The New Business Visas

Post 1 July 2012, there are then 3 business visas left, the subclass 132 (Business Talent), Subclass 188 (Business Innovation and Investment (Provisional)) and the new subclass 888 (Business Innovation and Investment (Permanent)) visa.

Here is a summary of some basic criteria:

Subclass Assets Turnover

(188) Business innovation stream AUD800 000 AUD500 000

(188) Investor stream AUD2.25 million N/A

(888) Business innovation stream AUD600 000 AUD300 000

(132) Significant business history stream AUD1.5 million AUD3 million

Score 65 points on business innovation and investment points test

There are no minimum English requirements although those not having functional English will have to pay an extra visa application charge.

Here is the criteria for the subclass 132 (Business Talent) visa.

The subclass 132 (Business Talent) visa

This becomes subject to the Expression of Interest regime. This visa is divided into two streams, the Significant Business History stream and the Venture Capital Entrepreneur stream. Both streams require state or territory government nomination. The Significant Business History stream contains the same criteria as one now finds in the subclass 132 (Business Talent) visa.

Note that “eligible business” is defined in s. 134(10) of the Migration Act:

means a business that the Minister reasonably believes is resulting or will result in one or more of the following:

(a) the development of business links with the international market;

(b) the creation or maintenance of employment in Australia;

(c) the export of Australian goods or services;

(d) the production of goods or the provision of services that would otherwise be imported into Australia;

(e) the introduction of new or improved technology to Australia;

(f) an increase in commercial activity and competitiveness within sectors of the Australian economy;

The Venture Capital Entrepreneur stream

Here is what the revamped criteria for the subclass 132 (Business Talent) visa.

1104AA. Business Skills—Business Talent (Permanent) (Class EA)

(1) Form: The approved form specified by the Minister in a legislative instrument made for this item under subregulation 2.07(5).

(2) Visa application charge:

(a) first instalment (payable at the time the application is made):

First instalment

ItemComponentAmount

1Base application charge$6 990

2Additional applicant charge for an applicant who is at least 18$3 495

3Additional applicant charge for an applicant who is less than 18$1 745

Note: Regulation 2.12C explains the components of the first instalment of visa application charge and specifies the amounts of subsequent temporary application charge and non‑Internet application charge. Not all of the components may apply to a particular application.

Additional applicant charge is paid by an applicant who claims to be a member of the family unit of another applicant and seeks to combine the application with that applicant’s application.

(b) second instalment (payable before grant of visa):

Second instalment

ItemApplicantAmount

1Applicant who:

(a) was at least 18 at the time of application; and

(b) is assessed as not having functional English; and

$9 7952Applicant who:

(a) was at least 18 at the time of application; and

(b) is assessed as not having functional English; and

$4 890

3Any other applicantNil

(3) Other:

(a) An application must be made at the place, and in the manner, (if any) specified by the Minister in a legislative instrument made for this item under subregulation 2.07(5).

(b) An applicant may be in or outside Australia, but not in immigration clearance.

(i) a substantive visa; or

(ii) a Subclass 010 Bridging A visa; or

(iii) a Subclass 020 Bridging B visa; or

(iv) a Subclass 030 Bridging C visa.

(d) An application by a person claiming to be a member of the family unit of a person who is an applicant for a Business Skills—Business Talent (Permanent) (Class EA) visa may be made at the same time as, and combined with, the application by that person.

(4) An applicant seeking to satisfy the primary criteria for a Subclass 132 (Business Talent) visa in the Significant Business History stream must meet the requirements in the table.

ItemRequirements

1The applicant must have been invited, in writing, by the Minister to apply for a Subclass 132 (Business Talent) visa in the Significant Business History stream

2The applicant must apply for that visa within the period stated in the invitation

3The applicant must be nominated by a State or Territory government agency

Note: The invitation to apply for the visa will identify the stream to which the invitation relates.

(5) An applicant seeking to satisfy the primary criteria for a Subclass 132 (Business Talent) visa in the Venture Capital Entrepreneur stream must meet the requirements in the table.

ItemRequirements

1The applicant must have been invited, in writing, by the Minister to apply for a Subclass 132 (Business Talent) visa in the Venture Capital Entrepreneur stream

2The applicant must apply for that visa within the period stated in the invitation

3The applicant must be nominated by a State or Territory government agency

Note: The invitation to apply for the visa will identify the stream to which the invitation relates.

(6) Subclasses:

Subclass 132 (Business Talent)

Schedule 2 criteria for the subclass 132 visa

Subclass 132—Business Talent

132.1—Interpretation

Note 1: For AUD, eligible business, fiscal year, ownership interest and qualifying business: see regulation 1.03.

Note 2: main business is defined in regulation 1.11.

Note 3: For beneficial ownership of an asset or ownership interest: see regulation 1.11A.

Note 4: There are no interpretation provisions specific to this Part.

132.2—Primary criteria

Note: The primary criteria for the grant of a Subclass 132 visa include criteria set out in streams.

If an applicant applies for a Subclass 132 visa in the Significant Business History stream, the criteria in Subdivisions 132.21 and 132.22 are the primary criteria for the grant of the visa.

If an applicant applies for a Subclass 132 visa in the Venture Capital Entrepreneur stream, the criteria in Subdivisions 132.21 and 132.23 are the primary criteria.

The primary criteria must be satisfied by at least one member of a family unit. The other members of the family unit who are applicants for a visa of this subclass need satisfy only the secondary criteria.

All criteria must be satisfied at the time a decision is made on the application.

132.21—Common criteria

Note: These criteria are for all applicants seeking to satisfy the primary criteria for a Subclass 132 visa.

132.211

The applicant, and the applicant’s spouse or de facto partner, do not have a history of involvement in business activities that are of a nature that is not generally acceptable in Australia.

132.212

The nominating State or Territory government agency has not withdrawn the nomination.

132.213

(1) The applicant satisfies public interest criteria 4001, 4002, 4003, 4004, 4005, 4010, 4020 and 4021.

(2) If the applicant had turned 18 at the time of application, the applicant satisfies public interest criterion 4019.

(3) Each member of the family unit of the applicant who is an applicant for a Subclass 132 visa satisfies public interest criteria 4001, 4002, 4003, 4004, 4005, 4010 and 4020.

(4) Each member of the family unit of the applicant who:

(a) is an applicant for a Subclass 132 visa; and

(b) had turned 18 at the time of application;

satisfies public interest criterion 4019.

(5) Each member of the family unit of the primary applicant who:

(a) is an applicant for a Subclass 132 visa; and

(b) has not turned 18;

satisfies public interest criteria 4015 and 4016.

(6) Each member of the family unit of the applicant who is not an applicant for a Subclass 132 visa:

(a) satisfies public interest criteria 4001, 4002, 4003 and 4004; and

(b) satisfies public interest criterion 4005 unless it would be unreasonable to require the member to undergo assessment in relation to the criterion.

132.214

(1) The applicant satisfies special return criteria 5001, 5002 and 5010.

(2) Each member of the family unit of the applicant who is an applicant for a Subclass 132 visa satisfies special return criteria 5001, 5002 and 5010.

132.22—Criteria for Significant Business History stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 132 visa in the Significant Business History stream.

132.221

The applicant was invited, in writing, by the Minister to apply for the visa.

132.222

The applicant:

(a) had not turned 55 at the time of invitation to apply for the visa; or

(b) is proposing to establish or participate in a business that the nominating State or Territory government agency has determined is of exceptional economic benefit to the State or Territory in which the agency is located.

132.223

The applicant has overall had a successful business career.

132.224

For at least 2 of the 4 fiscal years immediately before the time of invitation to apply for the visa:

(a) the net value of the assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, in a qualifying business or qualifying businesses in which the applicant had an ownership interest was at least AUD400 000; and

(b) if a qualifying business mentioned in paragraph (a) was operated by a publicly listed company, the shareholding of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, was at least 10% of the total issued capital of the company.

132.225

For at least 2 of the 4 fiscal years immediately before the time of invitation to apply for the visa, the applicant’s main business, or the applicant’s main businesses together, had an annual turnover of at least AUD3 000 000.

132.226

The business and personal assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together:

(a) have a net value of at least AUD1 500 000; and

(b) are lawfully acquired; and

132.227

(1) The applicant genuinely has a realistic commitment to:

(a) establish a qualifying business in Australia; or

(b) participate in an existing qualifying business in Australia.

(2) The applicant genuinely has a realistic commitment to:

(a) maintain a substantial ownership interest in the qualifying business mentioned in subclause (1); and

(b) maintain a direct and continuous involvement in the management of the qualifying business from day to day, and in the making of decisions that affect the overall direction and performance of the qualifying business, in a manner that benefits the Australian economy.

132.23—Criteria for Venture Capital Entrepreneur stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 132 visa in the Venture Capital Entrepreneur stream.

132.231

The applicant was invited, in writing, by the Minister to apply for the visa.

132.232

(1) The applicant has entered into a legally enforceable agreement with an Australian company to receive venture capital funding for:

(a) the early‑phase start‑up of a business in Australia; or

(b) the commercialisation of a product in Australia; or

(d) the expansion of a business in Australia.

(2) The amount to be provided under the agreement is at least AUD1 000 000.

(3) The Australian company:

(a) is a member of an industry association or similar body specified by the Minister in an instrument in writing for this paragraph; and

(b) holds a category of membership of the industry association or similar body specified by the Minister in an instrument in writing for this paragraph.

132.233

The nominating State or Territory government agency is satisfied that the net value of the business and personal assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, is sufficient to allow them to settle in Australia.

132.234

(1) The applicant genuinely has a realistic commitment to:

(a) establish an eligible business in Australia; or

(b) participate in an existing eligible business in Australia.

