Further Reforms to Australian Employer Sponsored Skilled Migration (ENS Subclass 186 and 187 Visa) -THE GOAL POSTS CHANGED ON 19 APRIL 2017. IS YOUR OCCUPATION ON THE LIST?

Following from the Government announcement that the Temporary Work (Skilled) visa (subclass 457 visa) will be abolished and replaced with the new Temporary Skill Shortage (TSS) visa in March 2018, there has been further reforms introduced to the Employer Sponsored Skilled Migration.

The reforms are applicable to all visa applicants who intend to lodge a visa application in this category after 19 April 2017.

From 19 April 2017, the new direct entry scheme applicants will need to be nominated under one of the occupations from the new occupation lists (Medium and Long-term Strategic Skills List (MLTSSL) and Short-term Skilled Occupations List (STSOL).  The lists has become drastically condensed with the new reforms with the removal of 216 occupations.

Timeline of changes to be implemented in future

1 July 2017

  • Further revised Occupations lists: Further revision to the MLTSSL and STSOL list is to be expected
  • English language requirements: Applicants will be required to obtain an IELTS score of 6 in each component.
  • Age:  Introduction of new age requirement of 45 years at the time of application will apply to Direct Entry stream applicants. The age limit of 50 years will still remain applicable to the Temporary Residence Transition stream.

March 2018

  • Occupation lists: MLTSSL lists will be applicable for both 186 and 187 visas with additional occupation available for 187 RSMS.
  • Period of Residency: The new applicants for 186 and 187 visa under Temporary Residence Transition stream would be required to satisfy a 3 year residence eligibility period instead of 2 years.
  • Work experience:  At least three years’ relevant work experience required.
  • Age:  All applicants, including Temporary Residence Transition stream, must be under the maximum age of 45 years at the time of application.
  • Training requirement: Introduction of strengthened training requirement for the nominating employers.

Koffels Solicitors & Barristers are experienced in matter of Immigrations, and Ross Koffel is a licenced Immigration Agent (0006391). If you have enquiries regarding migration to Australia we will be pleased to assist.

WHAT IS THE STATUS OF BUYING OFF THE PLAN PROPERTY THAT HAS ALREADY BEEN SOLD TO A THEN DEFAULTING FOREIGN PURCHASER – CAN YOU DO IT? THE AUSTRALIAN GOVERNMENT IS STEPPING IN TO HELP.

Under the Foreign Acquisitions and Takeovers Act 1975, a residential property is considered to be sold when an agreement for sale of such property becomes binding on the parties.

This has raised an issue as to whether the Off–the-Plan property which is on-sold after the binding date, (which is usually upon execution of the contract by both parties), and prior to settlement, should be treated as an established dwelling.   If this were the case, the property then becomes property unavailable for purchase by other foreign investors under the Act. (Please refer to our previous article about FIRB for your reference).

This has raised some serious concerns from the developers who in recent times have been faced with an increasing numbers of defaulting foreign investors. This is predicted to be the effect of financial institutions’ changes to heavily clamp down on the grant of loans to foreign investors who are purchasing Off-the-Plan properties.

Fortunately, the Australian Government has responded to these concerns of the developers by allowing on-sale of Off-the-Plan dwellings which fail to reach settlement.

The government, through their release, has stated that to address the concerns of the industry, and to ensure the market is not being impacted negatively, they “will implement changes under the foreign investment framework to allow foreign buyers to purchase an Off-the-Plan dwelling when another foreign buyer has failed to reach settlement.”[1]

If you require assistance or have questions about the recent FIRB developments, please feel free to contact our office.  Koffels Solicitors are experienced in the sale and purchase of property for both Australian and Overseas buyers.  We will be happy to discuss your concerns to guide you through the sometimes complicated process to be sure you are compliant in what is always an important investment decision.

 

[1] http://sjm.ministers.treasury.gov.au/media-release/122-2016/

BUYING PROPERTY IN NEW SOUTH WALES?   THE LPI WILL WANT TO KNOW WHO YOU ARE!   HERE’S WHY.

 

Verification of Identity for Land Dealings in New South Wales

 

The NSW Land and Property Information (LPI) has introduced conveyancing rules under section 12E of the Real Property Act. These Conveyancing Rules relate to the requirements for lawyers and conveyancers to verify the identity of their clients.

