Full changes to Oz investment visas announced

New investment in innovative Australian ideas and emerging companies will be encouraged as part of enhanced Significant Investment Visa (SIV) and new Premium Investor Visa (PIV) complying investment framework arrangements announced by the Oz government last week.

The changes to SIV and introduction of a PIV – both investor visas which offer pathways to permanent residency, subject to significant complying investments being made in Australia by an applicant – are part of a suite of Government policy initiatives which aim to promote investment, innovation and commercialisation of Australian ideas, research and development which are critical to our economic future.

Andrew Robb, Minister for Trade and Investment said: “Australian permanent residency is a great privilege – and the Government believes this warrants more dynamic investment in areas of the economy that will drive innovation and make a real difference.”

Assistant Minister for Immigration and Border Protection Michaelia Cash meanwhile stated that she believes the SIV programme provides a great pathway to Australian permanent residence for high net worth international investors. “The Government is keen to attract international investors with business and entrepreneurial skills, who will bring the necessary capital to enhance investment into innovative Australian businesses,” she said.

From 1st July 2015, the Government intends that new SIV applicants will be required to invest at least AUS$5 million in complying investments, which must now include:

– At least AUS$500,000 in eligible Australian venture capital or growth private equity fund(s) investing in start-up and small private companies. The Government expects to increase this to AUS$1 million for new applications within two years as the market responds;

– At least AUS$1.5 million in an eligible managed fund(s) or Listed Investment Companies (LICs) that invest in emerging companies listed on the Australian Securities Exchange (ASX); and

– A ‘balancing investment’ of up to AUS$3 million in managed fund(s) or LICs that invest in a combination of eligible assets that include other ASX listed companies, eligible corporate bonds or notes, annuities and real property (subject to a 10% limit on residential real estate).

Speaking last week Minister Robb said that the previous SIV framework had set the bar too low, with investment largely directed into passive investments such as government bonds and residential real estate schemes – areas that already attract large capital flows.

“Direct investment in residential real estate has never been a complying investment for SIV and this will not change,” he explained. “Indirect investment in residential real estate through managed funds will now be restricted. Importantly, a SIV holder can still independently invest in residential real estate so long as it complies with foreign investment rules, but this would not count as a complying investment to qualify for a visa.”

The new PIV will also be introduced from 1st July 2015. This visa will target talented entrepreneurs and innovators with a minimum AUS$15 million to invest. It will be available at the invitation of the Australian Government only, with potential applicants to be nominated by Austrade.

This programme will be rolled out over the next year, focussing on attracting a small number of highly talented and entrepreneurial individuals to Australia who can contribute those skills and talents into areas which deliver a long term economic benefit to the country. States and Territories will play an important role in helping to identify potential applicants.