business is expected to be financially impacted by drought for at least the next 12 months.\n\nBusiness requirement\n\n (5) Another requirement is that:\n\n (a) the business is carried on by an entity that is:\n\n (i) a sole trader; or\n\n (ii) a partnership; or\n\n (iii) a trust; or\n\n (iv) a corporation (within the meaning of the Corporations Act 2001), other than a public company (within the meaning of that Act); and\n\n (b) the entity carrying on the business is registered for tax purposes in Australia with an Australian Business Number (ABN) and registered under the A New Tax System (Goods and Services Tax) Act 1999; and\n\n (c) the Corporation is satisfied that the sole trader, at least one of the partners in the partnership, at least one beneficiary of, or unit‑holder in, the trust or at least one member of the corporation:\n\n (i) is an Australian citizen or permanent resident; and\n\n (ii) contributes or plans to contribute at least 75% of their labour to the business; and\n\n (iii) derives or plans to derive at least 50% of their income from the business; and\n\n (d) the entity carrying on the business is not subject to external administration or bankruptcy; and\n\n (e) the business has a drought management plan that sets out the business’s drought preparedness, drought management and drought recovery strategies.\n\nFinancial requirements\n\n (6) Another requirement is that the Corporation is satisfied that:\n\n (a) the business is financially viable or has sound prospects of a return to financial viability within 5 years; and\n\n (b) the business has the capacity to repay the loan; and\n\n (c) the business has provided sufficient security for the loan.\n\n (7) Another requirement is that the Corporation is satisfied that the business is in financial need of a concessional loan.\n\nDebt requirement\n\n (8) Another requirement is that, at the time the application is made, the business:\n\n (a) owes commercial debt; and\n\n (b) has the support of each commercial lender to the proposed loan under this instrument.\n\n10  Application for loan\n\n (1) A business may make an application for a loan under this instrument.\n\n (2) The application must:\n\n (a) be in a form approved under subsection (3); and\n\n (b) include the information (if any) required by the Corporation; and\n\n (c) be accompanied by the documents (if any) required by the Corporation; and\n\n (d) be made in the manner (if any) approved under subsection (4).\n\n (3) The Corporation must, in writing, approve a form for the purposes of paragraph (2)(a). The Corporation must publish the form on its website.\n\n (4) The Corporation may, in writing, approve a manner for the purposes of paragraph (2)(d). The Corporation must give details of the manner on its website.\n\n11  Informing applicant of outcome of applications for loan\n\n (1) The Corporation must ensure that an applicant for a loan under this instrument is informed in writing of the outcome of the application as soon as practicable after a decision on the application is made.\n\n (2) For a decision to refuse an applicant a loan, the Corporation must give the applicant written reasons for the refusal.\n\nDivision 3—Terms and conditions of loans\n\n12  Maximum amount of loan\n\n (1) The Corporation must not make a loan under this instrument to a business that exceeds the maximum loan amount.\n\n (2) The maximum loan amount for a business is the lesser of the following:\n\n (a) an amount that would result in the business holding 50% of its total debt in Commonwealth‑funded concessional loans;\n\n (b) $250,000.\n\n (3) The total debt of a business is the sum of:\n\n (a) the business’s commercial debt; and\n\n (b) the amount owing under each Commonwealth‑funded concessional loan provided to the business.\n\n13  Other terms and conditions of loan\n\n (1) In addition to section 12, a loan agreement in relation to a loan under this instrument to a business must provide for the loan to be made on terms and conditions that include the following:\n\n (a) the term of the loan is 5 years;\n\n (b) the loan is to be used to assist the business to manage or recover from the impact of drought by meeting operating expenses of the business;\n\n (c) the accrual of interest for the term of the loan;\n\n (d) no principal or interest is payable for the first 2 years of the loan;\n\n (e) the business must pay interest and repay the principal over the final 3 years of the loan;\n\n (f) the business being able to make a full or partial early repayment of the principal or interest (or both) at any time during the term of the loan without penalty;\n\n (g) all outstanding amounts must be repaid at the end of the term of the loan.\n\nNote: Part 2 of the Regional Investment Corporation Operating Mandate Direction 2018 deals with the interest rates applying to loans under this instrument.\n\n (2) The Corporation may, by notice in writing given to the business, determine other terms and conditions on which the loan is made (including other terms and conditions relating to amortisation of the loan).\n\nDivision 4—Loan management\n\n14  Mediation\n\n  The Corporation must:\n\n (a) offer to undertake mediation in respect of debts relating to loans under this instrument; and\n\n (b) undertake the mediation if the offer is accepted.\n\n15  Waiver decisions\n\n  A decision to waive a debt relating to a loan under this instrument must be made by the Corporation (not a delegate of the Corporation):\n\n (a) with the agreement of the Board (not a delegate of the Board); and\n\n (b) after the Corporation (not a delegate of the Corporation) has consulted the responsible Ministers and taken their views into account.