The purpose of carrying out a verification of identity for land transactions is to:

  • ensure a person is who they claim to be;
  • prevent the registration of fraudulent land transactions;
  • reduce the risk of identity fraud

The Conveyancing Rules apply to:

  • all conveyancing transactions which are transactions involving one or more parties and the purpose of which is: to create, transfer, dispose of, mortgage, charge, lease or deal with in any other way an estate or interest in land, or
  • getting a document registered, noted or recorded in the titles register, or
  • getting the registration, note or record of something in the titles register changed, withdrawn or removed; and
  • the delivery of certificates of title to clients and mortgagors.

Original identity documents and visual (“face to face”) verification of identity are to be produced when being identified. A “face to face” in person interview must be undertaken by the lawyer or conveyancer acting and the person being identified.

As an indication, you will generally need:

  • an Australian passport or a foreign passport;
  • plus an Australian driver’s licence or Photo Card;
  • plus a change of name or marriage certificate (if necessary).

If any of the above original documents cannot be produced alternate categories of documents can be sought.

 

What if a client resides overseas?

Where a client resides overseas steps will need to be taken by the lawyer or conveyancer acting, to verify the client’s identity having regard to the available services and options under the circumstances. One available option is to utilize the services of the Australian Embassy, High Commission or Consulate coupled with any necessary further steps in order for the lawyer or conveyancer acting to be reasonably confident in the person’s identity. An international financial institution or law practice would also be able to use overseas personnel to conduct verification of identity.

What if a client is unable to come into the office for the identity to be verified?

Australia Post offers a Verification of Identity service where you attend a participating Post Office and are interviewed by an Australia Post Identity Verifier. You must check what Post Offices near you conduct the service you require. The Verification of Identity report is then delivered to us.

 

Koffels Solicitors are highly experienced in Real Property transactions, and for overseas clients we have a broad network of associated offices to assist in complying with identification regulations.

Recent Development in Significant Investor Visa (SIV) and Premium Investor (PIV) Stream

NOTE: The following information have not yet been officially confirmed by the Department of Immigration and Border Protection. The proposed changes have been discussed in details by the various Australian government bodies including the Austrade. If the changes are approved then they are expected to be implemented from July 2015.

NEW REGULATION (SIV AND PIV)

Foreign Investment Review compliance required on investment
Invested funds are to be unencumbered
Exclude arrangements where the SIV investment is used as collateral by applicants
Derivatives can only be used for risk management purposes and combined cash and derivatives be limited to 20% notional exposure of a fund’s net assets
Direct investment into residential real estate is ineligible and indirect exposure through investment vehicles is to be restricted to less than 10% of the vehicle’s net assets
The managers for the investments through Australian Financial Services products must be independent of the applicant and their spouse. The funds managed must be performed by AFS licensed fund managers domiciled in Australia.

COMPLYING INVESTMENT RESTRICTIONS (SIV)

Mandatory investment of at least minimum $0.5 million at time of investment in an Australian Venture Capital (VC) limited partner fund .
Mandatory investment of at least minimum $1.5 million at time of investment in eligible managed funds investing in Emerging Companies.
Mandatory investment of $3.0 million at time of investment in managed investment or Listed Investment Companies that invest in eligible assets.

*There are going to be other additional criteria and restrictions on each of these investments

“Venture Capital Fund”

Type of investment fund which manages money from investors seeking private equity holdings in start up and small size entity with growth potential.

“Emerging Companies”

The companies are to be Australian exchange listed equities with a market capitalisation of less than $500m

PREMIUM INVESTOR VISA (PIV)

The Australian government is introducing a new stream to the Business Innovation and Investor Visa called Premium Investor Visa (“PIV”)

The visa stream would have the nomination and invitation model where applicant would require referral from State or Territory government.

This is a fast track visa stream as it only requires 12 months period of investment before the permanent visa is granted.

The visa will require the Applicant to make a minimum investment of AUD $15 million into complying investments

This stream would also likely waive the new complying investment restriction which are proposed to be imposed on the SIV (mandatory VC and Emerging Company criteria).

