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HOW TO DEMONSTRATE “BUSINESS SKILLS” FOR AUSTRALIAN BUSINESS MIGRATION PURPOSE

Blog & Articles, Business Migration, Business Visa, Migration Law , , , , , , , , , , , , ,

Basic Requirements

To qualify for business migration, generally speaking, you must be able to demonstrate that you have the requisite business skills.
Under the migration policies, the Immigration Department will assess you on:
  1. Your overall successful business career; and
  2. Your direct and continuous management involvement

Overall Successful Business Career

The migration policy intention is to measure the business performance of your entire business career, including any business activities that pre-date the assessment period.  Be aware that the Department may assess ALL businesses that you have had a management role.

Factors considered by the Department in conducting the assessment include:

  1. Financial position of your business – whether it has been making trading profits or losses.
  2. General trend of your business revenue – is it upward or downward trend.
  3. Whether the business likely to be successful in the longer term, looking at the potential to increase profitability, market share, business growth and/or competitive advantage.
  4. If your business recorded losses, you must provide details of relevant factors leading to the loss, such as:
  5. External economic trends
  6. Fall in property values
  7. Drop in world commodity prices
  8. Changes in taxation regime
  9. Recent acquisition of assets

You will NOT pass this criterion if your business has suffered recent trading losses and the business is consideredunlikely to be successful in the longer term due to your role and decision-making in the business.

Direct and Continuous Management Involvement

You are required to demonstrate that they have had direct and continuous involvement in management of the business from day to day and in making decisions affecting the overall direction and performance of the business.

Direct involvement in management

Direct involvement requires an applicant to be in charge of managing the whole or part of a business according to the size of the business.

If the main business is a small business with no or few employees it is expected that the applicant has a dominant role and responsibility for managing the business.

In the case of a larger business, you may not hold responsibility for a principal or dominant role, but it is necessary that you have been directly involved in managing at least one facet of a main business.  If there is more than one person who might have responsibility for managing the business it is necessary to define the management role of the applicant.

“Management” involves planning, organising, directing and controlling the resources of the business.

  • “Planning” includes setting the goals of the business, developing strategies for achieving the goals and determining the standards or quality.
  • “Organising” refers to the way the business allocates resources, assigns tasks, and goes about meeting its goals. In the process of organising, managers arrange a framework that links all workers, tasks and resources together so the business goals can be achieved.
  • “Directing” is supervising or leading workers to accomplish the goals of the business.
  • “Controlling” is the process of determining if the goals and objectives of the business are being met, setting performance standards for workers and monitoring their performance against standards.

Continuous involvement from day to day

You are expected to consistently spend a significant portion of your time managing the business on an ongoing basis from day to day. For a business to be considered a ‘main business’ it is intended that you would be involved in actively exercising your management role:

  • without any significant or frequent breaks in their management involvement
  • without any significant or frequent gaps in the activities of the business and
  • on any ordinary business day.

Decisions affecting the overall direction and performance of the business

You need to demonstrate that you were involved in making decisions affecting the overall direction and performance of the business. For example:

  • Establishing the business goals, market position, and competitive edge.
  • Method of sales distributions
  • Determining or creating business products and services
  • Setting up management structure and operational plan for efficient monitoring
  • Solving problems with complaints
  • Contingency planning for unforeseen circumstances

Assessment by the Department

If the Department has any doubt in relation to your management, additional scrutiny will be undertaken to determine the true nature of your management role in the business.

The case officers in charge of handling your application may:

  • refuse the visa
  • request further evidence
  • arrange an interview for you (in person or by phone). An interview may test whether you appear to have a full understanding of how the business operates, the duties you undertakes and the level of responsibility held.
  • A site visit may also be undertaken.

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ABOUT THE WRITER

Kelvin Tang has close to 20 years’ experience practising law in Australia. He is the founder and Principal Partner of Tang Law based in Perth, Western Australia. Kelvin is a Registered Migration Agent (MARN: 1386452) and has extensive experience in providing migration advice to clients, advising on “Eligible Businesses” within the definition of the Migration Regulations, assisting migrants (investor of the business) with satisfying migration requirements, making visa applications and appealing cancelled or refused visas in the Federal Court of Australia, Administrative Appeals Tribunal and Migration Review Tribunal. Kelvin also has extensive experience in civil litigation, commercial and corporate law matters.