(2) The applicant genuinely has a realistic commitment to:

(a) maintain a substantial ownership interest in the eligible business mentioned in subclause (1); and

(b) maintain a direct and continuous involvement in the management of the eligible business from day to day, and in the making of decisions that affect the overall direction and performance of the eligible business, in a manner that benefits the Australian economy.

132.3—Secondary criteria

Note: These criteria are for applicants who are members of the family unit of a person who satisfies the primary criteria. All criteria must be satisfied at the time a decision is made on the application.

132.31—Criteria

132.311

The applicant:

(a) is a member of the family unit of a person who holds a Subclass 132 visa granted on the basis of satisfying the primary criteria for the grant of the visa; and

(b) made a combined application with that person.

132.312

(1) The applicant satisfies public interest criteria 4001, 4002, 4003, 4004, 4005, 4010, 4020 and 4021.

(2) If the applicant had turned 18 at the time of application, the applicant satisfies public interest criterion 4019.

(3) If the applicant has not turned 18, the applicant satisfies public interest criteria 4017 and 4018.

132.313

The applicant satisfies special return criteria 5001, 5002 and 5010.

132.4—Circumstances applicable to grant

132.411

The applicant may be in or outside Australia when the visa is granted, but not in immigration clearance.

Note: The second instalment of visa application charge must be paid before the visa can be granted.

132.5—When visa is in effect

132.511

Permanent visa permitting the holder to travel to and enter Australia for 5 years from the date of grant.

132.6—Conditions

132.611

If the applicant is outside Australia when the visa is granted:

(a) first entry must be made before the date specified by the Minister; and

(b) if the applicant satisfies the secondary criteria for the grant of the visa, condition 8515 may be imposed.

INDUSTRY ASSOCIATIONS AND MEMBERSHIP LEVELS

(Paragraphs 132.232(3)(a) and (b))

I, CHRIS BOWEN, Minister for Immigration and Citizenship, acting under paragraphs 132.232(3)(a) and (b) of Schedule 2 to the Migration Regulations 1994(‘the Regulations’):

SPECIFY for the purposes of paragraph 132.232(3)(a) of Schedule 2 to the Regulations that the Australian company must be a member of the industry body The Australian Private Equity and Venture Capital Association Limited; AND
SPECIFY for the purpose of paragraph 132.232(3)(b) of Schedule 2 to the Regulations that the category of membership must be Venture Capital Membership.

This Instrument, IMMI 12/052, commences on 1 July 2012 immediately after the commencement of the Migration Amendment Regulation 2012 (No. 2).

132.233 The nominating State or Territory government agency is satisfied that the net value of the business and personal assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, is sufficient to allow them to settle in Australia.

132.234 (1) The applicant genuinely has a realistic commitment to:

(a) establish an eligible business in Australia; or

(b) participate in an existing eligible business in Australia.

(2) The applicant genuinely has a realistic commitment to:

(a) maintain a substantial ownership interest in the eligible business mentioned in subclause (1); and

132.3 Secondary criteria

Note These criteria are for applicants who are members of the family unit of a person who satisfies the primary criteria. All criteria must be satisfied at the time a decision is made on the application.

132.31 Criteria

132.311 The applicant:

(a) is a member of the family unit of a person who holds a Subclass 132 visa granted on the basis of satisfying the primary criteria for the grant of the visa; and

(b) made a combined application with that person.

132.312 (1) The applicant satisfies public interest criteria 4001, 4002, 4003, 4004, 4005, 4010 and 4020.

(2) If the applicant had turned 18 at the time of application, the applicant satisfies public interest criterion 4019.

(3) If the applicant has not turned 18, the applicant satisfies public interest criteria 4017 and 4018.

132.313 The applicant satisfies special return criteria 5001, 5002 and 5010.

132.314 Either:

(a) the applicant holds a valid passport that:

(i) was issued to the applicant by an official source; and

(ii) is in the form issued by the official source; or

(b) it would be unreasonable to require the applicant to hold a passport.

132.4 Circumstances applicable to grant

132.411 The applicant:

(a) may be in or outside Australia when the visa is granted; and

(b) must not be in immigration clearance.

Note The second instalment of visa application charge must be paid before the visa can be granted.

132.5 When visa is in effect

132.511 Permanent visa permitting the holder to travel to, enter and remain in Australia for 5 years from the date of grant.

132.6 Conditions

132.611 If the applicant is outside Australia when the visa is granted:

(a) first entry must be made before the date specified by the Minister; and

(b) if the applicant satisfies the secondary criteria for the grant of the visa, condition 8515 may be imposed.

The subclass 188 Business Innovation and Investment (Provisional) visa

Schedule 1 criteria

1202B. Business Skills (Provisional) (Class EB)

(1) Form: The approved form specified by the Minister in a legislative instrument made for this item under subregulation 2.07(5).

(2) Visa application charge:

(a) first instalment (payable at the time the application is made):

(i) for an applicant:

(A) seeking to satisfy the primary criteria for the grant of a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Business Innovation Extension stream or the Significant Investor Extension stream; or

(B) whose application is combined, or sought to be combined, with an application made by that person:

First instalment

ItemComponentAmount

1Base application charge$575

2Additional applicant charge for an applicant who is at least 18$290

3Additional applicant charge for an applicant who is less than 18$145

(ia) for an applicant:

(A) seeking to satisfy the primary criteria for the grant of a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor stream; or

(B) whose application is combined, or sought to be combined, with an application made by that person:

First instalment

ItemComponentAmount

1Base application charge$7 010

2Additional applicant charge for an applicant who is at least 18$3 505

3Additional applicant charge for an applicant who is less than 18$1 755

(ib) for an applicant:

(A) seeking to satisfy the primary criteria for the grant of a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Premium Investor stream; or

(B) whose application is combined, or sought to be combined, with an application made by that person:

First instalment

ItemComponentAmount

1Base application charge$8 410

2Additional applicant charge for an applicant who is at least 18$4 205

3Additional applicant charge for an applicant who is less than 18$2 105

(ii) for any other applicant:

First instalment

ItemComponentAmount

1Base application charge$4 780

2Additional applicant charge for an applicant who is at least 18$2 390

3Additional applicant charge for an applicant who is less than 18$1 195

Additional applicant charge is paid by an applicant who claims to be a member of the family unit of another applicant and seeks to combine the application with that applicant’s application.

(b) second instalment (payable before grant of visa):

(d) has not paid a second instalment of the visa application charge in relation to an application for a Subclass 188 (Business Innovation and Investment (Provisional)) visa

Second instalment

ItemApplicantAmount

1Applicant who:

(a) was at least 18 at the time of application; and

(b) is assessed as not having functional English; and

(c) satisfies the primary criteria for the grant of a Subclass 188 (Business Innovation and Investment (Provisional)) visa; and

$9 7952Applicant who:

(a) was at least 18 at the time of application; and

(b) is assessed as not having functional English; and

(c) satisfies the secondary criteria for the grant of a Subclass 188 (Business Innovation and Investment (Provisional)) visa; and

(d) has not paid a second instalment of the visa application charge in relation to an application for a Subclass 188 (Business Innovation and Investment (Provisional)) visa

$4 8903Any other applicantNil

(3) Other:

(a) An application must be made at the place, and in the manner, (if any) specified by the Minister in a legislative instrument made for this item under subregulation 2.07(5).

(b) An applicant may be in or outside Australia, but not in immigration clearance.

(i) a substantive visa; or

(ii) a Subclass 010 Bridging A visa; or

(iii) a Subclass 020 Bridging B visa; or

(iv) a Subclass 030 Bridging C visa.

(d) An application by a person claiming to be a member of the family unit of a person who is an applicant for a Business Skills (Provisional) (Class EB) visa may be made at the same time as, and combined with, the application by that person.

(4) An applicant seeking to satisfy the primary criteria for a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Business Innovation stream must meet the requirements in the table.

ItemRequirements

1The applicant must have been invited, in writing, by the Minister to apply for a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Business Innovation stream

2The applicant must apply for that visa within the period stated in the invitation

3The applicant must be nominated by a State or Territory government agency

Note: The invitation to apply for the visa will identify the stream to which the invitation relates.

(5) An applicant seeking to satisfy the primary criteria for a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Business Innovation Extension stream must meet the requirements in the table.

ItemRequirements

1The applicant must hold a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Business Innovation stream

2The applicant must have held the Subclass 188 (Business Innovation and Investment (Provisional)) visa for at least 3 years

3The applicant must not have held more than one Subclass 188 (Business Innovation and Investment (Provisional)) visa

4The applicant must be nominated by a State or Territory government agency

(6) An applicant seeking to satisfy the primary criteria for a Subclass 188 visa in the Investor stream must meet the requirements in the table.

ItemRequirements

1The applicant must have been invited, in writing, by the Minister to apply for a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Investor stream

2The applicant must apply for that visa within the period stated in the invitation

3The applicant must be nominated by a State or Territory government agency

Note: The invitation to apply for the visa will identify the stream to which the invitation relates.

(6A) An applicant seeking to satisfy the primary criteria for a Subclass 188 visa in the Significant Investor stream must meet the requirements in the table.

ItemRequirements

1The applicant must have been invited, in writing, by the Minister to apply for a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor stream

2The applicant must apply for that visa within the period stated in the invitation

3The applicant must be nominated by a State or Territory government agency or the CEO of Austrade

Note: The invitation to apply for the visa will identify the stream to which the invitation relates.

(6B) An applicant seeking to satisfy the primary criteria for a Subclass 188 visa in the Significant Investor Extension stream must meet the requirements in the table.

(b) at the time of application, the applicant:

(i) holds a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor Extension stream; and

(ii) has not held more than one Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor Extension stream

ItemRequirements

1The applicant must be nominated by a State or Territory government agency or the CEO of Austrade

2Either:

(a) the applicant

(i) holds a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor stream; and

(ii) has held that visa for at least 3 years; or

(6C) An applicant seeking to satisfy the primary criteria for a Subclass 188 visa in the Premium Investor stream must meet the requirements in the table.

