Investor Visa

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<div>According to the Department of Immigration and Border Protection (DIBP) the significant investor visa (SIV) programme is designed to be:</div>
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<div><em>"...a pathway to provide for significant migrant investment into Australia under the Business Innovation and Investment visa programme".</em></div>
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<div>From the inception of the SIV programme in November 2012 until 30 June 2015 there had been some 2,573 applications lodged, but only 879 visas actually granted.</div>
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<img src="/images/2016/08/30/SIV2.jpg" alt=""><br><span><br></span><span>There can necessarily be a lag between application lodgement and visas being granted.</span><br><span><br></span><span>The service standard is 6 to 9 months for the Business Innovation and Investment category.</span><br><div> </div>
<div>The latest available statistics from the DIBP showed that 495 of the outstanding applications lodged prior to 1 July 2015 have now been granted.</div>
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<div>A further 20 applications lodged after 1 July 2015 have also been granted in the financial year to 31 May 2016.</div>
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<div>This means that the May 2016 figures recorded a total of 515 SIVs issued for the 11 months for the financial year to date.</div>
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<div class="separator">The geographically segmented figures show that high net worth applicants are overwhelmingly focused on Melbourne, and then Sydney...with daylight third. </div>
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<div class="separator">This reflects that Melbourne and to a somewhat lesser extent Sydney have been the two key destinations and markets of interest for Chinese investors since around 2012.</div>
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<div class="separator">Indeed, the Foreign Investment Review Board (FIRB) Annual Report showed that real estate applications tripled in two years, driven overwhelmingly by a deluge of Chinese investors into Victoria, New South Wales, and Queensland. </div>
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<div class="separator">The DIBP statistics for the top five source countries correspondingly show that more than 90 per cent of applicants for SIVs have also been Chinese. </div>
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<br><strong><span style="text-decoration: underline;">The wrap</span></strong><br><br><div>Since the commencement of the significant investor visa programme in 2012 there have now been a total of 1,397 SIVs granted, leading to just a shade under A$7 billion of investment in complying assets.</div>
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<div>It's difficult to say what the expected take-up for the SIV ever really was, but fewer than 1,400 visas sounds suspiciously like a fizzer of an initiative to me (albeit the composition and destination of applicants says something of note about where capital invested in Australia is coming from and where it is headed to).</div>
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<div>Previously SIV investors were opting to drop money into passive investments such as qualifying government bonds and residential real estate schemes - not really what Australia needs more of, tbh! - which led to a much-needed reassessment of the requirements for complying investments.</div>
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<div>Unfortunately interest in SIVs has been dampened since, following consultation with stakeholders, the rules were amended to require a greater share of the $5 million required investment to hit up venture capital products (at least 10 per cent) and emerging companies (minimum 30 per cent), investments that are typically associated with a higher risk of loss, whether perceived or real.</div>
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<div><span style="text-decoration: underline;"><em>Source: DIBP</em></span></div>
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<div>The most timely available statistics for expressions of interest, invitations, and applications lodged suggest only a modest ongoing flow of interest in the SIV.</div>
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<div>Requiring wealthy Chinese with A$5 million to invest in venture capital projects and emerging companies is a fabulous idea...on paper.<br><br>In reality, however, this may be too ambitious and result in the killing off of SIV applications given that wealthy foreigners are unlikely to be familiar with the products and ventures in question, and therefore remain understandably reluctant to commit.</div>
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<div>It wouldn't be a surprise to see the rules amended again or relaxed to allow Chinese investors to provide project funding (not passive investment) for residential and commercial real estate developments, or for infrastructure projects.</div>
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<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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Slow take up of Significant Investor Visa: Pete Wargent 

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<p>GUEST OBSERVATION</p>
<p>A top fund manager for some of Australia’s most wealthy future Chinese citizens, Atlas Advisors Australia, is urging the Australian Government to improve the Significant Investor Visa industry regime to encourage greater investment into the nation.</p>
<p>Executive Chairman of Atlas Advisors Australia, Guy Hedley said he supported the Australian Government’s review of Investor visas and Significant Investor visas as part of its “Business Innovation and Investment Program: Getting a better deal for Australia” inquiry.</p>
<p>“The Federal Government is working hard to maximise the opportunities and benefits to Australia from the program,” Mr Hedley said.</p>
<p>“The best way to achieve this is through ongoing collaboration with key industry participants after the public consultation period for the inquiry closes on February 14.”</p>
<p>Mr Hedley urged the Australian Government to stay committed to the SIV program and to increase incentives for applicants. </p>
<p>“Tweaks to improve the system could include extending the significant investor visa period from four years to five years which would equate to a 20 per cent increase in economic benefit without changing the asset mix,” he said.</p>
<p>“Alternatively, investors riskier exposure to emerging companies and venture capital could be increased with a reduced visa period of three years rather than four years.”</p>
<p>Mr Hedley said it was critical to remember that SIV applicants were future citizens who were pouring millions into the Australian economy without any certainty about their applications.</p>
<p>“This is boosting local businesses and funding startups in important areas such as health and technology as well as lifting Australian exports, employment and international trade connections,” he said.</p>
<p>Atlas Advisors Australia manages the investments of many of the highest net worth Chinese investors into Australia with more than $1.7 billion of funds under management.</p>
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