MELBOURNE - A China-linked fund that is a major shareholder in Australia's Northern Minerals has filed a motion to oust the rare earth developer's chairman after the fund's move for a higher stake was rejected on national interest grounds early this year.

Singapore-based Yuxiao Fund, which owns a near 10% stake in Northern Minerals, proposed a shareholder's resolution that Chairman Nicholas Curtis be immediately removed as a director, Northern Minerals said in an exchange filing on Tuesday.

Yuxiao Fund is a private company that lists Chinese national Wu Yuxiao as its sole shareholder and director, its corporate filings show. Northern Minerals has previously said that Wu Tao, the chairman of mainland China-based Jinan Yuxiao Group which has invested in mining projects in Mozambique and Australia, controls the fund.

Yuxiao Fund did not immediately respond to an emailed request for comment. Curtis did not immediately respond to a request for comment.

Northern Minerals is developing the Browns Range heavy rare earths project in Western Australia, at a time when the sector has become increasingly strategic for its uses in green energy and defence.

Australia has said it is looking for friendly nations to build out its critical minerals industry as the West diversifies away from dominant producer China.

Singapore business registry filings for Yuxiao Fund show Yuxiao Wu is the sole shareholder and a Chinese citizen.

Yuxiao Fund owns 9.8% of Northern Minerals and nominated Wu Tao to the company's board.

The fund last year sought approval from Australia's Foreign Investment Review Board to raise its ownership in Northern Minerals to 19.9%. But Treasurer Jim Chalmers in February blocked it from increasing its investment beyond 10% on national interest grounds.

Northern Minerals said in the filing on Tuesday that Yuxiao Fund proposed a second resolution to "review the legality and compliance of Nicholas Curtis’ conduct in the performance of his duties as a director and an officer" and to inspect the books of the company.

It said it was reviewing the validity of the proposals, and that it would comply with all legal requirements.

The company also said it is subject to an annual audit and that it was in compliance with all regulations.