19 Oct

'Changes to the Business Innovation and Investment Program (1 July 2021)' By Saro Mugnaini, LegalVision

The Australian Government offers business owners and investors the opportunity to migrate to Australia via its Business Innovation and Investment program. The Business Innovation and Investment program is a two-stage process, with a provisional visa (subclass 188) first and then a permanent visa (subclass 888). From 1 July 2021, several key changes apply to the Business Innovation and Investment program.

This article will give a brief overview of the changes introduced from 1 July 2021, and then explain the new requirements more in-depth under each visa stream.

What Are The Key Changes I Need To Know?

You can find a brief overview of the key changes to the Business Innovation and Investment program below:

 

 

188  Visa Stream

Description

Requirements if invitation received before 1 July 2021

Requirements if invitation received after 1 July 2021

Business Innovation

For applicants proposing to operate a new or existing business in Australia

Personal and business net assets of $800K
 

Annual business turnover at least $500K for 2 out of 4 fiscal year

Personal and business net assets of $1.25 million
 

Annual business turnover at least $750K for 2 out of 4 fiscal year

Investor

For applicants proposing to carry out business or investment activity in Australia

Total net value of eligible investments was at least $1.5 million

Personal and business net assets of $2.25 million for two fiscal years

Must make a designated investment of at least $1.5 million in the State or Territory where the nominating State or Territory government agency is located.

Total net value of eligible investments was at least $2.5 million

Personal and business net assets of $2.5 million for two fiscal years

Must make a complying significant investment of at least $2.5 million and hold that investment continuously for the life of your provisional visa.

Significant Investor

For applicants to carry out investment activity in Australia

Must make a complying significant investment of at least $5 million, which consists of:

  • at least AUD500,000 in venture capital and growth private equity funds which invest in start-ups and small private companies;
  • at least AUD1.5 million in approved managed funds. The managed funds must invest in emerging companies listed on the Australian Stock Exchange; and
  • a ‘balancing investment’ of at least AUD3 million in managed funds.

Visa valid for four years with an opportunity to extend for a further two years

Must make a complying significant investment of at least $5 million, which consists of:

  • at least AUD1 million in venture capital and growth private equity funds which invest in start-ups and small private companies;
  • at least AUD1.5 million in approved managed funds. The managed funds must invest in emerging companies listed on the Australian Stock Exchange; and
  • a ‘balancing investment’ of at least AUD2.5 million in managed funds.

Visa valid for five years with an opportunity to extend twice (each extension for two additional years)

 

Entrepreneur

For applicants proposing to carry out entrepreneurial activities in Australia

Have received funding of at least $200,000 from one of the following entities:

  • Commonwealth Government agency
  • State or Territory government agency
  • Publicly funded research or innovation organisation
  • Higher education provider specified as a Table A or Table B provider under Part 2-1 of the Higher Education Support Act 2003
  • Investor registered as an Australian Venture Capital Limited Partnership or Early Stage Venture Capital Limited Partnership

$200,000 funding is no longer required. However, relevant states and territories may set additional criteria.

Premium Investor

For applicants proposing to carry out business or investment activity in Australia

Make a complying premium investment of at least AUD15 million

Closed

The subclass 188 has now been consolidated into four streams – Business Innovation, Investor, Significant Investor and Entrepreneur. The subclass 132 has closed.

Requirements for Subclass 188 Visa post 1 July 2021

Business Innovation Stream

Under the business innovation stream, the applicant must:

  • be under 55 years old;
  • score 65 points or higher on the points test;
  • be nominated by a State or Territory agency;
  • have personal and business net assets of $1.25 million;
  • have an ownership interest in a main business, and that business had an annual turnover of $750K (for at least two of the last four fiscal years); and
  • have a genuine and realistic commitment to establish or participate in a qualifying business in Australia.

Additionally, the applicant requires state or territory nomination, and each state/territory will require the applicant to meet criteria under this stream:

NSW

VIC

QLD

SA

WA

NT

TAS

Under 50

 

Assets = $1.75 million

 

Business turnover - $1.25 million

 

Business investment of $500K

 

Business in a target sector

 

NSW criteria

Have a STEMM qualification or an MBA or relevant business history in a target sector.

 

VIC criteria

Criteria not yet released.

 

 

SA criteria

DHA criteria (as outlined above)

 

WA criteria

 

 

Criteria not yet released.

 

NT criteria

Criteria not yet released.

 

TAS criteria

 

Investor Stream

Under the investor stream, the applicant must:

  • be under 55 years old;
  • score 65 points or higher on the points test;
  • be nominated by a State or Territory agency;
  • have a total net value of eligible investments of at least $2.5 million;
  • have personal and business net assets of $2.5 million for two fiscal years;
  • make a complying significant investment of at least $2.5 million and hold that investment continuously for the duration of the provisional visa. You must invest the funds in the following proportions:
    • at least $500,000 in venture capital and growth private equity funds which invest in start-ups and small private companies;
    • at least $750,000 in approved managed funds. The managed funds must invest in emerging companies listed on the Australian Stock Exchange; and
    • a ‘balancing investment’ of at least $1.25 million in managed funds.

The applicant requires state or territory nomination, and each state/ territory will require the applicant to meet additional criteria under this stream:

Significant Investor Stream

The applicant must (on or after the time of application) make a complying significant investment of $5 million, invested into the following categories:

  • at least $1 million in venture capital and growth private equity funds which invest in start-ups and small private companies;
  • at least $1.5 million in approved managed funds. The managed funds must invest in emerging companies listed on the Australian Stock Exchange; and
  • a ‘balancing investment’ of at least $2.5 million in managed funds.

The applicant requires state or territory nomination, and each state/ territory will require the applicant to meet additional criteria under this stream:

Austrade can also nominate applicants.

Entrepreneur Stream

Under the entrepreneur stream, the applicant must:

  • be under 55 years old; and
  • undertake or propose to undertake complying entrepreneur activity.

The applicant requires state or territory nomination, and each state/ territory will require the applicant to meet additional criteria under this stream:

To meet the complying entrepreneur activity requirement, the entrepreneur activity must be related to either commercialising products or services in Australia or establishing a new business or enterprise in Australia. It cannot be an investment into residential property, labour-hire company or investing into an existing business or enterprise.

Key Takeaways

The Business Innovation and Investment program is a key focus of Australian migration policy. Therefore, applicants who can satisfy the criteria of the 188 visa (in either stream) will receive preference. The changes impact applicants who have received an invitation after 1 July 2021. Applicants who received an invitation and applied for the subclass 188 pre 1 July 2021 will be subject to the historical requirements.

Evidently, the amendments reveal an increase in asset threshold, business turnover and the nature of investments. The objective of the Australian government is to attract business owners, investors and entrepreneurs that have the capacity and potential to significantly and beneficially impact the Australian economy. 

If you have any questions about the new requirements under the Business Innovation and Investment program, LegalVision’s experienced immigration lawyers can help. Contact them at 1800 534 315 or fill out the form on this page.

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