News Flash

New Entrepreneur Visa hopes to attract innovators to Australia

17-Oct-2016

On 10 September 2016, a new Entrepreneur Stream for the Business Innovation and Investment (Provisional) visa (subclass 188) was introduced.

What is it?

The Entrepreneur Stream is specifically for entrepreneurs with innovative ideas and financial backing from a third party. Those interested are invited to submit an Expression of Interest through SkillSelect, and if successful will be nominated by a State or Territory government for the visa.

Eligibility criteria includes:

  • ​being under 55 years of age (although this can be waived if your proposed complying entrepreneur activity will be of exceptional economic benefit);
  • having competent English and be able to provide evidence of this at the time you are invited to apply for the visa; and
  • be undertaking or proposing to undertake a complying entrepreneur activity in Australia and have a genuine intention to continue this activity.

An Entrepreneur visa holder can obtain permanent residency after four years if certain measures of success are reached. This includes factors like business turnover, employment of Australians and ability to obtain significant financial backing.

Additionally, postgraduate research graduates with science, technology, engineering and mathematics (STEM) and information and communications technology (ICT) qualifications will be awarded extra points under the General Skilled Migration (GSM) points test to make their pathway to permanent residence easier.

What is a ‘complying entrepreneur activity’?

A complying entrepreneur activity is an activity that relates to an innovative idea that will lead to the commercialisation of a product or service in Australia, or the development of an enterprise or business in Australia.

This activity must not relate to:

  • Residential real estate
  • Labour hire
  • Purchase of an existing enterprise or a franchise in Australia.

Why was it introduced?

The purpose of the Entrepreneur Stream is to attract foreign entrepreneurial talent and skills to Australia, increasing the number of entrepreneurs starting businesses. This is in line with the government’s renewed attention to science and innovation due to skills shortages in STEM and ICT sectors.

Proponents of the new stream argue that the existing visa structure – including the Business Talent (Permanent) visa (Subclass 132) – does not provide a clear pathway for foreign entrepreneurs to establish promising businesses in Australia. There is too much red tape, it has prohibitive qualification requirements, doesn’t credit entrepreneurial skills enough, and takes too long to process.

Analysis

Overall, there has been a very positive response to the entrepreneur visa. Both major parties have come out in strong support of it, with backers citing evidence that immigrant entrepreneurs create jobs and boost local competitiveness. However, skeptics point out that too much focus on small businesses and start-ups masks the fact that larger, well-managed companies tend to have higher productivity.

There are still uncertainties around the new stream eg. what precise criteria will be used to determine the ‘innovativeness’ of an idea, or if a cap on the number of visas to be granted will be introduced later on. We’ll just have to wait and see.

For more information on the new visa stream, head to the DIBP website. Alternatively, contact one of our immigration specialists to discuss your options today.

 

Source: DIBP