ItemRequirements

1The applicant must have been invited, in writing, by the Minister to apply for a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Premium Investor stream

2The applicant must apply for that visa within the period stated in the invitation

3The applicant must be nominated by the CEO of Austrade

Note: The invitation to apply for the visa will identify the stream to which the invitation relates.

(7) Subclasses:

Subclass 188 (Business Innovation and Investment (Provisional))

Schedule 2 criteria for the subclass 188 Business Innovation and Investment (Provisional) visa

Subclass 188—Business Innovation and Investment (Provisional)

188.1—Interpretation

188.111

In this Part:

designated investment means an investment in a security that is specified for this Part by the Minister under regulation 5.19A.

188.112

In this Part, each of the following is an eligible investment if a person owns it for the purpose of producing a return in the form of income or capital gain, and not for personal use:

(a) an ownership interest in a business;

(b) cash on deposit;

(d) real estate;

(e) gold or silver bullion.

188.113

In this Part, a loan to a business is an eligible investment if a person makes it for the purpose of producing a return in the form of income or capital gain.

Note 1: For AUD, business innovation and investment points test, fiscal year, ownership interest and qualifying business: see regulation 1.03.

Note 2: Regulation 1.03 also provides that member of the family unit has the meaning set out in regulation 1.12.

Note 3: main business is defined in regulation 1.11.

Note 4: For the beneficial ownership of an asset, eligible investment or ownership interest: see regulation 1.11A.

Note 5: Complying investment is defined in regulation 5.19B.

Note 6: Complying significant investment is defined in regulation 5.19C.

Note 7: Complying premium investment is defined in regulation 5.19D.

188.2—Primary criteria

Note: The primary criteria for the grant of a Subclass 188 visa include criteria set out in streams.

If an applicant applies for a Subclass 188 visa in the Business Innovation stream, the criteria in Subdivisions 188.21 and 188.22 are the primary criteria for the grant of the visa.

If an applicant applies for a Subclass 188 visa in the Business Innovation Extension stream, the criteria in Subdivisions 188.21 and 188.23 are the primary criteria.

If an applicant applies for a Subclass 188 visa in the Investor stream, the criteria in Subdivisions 188.21 and 188.24 are the primary criteria.

If an applicant applies for a Subclass 188 visa in the Significant Investor stream, the criteria in Subdivisions 188.21 and 188.25 are the primary criteria.

If an applicant applies for a Subclass 188 visa in the Significant Investor Extension stream, the criteria in Subdivisions 188.21 and 188.26 are the primary criteria.

If an applicant applies for a Subclass 188 visa in the Premium Investor stream, the criteria in Subdivisions 188.21 and 188.27 are the primary criteria.

All criteria must be satisfied at the time a decision is made on the application.

188.21—Common criteria

Note: These criteria are for all applicants seeking to satisfy the primary criteria for a Subclass 188 visa.

188.211

The applicant, and the applicant’s spouse or de facto partner, do not have a history of involvement in business or investment activities that are of a nature that is not generally acceptable in Australia.

188.212

The nominating State or Territory government agency or the CEO of Austrade has not withdrawn the nomination.

188.213

(1) The applicant satisfies public interest criteria 4001, 4002, 4003, 4004, 4010, 4020 and 4021.

(2) If the applicant had turned 18 at the time of application, the applicant satisfies public interest criterion 4019.

(3) Each member of the family unit of the applicant who is an applicant for a Subclass 188 visa satisfies public interest criteria 4001, 4002, 4003, 4004, 4010 and 4020.

(4) Each member of the family unit of the applicant who:

(a) is an applicant for a Subclass 188 visa; and

(b) had turned 18 at the time of application;

satisfies public interest criterion 4019.

(5) Each member of the family unit of the applicant who:

(a) is an applicant for a Subclass 188 visa; and

(b) has not turned 18;

satisfies public interest criteria 4015 and 4016.

(6) Each member of the family unit of the applicant who is not an applicant for a Subclass 188 visa satisfies public interest criteria 4001, 4002, 4003 and 4004.

188.214

(1) The applicant satisfies special return criteria 5001, 5002 and 5010.

(2) Each member of the family unit of the applicant who is an applicant for a Subclass 188 visa satisfies special return criteria 5001, 5002 and 5010.

188.22—Criteria for Business Innovation stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 188 visa in the Business Innovation stream.

188.221

(1) The applicant was invited, in writing, by the Minister to apply for the visa.

(2) The applicant:

(a) had not turned 55 at the time of the invitation to apply for the visa; or

(b) is proposing to establish or participate in business or investment activity that the nominating State or Territory government agency has determined is of exceptional economic benefit to the State or Territory in which the agency is located.

188.222

(1) The applicant’s score on the business innovation and investment points test is not less than the number of points specified by the Minister in an instrument in writing for this subclause.

(2) For subclause (1):

(a) an applicant’s score on the business innovation and investment points test is the sum of the applicant’s scores under Parts 7A.2, 7A.3, 7A.4, 7A.5, 7A.7, 7A.8, 7A.9 and 7A.10 of Schedule 7A; and

(b) the Minister must not give the applicant the prescribed number of points for more than one prescribed qualification in Parts 7A.2, 7A.3, 7A.4, 7A.5, 7A.7, 7A.8 and 7A.10 of Schedule 7A; and

(c) if the applicant’s circumstances satisfy more than one prescribed qualification in Parts 7A.2, 7A.3, 7A.4, 7A.5, 7A.7, 7A.8 and 7A.10 of Schedule 7A, the Minister must give the applicant points for the qualification that has been satisfied that attracts the highest number of points.

188.223

The applicant demonstrates that there is a need for the applicant to be resident in Australia to establish or conduct the proposed business activity.

188.224

The applicant has overall had a successful business career.

188.225

(1) For at least 2 of the 4 fiscal years immediately before the time of invitation to apply for the visa, the applicant had an ownership interest in one or more established main businesses that had an annual turnover of at least AUD500 000 in each of those years.

(2) If the applicant was engaged in one or more businesses providing professional, technical or trade services for at least 2 of the 4 fiscal years immediately before the time of invitation to apply for the visa, the applicant was directly engaged in the provision of the services, as distinct from the general direction of the operation of the business, for no more than half the time spent by the applicant from day to day in the conduct of the business.

188.226

At the time of invitation, the business and personal assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, that can be applied to the establishment or conduct of a business in Australia have a net value of at least AUD800 000.

188.227

The nominating State or Territory government agency is satisfied that the net value of the business and personal assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, other than the business and personal assets mentioned in clause 188.226, is sufficient to allow the applicant and the spouse or de facto partner to settle in Australia.

188.228

The business and personal assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together:

(a) are lawfully acquired; and

(b) are available for transfer to Australia within 2 years after the grant of a Subclass 188 visa.

188.229

(1) The applicant genuinely has a realistic commitment to:

(a) establish a qualifying business in Australia; or

(b) participate in an existing qualifying business in Australia.

(2) The applicant genuinely has a realistic commitment to:

(a) maintain a substantial ownership interest in the qualifying business mentioned in subclause (1); and

188.229A

(1) The applicant satisfies public interest criterion 4005.

(2) Each member of the family unit of the applicant who is an applicant for a Subclass 188 visa satisfies public interest criterion 4005.

(3) Each member of the family unit of the applicant who is not an applicant for a Subclass 188 visa satisfies public interest criterion 4005 unless it would be unreasonable to require the member to undergo assessment in relation to the criterion.

188.23—Criteria for Business Innovation Extension stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 188 visa in the Business Innovation Extension stream.

188.231

The applicant demonstrates that there is a need for the applicant to be resident in Australia to operate the main business.

188.232

(1) For at least the 2 years immediately before the application was made, the applicant had an ownership interest in one or more main businesses that were actively operating in Australia.

(2) The applicant continues to have the ownership interest mentioned in subclause (1).

188.233

The applicant genuinely has a realistic commitment to:

(a) maintain the ownership interest mentioned in subclause 188.232(1); and

(b) maintain a direct and continuous involvement in the management of the main business from day to day, and in the making of decisions that affect the overall direction and performance of the main business, in a manner that benefits the Australian economy.

188.234

(1) The applicant satisfies public interest criterion 4007.

(2) Each member of the family unit of the applicant who is an applicant for a Subclass 188 visa satisfies public interest criterion 4007.

(3) Each member of the family unit of the applicant who is not an applicant for a Subclass 188 visa satisfies public interest criterion 4007 unless it would be unreasonable to require the member to undergo assessment in relation to the criterion.

188.24—Criteria for Investor stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 188 visa in the Investor stream.

188.241

(1) The applicant was invited, in writing, by the Minister to apply for the visa.

(2) The applicant:

(a) had not turned 55 at the time of the invitation to apply for the visa; or

188.242

(1) The applicant’s score on the business innovation and investment points test is not less than the number of points specified by the Minister in an instrument in writing for this subclause.

(2) For subclause (1):

(a) an applicant’s score on the business innovation and investment points test is the sum of the applicant’s scores under Parts 7A.2, 7A.3, 7A.4, 7A.6, 7A.7, 7A.8, 7A.9 and 7A.10 of Schedule 7A; and

(b) the Minister must not give the applicant the prescribed number of points for more than one prescribed qualification in Parts 7A.2, 7A.3, 7A.4, 7A.6, 7A.7, 7A.8 and 7A.10 of Schedule 7A; and

(c) if the applicant’s circumstances satisfy more than one prescribed qualification in Parts 7A.2, 7A.3, 7A.4, 7A.6, 7A.7, 7A.8 and 7A.10 of Schedule 7A, the Minister must give the applicant points for the qualification that has been satisfied that attracts the highest number of points.

188.243

(1) The applicant has overall had a successful record of eligible investment activity or qualifying business activity.