Source: https://www.austrade.gov.au/

Want to Make Your Own Phone Apps? Remember we have Privacy Laws! and the Australian Government takes this Very Seriously

The following will help you to ensure you are compliant.

There are thousands or more new applications being released every day for our mobile phone platforms, and some of these applications become very successful and profitable. In Australia, however, if you are considering make an application, you must consider the privacy law implications under the Australian Privacy Act and Australian Privacy Policy (coincidentally referred to as “APP”).

There was a recent statement made by Office of the Australian Information Commissioner in relation to the new Pokémon GO app. Enquiries were being made to the application developer to ensure that the application is managing collected personal information in accordance with the Australian Privacy Act.[1] This is just an example of how Australian government is taking this issue very seriously.

The Office of the Australian Information Commissioner has set out general guidelines for application designers to follow, in order to ensure that the developed applications are in accordance with operation of the APP. They are as follows:

Your privacy responsibilities

Your agency or organisation (which may just be you) is responsible for all personal information collected, used and disclosed by your mobile app.

Identify someone to be responsible for privacy protection.
Use a Privacy Impact Assessment to map where the information is going, identify potential privacy risks, and assist with privacy planning (including ‘privacy by design’).
Implement practices, procedures and systems that enable compliance with the Australian Privacy Principles, and will enable you to deal with privacy enquiries or complaints.
Put in place controls, such as conditions of contract or user agreements, to ensure that third parties accessing personal information through your app respect their privacy obligations.
Be open and transparent about your privacy practices
Develop a privacy policy that clearly and simply informs users what your app is doing with their personal information.
Make your app’s privacy policy easy for users and potential users to find.
Put in place a monitoring process to ensure that personal information is being handled in the way described in your privacy policy.
When updating an app, inform users of any changes to the way their personal information is handled, and seek express consent to any changes that could impact on their privacy.
Obtain meaningful consent despite the small screen challenge
Select the right strategy to convey privacy rules in a way that is meaningful on the small screen. This could include:
‘short form notices’, with important points up front and links to more detailed explanations
a privacy dashboard that displays a user’s privacy settings and provides a convenient means of changing them
cues such as graphics, colour and sound to draw user attention to what is happening with their personal information, the reasons for it, and choices available to the user.
Timing of user notice and consent is critical
Obtain consent at the point of download.
Tell users how their personal information is being handled at the time they download the app and in-context when they use the app to ensure that their consent is meaningful and relevant.
Consider how best to deliver privacy messages to most effectively capture users’ attention and achieve the most impact at the right time, without causing notice fatigue.
Only collect personal information that your app needs to function
Limit data collection to what is needed to carry out legitimate purposes.
Do not collect data just because you think it may be useful in the future.
Allow users to opt out of the collection of their personal information, or if that is not practicable, clearly explain they cannot opt out so they can make an informed decision whether to use the app.
Delete or de-identify personal information that you no longer need for a lawful purpose.
Secure what you collect
Put in place appropriate safeguards to protect the personal information you are handling. Use encryption when storing and transmitting data.
Give users the ability to delete or request the deletion of all of the data that your app has collected about them.
Publish clear policies about how long it will take to delete personal information once a user stops using your app.
Delete personal information that you no longer need for a lawful purpose.

Source: https://www.oaic.gov.au/agencies-and-organisations/guides/guide-for-mobile-app-developers

If you need assistance with the drafting of privacy statements, policy and other related requirements for the successful launch of your APP, please do not hesitate to inquire as to just what is entailed to be compliant with Government Policy and Regulations.

To find out too late that you are not compliant and in breach of these regulations is a short track to the loss of all your hard work on a creative idea, and leaves you open to prosecution.

Getting it wrong is expensive on a lot of levels. Do it once, do it right!

[1] https://www.oaic.gov.au/media-and-speeches/statements/pokemon-go

Purchasing Real Estate in Australia – Foreign Investment

What is available to buy?

Foreign investors are allowed to purchase commercial properties, newly developed residential property or vacant land for the purpose of development of residential real property in Australia. If the investor obtains a temporary resident visa in Australia allowing them to reside in Australia for period of more than 12 months then they may also acquire one established property and it must be used as their residence (home) but such proposals are often subject to conditions such as, that the temporary resident sells the property when it ceases to be their residence.