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ARE YOU ELIGIBLE TO APPLY FOR A BUSINESS TALENT (SUBCLASS 132A) VISA?

163 visa, 188 visa, Blog & Articles, Business Migrants, Immigration Law, Migration Law, Perth Immigration Lawyer, Tang Law, Visa 132

Australia invites you to apply for permanent residence through a Business Talent visa. ​​These visas can provide businessmen that have a Significant Business History with permanent residency to establish a new (or develop an existing) business in Australia that can deliver exceptional economic benefits to the country and generate jobs.

Successful applicants will:

  • Have the opportunity to sponsor eligible relatives for permanent residency to live and work in Australia.
  • Be able to travel freely within and out of Australia while managing their day-to-day business directly or through an authorised representative. [1]

Australia also has many benefits for domestic and international businesses, which includes:

  • A stable political and legal environment, ranked as one of the top ten stable countries in the world based on its defence, economy and system power.[2]
  • A weaker Australian dollar in the past three years, making assets in Australia substantially cheaper for foreign investors to acquire and operate.
  • Favourable time zones due to its geographical location. Specifically, Western Australia is in the same time zone as about 60% of the world’s population making international business with Asia much more convenient.

For all states and territories in Australia, the criteria for applicants to be considered as having a Significant Business History is that they have net business and personal assets of at least AUD1.5 million and an annual business turnover of at least AUD3 million.[3]Each state or territory will then impose additional requirements relevant to their state.

Why Western Australia?

Western Australia has some of the most favourable requirements for prospective applicants.[4]For example:

  • Western Australia only requires AUD1 million of net assets to be in business within the state, unlike Victoria (AUD2 million) and New South Wales (AUD3 million).
  • Western Australia only restricts those businesses that exist only for the provision of rental properties or passive investment unlike other states, such as Victoria, which place additional restrictions on general importing, exporting of commodities and smaller project based property development businesses.

Generally, Western Australia requires the creation of at least one (1) new job for any qualifying business and two (2) new jobs for a property development business. Other states, such as New South Wales, require as many as five (5) jobs created within the city of Sydney or three jobs created in regional New South Wales.

Applications for Business Talent visas are assessed on a case-by-case basis and exemptions for certain requirement may be extended to applicants based on their individual applications and reasoning. To maximise your chances for a successful application and to find out how you can expand your business to Australia, get in touch with us at Tang Law in Northbridge.

 

[1] See Re Sheik Anis Iqbal and Minister For Immigration And Citizenship [2010] AATA 1029; Huang v Minister for Immigration and Multicultural Affairs [2002] AATA 656.

[2] http://www.heritage.org/index/ranking [as at 6 January 2017], https://www.gfmag.com/global-data/non-economic-data/most-peaceful-countries?page=2 [as at 6 January 2017].

[3] Migration Regulations 1994 (Cth) sch 2, ‘Subclass 132 — Business Talent’

[4]For a list of Western Australian requirements, please refer to http://www.businessmigration.wa.gov.au/?cat=business-migration&page=visa-132-business-talent

ABOUT THE WRITER

Kelvin Tang has over 14 years’ experience practising law in Western Australia. He is the founder and Principal Partner of Tang Law based in Perth, Western Australia. Kelvin is a Registered Migration Agent (MARN: 1386452) and has extensive experience in providing migration advice to clients, advising on “Eligible Businesses” within the definition of the Migration Regulations, assisting migrants (investor of the business) with satisfying migration requirements, making visa applications and appealing cancelled or refused visas in the Federal Court of Australia, Administrative Appeals Tribunal and Migration Review Tribunal. Kelvin also has extensive experience in civil litigation, commercial and corporate law matters.

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Case Study: How Did Our Lawyers Handle Complex Case involving Commercial Transactions & Migration Law?