(2) The applicant has had a total of at least 3 years experience of direct involvement in managing one or more qualifying businesses or eligible investments.

(3) The applicant has demonstrated a high level of management skill in relation to the eligible investment or qualifying business activity.

188.244

For at least one of the 5 fiscal years immediately before the time of invitation to apply for the visa:

(a) both of the following apply:

(i) the applicant maintained direct involvement in managing a qualifying business;

(ii) the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, had an ownership interest of at least 10% of the total value of the business; or

(b) both of the following apply:

(i) the applicant maintained direct involvement in managing eligible investments of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together;

(ii) the total net value of the eligible investments was at least AUD1 500 000.

188.245

For the 2 fiscal years immediately before the time of invitation to apply for the visa, the business and personal assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, had a net value of at least AUD2 250 000.

188.246

(1) The applicant has made a designated investment of at least AUD1 500 000 in the State or Territory in which the nominating State or Territory government agency is located, and has made the investment:

(a) in the name of the applicant; or

(b) in the names of the applicant and his or her spouse or de facto partner.

(2) The funds used to make the designated investment mentioned in subclause (1) were:

(a) unencumbered; and

(b) accumulated from either or both of:

(i) one or more qualifying businesses conducted by the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together; and

(ii) eligible investment activities of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together.

188.247

The business and personal assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together:

(a) are lawfully acquired; and

(b) are available for transfer to Australia within 2 years after the grant of a Subclass 188 visa.

188.248

(1) The applicant genuinely has a realistic commitment to continue to maintain business or investment activity in Australia after the designated investment made by the applicant, or by the applicant and his or her spouse or de facto partner, matures.

(2) The applicant has a genuine intention to reside for at least 2 years in the State or Territory in which he or she made the designated investment application.

188.249

(1) The applicant satisfies public interest criterion 4005.

(2) Each member of the family unit of the applicant who is an applicant for a Subclass 188 visa satisfies public interest criterion 4005.

188.25—Criteria for Significant Investor stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 188 visa in the Significant Investor stream.

188.251

The applicant was invited, in writing, by the Minister to apply for the visa.

188.252

(1) The applicant has made, on or after the time of application, a complying significant investment (within the meaning of regulation 5.19C as in force at the time of application) of at least AUD 5 000 000.

(2) The applicant has a genuine intention to hold the complying significant investment for at least 4 years.

Note: A complying significant investment may be based on one or more investments.

188.253

(1) The applicant has given the Minister evidence that the investment complies with the requirements set out in regulation 5.19C as in force at the time of application.

(2) The applicant has given the Minister a completed copy of approved form 1412, signed by the applicant and each other applicant aged at least 18.

Note: Approved form 1412 is a deed of acknowledgment, undertaking and release, signed by each person mentioned in subclause (2), under which they:

(a) acknowledge that they are responsible for their financial and legal affairs; and

(b) undertake not to bring an action against the Commonwealth in relation to any loss relating to the complying significant investment; and

(c) release the Commonwealth from any liabilities in relation to any loss relating to the complying significant investment.

188.254

If the applicant was nominated by a State or Territory government agency, one or more of the following have a genuine intention to reside in the State or Territory whose government agency nominated the applicant:

(a) the applicant;

(b) the applicant’s spouse or de facto partner.

188.255

(1) The applicant satisfies public interest criterion 4005.

(2) Each member of the family unit of the applicant who is an applicant for a Subclass 188 visa satisfies public interest criterion 4005.

188.26—Criteria for Significant Investor Extension stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 188 visa in the Significant Investor Extension stream.

188.261

(1) The applicant meets the requirements of subclause (1A) or (1B).

(1A) Both of the following apply:

(a) the most recent Subclass 188 visa in the Significant Investor stream held by the applicant (which may be the visa currently held by the applicant) was granted on the basis of an application made before 1 July 2015;

(b) the applicant continues to hold a complying investment within the meaning of regulation 5.19B as in force at the time the application mentioned in paragraph (a) was made.

(1B) Both of the following apply:

(b) the applicant continues to hold a complying significant investment within the meaning of regulation 5.19C as in force at the time the application mentioned in paragraph (a) was made.

(2) For any part of the investment mentioned in subclause (1A) or (1B) for the applicant that is, or was, a direct investment in an Australian proprietary company:

(a) if the period of the direct investment was less than 2 years, the company was a qualifying business for the whole period; or

(b) if the period of the direct investment was 2 years or more, the company was a qualifying business for at least 2 years; or

(c) if the company has been unable to operate as a qualifying business, the Minister is satisfied that the applicant made a genuine attempt to operate the business as a qualifying business.

(3) The applicant has given the Minister:

(a) if subclause (1A) applies to the applicant—a completed copy of approved form 1413 for each investment in a managed fund on which the investment mentioned in that subclause is based; or

(b) if subclause (1B) applies to the applicant—evidence that the applicant holds an investment as required for that subclause.

Note: Approved form 1413 includes a declaration that the investments made by a managed fund for the benefit of clients are limited to one or more of the purposes specified by the Minister for paragraph 5.19B(2)(c).

(4) The applicant has given the Minister a completed copy of approved form 1412, signed by the applicant and each other applicant aged at least 18.

Note: Approved form 1412 is a deed of acknowledgment, undertaking and release, signed by each person mentioned in subclause (4), under which they:

(a) acknowledge that they are responsible for their financial and legal affairs; and

(b) undertake not to bring an action against the Commonwealth in relation to any loss relating to the relevant investment; and

188.262

(1) The applicant satisfies public interest criterion 4007.

(2) Each member of the family unit of the applicant who is an applicant for a Subclass 188 visa satisfies public interest criterion 4007.

188.27—Criteria for Premium Investor stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 188 visa in the Premium Investor stream.

188.271

The applicant was invited, in writing, by the Minister to apply for the visa.

188.272

(1) The applicant has made, on or after the time of application, a complying premium investment (within the meaning of regulation 5.19D as in force at the time of application) of at least AUD 15 000 000.

(2) The applicant has a genuine intention to hold the complying premium investment for the whole of the visa period (except any part of the investment that is a philanthropic contribution).

Note: A complying premium investment may be based on one or more investments or one or more philanthropic contributions, or a combination of both.

188.273

(1) The applicant has given the Minister evidence that the investment complies with the requirements set out in regulation 5.19D as in force at the time of application.

(2) The applicant has given the Minister a completed copy of approved form 1412, signed by the applicant and each other applicant aged at least 18.

Note: Approved form 1412 is a deed of acknowledgement, undertaking and release, signed by each person mentioned in subclause (2), under which they:

(a) acknowledge that they are responsible for their financial and legal affairs; and

(b) undertake not to bring an action against the Commonwealth in relation to any loss relating to the complying premium investment; and

188.274

(1) The applicant satisfies public interest criterion 4005.

(2) Each member of the family unit of the applicant who is an applicant for a Subclass 188 visa satisfies public interest criterion 4005.

188.3—Secondary criteria

188.31—Criteria

188.311

The applicant is a member of the family unit of a person who holds a Subclass 188 visa granted on the basis of satisfying the primary criteria for the grant of the visa (the primary applicant).

188.311A

If:

(a) the applicant has turned 18; and

(b) the primary applicant holds a Subclass 188 visa in the Significant Investor stream, the Significant Investor Extension stream or the Premium Investor stream;

the applicant has given the Minister a completed copy of approved form 1412.

Note: Approved form 1412 is a deed of acknowledgment, undertaking and release, signed by the primary applicant, and each other applicant aged at least 18 years, under which they:

(a) acknowledge that they are responsible for their financial and legal affairs; and

(b) undertake not to bring an action against the Commonwealth in relation to any loss relating to the relevant investment; and

188.312

(1) The applicant satisfies public interest criteria 4001, 4002, 4003, 4004, 4010, 4020 and 4021.

(2) If the applicant had turned 18 at the time of application, the applicant satisfies public interest criterion 4019.

(3) If the applicant has not turned 18, the applicant satisfies public interest criteria 4017 and 4018.

(4) If the primary applicant holds a Subclass 188 visa in the Business Innovation stream, the Investor stream, the Significant Investor stream or the Premium Investor stream, the applicant satisfies public interest criterion 4005.

(5) If the primary applicant holds a Subclass 188 visa in the Business Innovation Extension stream or the Significant Investor Extension stream, the applicant satisfies public interest criterion 4007.

188.313

The applicant satisfies special return criteria 5001, 5002 and 5010.

188.4—Circumstances applicable to grant

188.411

The applicant may be in or outside Australia when the visa is granted, but not in immigration clearance.

Note: The second instalment of visa application charge must be paid before the visa can be granted.

188.5—When visa is in effect

188.511

If the applicant satisfied the primary criteria for the grant of a Subclass 188 visa in the Business Innovation stream, the Investor stream, the Significant Investor stream, or the Premium Investor stream, temporary visa permitting the holder to travel to, enter and remain in Australia for 4 years and 3 months from the date of grant.

188.512

If the applicant satisfied the primary criteria for the grant of a Subclass 188 visa in the Business Innovation Extension stream, temporary visa permitting the holder to travel to, enter and remain in Australia for 6 years after the date of the grant of the provisional visa the applicant held at the time of application.

188.512A

If the applicant satisfied the primary criteria for the grant of a Subclass 188 visa in the Significant Investor Extension stream, temporary visa permitting the holder to travel to, enter and remain in Australia:

(a) if the applicant held a Subclass 188 visa in the Significant Investor stream at the time of application—6 years after the date of the grant of the Subclass 188 visa in the Significant Investor stream; or

(b) if the applicant held a Subclass 188 visa in the Significant Investor Extension stream at the time of application—8 years after the date of the grant of the Subclass 188 visa in the Significant Investor stream.

188.513

If the applicant satisfied the secondary criteria for the grant of a Subclass 188 visa, temporary visa permitting the holder to travel to, enter and remain in Australia until the day specified for the applicant who satisfied the primary criteria.

