By Moustafa Daly
Australia is expected to make changes to its migration policy by the end of this year, following the announcement of a major overhaul in May. The proposed update includes potentially ending the Business Innovation and Investment Program Stream 188 and expanding visa options for entrepreneurs and startup founders, among other changes.
In May, the Australian government announced it was in the process of overhauling its migration policy to attract talent and funds.
“The new government is working on a migration strategy to revise the whole migration system. This is a massive undertaking,” James Hall, director at ANZ Migrate, tells Uglobal. “The strategy will be based upon a review of the whole migration system completed early this year and presented by the government in April.”
While the full strategy is planned to be made public at the year’s end, the government has indicated some of its anticipated changes, particularly regarding investment migration routes.
What changes might be coming to Australia’s investor visas?
The investment migration visa that is widely expected to be scrapped by the year’s end is the country’s Business Innovation and Investment Program (BIIP) Stream 188, which gives foreign investors access to five-year visas in exchange for investment between AUD 1.25 million ($794,000) and AUD 2.5 million ($159,000), in addition to passing a point-based evaluation.
Other conditions include a net worth of at least AUD 2.5 million, including all business and personal assets.
“Concerns were raised with the 188 program generally,” explains Hall. “The findings [of the review] were that the net benefits for the business innovation stream were negative, and there were no positive reasons to keep this stream.”
However, a decision to end the 188 stream must consider the accumulated pending applications from foreign investors, numbering in the thousands.
“One of the challenges is there are around 25,000 188 applications sitting in the queue, and only a certain number can be granted each year, according to the planning level,” says Hall. “This year, there are 1,900 visas available. This means a long time to grant these and clear the queue.”
Potential changes to the Significant Investor Stream (subclass 888)
Launched in 2012, the Significant Investor Stream is open for foreigners who invest at least AUD 5 million ($3,185,000), granting them permanent residency in the country if their investment meets a set of conditions.
The government’s review of the immigration policy this year found that the 888 stream brings considerable economic benefits – indicating that this investor visa could survive the government’s revamp – maybe even expand it.
“The most beneficial stream was the Significant Investor stream,” says Hall.
“It’s likely we will see a new visa similar to the Significant Investor visa. I think this is likely later next year, and it’s likely to remain around AUD 5 million,” expects Hall.
Boosting entrepreneurial activity is part of Australia’s immigration objectives
The government’s review has also nodded positively to the possibility of expanding visa options for entrepreneurs and startup founders. Currently, there’s an Entrepreneur Stream that entails applicants must be nominated by a state, territory, or government agency in Australia. This condition alone, despite the lack of an investment threshold, may be keeping this visa from achieving its potential in attracting and nurturing entrepreneurial activity in the country.
“The review did see some potential in the Entrepreneur Stream,” says Hall, adding that despite availability, this stream hasn’t really taken off since its 2016 launch, which may compel the government to introduce some changes to it.
“Given this overall situation, we may see an increase in the venture capital funding component,” anticipates Hall. “We will also likely see a [different] entrepreneur visa sometime, which I expect won't be part of the 188 stream [unlike the current Entrepreneur visa]. The year’s end is the earliest we’ll see any changes to Australia’s immigration system and visa offerings – if not longer.”
“Ultimately we are waiting for the strategy, and we don't know when it will be out, just by the end of the year,” he says. “It's possible the strategy is high level and doesn't have enough detail [by then].”
“Worst case, we would need to wait for May next year when the budget is out,” says Hall.
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