Consider this: a young French entrepreneur has operated an online marketing business for over a decade and has generated annual revenues exceeding $5 million. In fact, our French entrepreneur is widely considered a guru in the field and has a substantial following. In turn, she has amassed some wealth and has cash reserves of over $1 million. On an impromptu visit to Australia for a holiday, she falls in love with the weather, lifestyle and energy in our beautiful country. Out of curiosity, she undertakes some due diligence and uncovers that there are few competitors in her industry and better yet there are virtually no barriers to entry.

Not one to sit on her laurels, she returns to Paris and remotely engages an Australian accountant to establish a subsidiary of her offshore business in Australia. The local entity is a proprietary limited and is fully owned by the offshore business (the “parent company”). She joins an Australian business networking group and signs up for various associations in online marketing. During this initial phase, she meets another vibrant entrepreneur and they chat via Skype. As her accountant has suggested that she seek out a local director, she asks her new contact about a potential directorship with her Australian business. Her new contact jumps at the idea and they have the relevant forms signed and lodged with ASIC.

They open a bank account and she transfers $50,000.00 into the account. She now turns her mind to getting back to Australia so she can start the business and get immersed in the market. After searching on various websites under search strings like ‘working in Australia’ and ‘doing business in Australia’, she realises that she will most likely require a work visa of some sort. She soon realises that the only ‘work’ visa that would suit her needs is a subclass 457 visa but she finds that changes relating to the ‘genuine position’ requirement may halter the entire process and in fact, it seems that departmental policy appears to ‘ban self sponsorship’.

Specifically, she learns that legislation has highlighted ‘risk factors’ that could indicate her role in the business is not genuine, including:

  • Visa applicant is an owner or Director of the sponsoring business
  • Visa applicant is a relative or personal associate of an officer in the sponsoring business.

In particular, it seems that overseas businesses will come under heightened scrutiny as much of the information found online specifically mentions a ban on overseas businesses utilised to ‘self-sponsor’ a business owner to establish a branch in Australia. The reason behind this is to prevent the 457 program being used to evade the Business Innovation and Investment (subclass 188) program.

She quickly does some research on the business innovation and investment program. Whilst she considers that she would satisfy most of the requirements (including a relatively high score), she is a bit disheartened by the uncertainty surrounding the SkillSelect program. In particular, she notes the processing times of 9 months for the subclass 188 visa relative to the 4 to 6 weeks that apply to the subclass 457 visa.

She was making great inroads with forming some business relationships but as the saying goes ‘strike while the iron is hot’ not lukewarm, she calls her business partner to vent about the obstacle of getting her back to Australia. Her business partner starts the search for a trusted immigration lawyer to help with the visa issues. Although her French business partner is a director of the business, she will be engaged on a full-time basis with the technical aspects of the business including delivery of the online marketing services. As such, she is involved in the management of the business whilst also dealing with clients. As an expert in the field, she is more than qualified to undertake the work but it seems this may not be entirely possible with the subclass 188 visa as there appears to be some restriction on her activities.

After consulting with a few immigration agents, the business partner decides that it may be too difficult as there is no clear answer to this issue. There is a school of thought that insists that self-sponsorship is simply a misnomer and it is possible, whilst others seem to think there is a clear and unambiguous ban on applications which nominate a director/owner of a business.

Shortly thereafter, the business discussions slow down and after a few weeks, they stall completely.

To be continued…