188.6—Conditions

188.611

If the applicant is outside Australia when the visa is granted:

(a) first entry must be made before the date specified by the Minister; and

(b) if the applicant satisfies the secondary criteria for the grant of the visa, condition 8515 may be imposed.

188.612

If the applicant is granted a Subclass 188 visa in the Significant Investor stream, the Significant Investor Extension stream or the Premium Investor stream, condition 8557 must be imposed.

Designated Investment

See reg 5.19A

SECURITYISSUING AUTHORITY

Government Bonds of VictoriaTreasury Corporation of Victoria

New South Wales Treasury BondsNew South Wales Treasury Corporation

Queensland BondsQueensland Treasury Corporation

Queensland Industry BondsQueensland Industry Development Corporation before 1 December 1996

TASCORP Inscribed StockTasmanian Public Finance Corporation

Territory BondsNorthern Territory Treasury Corporation

Western Australian State BondsWestern Australian Treasury Corporation

South Australian Government Financing Authority BondsSouth Australian Government Financing Authority

The new subclass 888 (Business Innovation and Investment (Permanent)) visa

Schedule 1 Criteria

1104BA Business Skills (Permanent) (Class EC)

(1) Form: The approved form specified by the Minister in a legislative instrument made for this item under subregulation 2.07(5).

(2) Visa application charge:

(a) first instalment (payable at the time the application is made):

First instalment

ItemComponentAmount

1Base application charge$2 305

2Additional applicant charge for an applicant who is at least 18$1 155

3Additional applicant charge for an applicant who is less than 18$575

Additional applicant charge is paid by an applicant who claims to be a member of the family unit of another applicant and seeks to combine the application with that applicant’s application.

(b) second instalment (payable before grant of visa):

Second instalment

ItemApplicantAmount

1Applicant who:

(a) was at least 18 at the time of application; and

(b) is assessed as not having functional English; and

(c) satisfies the secondary criteria for the grant of a Subclass 888 (Business Innovation and Investment (Permanent)) visa; and

(d) has not paid a second instalment of the visa application charge in relation to an application for a Subclass 188 (Business Innovation and Investment (Provisional)) visa

$4 890

2Any other applicantNil

(3) Other:

(a) An application must be made at the place, and in the manner, (if any) specified by the Minister in a legislative instrument made for this item under subregulation 2.07(5).

(b) An applicant may be in or outside Australia, but not in immigration clearance.

(i) if the applicant is seeking to satisfy the primary criteria for the grant of a Subclass 888 (Business Innovation and Investment (Permanent)) visa in the Business Innovation stream or the Investor stream—a State or Territory government agency; or

(ii) if the applicant is seeking to satisfy the primary criteria for the grant of a Subclass 888 (Business Innovation and Investment (Permanent)) visa in the Significant Investor stream—a State or Territory government agency or the CEO of Austrade; or

(iii) if the applicant is seeking to satisfy the primary criteria for the grant of a Subclass 888 (Business Innovation and Investment (Permanent)) visa in the Premium Investor stream—the CEO of Austrade.

(d) An application by a person claiming to be a member of the family unit of a person who is an applicant for a Business Skills (Permanent) (Class EC) visa may be made at the same time as, and combined with, the application by that person.

(4) An applicant seeking to satisfy the primary criteria for the grant of a Subclass 888 (Business Innovation and Investment (Permanent)) visa in the Business Innovation stream must meet the requirements in at least one item in the table.

ItemRequirements

1The applicant holds a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Business Innovation stream or the Business Innovation Extension stream

2The applicant holds a Subclass 188 (Business Innovation and Investment (Provisional)) visa granted on the basis that the applicant was the spouse or de facto partner of a person who held a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Business Innovation stream or the Business Innovation Extension stream

3The applicant holds a Subclass 444 (Special Category) visa

4The applicant holds a Subclass 457 (Business (Long Stay)) visa granted on the basis that:

(a) the applicant; or

(b) the applicant’s spouse or de facto partner (if any); or

satisfied the criteria in subclause 457.223(7) or (7A) of Schedule 2 for the grant of the visa

(5) An applicant seeking to satisfy the primary criteria for the grant of a Subclass 888 (Business Innovation and Investment (Permanent)) visa in the Investor stream must meet the requirements in at least one item in the table.

ItemRequirements

1The applicant holds a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Investor stream

(5A) An applicant seeking to satisfy the primary criteria for the grant of a Subclass 888 (Business Innovation and Investment (Permanent)) visa in the Significant Investor stream must meet the requirements in at least one item in the table.

(b) either:

(i) the applicant has ceased to be the spouse or de facto partner of that person; or

(ii) that person has since died

ItemRequirements

1The applicant holds a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor stream or the Significant Investor Extension stream

2Both of the following apply:

(a) the applicant holds a Subclass 188 (Business Innovation and Investment (Provisional)) visa granted on the basis that the applicant was the spouse or de facto partner of a person who held a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor stream or the Significant Investor Extension stream;

(5B) An applicant seeking to satisfy the primary criteria for the grant of a Subclass 888 (Business Innovation and Investment (Permanent)) visa in the Premium Investor stream must meet the requirements in at least one item in the table.

ItemRequirements

1The applicant holds a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Premium Investor stream

2Both of the following apply:

(a) the applicant holds a Subclass 188 (Business Innovation and Investment (Provisional)) visa granted on the basis that the applicant was the spouse or de facto partner of a person (the primary visa holder) who held a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Premium Investor stream;

(b) either:

(i) the applicant has ceased to be the spouse or de facto partner of the primary visa holder; or

(ii) that primary visa holder has since died

(6) Subclasses:

Subclass 888 (Business Innovation and Investment (Permanent))

Schedule 2 criteria

Subclass 888—Business Innovation and Investment (Permanent)

888.1—Interpretation

888.111

In this Part:

designated investment means an investment in a security that is specified for this Part by the Minister under regulation 5.19A.

Note 1: For AUD, fiscal year, ownership interest and qualifying business: see regulation 1.03.

Note 2: Regulation 1.03 also provides that member of the family unit has the meaning set out in regulation 1.12.

Note 3: main business is defined in regulation 1.11.

Note 4: For the beneficial ownership of an asset, eligible investment or ownership interest: see regulation 1.11A.

Note 5: Complying investment is defined in regulation 5.19B.

Note 6: Complying significant investment is defined in regulation 5.19C.

Note 7: Complying premium investment is defined in regulation 5.19D.

888.2—Primary criteria

Note: The primary criteria for the grant of a Subclass 888 visa include criteria set out in streams.

If an applicant applies for a Subclass 888 visa in the Business Innovation stream, the criteria in Subdivisions 888.21 and 888.22 are the primary criteria for the grant of the visa.

If an applicant applies for a Subclass 888 visa in the Investor stream, the criteria in Subdivisions 888.21 and 888.23 are the primary criteria for the grant of the visa.

If an applicant applies for a Subclass 888 visa in the Significant Investor stream, the criteria in Subdivisions 888.21 and 888.24 are the primary criteria for the grant of the visa.

If an applicant applies for a Subclass 888 visa in the Premium Investor stream, the criteria in Subdivisions 888.21 and 888.25 are the primary criteria for the grant of the visa.

All criteria must be satisfied at the time a decision is made on the application.

888.21—Common criteria

Note: These criteria are for all applicants seeking to satisfy the primary criteria for a Subclass 888 visa.

888.211

888.212

The nominating State or Territory government agency or the CEO of Austrade has not withdrawn the nomination.

888.213

The applicant genuinely has a realistic commitment to maintain business or investment activities in Australia.

888.214

The applicant, and the applicant’s spouse or de facto partner, have a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to the applicant’s business.

Note: Those laws include laws relating to taxation, superannuation and workplace relations.

888.215

(1) The applicant satisfies public interest criteria 4001, 4002, 4003, 4004, 4007, 4010, 4020 and 4021.

(2) If the applicant had turned 18 at the time of application, the applicant satisfies public interest criterion 4019.

(3) Each member of the family unit of the applicant who is an applicant for a Subclass 888 visa satisfies public interest criteria 4001, 4002, 4003, 4004, 4007, 4010 and 4020.

(4) Each member of the family unit of the applicant who:

(a) is an applicant for a Subclass 888 visa; and

(b) had turned 18 at the time of application;

satisfies public interest criterion 4019.

(5) Each member of the family unit of the applicant who:

(a) is an applicant for a Subclass 888 visa; and

(b) has not turned 18;

satisfies public interest criteria 4015 and 4016.

(6) Each member of the family unit of the applicant who is not an applicant for a Subclass 888 visa:

(a) satisfies public interest criteria 4001, 4002, 4003 and 4004; and

(b) satisfies public interest criterion 4007 unless it would be unreasonable to require the member to undergo assessment in relation to the criterion.

888.216

(1) The applicant satisfies special return criteria 5001, 5002 and 5010.

(2) Each member of the family unit of the applicant who is an applicant for a Subclass 888 visa satisfies special return criteria 5001, 5002 and 5010.

888.22—Criteria for Business Innovation stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 888 visa in the Business Innovation stream.

888.221

The applicant has been in Australia, as the holder of one or more visas mentioned in the table in subitem 1104BA(4) of Schedule 1, for a total period of at least one year in the 2 years immediately before the application was made.

888.222

(1) The applicant (the current applicant):

(a) had an ownership interest in at least one actively operating main business in Australia during the 2 years immediately before the application was made; and

(b) continues to have the ownership interest in the actively operating main business.

(2) If the current applicant acquired the ownership interest from another person who was an applicant for, or held, a Business Skills (Permanent) (Class EC) visa or a Business Skills (Residence) (Class DF) visa at the time of the acquisition, the current applicant must have held the ownership interest with that person as a joint interest for at least one year before the current applicant’s application was made.

888.223

An Australian Business Number has been obtained for each business mentioned in subclause 888.222(1).