\n\n16  Loan foreclosure decisions\n\n  A decision on foreclosure on a loan under this instrument must be made by the Corporation (not a delegate of the Corporation) with the agreement of the Board (not a delegate of the Board).\n\n17  Charging of transaction costs\n\n  For the purposes of subparagraph 8(5)(b)(i) of the Act, the Corporation may charge applicants for loans under this instrument, and recipients of loans under this instrument, transaction costs incurred by the Corporation in relation to the program.\n\nDivision 5—Funding of loans\n\n18  Funding of loans\n\n (1) Funds for the Corporation, to make loans under this instrument, are to be made out of money appropriated by the Parliament by an Act.\n\nNote: The Act will usually be an Annual Appropriation Act.\n\n (2) The Commonwealth is to provide funds to the Corporation for loans under this instrument, upon the Corporation’s request, to enable the Corporation to make loans to businesses under this instrument as required.\n\n (3) The Corporation must:\n\n (a) only request funds from the Commonwealth as the funds are required to make loans to businesses under this instrument; and\n\n (b) only use funds provided for loans under this instrument for that purpose.\n\n19  Corporation to pay amounts collected to Commonwealth\n\n  The Corporation must pay the Commonwealth, as soon as reasonably practicable, all payments received by the Corporation, from recipients of loans under this instrument, that are payments of interest on, or repayments of principal of, those loans.\n\nNote: For the payment of transaction costs in relation to the program, see section 17.\n\nDivision 6—Involvement of responsible Ministers\n\n20  Quarterly reporting to responsible Ministers\n\n  The Corporation must provide a report on loans under this instrument to the responsible Ministers as at the end of every March, June, September and December, including information regarding:\n\n (a) the uptake of those loans; and\n\n (b) details of the portfolio of those loans; and\n\n (c) financial performance information.\n\n21  Directions by responsible Ministers\n\n  For the purposes of subparagraph 8(5)(b)(iii) of the Act, the responsible Ministers may give written directions to the Corporation in relation to the program (other than directions that direct, or have the effect of directing, the Corporation in relation to a particular loan under this instrument).\n\nPart 3—Other functions relating to program\n\nDivision 1—Corporation functions\n\n22  Preparing and publishing guidelines relating to program\n\n  For the purposes of paragraph 8(1)(h) of the Act, the Corporation has the functions of:\n\n (a) preparing written guidelines about the program, including guidelines about:\n\n (i) the eligibility criteria for loans under this instrument; and\n\n (ii) the types of security the Corporation may consider and require for loans under this instrument; and\n\n (iii) the right to request review of decisions to make or refuse loans under this instrument and the process for requesting such reviews; and\n\n (iv) loans that the Corporation considers to be Commonwealth‑funded concessional loans; and\n\n (b) publishing the guidelines on the Corporation’s website.\n\n23  Provision of information and advice\n\n  For the purposes of paragraph 8(1)(h) of the Act, the Corporation has the functions of:\n\n (a) providing information about loans under this instrument to the responsible Ministers on request; and\n\n (b) advising the Commonwealth on matters that may improve the operation and policy outcomes of those loans.\n\nDivision 2—Board functions\n\n24  Ensuring internal review of decisions about loans\n\n  For the purposes of paragraph 15(1)(e) of the Act, the Board has the function of ensuring that:\n\n (a) the Corporation develops and applies procedures for the review, on request, of any decision (the original decision) to make or refuse a loan under this instrument; and\n\n (b) those procedures:\n\n (i) are transparent, robust and fair; and\n\n (ii) provide for the review to be carried out, and a decision to be made on the review, by a person or persons who were not involved in making the original decision; and\n\n (iii) are consistent with principles of procedural fairness.\n\n25  Developing and applying loan management policies and procedures\n\n (1) For the purposes of paragraph 15(1)(e) of the Act, the Board has the functions of:\n\n (a) ensuring that the Corporation develops policies and procedures described in subsection (2), taking into account the following matters:\n\n (i) the concessional nature of loans under this instrument;\n\n (ii) the effect on recipients of those loans of taking action in accordance with those policies and procedures; and\n\n (b) ensuring that the Corporation applies those policies and procedures taking those matters into account.\n\n (2) Subsection (1) applies to policies and procedures for managing loans under this instrument in a prudential manner to minimise the risk of default, including policies and procedures for:\n\n (a) arrears management; and\n\n (b) recovery action; and\n\n (c) foreclosure arrangements; and\n\n (d) waiving debt after consulting the responsible Ministers; and\n\n (e) writing off debt; and\n\n (f) handling disputes and complaints.\n","sortOrder":0}],"analysis":{"kimi_summary":{"content_quality":"ok","complexity_score":5,"scope_assessment":{"changed":false,"description":"The legislation remains tightly focused on its original purpose of providing concessional drought loans to farm businesses. The scope aligns with the enabling Act's intent and does not expand into unrelated areas."