Introduction
Holding a Standard Business Sponsorship (SBS) approval allows Australian businesses to sponsor skilled overseas workers under visa programs such as the Temporary Skill Shortage (TSS) subclass 482 or Employer Nomination Scheme (ENS) subclass 186. However, SBS holders must comply with a set of ongoing obligations, including notifying the Department of Home Affairs (DHA) of changes in the business structure or management.
This article outlines the legal responsibilities of company directors when there is a change in management or company control, and how these changes affect the SBS approval status.
What Is a Standard Business Sponsorship?
An SBS is granted by the Department of Home Affairs to businesses that demonstrate:
- A legally established and actively operating business in Australia
- A genuine need to employ an overseas worker
- A commitment to meeting sponsorship obligations
SBS approvals are typically valid for five years, during which the business must comply with specific conditions under Migration Regulation 2.87 and 2.90.
What Triggers a Management Change Notification?
Management changes that must be reported include:
- Change of directors, partners or owners
- Change in ABN due to restructuring
- Business sale, acquisition or merger
- New controlling entity or shareholder restructure
Directors play a crucial role in ensuring that these changes are reported within 28 calendar days to avoid non-compliance penalties.
Director’s Legal Obligations
- Notify the Department of Home Affairs
As a director, you are legally responsible for ensuring the DHA is informed of:
- Any change to the directors or management team
- The business becoming insolvent or entering administration
- A change in the business’s legal entity, such as moving from sole trader to company or undergoing a corporate restructure
Failure to notify the Department within the required timeframe may result in:
- Cancellation of the SBS approval
- Bars on future sponsorship
- Civil penalties
- Update Business Records and ABN Registration
If the ABN or legal structure changes, directors must:
- Register the new ABN with the Australian Business Register (ABR)
- Lodge a new SBS application if the legal entity is no longer the same
Even if business operations remain the same, a change in legal entity requires a fresh SBS application.
- Maintain Sponsor Obligations
Despite any internal management shifts, directors must ensure the business continues to:
- Pay sponsored employees correctly
- Provide equivalent employment conditions
- Maintain records and provide them upon request
- Ensure that the role remains genuine and ongoing
Why Compliance Matters
The Department of Home Affairs actively monitors sponsors for compliance. Directors who fail to act on management changes risk:
- Financial penalties (up to $18,780 for individuals or $93,900 for corporations)
- Sponsorship bans
- Reputational damage and visa implications for current sponsored staff
Best Practices for Directors During Management Changes
- Appoint a compliance officer to monitor sponsorship obligations
- Review and audit existing sponsorship arrangements regularly
- Engage a Registered Migration Agent when legal or structural changes are planned
- Keep internal records of board and shareholder resolutions relating to changes in company control
Final Thoughts
Management changes are common in business, but they carry serious immigration compliance implications when your company holds a Standard Business Sponsorship. Directors must remain vigilant and proactive in fulfilling notification and compliance duties under Australian migration law.
Staying ahead of these obligations protects not only your business’s ability to sponsor overseas talent, but also ensures you avoid potential fines and reputational risks.
Need help managing SBS compliance during a change of management? Contact us on admin@validvisas.com.au or employment law professional today.
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