Applicable taxes

The investors would also pay stamp duty tax at an average rate between the range of 0.3% to 3% of the purchase amount. The rate depends on the state where the property is located and the value of the property. The investors may also have to pay an annual land tax if they own property worth more than a certain threshold amount. If the investment property is leased to tenants then the investor would have to account for the rental income in their annual tax obligations in Australia. Australia is signatory to double tax treaties with many countries around the world which would prevent investors from incurring double taxes.

Entering into contract

Each state and territory of Australia have their own laws and process in relation to the purchase of property. It is recommended that the purchaser seek legal advice from Australian solicitor before committing to the purchase of property by signing the contract. Most of the purchase contracts would usually require 10% of the purchase price to be paid as deposit at the signing of the contract and the balance would be payable on completion of the sale. There should be agreed time between the signing and completion date noted on the contract. In case of off-the-plan property contract (property which has not yet been constructed or registered to lands department), the time between the signing and completion could be a number of years depending on the period of construction.

Foreign Investment Review Board

All proposed purchases of commercial and residential real estate in Australia is subject to review by Foreign Investment Review Board. There are fees payable for each of the application. The contract for sale of a property would generally be subject to Foreign Investment Review Board approval. The purchaser would enter into the contract for sale first and then make the application to the FIRB for their approval. In the case the approval is not granted, the purchaser would be able to terminate the contract and receive their deposit back.

TAX LAW UPDATE – FOREIGN RESIDENT CAPITAL GAINS WITHHOLDING PAYMENTS

What is it?

Introduction of new tax regime under Tax and Superannuation Laws Amendment (2015 Measures No. 6) Act 2016 whereby when a foreign resident sells certain taxable Australian property, the purchaser of such property will be required to withhold 10% of the purchase price and pay that amount to the Australian Taxation Office (ATO).

Who is effected?

Foreign resident vendor and their respective purchaser selling/buying property including real property, lease premium and options to purchase such property with market value above AUD $2 million.

The applicable vendors may apply to the ATO for Clearance Certificates which could be served on the purchasers before settlement. Also vendors who believes 10% withholding is inappropriate may contact the ATO to make a Variation Application varying the withholding rate.

When?

The new regime is due to be introduced on 1 July 2016.

REAL PROPERTY LAW UPDATE – SWIMMING POOLS DISCLOSURE

What is it?

Each owner of property with a swimming pool or spa pool under the Swimming Pools Act 1992 must register their swimming pool or spa pool on the NSW Swimming Pool Register.

Local councils and accredited certifiers, registered with the Building Professionals Board, are able to inspect the swimming pools or spa pools to provide a certificate of compliance or relevant occupation certificate.

Each owner must provide a copy of a valid certificate of compliance or relevant occupation certificate in their residential tenancy agreements to rent property with a swimming pool or spa pool. Also, a seller of a property must attach a copy of a valid certificate of compliance or relevant occupation certificate, or a valid certificate of non-compliance, to the contract for sale of a property with a swimming pool or spa pool.

Who is effected?

Owners and landlords selling a property with a swimming pool or spa pool, or entering into a residential tenancy agreement to rent property with a swimming pool or spa pool. The owners of lots in a strata scheme or in a community scheme are exempt from such requirements. Also off-the-plan contracts are exempt from disclosure requirement.

A purchaser of property who has been provided with a certificate of non-compliance is given 90 days from the date of the transfer of such property to address any issues of non-compliance or they will be subject to penalties under the law.

When?

From 29 April 2016 for all applicable residential tenancy agreements and contract of sale

Should you attend your next Strata meeting? Changes to Strata NSW Laws on Collective Sale and Renewal take effect mid 2016 –the numbers have changed!

The bills to amend the current Strata Schemes Management Act and Strata Schemes Development Act were passed at the Parliament on 28 October 2015. The changes are expected to be introduced in the middle of 2016. Amongst the list of extensive changes introduced, one of the key changes was the law on collective sale and renewal.

Current Strata laws allow for the termination of a strata scheme under certain circumstances such as when there is a unanimous vote in support from all the owners. Under the reformed law, the requirement has been reduced to 75% of owners. This would mean that there may be a situation where 25% of the owners are forced into sale or renewal. To some owner groups however, this new law would be a significant advantage and relief.

