Australia's Business Innovation and Investment Program provides a pathway to permanent residency for investors, innovators, entrepreneurs and people with business skills and experience. However, the government has made some significant changes to these visas for the first time since the program's introduction.
The Business Innovation and Investment Program has contributed nearly $16 billion in investment in the Australian economy since its introduction in 2012.
The government nearly doubled the program, allocating 13,500 visa places in the 2020-21 annual migration program, which is carrying over in 2021-22.
However, there are some significant changes from 1 July 2021.
- The number of visa streams and subclasses has been cut to four from nine.
- Applicants will need to satisfy a higher assets and turnover test for the Business Innovation stream.
- The requirement for $200,000 funding for the Entrepreneur stream has been scrapped.
Fewer business visa subclasses
From 1 July 2021, only four visa streams are available to new applicants, instead of nine, under the Business Innovation and Investment Program.
Business Innovation, Entrepreneur, Investor and Significant Investor streams of Subclass 188 provisional visa provide a permanent residency pathway through subclass 888 visa.
Business talent subclass 132 (permanent) visa is no longer available.
"All of the Business Investor visas are now within the Subclass 188, and applicants can make a transition to permanent residency through the 888 Visa," says Chris Johnston, founder and Principal Immigration lawyer at VisaEnvoy.
These visas are now granted with a longer validity of five years, which will give the visa holders more time to meet the requirements for their second stage permanent visa.
Also, from 1 July 2021, the BIIP visa application charges have increased by 11.3 per cent.
Higher assets and turnover requirements
For the first time since 2012 when the BIIP was first introduced, requirements for the Business Innovation stream, also known as 188A, have changed.
Applicants for the Business Innovation stream now have to satisfy higher assets and business turnover test.
“The personal and business assets have increased from $800,000 to $1.25 million, and the turnover requirement has also been increased too," says Mr Johnston.
The business turnover requirement has increased from $500,000 to $750,000 for new applicants.
These requirements must be met for at least two out of the last four fiscal years before applying for the visa.
Investor and Significant Investor streams
The investment amount for the Significant Investor stream remains unchanged at $5 million, while applicants for the Investor stream visa now have to invest $2.5 million instead of $1.5 million.
Mr Johnston points out that previously applicants could invest in the state government bonds, but now they must invest in complying investments as defined by the Complying Investment Framework.
The Complying Investment Framework ratio represents an increase in investment in venture capital and a decrease in investment in the balancing funds.
The Complying Investment Framework requires applicants to invest:
- 20 per cent in venture capital and Private Growth Equity funds
- 30 per cent in emerging companies
- 50 per cent in balancing investments
No funding requirement for the Entrepreneur stream
Lawyer and Registered Migration Agent at SeekVisa, Ben Watt, says the Entrepreneur stream of Subclass 188 visa no longer requires an applicant to meet the AUD200,000 funding threshold.
If you can show that you’ve got a great idea that you want to commercialise and bring to Australia, you can apply for 188 Visa.
“Before, you needed AUD200,000 in funding from some fund that was listed on a particular index or a university. Now that’s removed. So, my view is this stream is where a lot of visas are going to go," Mr Watt says.
He says requirements that a visa holder needs to fulfil for permanent residency while holding a provisional visa in the Entrepreneur stream have also been simplified. They are no longer obliged to demonstrate key success factors, including annual turnover, funding and the provision of employment for at least two Australians.
Ben Watt welcomes the Entrepreneur stream changes as they bring to the country innovations that benefit greater social good rather than just conventional business.
If you convince the state that your idea, which doesn’t have a significant financial return, benefits society, you may be successful with your application. I think that’s a very good change.
Immigration Minister Alex Hawke said the changes would help create more Australian jobs, promote the growth of key sectors and support Australia's economic recovery from the pandemic.
“Australia is an attractive destination for investors, and these changes will directly benefit emerging enterprises, the commercialisation of Australian ideas, and research and development," he while announcing the changes in May 2021.
“Increased investment thresholds and the adjustment of investment ratios to focus more on venture capital and private growth equity will better support innovation and emerging enterprises in Australia."
Prospective business and investment visa applicants can lodge their expression of interest through Skillselect. They must be nominated by a State or Territory government before being invited to lodge their visa application.
To find out more about the latest changes to the Business, Investment and Innovation Program, visit the Department of Home Affairs website.