Proposed significant investor visa changes unworkable: Hall & Wilcox

Legal firm Hall & Wilcox says proposed changes to the Significant Investor Visa (SIV) raised in an Austrade discussion paper will prove unworkable as it misunderstands Chinese investors.

Eugene Chen, a Special Counsel and Head of China practice at Hall & Wilcox, said proposed new requirements, which include investing minimum 50 per cent in venture capital and small caps funds, along with a ban on direct investment in residential property (potentially extending to residential property development), introduce unacceptable risks for Chinese investors.

“We have worked closely with fund managers and financial services firms to attract Chinese investors since the scheme was introduced, so we know what makes them tick.

“We know that Chinese investors want low risk investments, something that they understand.

“The risk appetite is not there.”

Mr Chen said he agrees with the need to increase venture capital (VC) investment in Australia, but warned the changes are unlikely to create a VC ‘honey pot’. “My understanding of Chinese SIV investors is that they may decide to opt-out altogether. It has potential to at least diminish, and possibly kill-off the regime.”

Chinese investors tend to see Australia as a destination for low risk, relatively stable returns, rather than speculation, according to Mr Chen. “If we look at it from the Chinese investor’s point of view, the difference in VC returns between Australia and China is vast.

“In China there are more opportunities for much more lucrative VC returns. But the risk profile is the same. So why take that risk in Australia?

“We cannot assume that the lure of residency will be enough, as these investors have other options.”

Mr Chen said that Hall & Wilcox clients had expressed strong concern at the changes. “We agree that more VC investment is needed. We also agree that land-banking is wrong. But the changes need to be considered further as they may put the scheme at risk.”

Contact

Emma Woolley

Partner & Head of Family Office Advisory

Karl Rozenbergs

Partner & Co-Lead, Health & Community

Ben Hamilton

Partner & Technology and Digital Economy Co-Lead

James Deady

Partner & Technology and Digital Economy Co-Lead

Eugene Chen

Partner & Head of China Practice

Oliver Jankowsky

Partner & Head of International Practice

John Bassilios

Partner & Fintech and Blockchain Lead

Matthew Curll

Partner & Insurance National Practice Leader

Melanie Smith

Director – Business Development, Marketing and Communications

Natalie Bannister

Partner & Commercial National Practice Leader

Nathan Kennedy

Partner, Head of Pro Bono & Community and ESG Co-Lead

William Moore

Partner & Head of Private Clients Advisory

Mark Dessi

Partner & Energy Leader

James Bull

Special Counsel & Frank Lab Co-Lead

Melanie James

People & Culture Manager

Jacqui Barrett

Partner & Head of US Desk

Lauren Parrant

Senior People & Culture Advisor

Melinda Woledge

Marketing & Communications Manager

Jasmine Koh

Senior Associate & Frank Lab Co-Lead

Alison Choy Flannigan

Partner & Co-Lead, Health & Community

Jordon Lee

Lawyer

Geoff Benson

Lawyer

Meg Lee

Partner & ESG Co-Lead

John Gray

Partner, Technology & Digital Economy Co-Lead and NSW Government Co-Lead

Harvey Duckett

Lawyer

Luke Denham

Lawyer

Billie Kerkez

Manager – Smarter Recovery Solutions

Jemima Whiteman

Lawyer

Bradley White

Lawyer

Sarah Khan

Lawyer

Audrey Leahy

Special Counsel & Head of Irish Desk

Nicole Tumiati

Partner & Retail & Consumer Goods Leader

Marie Mitilineos

Lawyer

Gloria Tam

Lawyer

Peter Jones

Senior Commercial Counsel

Eden Winokur

Partner & Head of Cyber

Jennifer Degotardi

Partner & NSW Government Co-Lead

Sheldon Fu

Lawyer

Claire Bourke

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Chloe Taylor

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Silvana Brcina

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Daphne Schilizzi

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Andrew Banks

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Isabella Urso

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Jessica Liu

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Amelia Spratt

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Lisa Ziegert

Director – Client Solutions

Luke Raams

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Emma McDonald

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Carl Ayers

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Maddison Reznik

Senior Associate & Trade Marks Attorney

Rebecca Dodd

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Ruby Hunt

Pro Bono & Community Co-ordinator

Rachel Bonic

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Samantha Frost

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Emma Bechaz

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Matt Dolan

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Luke Hefferan

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