888.224

Each Business Activity Statement required by the Commissioner of Taxation during the 2 years immediately before the application was made has been submitted to the Commissioner and has been included in the application.

888.225

(1) If the nominating State or Territory government agency has not determined that there are exceptional circumstances:

(a) the requirements in at least 2 of subclauses (2) to (4) are met; and

(b) the requirement in subclause (5) is met.

(2) The assets owned by the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, in the main business or main businesses in Australia:

(a) had a net value of at least AUD200 000 throughout the period of 12 months immediately before the application was made; and

(b) continue to have a net value of at least AUD200 000; and

(3) In the period of 12 months immediately before the application was made:

(a) the main business in Australia, or main businesses in Australia, of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together provided employment in Australia to 2 or more employees for a total number of hours that was at least the total number of hours that would have been worked by 2 full‑time employees; and

(b) each employee whose employment is used to work out that total number of hours:

(i) was not the applicant or a member of the family unit of the applicant during that period; and

(ii) was an Australian citizen, an Australian permanent resident or the holder of a valid New Zealand passport during that period.

(4) The business and personal assets in Australia of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together:

(a) had a net value of at least AUD600 000 in the period of 12 months ending immediately before the application was made; and

(b) continue to have a net value of at least AUD600 000; and

(5) The main business in Australia, or main businesses in Australia, of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, had an annual turnover of at least AUD300 000 in the 12 months immediately before the application was made.

888.226

(1) Subclause (2) or (3) applies.

(2) All of the following apply:

(a) the nominating State or Territory government agency has determined that there are exceptional circumstances;

(b) the requirements set out in at least 2 of subclauses 888.225(2) to (4) have been met;

(i) resides in an area specified by the Minister in an instrument in writing for this subparagraph; and

(ii) operates the applicant’s main business or businesses in Australia in the area.

(3) Both of the following apply:

(a) the nominating State or Territory government agency has determined that there are exceptional circumstances;

(b) the requirement set out in subclause 888.225(5) has been met.

888.23—Criteria for Investor stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 888 visa in the Investor stream.

888.231

The applicant has been in Australia, as the holder of a visa mentioned in the table in subitem 1104BA(5) of Schedule 1, for a total period of at least 2 years in the 4 years immediately before the application was made.

888.232

The designated investment made by the applicant for the purpose of satisfying a criterion for the grant of a Subclass 188 (Business Innovation and Investment (Provisional)) visa has been held continuously in the name of the applicant, or in the names of the applicant and his or her spouse or de facto partner together, for:

(a) if the Subclass 188 (Business Innovation and Investment (Provisional)) visa was granted on the basis of an application made before 1 July 2015—at least 3 years and 11 months; or

(b) if the Subclass 188 (Business Innovation and Investment (Provisional)) visa was granted on the basis of an application made on or after 1 July 2015—at least 4 years.

888.24—Criteria for Significant Investor stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 888 visa in the Significant Investor stream.

888.241

(1) At the time of application:

(a) the applicant has held a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor stream for a continuous period of 4 years; or

(b) the applicant has held a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor stream and one or more Subclass 188 (Business Innovation and Investment (Provisional)) visas in the Significant Investor Extension stream for a continuous period of 4 years; or

(i) has held, for a continuous period of 3 years and 11 months, a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor stream applied for before 1 July 2015; and

(ii) has not held a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Significant Investor Extension stream granted on the basis of the visa mentioned in subparagraph (i).

(2) The applicant meets the requirements of subclause (2A) or (2B).

(2A) Both of the following apply:

(b) the applicant has held, for the whole of the period during which the applicant has held the visas or visa mentioned in subclause (1), a complying investment within the meaning of regulation 5.19B as in force at the time the application mentioned in paragraph (a) was made.

(2B) Both of the following apply:

(b) the applicant has held, for the whole of the period during which the applicant has held the visas or visa mentioned in subclause (1), a complying significant investment within the meaning of regulation 5.19C as in force at the time the application mentioned in paragraph (a) was made.

(3) For any part of the investment mentioned in subclause (2A) or (2B) for the applicant that is, or was, a direct investment in an Australian proprietary company:

(a) if the period of the direct investment was less than 2 years, the company was a qualifying business for the whole period; or

(b) if the period of the direct investment was 2 years or more, the company was a qualifying business for at least 2 years; or

(c) if the company has been unable to operate as a qualifying business, the Minister is satisfied that the applicant made a genuine attempt to operate the business as a qualifying business.

(4) The applicant has given the Minister:

(a) if subclause (2A) applies to the applicant—a completed copy of approved form 1413 for each investment in a managed fund on which the investment mentioned in that subclause is based; or

(b) if subclause (2B) applies to the applicant—evidence that the applicant holds an investment as required for that subclause.

888.242

(1) The applicant meets the requirements of subclause (2) or (3).

(2) The applicant has been in Australia for at least the number of days worked out by adding the results of paragraphs (a) and (b):

(a) 40 multiplied by the number of complete years in the period in which the applicant has held a Subclass 188 visa in the Significant Investor stream; and

(b) 40 multiplied by the number of years (if any) (treating a part of a year as 1 year) in the period in which the applicant has held a Subclass 188 visa in the Significant Investor Extension stream.

(3) The applicant’s spouse or de facto partner has been in Australia on a Subclass 188 visa, granted on the basis that the applicant held a Subclass 188 visa in the Significant Investor stream or the Significant Investor Extension stream, for at least the number of days worked out by adding the results of paragraphs (a) and (b):

(a) 180 multiplied by the number of complete years in the period in which the applicant held a Subclass 188 visa in the Significant Investor stream; and

(b) 180 multiplied by the number of years (if any) (treating a part of a year as 1 year) in which the applicant held a Subclass 188 visa in the Significant Investor Extension stream.

Note: It is not necessary for the applicant to have been in Australia for 40 days in each year in the period or the applicant’s spouse or de facto partner to have been in Australia for 180 days in each year in the period.

888.25—Criteria for Premium Investor stream

Note: These criteria are only for applicants seeking to satisfy the primary criteria for a Subclass 888 visa in the Premium Investor stream.

888.251

(1) At the time of application the applicant has held a Subclass 188 (Business Innovation and Investment (Provisional)) visa in the Premium Investor stream for a continuous period of at least 12 months.

(2) For the whole of the period during which the applicant has held the visa mentioned in subclause (1), the applicant has held a complying premium investment (within the meaning of regulation 5.19D as in force at the time the application for that visa was made) except any part of the investment that is a philanthropic contribution.

(3) For any part of the complying premium investment (except any part of the investment that is a philanthropic contribution) that is, or was, a direct investment in an Australian proprietary company:

(a) the company was a qualifying business for the whole period; or

(b) if the company has been unable to operate as a qualifying business, the Minister is satisfied that the applicant made a genuine attempt to operate the business as a qualifying business.

(4) The applicant has given the Minister evidence that the investment complies with the requirements set out in regulation 5.19D as in force at the time of application.

888.3—Secondary criteria

888.31—Criteria

888.311

The applicant:

(a) is a member of the family unit of a person who holds a Subclass 888 visa granted on the basis of satisfying the primary criteria for the grant of the visa; and

(b) made a combined application with that person.

888.312

(1) The applicant satisfies public interest criteria 4001, 4002, 4003, 4004, 4007, 4010, 4020 and 4021.

(2) If the applicant had turned 18 at the time of application, the applicant satisfies public interest criterion 4019.

(3) If the applicant has not turned 18, the applicant satisfies public interest criteria 4017 and 4018.

888.313

The applicant satisfies special return criteria 5001, 5002 and 5010.

888.4—Circumstances applicable to grant

888.411

The applicant may be in or outside Australia when the visa is granted, but not in immigration clearance.

Note: The second instalment of visa application charge must be paid before the visa can be granted.

888.5—When visa is in effect

888.511

Permanent visa permitting the holder to travel to and enter Australia for 5 years from the date of grant.

888.6—Conditions

888.611

If the applicant is outside Australia when the visa is granted:

(a) first entry must be made before the date specified by the Minister; and

(b) if the applicant satisfies the secondary criteria for the grant of the visa, condition 8515 may be imposed.

The points test is set out in an accompanying document and is Schedule 7A Business innovation and investment points test—attributes and points (Business Skills (Provisional) (Class EB) visas)

CLIENTS WITH A SHADY PAST

Business visas are generally subject to this criterion:

892.214

Neither the applicant nor his or her spouse or de facto partner (if any) has a history of involvement in business activities that are of a nature that is not generally acceptable in Australia.

In Lee v Minister for Immigration and Citizenship [2009] FCA 977 (28 August 2009), the MRT found against the applicants. Here are the facts. The applicant wrote to the MRT as follows:

Due to the nature of the business, I had to employ a few people on a casual basis. And due to the lack of interest from the Australian general public in working in this type of labour work, I had no choice but to rely on overseas people such as working holiday makers for the required job. They work for a short period due to their travel plan and work limitation condition. This has been the main reason why they were omitted from employment declaration and PAYG withholding tax. I have now rectified this situation and will continue to do the right things. I regret about the default of conducting the business in the way that had gone through.

The Tribunal, in its reasons for decision , said:

The Tribunal observes that the first named visa applicant has admitted by way of submission and oral evidence that he had paid cash to his carwash casual employees. The delegate found that the salaries had not been declared to the ATO and that PAYG withholding tax obligations on their behalf had not been met and that the first named visa applicant “had evaded tax obligations through participation in the ‘cash’ or ‘black’ economy and this behaviour “would be likely to be offensive or to give rise to controversy in the Australian economy”.

