The Morrison Government has announced reforms to the Business Innovation and Investment Program (BIIP) in a push to create more jobs in Australia and support Australia’s economic bounce back from the COVID-19 pandemic, through the promotion of key sector growth.
The changes hope to improve the “quality of investments and maximise the economic benefits for Australia” confirmed Alex Hawke, the Minister for Immigration Citizenship, Migration Services and Multicultural Affairs.
Key changes that come into effect form 1 July 2021:
- The investment amount for the Investor stream will increase from $1.5 million to $2.5 million. The investment amount for the Signiﬁcant Investor stream will remain at $5 million.
- The Complying Investment Framework (CIF) will be applied to both investment streams—Investor and Signiﬁcant Investor.
- The venture capital and private equity component of the CIF will be increased from 10 to 20 per cent, with a further 30 per cent dedicated to 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. The use of Fund of Funds, debentures and derivatives will be clariﬁed in the CIF.
Under these proposed changes, the new CIF ratios that will apply to both the Investor and the Signiﬁcant Investor streams from 1 July 2021 are as follows:
- 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
Strong compliance measures are in place to maintain the integrity of Australia’s borders and economic migration program. All visa applicants will continue to be subject to meeting Australia’s security, identity and character requirements, as well as visa stream speciﬁc requirements.
Minister Hawke stated that with “over $15.9 billion already invested into the Australian economy since 2012” these changes will hope to see these ﬁgure dramatically increase. As “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”.
Source: Media Release of Australian Government (Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs)