Significant Investor Visa Fiona Halsey | Halsey Legal Services www.halseys.com.au www.halseys.com.au
Warning 1) This presentation is intended only to provide a summary and general overview on matters of interest. It is not intended to, nor does it constitute legal advice. We make no warranties or representations about the contents of this presentation. You should consider the content of the presentation as merely promoting discussion on the topics referred to. You should not act on or rely on the contents of this presentation before not act on or rely on the contents of this presentation before first obtaining professional advice specific to your circumstances. 2) This presentation does not create a solicitor-client relationship between you and the presenter, author or promoter of the presentation . HALSEYS
What is it? 1) Business Innovation and Investment (Provisional) Visa (Subclass 188) 2) Business Innovation and Investment (Permanent) Visa (Subclass 888) HALSEYS
Requirements To be eligible for the provisional visa: 1) Investment of at least A$5 million 2) Complying investments 3) Minimum of 4 years HALSEYS
Other requirements 1) Health 2) Character 3) No history of involvement in unacceptable business or investment activities, regardless of location of activities 4) 4) Certain other public interest criteria (4001, 4002, 4003, Certain other public interest criteria (4001, 4002, 4003, 4004, 4010, 4020 and 4021) 5) Reside in Australia for 40 days per year (may be assessed cumulatively – 160 days over 4 years) 6) Genuine intention to reside in the State or Territory which govt agency nominated the applicant Halseys
Note Certain usual requirements of business investment/ skilled migration visas do not apply. 1) No innovation points test 2) No upper age limit 3) 3) No English language threshold requirement (note: if No English language threshold requirement (note: if unable to demonstrate functional English, applicants must pay a second instalment charge) 4) No restriction in relation to obtaining work or study once visa is granted HALSEYS
Complying Investments What are complying investments? 1) Commonwealth, State or Territory Government Bonds 2) ASIC regulated managed funds with a mandate for investing in Australia 3) 3) Direct investment into Australian proprietary companies Direct investment into Australian proprietary companies Listed investments are NOT acceptable, however, this can be achieved through use of a suitable managed fund HALSEYS
Investment requirements What are the specifics? 1) Investments can be held in any combination, however, depends upon the State 2) Investors can change investments 3) 3) Sums withdrawn must correspond with sums reinvested Sums withdrawn must correspond with sums reinvested 4) An investor has 30 days from withdrawal to reinvest 5) If funds are reinvested within 30 days, the investments will be taken to have been held continuously (in relation to the 4 year requirement) 6) Current investments may count towards the $A5M total, however, must be held for 4 years of provisional visa HALSEYS
Investment Requirements Value of investments 1) As long as no withdrawals are made, the value of investments may fall below A$5M 2) If the value of investment increases over A$5M, no withdrawals are permitted unless they are reinvested within 30 days HALSEYS
Details of different kinds of complying investments 1. Managed funds 2. Pty Ltd companies 3. Government bonds (not covered in any detail) � Rules for managed funds and Pty Ltd companies are very different � Different rules for the individual applicant asset holding entity, and the complying investments HALSEYS
Managed funds Features of a complying managed fund: 1) MIS as defined in the Corporations Act 2001 2) Interests are not able to be traded on a financial market 3) No representations have been made to a member that the interests will be able to be traded the interests will be able to be traded 4) The issue of the interests are covered by an AFSL 5) Restricted investments, as specified by the Minister Additionally: 1) Available to the public 2) IDPS is allowed HALSEYS
Managed Funds – permitted underlying investments Purposes specified by the Minister (really quite broad): 1) Infrastructure projects in Australia 2) Cash held by Australian ADIs 3) 3) Bonds issued by Cth, State or Territory Governments Bonds issued by Cth, State or Territory Governments 4) Bonds, equity, hybrids or other corporate debt in companies and trusts listed on any Australian stock exchange 5) Bonds or term deposits issued by Australian financial institutions HALSEYS
