Recently, there has been a great deal of buzz about thepossible cancellation of the $5 million Significant Investor visaThe incoming Labor government has already launched a deep-level reform of Australia’s entire migration system (for details, see:“Australia’s migration system is now too expensive and too slow!” — deep reform review launched! The Home Affairs Minister has said: it is not just numbers under review!)
. The Minister for Immigration and the Minister for Home Affairs have both stated that this round of reform will touch every category, every quota, and every process — not just isolated elements. The goal is for Australia to attract the talent it needs and avoid falling behind competing nations in the future.
A new government always makes bold moves early on, and the first of those moves looks set to target the $5 million Significant Investor visa.
Let’s first look at whatthe Home Affairs Ministersaid in an interview last Sunday.
You can tell that the Minister’s criticism and dissatisfaction are clear, and her position is unambiguously negative.Government officials generally choose their words carefully before a formal announcement is made, even when they already know the outcome.So when they speak this openly and explicitly about their views, it is essentially a clear signal.
The $5 million investor visa has beenmired in controversy ever since it was established.
Key milestones in the SIV Significant Investor visa (Subclass 188C):
In practice, criticism of Subclass 188C applicants has never stopped in recent years. The main concerns have beenthe security of the funds, and the age and English language ability of applicants.
The Grattan Institute, a prominent Australian think tank, cited calculations from the Australian Treasury in a report last year, stating that applicants for this visa typetend to be aged 45 or above, have limited English proficiency, and cost the public services system AU$120,000 more over their lifetime than they contribute in tax.
This time, the “cry of wolf”is real.
After several false alarms about cancellation, this time it appears to be genuine.
As at 30 June 2020, a total of 2,349 visas had been granted under the SIV category.However, we can see that following policy changes, grants dropped noticeably after 1 July 2015. Of all visa holders, mainland Chinese nationals accounted for approximately 85%, with the vast majority settling in New South Wales and Victoria:
Based on feedback from some of our investor migration clients, the above assessment does reflect the current situation.Subclass 188B and 188C holders generally begin residing in Australia after arrival, after which they can meet the requirements to transition to permanent residency.Due to language and age barriers, the majority of applicants do not start a new business or investment in Australia and do not enter employment there, meaning they are fundamentally unable to contribute meaningfully to Australia’s development.
By contrast, Subclass 188A and 188E clients need to establish a business in Australia in order to qualify for permanent residency, so their contribution — whether to employment, tax revenue, or economic growth — is clearly greater than that of Subclass 188B and 188C clients.
Lock in now — this is the moment!
The Australian migration system review panel willin February next yearsubmit its report to the government. A series of policy reforms is expected to be announced shortly thereafter,with Subclass 188C — the first in the firing line — potentially affected even earlier. Lock in now — this is the moment!
We have also recently secured state nomination invitations under Subclass 188C for several clients, locking in the current policy for them.
QLD 188C — Client K: source of funds from company/corporate loan
QLD 188C — Client X: source of funds from property sale proceeds and gifts
NSW 188C — Client W: source of funds from company dividends
NSW 188C — Client K: state nomination application submitted at 11:30 am, invitation received before 1:00 pm
Australia’s Subclass 188C $5 million Significant Investor visa may be abolished,two key dates to watch closely going forward:
– Mid-October: how many BIIP (Subclass 188 visa) places are allocated in this financial year’s budget;
– We strongly recommend that prospective Subclass 188C applicants complete and lodge their visa application before February next year.
Australia Subclass 188C Significant Investor visa —
Eligibility requirements:
1. Net family assets: AU$5 million;
2. Invest AU$5 million into designated Australian investment products;
a. At least 20% (AU$1 million) invested through Australian venture capital or private equity funds into start-up companies;
b. At least 30% (AU$1.5 million) invested in ASX-listed emerging companies with a market capitalisation of no more than AU$500 million;
c. The remaining 50% (AU$2.5 million) may be invested through funds in commercial property, corporate bonds, or Australian equities.
If you want to catch the last policy window
and get across the line quickly,
contact our registered migration agent Simon Wu
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