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Marcus Beveridge, Principal, Queen City LawBradley So, Lawyer, Queen City Law

ENTREPRENEUR WORK VISA AND ENTREPRENEUR RESIDENCE VISA: Comments on the recent changes

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Topics

• Entrepreneur Work Visa

BB3.10 - Point System- Business Experience- Employment- Approved Export- Unique and New- Capital Investment- Bonus Points

BB3.15 – Requirement for a Business Plan

BB5 – Changing a Business Proposal

• Entrepreneur Residence Visa- BH2.1 – Successful Establishment- BH4.10 – Trading Profitably as per BH6.1.40- Existing LTBV – Grand parenting

OVERVIEW

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BB3.10 – POINTS SCALE

• Minimum score of 120 (is not Expression of Interest)

BUSINESS EXPERIENCE

• One Category

• Not essential to claim but will need to show (Not Recommended):

• BB3.1 (h) – Sufficient business experience? Transferrable Skills?

• Linkages in NZ – Business Mentors/Incubators e.g ICEHOUSE, SparkBox etc..

• “Buying Experience” - what is the applicant’s role?

ENTREPRENEUR WORK VISA

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ENTREPRNEUR WORK VISA

NEW FULL-TIME EMPLOYMENT

• At least 30 hours

• When do I have to employ? At what period? First year? Second Year? Final Year?

• TEST: Comply with your proposed Business Plan

APPROVED EXPORT BUSINESSES (BASED ON ANNUAL TURNOVER)

• What is the basis to claim the turnover? Is this based on the First year, Second Year, Third year of the Projection.

• THE TEST IS: “ANNUAL” - COMMON DENOMINATOR (“CD”)

Year 1: 200K Year 2: 400K Year 3: 600K

CD 200K 200K 200K

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ENTREPRENEUR WORK VISA

UNIQUE OR NEW PRODUCTS OR SERVICES

BH6.1.30• New – “Significant Enhancement”

• Unique – “Only product or service” – What is the Unique Selling Point?

CAPITAL INVESTMENT

• Minimum of $100,000 (No points) to claim points at least $200,000

• BB3.5.1 – Waiver only applies to:

• BB6.1.55 - ICT

• BB6.1.60 - High Value Export (5 new jobs plus $500,000 turnover)

• BB6.1.70 – Innovation

• BB6.1.50 - What is working capital?

TEST: If it is an expense then it is working capital? If you can amortize or depreciate then this is Capital Investment

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ENTREPRENEUR WORK VISA

BONUS POINTS

• BB6.1.35 – Outside of Auckland

• Where is the headquarters of business located?

• Where are the job created?

• Where is the commercial activity?

• Local Agency Support:

• A grant or subsidy to develop the business

• Must be measurable and tangible – a letter of support is not sufficient.

• NOTE: Agencies are not obliged to give support

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SPECIFIC BUSINESS

BUSINESS PLAN AS BB3.15

• Be Specific

• What is the business?

• Where is the business?

• When do you intend to operate the business?

• Why do you choose this business?

• Format

• Follow the format as per the application form

• Itemise breakdown the allocation of investment capital/working capital

• Forecast – What are the assumption?

• Differentiate between New or Existing business

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SPECIFIC BUSINESS PLAN

FACTORS TO CONSIDER

• TYPE OF BUSINESS

• Consistent with the Objectives of BB1

• High growth

• Innovative

• Export

• New/Existing Business

• CAPITAL REQUIREMENT

• Existing Business

• Share Acquisition/Asset Acquisition

• LOCATION

• In Auckland or outside of Auckland

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SPECIFIC BUSINESS PLAN

Practical Implications

• Offshore applicants will need to come to NZ before a visa is granted

• Interim visa of 12 months is purely to set up the business

• One variation of business plan opportunities

• Decrease in buying existing businesses

• Pro forma business plans will no longer apply

• Applicants are better prepared for Residency

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CAPITAL ENTREPRENEUR RESIDENC VISA

BH2.1 SUCCESSFULLY ESTABLISHING A BUSINESS

• TWO YEARS

• SIX MONTHS – subject to S49 Conditions maintain $500k and three jobs created

BH4.10 BENEFITING TO NZ

Benefits

• Promoted New Zealand’s economic growth as set out in a) i - vi, such as by creating employment or introducing new, or enhancing existing, products or services, spill-over

• Productivity-enhancing spillover benefits

• Increase Capacity Utilisation (such as significant net new job creation)

Trading profitably

• BB6.1.40 – meeting or exceeding the projected annual turnover from the original business plan and assessment from the points scale;

• Making sufficient profit = minimum wage per annum

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ENTREPRENEUR RESIDENCE VISA

GRANDPARENTING

• TEST: Did you comply with your business plan?

WHAT IF I DON”T MEET THE FORECAST OR THE BENEFITS CLAIMED?

• The applicant can apply for extension on the EWV provided that they can show that the business has potential to meet the forecast.

• BH3.1 (a)(iv) – may be triggered

“The business has provided a significant benefit to New Zealand or greater than the original business as determined by a business immigration specialist”

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CONCLUSION

REMEMBER – BEFORE SUBMITTING AN APPLICATION

• BE CONSERVATIVE WHEN CLAIMING POINTS

• JUSTIFY YOUR ASSUMPTIONS

• WORK ON THE BUSINESS PLAN

• DO NOT APPLY FOR RESIDENCE PREMATURELY

• ENSURE CONSISTENCY WITH BB1