Entrepreneur visa

The Australian Department of Immigration & Border Protection (DIBP) is making changes to the visa system as part of the National Innovation and Science Agenda.

 

It is intended that these changes will help Australia attract and retain the best and brightest entrepreneurial talent and the skilled, talented people Australia needs to drive ideas from research to commercial reality.

 

On 10 September 2016, DIBP launched a new Entrepreneur visa’ stream and amended the ‘points test’ for the skilled migration programme.

 

The Entrepreneur visa is part of the Business Innovation and Investment visa programme. Entrepreneurs interested in applying for the Entrepreneur visa will need to submit an Expression of Interest (EOI) in SkillSelect and be nominated by a State or Territory government.

 

Key eligibility criteria includes:

• Applicants must be undertaking, or proposing to undertake, an entrepreneurial venture in Australia.
• The entrepreneurial venture must not be related to residential real estate or labour hire or involve purchasing an existing business or franchise.
• Applicants must also be under 55 years of age, have a competent level of English, and have at least 30 per cent interest in their entrepreneurial venture.
• There must be one or more funding agreements in place for at least $200,000 between the entrepreneur or venture and a third party funding body or bodies.
• Sources of third party funding are limited to state and territory governments, Commonwealth agencies, Publicly Funded Research Organisations, and investors registered as a Venture Capital Limited
• Partnerships (VCLP) or Early Stage Venture Capital Limited Partnerships (ESVCLP). Agreements outlining funds from a combination of these sources are also acceptable.
• Applicants must have a business plan outlining their plans for their venture in Australia.

An Entrepreneur visa holder can progress to permanent residency after four years if they can meet a measure of success, which includes factors such as business turnover, employment of Australians and ability to obtain significant financial backing.

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Victorian retail landlords – remember your notice obligations

Landlords of premises regulated by the Retail Leases Act 2003 (Vic) (RLA) should diarise the various dates needed for them to comply with their notice obligations under Sections 28 and 64 of the RLA, especially if they wish to avoid unintentionally extending the term of the lease.  In this regard, even though the relevant lease document may clearly record the last day of the lease, that date may be extended by Sections 28 and 64, which may have consequences for a landlord who requires the premises to be vacated by a particular date.

Section 28 provides:

• If a lease contains an option exercisable by the tenant to renew the lease for a further term, the landlord must notify the tenant in writing of the date after which the option is no longer exercisable.  That notice is to be given at least 6 months and no more than twelve months before the date the option is no longer exercisable (Last Date);
• However, the landlord is not required to provide that notice if the tenant exercises or purports to exercise the option before being notified of that Last Date;
• If the landlord fails to provide the notice to the tenant within the required timeframe, the lease is taken to provide that the Last Date is extended to a date which is 6 months after the date landlord notifies the tenant;
• If that extended date is after the term of the lease ends, the lease continues until the extended date;
• However, if the tenant exercises the option prior to the extended date, the new lease commences at the expiry of the old lease, rather than the total term of the lease being extended.

Consequently, an unplanned extension of the term of the lease may occur where a landlord fails to provide, or is late in providing, a Section 28 notice to the tenant and where the tenant does not eventually exercise its option.

Section 64 provides:

• If the tenant under a lease does not have an option to renew the lease for a further term, the landlord must at least 6 months but no more than twelve months before the lease term ends, give written notice to the tenant:
  • offering the tenant a renewal of the lease on the terms specified in the notice; or
  • informing the tenant that the landlord does not propose to offer the tenant a renewal of the lease;
• An offer to renew the lease cannot be revoked without the tenant’s consent for sixty days after it is made;
• If the landlord fails to give the notice within the required time frame:
  • the landlord must give the tenant a notice containing that information; and
  • the lease continues on the same terms and conditions until the day being 6 months after the notice was actually given to the tenant.

Accordingly, a failure by a landlord to give a Section 64 notice to a tenant may have the effect of extending the term of the lease (and, accordingly, the date upon which the premises may be vacated) to a date which is 6 months after receipt of the notice.