Blog & Articles, Business Disputes Perth, Business Migrants, Commercial Disputes, Commercial Law, FIRB, Immigration Law, Migration Law, Perth Immigration Lawyer, Tang Legal, Visa 132

The Story

Mr Lee and his family was granted permanent resident visa.  To get the grant of the visa, Mr Lee entered into an agreement with the State that he will, amongst other conditions:

11) Invest at least $1,500,000 into an “Eligible Business” in the State;  and
22) The “Eligible Business” must employ at least five (5) full time employees who are either citizen or permanent residents of Australia.
Mr Lee looked at many possible investments in the State but repeatedly encountered these problems:
1.       Language barrier – Mr Lee does not speak or understand English.  Communication was a huge barrier.
2.       Cultural difference – Mr Lee operates a large enterprise in Asia and he has many personnel under him to manage and run his businesses for him. He was surprised to learn that owner of the business here is very often key person to the business.  He will not be able to commit 100% into the business due to his other commitments.  Mr Lee is also concerned about the safety of his investment.
3.       Constant uncertainty as to whether the business is in fact an “Eligible Business” and whether it can help him satisfy the migration requirements.

 

Mr Lee finally decided to invest with a property developer.  Mr Lee’s instructed us to advise and represent him.

 

Solution

We advised Mr Lee that his proposed venture and transaction must be structured to achieve the overarching purposes of:
11) Complying with Commonwealth migration requirements and Mr Lee’s Agreement with the State; and
22) Securing his commercial interests and his capital.
In terms of Commercial Law, Mr Lee took the following steps with our advice:
1.       Formation of legal structures for Mr Lee to undertake the investment.
Amongst other issues, segregation of risk, protection of personal assets, complying with migration requirements, and tax implications are important considerations in undertaking this task.
2.       Negotiation and formulation of the transaction structure with the property developer.
Amongst other considerations: 
·         Specific focus on ownership structure, investment vehicle, investment structure, key personnel required, role and obligations of Mr Lee and the property developer is important for migration compliance. 
·         Control of project and funds, security or collaterals, timing of project, possible variations, and terms and conditions of investment are important considerations for protection of capital.
·         Transfer duty and tax implications must be considered PRIOR TO entering into formal agreements.
3.       Prepare and advice on the formal agreements required in order to put together the transaction.
4.       Carried out due diligence on the proposed investment and the property developer.
5.       Completion and settlements of the agreed transactions.

In Migration Law:

 

11) We conducted a full review of Mr Lee’s initial business plan and Agreement with the State, and we advised Mr Lee that given the changes to his agreement with the State, he needs to notify and obtain approval from the State for the variation.  Note:  The formal agreements between the parties were made subject to Mr Lee obtaining an approval to amend Agreement with the State.
22)  IMPORTANT issue to overcome: Investment in property is very often seen as a passive investment and does NOT qualify as an “Eligible Business”.   Special attention must be given to how the transaction is structured to avoid complications.
33) Also given his increase in the amount of investment into the “Eligible Business”, we advised that he could negotiate with the State for a more lenient requirement on the number of full time employees.

Outcome

Mr Lee and the property developer were successful in reaching an agreement.   We strategically structured mechanism into the transaction to achieve the overarching purposes of satisfying the migration requirements and protecting his commercial interests.

Upon our conduct of legal due diligence and comprehensive checks on the proposed investment and the property developer, Mr Lee was satisfied with the results.
Mr Lee also obtained approval and a more favorable agreement with the State for the proposed investment, as we were successful in negotiating with the State in reducing the number of employee from five (5) to two (2).  

The property project has since commenced.

About The Writer 

Kelvin Tang has over 14 years’ experience practising law in Western Australia. He is the founder and Principal Partner of Tang Law based in Perth, Western Australia. Kelvin is a Registered Migration Agent (MARN: 1386452) and has extensive experience in providing migration advice to clients, advising on “Eligible Businesses” within the definition of the Migration Regulations, assisting migrants (investor of the business) with satisfying migration requirements, making visa applications and appealing cancelled or refused visas in the Federal Court of Australia, Administrative Appeals Tribunal and Migration Review Tribunal. Kelvin also has extensive experience in civil litigation, commercial and corporate law matters.
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