Overseas Business Sponsorship (OBS) – Overseas Companies Expanding into Australia

The grant of a Standard Business Sponsor (SBS) application will allow Australian businesses to sponsor overseas workers under the Skills in Demand Visa.

Further to the standard SBS, there are avenues for those businesses that operate outside of Australia and intend to expand into Australia under the Overseas Business Sponsorship (OBS).

This publication will cover how a business operating outside of Australia could obtain an OBS, which will allow an overseas business to sponsor overseas workers in Australia.

Criteria for OBS

Paragraph 2.59(h) of the Migration Regulations 1995 applies to SBS applicants who lawfully operate a business outside Australia and do not lawfully operate a business in Australia.

To demonstrate the above, the overseas applicant must provide evidence that demonstrates that their purpose for seeking approval as an OBS is to:

• Enable the sponsoring of SID visa holders/applicants, who will establish, or assist in establishing, on the applicant’s behalf, a business operation in Australia with overseas connections; or
• Fulfil or assist in fulfilling a contractual obligation for the applicant.

As stated in the Department Procedure Advice Manual, such evidence that may be considered includes the following (but is not limited to):

• A company or business expansion plan;
• A joint venture agreement between the SBS applicant and a party in Australia; and
• A contract between the OBS applicant and a party in Australia.

Company or Business Expansion Plan

The business plan must contain a sufficient amount of information to demonstrate that the applicant has a genuine and realistic commitment to the proposed activity. The business plan may include the following information:

1. Establishment of a branch office or the incorporation of a subsidiary company;
2. Identification of the location in which the Australian business operation will be based;
3. The proposed size of the business operation and the number of staff to be employed;
4. The amount of capital funding to be set aside for establishing the business operation; and
5. The type of trading activity the company will be involved in (if the business operation involves incorporating a new subsidiary company).

Joint Venture (JV) Agreement Between SBS Applicant and Party in Australia

Any Joint Venture (JV) must name the applicant as a member of the JV and include details like the JV’s purpose, how long it will last, the terms of the agreement, and how profits and losses will be shared.

Contract Between SBS Applicant and a Party in Australia

The contract must clearly show that the applicant is a party to it, and it should outline details such as the work the applicant must do in Australia to meet their obligations, as well as how any contract disputes will be handled.

Conclusion

Overseas businesses looking to expand into Australia could consider utilising the Overseas Business Sponsorship (OBS) to sponsor overseas workers. To meet the requirements, businesses must show a genuine plan to either set up operations in Australia or carry out specific contracts. Supporting documents such as business plans, joint venture agreements, or contracts can help demonstrate this.

For further information on the OBS program, you are welcome to contact our office.