If you require assistance with regards to drafting and serving Section 28 and Section 64 notices (in accordance with the provision of notices clause in your lease) please contact Andrew Bini, Senior Commercial Lawyer, at Nevett Ford Melbourne.

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Retail leasing Ministerial determination

It is not uncommon for a commercial  landlord to desire to have a lease fall outside the operation of the Retail Leases Act 2003 (Vic) (RLA), thereby enabling the landlord to claim land tax and lease preparation legal costs as an outgoing from the tenant. 

What constitutes a “retail lease” (being a lease which is regulated by the RLA) is set out in Section 4 of the RLA.  One of the exceptions to a lease being a “retail lease” is where the tenant is a body corporate or a subsidiary of body corporate whose securities are listed on a stock exchange located outside of Australia that is a member of the World Federation of Exchanges (WFE) (see Section 4 (2)(d) of the RLA).

However, much confusion has arisen in trying to determine whether the relevant overseas stock exchange is a member of the WFE.

In an effort to reduce the confusion, the Victorian Minister for Small Business, Innovation and Trade has made a determination dated 12 August 2016, pursuant to the Minister’s powers under clauses 4(2)(g) and 5 of the RLA, which has the effect of excluding the following tenants from the definition “retail premises”:

            “bodies corporate or companies or corporations whose securities are listed on a stock exchange outside Australia or the subsidiaries (including subsidiaries as defined in Section 9 of the Corporations Act 2001) of such bodies corporate, companies or corporations”.

It is expected that the determination will make it easier for landlords and their advisors to determine if the RLA will apply to leases to tenants or their subsidiaries who are corporations listed on overseas exchanges.

If you require assistance with retail leasing, please contact Andrew Bini, Senior Commercial Lawyer, Nevett Ford Melbourne Pty Ltd.

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Why do we need terms and conditions of trade?

Many of our clients who are suppliers of goods and services operate under formal written terms and conditions of trade.

Prudent clients usually have their terms and conditions periodically reviewed to ensure they provide the best available protection.

For example, in recent years many suppliers of goods have amended their terms and conditions to include new provisions under which the customer grants a security interest over the goods supplied in favour of the supplier, to support the customer’s payment obligations. The grant of the security interest enables the supplier to register that security interest on the register created under the Personal Properties Security Act 2009 (Cth) (PPSR).  Without registration of a security interest, a supplier might not have the ability to recover the goods, or amounts owed with respect to the goods, if the customer goes into liquidation or declares bankruptcy.

However, it is evident to us that there are many suppliers who trade without proper terms and conditions or with outdated terms and conditions which do not entitle the supplier to register security interests on the PPSR.

The simple answer to the question as to why terms and conditions of trade are necessary is twofold:

• to clearly set out the terms of the sale of goods and/or services arrangement (ie the contractual relationship) between the supplier and the customer; and
• to provide the some protection a supplier of goods may need in the event of non-payment.

Typically, when a supplier is dealing with a new customer the supplier will provide the new customer a credit application, usually accompanied by a director’s guarantee.  At this point we recommend the supplier also provide its terms and conditions of trade to the new customer and arrange to have the credit application, the director’s guarantee  and the terms and conditions of trade signed by the new customer.

Apart from the usual mechanical provisions regarding ordering of goods and/or services, price, delivery, price variation and variation and cancellation of orders, terms and conditions should clearly set out:

• the terms of payment;
• an obligation on the customer to pay interest on outstanding amounts at a specified rate if payment is not received on the relevant due date;
• a right in the supplier to charge the customer all costs (including legal costs) incurred by the supplier in pursuing and recovering unpaid amounts;
• retention of title (whereby title to the goods is not provided to the customer until such time as payment for the goods delivered have been received by the supplier) and the right for the supplier  to access the customer’s premises to recover the goods; and
• PPSR provisions enabling the supplier to register a security interest on the PPSR.

Of course, there may be other specific or unique provisions depending upon the nature of the goods and services to be provided.

We have experience in preparing and amending terms and conditions of trade for suppliers of goods and services of various types.

If you would like more information on terms and conditions of trade please contact Andrew Bini, senior commercial lawyer, Nevett Ford Melbourne.

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