Managed Funds Purposes specified by the Minister (cont): 6) Real estate in Australia 7) Australian agribusiness 8) Other ASIC regulated MISs that invest in the above list of investments of investments HALSEYS
Managed Funds 1) Potentially could use a standard retail fund, however, will need to be careful that fund only invests in acceptable investments. We say – don’t take the risk. 2) Likely that suitable funds will be established to satisfy visa requirements 3) A number of entities are establishing their own funds at the moment 4) Although the relevant State government will consider if investments are complying, this is no guarantee of quality or safety HALSEYS
Managed Funds Form 1413: 1) Declaration from the fund manager that all of the underlying investments in the fund are limited to the classes of investments specified by the Minister. 2) Any underlying funds within an MIS will also need to complete this form. 3) Available from the Department of Immigration and Citizenship website. HALSEYS
Examples of complying managed fund Property Fund NSW Road WA located Victorian shopping rental centre properties HALSEYS
Examples of complying managed fund Equity Fund Listed Corporate Cash with companies debt from Westpac (eg Coles Wesfarmers) HALSEYS
Examples of complying managed fund Fund of Funds Fund 1 - Fund 2 - Fund 3 - Equity Property Infrastructure Entities listed Australian on an Australian property Australian infrastructure exchange HALSEYS
Examples of non-complying managed fund Property Fund New Platinum Victorian Zealand International rental Road Managed properties Fund HALSEYS
Examples of non-complying managed fund Equity Fund Wesfarmers Companies Victorian listed only on rental New Zealand properties exchange HALSEYS
Examples of non-complying managed fund Fund of Funds Fund 1 - Fund 2 - Fund 3 - Equity Property Infrastructure Entities listed Australian on an Australian property Australian infrastructure exchange plus some NZ infrastructure HALSEYS
Effect of NZ Infrastructure 1) Causes all investments made through the top fund to be non-complying 2) No investor satisfies the requirement 3) Everyone involved probably sued Immigrants should require that all fund managers certify that the underlying investments are complying, and require suitable guarantees and indemnities. However this is not a perfect solution. HALSEYS
Australian Pty Ltd Companies 1) Must be registered under the Corporations Act 2001 and with ASIC 2) Must genuinely operate a qualifying business 3) Must have ABN 4) 4) Applicant must have an ownership interest in the Applicant must have an ownership interest in the company Acceptable investments through a Pty Ltd company are quite different to those through a managed fund HALSEYS
Australian Pty Ltd Companies Qualifying business: 1) Enterprise that is operated for the purpose of making profit through the provision of good, services or goods and services (but not the purpose of rental property) to the public, and is not operated for the purpose of speculative or passive investment. speculative or passive investment. 2) Company cannot be wholly or substantially created for the purpose of being a complying investment. At law, goods does not include land – there has always been a distinction. HALSEYS
Australian Pty Ltd Companies Qualifying business (cont): 1) Company must carry on as a qualifying business for at least two years. � If invested in the company for two years or more, company must be a qualifying business for at least two years. � If investment is held for less than two years, company must be a qualifying business for the entire period. 2) Otherwise, must show that that there was a genuine attempt to maintain a qualifying business by providing evidence. HALSEYS
Australian Pty Ltd Companies Qualifying business (cont): 1) Speculative an investment that carries a high level of risk of loss 1) Passive generally, purchased with the intention of long term generally, purchased with the intention of long term appreciation and limited maintenance HALSEYS
Australian Pty Ltd Companies Ownership interest: � Interest as a shareholder in the company that carries on the business, including interest held directly through one or more interposed companies, partnerships or trusts � Ownership may be in any proportion General Corps Law restrictions on Pty Ltd companies: � Generally thought inappropriate for public fundraising � Cannot have more than 50 non-employee shareholders � Cannot undertake fundraising that requires prospectus HALSEYS
Recommend
More recommend
