logo

Subclass 188A: Business Innovation Visa


The business innovation stream is intended for individuals looking to establish and operate a business in Australia. Applicants who do not wish to engage in a business should consider alternative streams or subclasses. Valid visa application under this stream prerequisites invitation through Skillselect and nomination by a State authority.

Primary Criteria

  • Applicant was invited with a minimum score of 65 on the Schedule 7A points test, in writing, by the Minister to apply for the visa;
  • Applicant has not turned 55 at the time of invitation, or is otherwise proposing to establish or participate in business or investment activities that the nominating State or Territory authority has determined is of exceptional economic benefit to the State or Territory;
  • Applicant has a successful record of business career;
  • Applicant had a total value of business and personal assets in a minimum sum of $800,000 at the time of invitation that can be transferred to establish or conduct a business in Australia within 2 years after the visa grant;
  • For at least 2 of the 4 fiscal years immediately before the time of invitation, the applicant has had an ownership interest in a main business with an annual turnover of $500,000;
  • For at least 2 of the 4 fiscal years immediately before the time of invitation, if the applicant’s business related to provision of professional, technical or trade services, his or her business involvement has predominantly concerned strategic direction and overall operation of the business, as opposed to mere provision of services;
  • Applicant has a genuine need to reside in Australia for the purpose of their proposed Australian business; and
  • Applicant has a realistic commitment to establish a qualifying business or participate in an existing qualifying business in Australia.

State Nomination

As part of the nomination application, a business proposal needs to be submitted to the nominating State or Territory authority. The assessment criteria varies across different States and Territories. The below draws comparisons of the 3 most popular nominating States of Australia:

New South Wales

  • Minimum Points: 65
  • The requisite value of business investment is $500,000 if the proposed business is in a metropolitan city and $300,000 if a regional area.
  • The nature of business investment must lie in property, plant, equipment, inventory, or goodwill.
  • No requisite funds for settlement in the State.
  • The minimum value of net assets is $1,300,000 for a metropolitan city and $800,000 for a regional area.
  • NSW Government does not specify any exclusions on business types.

Queensland

  • Minimum Points: 65
  • The requisite value of business investment is $200,000
  • No requisite funds for settlement in the State.
  • The minimum value of net assets is defined by the statutory threshold of $800,000.
    • Business and Skilled Migration Queensland excludes (with exemptions in certain cases) small retail businesses, general importing businesses and property development. Entry level small retail business, such as convenience stores, cafes, restaurants are only accepted if your proposed business is established in regional Queensland.
    • General importing business will not be accepted unless the imported products are highly innovative, advanced in technology, or currently unavailable in Queensland. Value-adding service should be provided to the imported products such as customised design, product assembly installation, testing, repair, maintenance and so on.

Victoria

  • Minimum Points: 80
  • The requisite value of business investment is $400,000 in addition to the requisite fund of $200,000 for settlement.
  • The minimum value of net assets is defined by the statutory threshold of $800,000.
  • Victorian Government excludes (with exemptions in certain cases) businesses in small scale property development, small scale freight forwarding and warehousing, export of commodities or scrap metal, and passive investment.

Age

Generally, applicants must not have turned 55 at the time of invitation in order to qualify for the business and innovation stream. Nevertheless, State and Territory authorities reserve the discretion to issue the waiver where the proposed Australian business is deemed to be of significant economic benefit to said State or Territory.

This discretion of the State and Territory authorities in determining the economic benefit is largely unfettered. Migration policy supports deference of such decision to recommendation of the State or Territory authorities, conferring enormous discretion in the exercise of this power. The State and Territory authorities provide minimal guidance on their consideration on significant economic benefits.

Main Business

In the context of Australian migration, a business is a main business in relation to an applicant for a Subclass 188 visa if for at least 2 of the 4 fiscal years immediately before the time of invitation:

  • The applicant, and the applicant’s spouse or de facto partner, has or has had, an ownership interest in the business; and
  • The applicant maintains, or has maintained, 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; and
  • The business is a qualifying business.

Ownership Threshold

  • 51% of the total value of the business, if the business is not operated by a publicly listed company and its annual turnover is less than $400,000.
  • 30% of the total value of the business, if the business is not operated by a publicly listed company and its annual turnover is more than $400,000.
  • 10% of the total value of the business, if the business is operated by a publicly listed company.

Qualifying Business

Qualifying business refers to an enterprise that:

  • is operated for the purpose of making profit through the provision of goods, services or goods and services (other than the provision of rental property) to the public; and
  • is not operated primarily or substantially for the purpose of speculative or passive investment.

Turnover

By definition, turnover encapsulates revenue generated in the ordinary course of business activities, including:

  • Sale of goods
  • Fees for service
  • Commission revenue
  • Interest
  • Capital gains
  • Government subsidies or bounties

Strategic Direction and Overall operation of a Business

Australian migration law delineates mere provision of services from holding responsibilities and exercising business skills in furtherance of the business operations. Where involvement in the main business predominantly comprises with delivery of services to clients and customers, the applicant may be deemed ineligible for a Subclass 188A visa.

Need to Reside in Australia

There must be a need to be resident in Australia to establish or conduct the proposed business activities on a day-to-day basis. The requisite level of presence in Australia is deemed to be substantial, and therefore businesses, which do not require ongoing presence in Australia, such as internet trading or brokering products between foreign countries, may be ineligible in this stream.

Successful Business Career

In assessing an overall record of successful business careers, the Department adopts a holistic approach to their assessment. It means the entire business careers are taken into consideration as well as external factors which may mitigate any perceived failures or losses stemming therefrom. Under the policy directives, business careers are generally deemed unsuccessful in the following circumstances:

  • Bankruptcy in the last 5 years;
  • Involvement in businesses which have been subject to insolvency, receivership or liquidation;
  • Recent trading losses stemming from decisions of the applicant which are likely to render the business unsuccessful in future.

Net Value of Personal and Business Assets

The business and personal assets of the applicant and the applicant’s spouse or de facto partner together, that can be applied to establish or conduct a business in Australia within 2 years after the visa grant, must exceed $800,000 in value.

This figure is calculated as business and personal assets less any liabilities. It should be noted that it is not limited to the assets of the main business, but assets of other businesses of the applicant and the applicant’s spouse or de facto partner are also to be considered.

Lawful Acquisition of Assets

Applicants must substantiate origins of their disclosed assets in order to demonstrate lawful ownership and availability for transfer to Australia.

Application Charges

Subclass 188 visa is payable in 2 installments.

First Installment

  • Base application charge: $5,375
  • Additional applicant charge for an applicant who is at least 18: $2,685
  • Additional applicant charge for an applicant who is less than 18: $1,345

Second Installment

  • Primary applicant without functional English: $9,795
  • Secondary applicants who do not demonstrate functional English: $4,890