The Tribunal concluded:

The Tribunal finds that the first named visa applicant’s claims are based on what he thinks is a real world scenario and the reality of his industry. The Tribunal does not disagree with him regarding the nature of the employment scenario he outlined to it. But the crucial point is that he has admitted to breaking the law over a period of time by bypassing payroll tax, superannuation and workers’ compensation payments through cash payments to his casual employees. The employees for their part have evaded paying income tax. He, therefore, has ‘a history of involvement in business activities’ meaning an elaborated, prolonged and consistent period of conduct in activities which are likely to be offensive to a large section of the Australian population and which are unlawful. Furthermore, although the first named visa applicant has claimed to have rectified these payments, he did not desist from this conduct until discovered by the Department on a site visit in regards to his Business visa application.

The Tribunal finds that this behaviour may be prevalent in Australia due to the exigencies of certain employment situations (as the first named visa applicant claims) but it is, nevertheless not ‘generally acceptable’ in Australia because it is, in fact, a breach of the law of the land and avoidable. The Tribunal finds, therefore, that the first named visa applicant does not meet the criterion in clause 892.214.

On appeal to the Federal Court Spender J agreed with the MRT

71 In my opinion, the disqualifying criterion in cl 892.214, that neither an applicant nor his or her spouse has a history of involvement in business activities that are of a nature that is not generally acceptable in Australia, requires a consideration of whether there is a history of involvement in business activities that are of a nature that the larger part, or most, of people in Australia would not or do not approve of. The activities of the appellant in the present case were identified by the Tribunal as bypassing payroll tax, superannuation, and workers’ compensation payments through cash payments to his casual employees, with the consequence that the employees, for their part, have evaded paying income tax. The Tribunal concluded those activities are activities “which are likely to be offensive to a large section of the Australian population and which are unlawful”. Those findings support the conclusion that “those business activities are not generally acceptable in Australia”. The Federal Magistrate concluded that “the first named visa applicant does not meet the criterion in cl 892.214”. No error taints this conclusion.

Obviously no applicant should be applying for visas without having a clean house as far as taxation is concerned.

Australian business ethics

The writer recently had a difficult experience of two parties to a business transaction disguising the price to avoid stamp duty. In Australia this is a criminal offence. If found out the client would never obtain a visa. It creates a difficult situation for a lawyer. A lawyer can not be involved in tax evasion and a migration agent who becomes involved in tax evasion becomes an accessory to a crime.

Clients need to be briefed that in applying for business visas the clients must comply with Australian rules and ethics otherwise any gains they achieve by unethical behaviour will be lost through being removed from Australia.

Sale of business before MRT made its decision

In Baldassarra v MIMIA [2005] FCA 239, a subclass 845 established business visa applicant sold his business before the MRT made its decision on review and a result failed to meet the criteria for the visa. Time of application criterion in paragraph 845.213 states:

845.213 The applicant:

(a) has had an ownership interest in 1 or more established main businesses in Australia for the period of 18 months immediately preceding the making of the application; and

(b) continues to have an interest of that kind.

And the time of decision criterion states:

845.221 The applicant continues to satisfy the criteria in clauses 845.213 to 845.218.

The result of those 2 provisions is that an applicant must own a business both at time of application and time of decision. The MRT steps into the shoes of the decision maker so that at the MRT stage all of the time of decision criteria must still be met. Having sold the business before the MRT made its decision, the applicant therefore failed to meet 845.221 because he did not continue to own a business. The applicant has stated:

‘Because the application was declined they felt it would be better to sell the business so they would not have the worry of having to sell it in a short period of time if their appeal was also declined’.

But the Federal Court held this was no basis on which to allow a non-compliance with a time of decision criterion.

This case is mentioned not because it is especially significant but because it shows that an attitude of not proceeding as it one is going to win an appeal will lead to the applicant losing.

Persistence wins the day

In contrast, the visa applicants in Lai 071566662 [2009] MRTA 126 (3 February 2009) had 3 separate subclass 845 visa applications rejected before being ultimately successful before the MRT. Sometimes in business visa applications, applicants end up taking 2 steps back before taking the right number of steps forward.

The difficulty in this matter concerned the documenting of director’s loans to the company being used to the run the business. It is not enough to simply have the directors’ loans in the company accounts. The MRT insisted upon and ultimately got evidence of the original bank transactions which put the money into the company’s accounts. Here is the detail of the evidence that the MRT required:

Further, the Tribunal accepts that the primary applicant transferred by telegraphic transfer USD60,000 directly into Auliwa’s bank account as the bank statement stated in relation to the TT as follows: “TT NSC911637 [the primary applicant] directly remit into USD account.’ On 20 March 2002, a USD bought approximately 1.8873 AU which meant that USD60,000 was worth approximately AUD113,238 (based on XE’s historical currency rates chart, mid market rates as at 20 March 2002 at noon Eastern Time: http://www.xe.com/ict/ accessed 13 January 2008). The Tribunal notes that due to the period of time that has elapsed further documentary evidence in the form of bank statements and other bank documents would be difficult to obtain.

In other words the MRT required documentary evidence that the loans were actually made. Here the applicants supplemented their case by an auditors’ report as well!

The applicants were therefore successful on their 3rd try for a subclass 845 established business visa. The writer believes the best approach for establishing the requisite asset position in business visa cases where the applicants own 100% of the business is for the applicants to allocate shares to themselves and pay for the allocation by a deposit into the company’s bank account (ie the applicants would allocate 100,000 one dollar shares to themselves by appropriate written resolution and then to give effect to that resolution they would deposit $100,000 into the company’s bank account.) Once the visa has been granted then the applicants could by resolution allow the company to buy back some of the shares (ie for example 98,000 shares at par). This is perfectly legal and proves without doubt that the applicant had the requisite $100,000 interest in the company at the relevant times. (Of course avoid loans back from the company to the shareholders as this dilutes the net asset position.)

Avoid Trusts

The writer has consistently argued over the years that discretionary trusts are dangerous vehicles to use as a means of setting up business structures to gain permanent residence. In the end the taxation and asset protection values of a trust (particularly a discretionary family trust) are an impediment to gaining permanent via the business visa regime.

A good example of this is the MRT case of Fatouros 060861990 [2008] MRTA 1343 (24 December 2008). Here there was a complex discretionary family trust and below is only an extract of the legal contortions the applicants had to take in an unsuccessful attempt to prove ownership:

Therefore, the only relevant document that is capable of being considered for subregulation 1.11A(2) is the trust deed. It is this document that must be considered. Clearly, this document must be considered together with any further relevant oral or other evidence which was submitted to the Tribunal. It is submitted that the trust deed, together with the evidence of the three parties concerned, clearly establishes the fact that Ms Fatouros had a one third interest in the business.

In the Tribunal’s view, the beneficial ownership the applicant needs to establish is conferred by the verbal agreement in accordance with the Trust Deed itself, not vice versa. The Tribunal does not accept that the fact that there is no appropriate authority to stamp a director’s declaration, or other document evidencing an oral agreement, means there is no requirement. Rather, it simply means that such evidence is not of a type which may evidence beneficial ownership under regulation 1.11A, and is not intended to be.
The Tribunal agrees with the agent’s contention that the Trust Deed is part of the evidence which a Court might rely on to find that the oral agreement has conferred the claimed interest. However, regulation 1.11A requires more than circumstantial, supporting, indirect evidence.
On the question of ownership interest, the agent concluded in his reply dated 2 October 2008:

Having regard to the matters discussed above, it is submitted that Ms Fatouros had a vested and indefeasible equitable and legal interest in one third of the business in question since October 2002 to date.

This is clearly the case, having regard to the decision in Saunders v Vauitier (1841) 49 ER 282. In accordance with the decision in this case, Ms Fatouros has the right to call on the trustee to terminate and distribute its assets with respect to the business, in which case she would receive one third of the business assets of the trust.

It is submitted, therefore, that she has the required ownership interest in terms of Acceptable Ownership of Trust Assets in Generic Guidelines M, for the purposes of subclause 892.211(1) of the Migration Regulations.

There is an argument that the applicant has had an equitable interest in one third of the business since October 2002. However, the requirement in clause 892.211 is not that a person must have an enforceable equitable interest in an asset which would be recognised by a Court. Subregulation 1.11A(1) provides that for Part 892 of Schedule 2 to the Regulations, ownership by an applicant includes beneficial ownership only if it is evidenced in accordance with subregulation 1.11A(2). The question is whether the applicant has shown the Tribunal one of the listed stamped documents evidencing beneficial ownership from the relevant time.
The rule in Saunders v Vautier (1841) 49 ER 282 has been expressed as follows (Goulding v James [1997] 2 All ER 239 at 247 per Mummery LJ, cited with approval by the High Court in CPT Custodian Pty Ltd v Commissioner of State Revenue (2005) 79 ALJR 1724 at [43]):

The [rule] recognises the rights of beneficiaries, who are sui juris and together absolutely entitled to the trust property, to exercise their proprietary rights to overbear and defeat the intention of a testator or settlor to subject property to the continuing trusts, powers and limitations of a will or trust instrument.

The agent does not appear to be contending that the Trust Deed itself, without the oral agreement and/or the Director’s Declaration, read in light of this rule, confers a beneficial ownership interest. The answer to that argument is that the question is not whether the applicant has beneficial ownership, but whether she has given acceptable evidence of it.
The Tribunal has, however, considered whether the Trust Deed itself, without the subsequent Trust Deed and/or agreement, confers an ownership interest.
In CPT Custodian the High Court quoted Thomas on Powers on the rule as follows:

Under the rule in Saunders v Vautier …, an adult beneficiary (or a number of adult beneficiaries acting together) who has (or between them have) an absolute, vested and indefeasible interest in the capital and income of property may at any time require the transfer of the property to him (or them) and may terminate any accumulation. [47]

In Feeney v Feeney [2008] NSWSC 890 at [16] – [23], the NSW Supreme Court appeared to rely on the idea that certain beneficiaries’ interests were not indefeasible (because they were contingent on them surviving their father) to find that the rule in Saunders v Vautier did not apply.
In the Tribunal’s view, it is this requirement that the beneficiaries have an indefeasible interest for the rule in Saunders v Vautier to apply which disposes of the issue in the present case. Clause 11.2(b) of the Trust Deed states “… the Trustee may by deed or resolution declare that a Beneficiary is excluded from being a Beneficiary.” Consequently it cannot be said that the applicant’s interest as a beneficiary is indefeasible, and the rule in Saunders v Vautier does not apply. Therefore the stamped Trust Deed does not by itself evidence an ownership interest.
In summary then, the Tribunal finds that neither the Director’s Declaration nor the Trust Deed on their own or when taken in conjunction establishes that the applicant had or has had, for the minimum 2-year period, an ownership interest in the supermarket business. Consequently the Tribunal finds that the applicant does not satisfy subclause 892.211(1) and clause 892.211.