},"complexity_factors":["Multiple constitutional bases required (external affairs power via Desertification Convention, corporations power, territories power, trade and commerce power) to ensure validity","Nested eligibility criteria with multiple sub-requirements (section 9 has 8 separate requirement categories, some with multiple sub-bullets)","Cross-references to parent Act (Regional Investment Corporation Act 2018) and other legislation (Corporations Act 2001, Australian Citizenship Act 2007, A New Tax System (GST) Act 1999)","Defined terms that themselves require calculation (maximum loan amount depends on ratio of concessional debt to total debt)","Conditional commencement dates with staggered implementation across different sections","Specific procedural safeguards for high-stakes decisions (waiver and foreclosure require Corporation + Board agreement, not delegates)","Dual ministerial oversight requirements (Agriculture and Finance Ministers both involved)"],"plain_english_summary":"The Drought Hardship Loans Program lets the Regional Investment Corporation provide government-backed concessional loans to drought-affected Australian farm businesses to cover operating costs and help them recover. Loans are limited (up to $250,000), run five years with a two-year repayment holiday, and require viability, lender support, a drought plan and security. The scheme gives breathing space to keep farms solvent, with ministerial oversight, reporting and mediation for distressed borrowers."},"flash_summary":{"complexity_score":6,"scope_assessment":{"changed":false,"description":"The instrument establishes a new Drought Hardship Loans Program under the Regional Investment Corporation Act 2018 and defines its scope, mechanics and governance. The text does not indicate it modifies an earlier version of the program or narrows/expands a pre‑existing statutory scope within this instrument."},"complexity_factors":["Multi‑layered eligibility criteria in s9 (location/affected area, 24‑month prior drought impact, expected 12‑month impact, entity types, ABN/GST registration, residency and labour/income thresholds, viability, security, commercial debt and lender support).","Loan cap formula and interaction with existing Commonwealth concessional debt (s12) — lesser of 50% of total debt held in Commonwealth concessional loans or $250,000; total debt aggregates commercial debt and existing Commonwealth concessional loans.","Unusual loan mechanics in s13: 5‑year term, 2‑year interest/principal holiday, accrual of interest, repayment over final 3 years, early repayment allowed without penalty, and linkage to Operating Mandate Direction for interest rates.","Decision‑making constraints and non‑delegable actions (ss15–16): waivers and foreclosure require Corporation and Board agreement and consultation with responsible Ministers, limiting routine delegation.","Funding and cashflow rules (ss18–19): on‑demand Parliamentary appropriation requests, restriction on use of funds, and obligation to remit repayments to the Commonwealth.","Ministerial oversight (ss20–21): quarterly reporting and written directions (subject to limits) create ongoing executive involvement.","Governance and review demands (ss22, 24–25): mandatory published guidelines, internal review procedures, procedural fairness requirements and prudential loan‑management policies increase administrative compliance.","Constitutional framing (ss6–7): reliance on external affairs and alternative 'trade and commerce/corporations/Territories' bases complicates the legal footing across jurisdictions.","Requirements for security, commercial lender support and interaction with external administration/bankruptcy rules create coordination and operational complexity (s9(8), s9(5)(d)).","Transaction costs and repayment handling (ss17, 19): ability to charge applicants/recipients for transaction costs and specific treatment of collections affects recipient cashflow and accounting."],"plain_english_summary":"*These Rules* authorise the Regional Investment Corporation to make concessional five‑year drought‑hardship loans to eligible Australian farm businesses, and set the program's eligibility, loan caps, terms, security, recovery and reporting arrangements. Loans are funded by Parliamentary appropriation and repayments flow back to the Commonwealth (ss18–19).\n\nDecisions on waivers, foreclosures and certain reviews require Corporation and Board agreement and consultation with Ministers; applicants must show drought impact, viability, lender support, residency and tax registration (s9, ss15–16, ss20–21)."},"flash_summary_failed":{"failed":true,"reason":"Unauthenticated. Configure AI_GATEWAY_API_KEY or use a provider module. Learn more: https://ai-sdk.dev/unauthenticated-ai-gateway","source":"analysis-cron"}},"importantCases":[],"_links":{"self":"/api/acts/regional-investment-corporation-drought-hardship-loans-rules-2026","history":"/api/acts/regional-investment-corporation-drought-hardship-loans-rules-2026/history","analysis":"/api/acts/regional-investment-corporation-drought-hardship-loans-rules-2026/analysis","conflicts":"/api/acts/regional-investment-corporation-drought-hardship-loans-rules-2026/conflicts","importantCases":"/api/acts/regional-investment-corporation-drought-hardship-loans-rules-2026/important-cases","documents":"/api/acts/regional-investment-corporation-drought-hardship-loans-rules-2026/documents"}}