To assist owners there will also be schemes to compensate the lot owners with at least the market value of their lot plus moving costs, as detailed in the Land Acquisition (Just Terms Compensation) Act 1991

The new process introduced under the reform will apply only to existing schemes if the owners corporation agrees to opt in to the new law. If the majority of owners, (50% or more), don’t support the decision, no further action can be taken. New Strata projects will automatically come under the new regulations.

In order to initiate the process the Strata Committee, (Executive Committee), would be required to hold a general meeting to discuss the proposal for the renewal or collective sale. If the majority of owners (50% or more), are in support of the proposal then the Strata Committee would develop a plan to carry out the proposal for renewal or collective sale. There would need to be number of meetings to determine the contents of the plan and professionals to be employed, such as valuers, lawyers, and tax experts to assist them. The plan should also list the compensation that is to be paid to each lot owner in dollar terms.

The final proposed plan developed by the Strata Committee after meetings with the owners would lapse if it is not supported by 75% of owners within 12 months.

Once there is a 75% support from the owners, the final plan for renewal will then be referred to the Land and Environment Court for final consideration. The Court would consider whether appropriate processes have been properly followed in accordance with the law. The Court in most circumstances, if required, would also encourage owners to resolve any disputes through conciliation or mediation.

The Court has the power to reject a renewal plan if it was found that the plan was not made in ‘good faith’ or followed due process. The Court will also examine the amount to be received by each owner in accordance with Land Acquisition (Just Terms Compensation) Act 1991.

Next time there is a notice calling for a Strata meeting, make sure to pay close attention.

Koffels can assist with planning submissions and/or in the event of a dispute. Always seek qualified support in such events. Like your building, projects going forward need to be built on a solid foundation. Getting help after the event is always a much harder route to resolution.

Min Hur

Associate

Purchasing Australian property – Don’t forget FIRB!

There may be restrictions imposed on foreigners purchasing properties in Australia however this does not mean they are stopped from buying any properties at all.

There are still many options available to the investors as long as they meet the criteria.

Please read below for options available to foreign investors in Australia.

Residential Real Estate in Australia – Foreign Investment

Temporary Residents of Australia

Applies to a person who holds a temporary residency visa which permits them to stay in Australia for a continuous period of more than 12 months

Established Dwellings (not investment property): – may acquire one established dwelling only and it must be used as their residence (home) in Australia. Such proposals are often subject to conditions such as, the temporary resident having to sell the property when it ceases to be their residence.
New Dwellings: – Temporary residents can also purchase a dwelling which is being purchased directly from the developer and has not been previously occupied for more than 12 months in total. (For example off-the plan purchase / purchase of proposed properties based on plan of construction)
Vacant Land: – Temporary residents can also apply to buy vacant land for residential development. These applications are normally approved subject to conditions such as that ongoing construction beginning within a certain period of time. (generally within two years).

Non-Residents (Foreign person with no resident visa in Australia)

Established Dwellings: – not allowed to be acquired except where foreign companies with a substantial Australian business, acquire second-hand dwellings for the purpose of providing housing for their Australian-based staff. The company undertakes to sell the property if it is expected to remain vacant for six months or more. Foreign companies would not be eligible under this category where the property would represent a significant proportion of its Australian assets.
New Dwellings: allowed under the same condition as temporary residents.
Vacant Land: allowed under the same condition as temporary residents.

New dwelling exemption certificates

Property developers can apply for a new dwelling exemption certificate to sell new dwellings in a development of 50 or more residences to foreign investors. The value of all apartments that can be bought by a single foreign investor is restricted to $3 million in the one development. If foreign investors want to purchase apartments above this value, they will have to seek individual approval.

FIRB Application Fees

Property valued $1 million or less $5,000

Property valued over $1 million $10,000 then $10,000 incremental fee increase per additional $1 million in property value.

New dwelling exemption certificates (Developer) $25,000 upfront, with a reconciliation of properties sold to foreign persons based on above rates.

The contract for sale would generally be subject to FIRB approval. The purchaser would enter into the contract for sale first, and then make the application to the FIRB for their approval. In the case the approval is not granted, the purchaser would be able to terminate the contract and receive their deposit back.

Min Hur

Associate
Source: https://firb.gov.au/