Thus the MRT concluded that the applicant did not have the necessary ownership interest to meet the requirements of the subclass 892 visa.

But having said the Full Federal Court has given a new gloss on the ability of a person to own assets through a trust.

In Minister for Immigration and Citizenship v Hart [2009] FCAFC 112 (31 August 2009), in a split two-one decision, the Full Federal Court found that the meaning of ownership interest in s. 134(10) of the Migration Act was sufficient to still establish that a person who owned an interest in a trust still had an ownership interest. S. 134(10) states:

ownership interest, in relation to a business, means an interest in the business as:

(a) a shareholder in a company that carries on the business; or

(b) a partner in a partnership that carries on the business; or

(c) the sole proprietor of the business;

including such an interest held indirectly through one or more interposed companies, partnerships or trusts.

Here the visa applicant was a beneficiary of the family trust and also had a 20% shareholding in the trustee company operating the business.

Spender J observed:

20 The business, Northside Cabinets, has, according to the balance sheet of Northside, goodwill. It is not in dispute that in relation to the requirement in reg 1.11(b), that Ms Hart “maintains, or has maintained, direct and continuous involvement in management of the business from day to day and in making decisions affecting the overall direction and performance of the business”. The business Northside Cabinets is a substantial one, giving employment to at least 11 full-time employees. It is clear that the policy reasons behind the eligibility for a Business Skills – Established Business (Residence) (Class BH) visa favour the grant of that visa to Ms Hart. It is necessary for such grant that she satisfy the “ownership intent” requirement in cl 845.213.

21 In my judgment, the business Northside Cabinets was carried on by Northside. That seems to be acknowledged in the judgment of Logan J, where his Honour said, at [113]:

True it is that Northside carries on the business but it does so as a trustee…..

24 It may be accepted that, under the general law, a beneficiary of a discretionary trust has no interest, legal or equitable, in any of the assets of the trust. It is true also that, under the general law, a shareholder in a company has no interest, legal or equitable, in the assets of the company.

25 The business Northside Cabinets is an asset of Northside as trustee for the Yates Family Trust, and under the general law, a shareholder in Northside, or a beneficiary under the Yates Family Trust, does not have any interest, legal or equitable, in the assets of the business Northside Cabinets.

26 Were it not for the definition of ownership interest in s 130(10) of the Act, the applicant would not satisfy the criteria in cl 845.213 (a).

27 The definition in s 134(10) of an “ownership interest”, in relation to a business, is a definition by Parliament, which definition is in disconformity with the ordinary meaning of such an interest under the general law. The concluding words of the definition of ownership interest vividly illustrate that disconformity.

28 Putting to one side the complications thrown up by any interposing of partnerships or trusts, if a person were a shareholder in a company that had a subsidiary which carried on the business, under the general law a shareholder in the holding company would have no interest in any of the assets of the holding company, and, a fortiori, would have no interests in the assets of a company that is a subsidiary of the holding company. The definition of “ownership interest” by Parliament is meant to apply to situations which are quite outside the orthodox position explained in Salomon v A Salomon and Co Ltd [1897] AC 22.

29 As McHugh J said in Newcastle City Council v GIO General Limited [1997] HCA 53; (1997) 191 CLR 85, at 113:

If the target of a legislative provision is clear, the court’s duty is to ensure that it is hit rather than to record that it has been missed.

30 The definition, inelegant and not in conformity with the ordinary understanding of the general law as it may be, makes plain that a shareholder in a company that carries on the business has an interest in the business, and that interest is an ownership interest.

31 For the purposes of criterion 845.213, a further necessary consequence of that definition is that if a shareholder in a company that carries on the business holds more than 10% of the shares in the company, the value of the ownership interest held by that shareholder is more than 10% of the value of the business, for the purposes of reg 1.11(1)(c).

32 The short answer to the question on the appeal is that Parliament has spoken as to what is an “ownership interest” in relation to a business. The necessary consequence is that since Ms Hart is a 20% shareholder in a company, Northside, that carries on the business of Northside Cabinets, she has an ownership interest in the business, and the value of her ownership interest is 20% (that is to say, at least 10%) of the total value of the business.

33 The Federal Magistrate was right to say that the “relevant inquiry … was whether the company in which there is the necessary shareholding carries on the relevant business”.

Spender J made some useful observations about how to interpret legislation:

7 Black CJ in Fox v The Commissioner for Superannuation [1999] FCA 372; (1999) 167 ALR 197 said, at [12]-[13]:

12 It was once thought that a statutory provision was to be interpreted literally unless its terms disclosed an ambiguity of meaning, in which case regard could be had to its context in order to discern the intention behind the provision’s enactment and thereby resolve the ambiguity. This, however is contrary to the modern approach to statutory interpretation described by Brennan CJ, Dawson, Toohey and Gummow JJ in CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; 141 ALR 618 at 634-5 …

[T]he modern approach to statutory interpretation (a) insists that the context be considered in the first instance, not merely at some later stage when ambiguity might be thought to arise, and (b) uses “context” in its widest sense to include such things as the existing state of the law and the mischief which, by legitimate means such as those just mentioned, one may discern the statute was intended to remedy.

13 It follows that context must be considered at the beginning of any inquiry into the meaning of a statute, regardless of the apparent clarity of the literal terms of the relevant provision itself. …

8 In this case, the objects of the legislation, and the width of the plain words of the definition of “ownership interest” in s 134(10) of the Act, make it plain to me that the context demands that the meaning of “ownership interest” is as Parliament intended in the plain words of s 134(10), without the qualifying or limiting addition.

The end result is that from a practical point of view, the ownership interest will be satisfied if the visa applicant has an ownership interest of at least 10% in the trustee company operating the business.

Time to take on DIAC on measuring the value of goodwill

DIAC has an unrealistic way of measuring goodwill as an asset. The PAM says the following:

– Business Skills visas – Business ownership & assets – Net business assets –Other net asset items.

41.2 Goodwill

Goodwill comprises the future economic benefits from unidentifiable assets such as synergy, good management and market penetration, which because of their nature cannot normally be individually recognised.

When a business is purchased, the purchaser is required by accounting standards to recognise all identifiable intangible assets on the financial statements at their fair values. Only the residual amount, if any, computed by subtracting the fair values of all identifiable tangible and intangible assets (less any liabilities assumed) of the business from the purchase price of that business is recognised as purchased goodwill.

Goodwill that is purchased must be recognised as a non-current asset by the purchaser. Purchased goodwill acquired in a business is required to be tested annually for impairment. An impairment loss occurs when the recoverable amount of an asset is less than its carrying amount – such as might occur if the estimated sale value of a business is considered less than the reported value of a business. Should this occur, the carrying amount of the business is reduced to its recoverable amount. Any impairment loss would first be allocated to reduce goodwill and then be applied to other assets of the entity.

An impairment loss recognised for goodwill is not reversible in a subsequent reporting period.

If there is no evidence that goodwill in a business has been tested for impairment, an officer may seek confirmation that it has occurred. Indications that a business may have experienced an impairment loss might include but are not limited to businesses whose revenue, net value of assets or anticipated future cash flows have significantly reduced.

Goodwill may be considered as part of an applicant’s assets in business, but only if the goodwill:

has been purchased (The goodwill component must appear in the financial statements of the business as an asset arising from the purchase of the business, and be valued at no more than the original value paid.) or
has been built up over a period of time and realised with the sale of the business.

Officers should satisfy themselves that:

the sale was a genuine arms-length sale (as evidenced by a contract of sale) and
a competent authority such as a chartered accountant or lawyer has attested in writing to the genuineness of the sale and value of goodwill.

The above guideline does not take into account that unrealized goodwill can be a powerful asset. Accountants regularly value goodwill using quite orthodox methodology. Goodwill can be built up in a number of ways – people developing an idea and building up a business around it, a computer programmer developing software, even a well run takeaway shop in a good location on a long lease has measurable goodwill.

Often goodwill is built up as a result of enormous effort, often forgoing wages or income to reach that point. But this is not recognized by DIAC. The above definition of goodwill then spills over to anywhere else where DIAC requires a certain level of assets to meet a criteria (eg employer sponsorships).

For example the criteria in paragraph 132.224 states:

132.224

For at least 2 of the 4 fiscal years immediately before the time of invitation to apply for the visa:

(a) the net value of the assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, in a qualifying business or qualifying businesses in which the applicant had an ownership interest was at leastAUD 400 000

The word ‘value’ in the writer’s opinion includes ‘goodwill’ generally, not the narrow definition contained in the PAM. In other areas of law like matrimonial law, ‘goodwill’ as generally defined by qualified accountants will be included in a partner’s assets. The same issue applies in partnership law. There is no reason to narrow the definition of goodwill in migration law.

So the writer is prepared to consider taking a case on, ON A NO-WIN NO FEE BASIS on a good will issue (No win no fee means that the client pays my fee on a solicitor client basis, not on a costs as recovered basis, if the issue of goodwill is determined in favour of the applicant).

Barbara DavidsonSeptember 9, 2017The New Business Visas

The New Business Visas

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