The Australian Government is reforming the Business Innovation and Investment Program (BIIP) to create more Australian jobs, promote the growth of key sectors and support Australia’s economic bounce back from the COVID-19 pandemic.
Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs Alex Hawke said that the changes would improve the quality of investments and maximize the economic benefits for Australia.
“Over $15.9 billion has been invested into the Australian economy since 2012 and the changes taking effect from 1 July will see this figure continue to increase,” Minister Hawke said.
“Australia is an attractive destination for investors and these changes will directly benefit emerging enterprises, the commercialisation of Australian ideas, and research and development,” he said.
“Increased investment thresholds and the adjustment of investment ratios to focus more on venture capital and private growth equity will better support innovation and emerging enterprises in Australia,” Minister Hawke said.
Key changes that come into effect from 1 July 2021:
- The investment amount for the Investor stream (188B) will increase from $1.5 million to $2.5 million. The investment amount for the Significant Investor stream (188C) will remain at $5 million.
- The Complying Investment Framework (CIF) will be applied to both investment streams-Investor and Significant Investor.
- Investor visa holders will be required to invest 20 per cent of their investment into venture capital or private equity funds, and a further 30 per cent into managed funds focused on growth and emerging companies.
- The balancing investment component will be reduced from 60 to 50 per cent.
- Funds will be required to provide annual independent audit reports showing their compliance with the CIF.
In summary, from 1 July 2021 the following CIF ratios will apply to both the Investor and the Significant Investor streams:
- 20 per cent venture capital and Private Growth Equity funds (VCPE)
- 30 per cent funds investing in emerging companies
- 50 per cent in balancing investments
The changes coming will also shorten the length of time investors have to wait before they can apply for permanent residency.
Currently, some investors have to wait at least four years before they can apply for permanent residency.
But the changes mean all BIIP visa holders will be able to apply for permanent residence if they meet the requirements of that stream after three years, and will have up to the fifth year to do so.
The reforms will come into effect at the same time as a number of other reforms to the Business Innovation and Investment Program (BIIP), including the slashing of the visa scheme to four streams: business innovation, entrepreneur, investor and significant investor.
Strong compliance measures are in place to maintain the integrity of Australia’s borders and economic migration program. All visa applicants are required to meet Australia’s security, identity and character requirements, as well as visa stream specific requirements.