1415975 (Migration)

[2015] AATA 3051

1415975 (Migration) [2015] AATA 3051 (7 July 2015)

DECISION RECORD

DIVISION: Migration & Refugee Division

APPLICANTS:  Mr George Frangos
Mrs Rita Frangos
Miss Angelica Frangos
Mr Michael Aurey Frangos

MRT CASE NUMBER:  1415975

DIBP REFERENCE(S):  CLF2014/44881 CLF2014/44882 CLF2014/44883 CLF2014/44884

TRIBUNAL MEMBER:  Glen Cranwell

DATE:7 July 2015

PLACE OF DECISION:  Brisbane

DECISION:The Tribunal affirms the decision not to grant the applicants Business Skills (Residence) (Class DF) visas.

Statement made on 07 July 2015 at 10:31am

STATEMENT OF DECISION AND REASONS

APPLICATION FOR REVIEW

1. This is an application for review of a decision made by a delegate of the Minister for Immigration on 5 September 2014 to refuse to grant the visa applicant a Business Skills (Residence) (Class DF) Subclass 892 visa under s.65 of the Migration Act 1958 (the Act).

2. The visa applicant applied for the visa on 21 March 2014.  The delegate refused to grant the visa on the basis that the first named applicant (the applicant) did not satisfy the requirements of cl.892.212(b) and in his circumstances, was unable to satisfy two of the three alternate requirements of cl.892.212 overall. An extract of the relevant legislation is attached to the decision.

3. The applicants appeared before the Tribunal on 26 May 2015 to give evidence and present arguments.

4. The applicants were represented in relation to the review by their registered migration agent. The representative attended the Tribunal hearing.

5. For the following reasons, the Tribunal has concluded that the decision under review should be affirmed.

   CONSIDERATION OF CLAIMS AND EVIDENCE

6. The applicants had sought to rely on the QCG No 1 Pty Ltd as a main business.  The 10 issued shares in QCG No 1 Pty Ltd are held by Frangos Coffee Pty Ltd.  The first and second named applicants, who are husband and wife, each held 2 of the 4 issued shares in Frangos Coffee Pty Ltd.

7. The issue in the present case is whether the applicant satisfies cl.892.212(b), which requires that the net value of the business and personal assets in Australia of the first and second named applicants was at least $250,000 for the period of 12 months immediately prior to the date of the visa application.

8. It is not in question that the Queensland state government (as the appropriate regional authority) has not certified there are exceptional circumstances which would exempt the applicants from the need to satisfy cl.892.212. Therefore the applicant must satisfy two of the three alternate criteria  in clause 892.212 in order to meet the requirements of cl.892.212 as a whole:

   892.212

   Unless the appropriate regional authority has determined that there are exceptional circumstances, the applicant meets at least 2 of the following requirements:

   (a) throughout the 12 months immediately before the application is made, the main business in Australia, or main businesses in Australia, of the applicant, the applicant's spouse, or the applicant and his or her spouse together, employed at least 1 full-time employee (or a number of part-time employees working an equivalent number of hours) who:

   (i) is not the applicant or a member of the family unit of the applicant; and

   (ii) is an Australian citizen, an Australian permanent resident or a New Zealand passport holder;

   (b) the net value of the business and personal assets in Australia of the applicant, the applicant's spouse, or the applicant and his or her spouse together, is, and has been throughout the 12 months immediately before the application is made, at least AUD250 000;

   (c) the total value of the net assets owned by the applicant, the applicant's spouse, or the applicant and his or her spouse together, in the main business or main businesses in Australia is, and has been throughout the 12 months immediately before the application is made, at least AUD75 000.

9. It is not in question that the applicant has provided satisfactory evidence (pay records, identity documents) that he meets 892.212(a). QCG No 1 Pty Ltd had the equivalent of more than one full-time Australian citizen or permanent resident employee for the relevant 12 month period.  The Tribunal finds the applicant meets the requirements of cl.892.212(a).

10. During the hearing, the applicant gave evidence that the net value of the first and second named applicants in QCG No 1 Pty Ltd during the relevant period did not amount of $75,000.  This is apparent from the statement of assets and liabilities set out below.  The Tribunal finds that the applicant does not meet the requirements of cl.892.212(c).

11. As noted above, the key issue for the Tribunal to determine is whether the applicant meets the requirements of cl.892.212(b).  That is, whether the net value of the personal and business assets of the first and second named applicants in Australia during the relevant period amounted to $250,000.

12. As evidence of satisfying cl.892.212, consistent with Departmental policy, the applicant provided to the Tribunal a statement of assets and liabilities as at 28 February 2013 and 28 February 2014, which is within 3 months of the date of the visa application.  The Tribunal has made the below findings on the basis of that same 12 month period.

13. In submissions provided to the Tribunal prior to the hearing, the applicant’s claimed assets and liabilities are as follows:

    28 February 2014     28 February 2013

    Net personal assets  $398,912                  $418,107

    Net assets in QCG No 1 Pty Ltd                -$128,473                 -$17,427

    Total net personal and business assets     $270,439                  $400,680

14. The net assets in QCG No 1 Pty Ltd include a loan of $115,000 from QCG Pty Ltd, which the applicant has attributed to himself as a loan to the company.

15. The first and second named applicants each hold 10 of the 40 issued shares in QCG Pty Ltd.

16. At the hearing, the Tribunal put to the applicant that the loan was from QCG Pty Ltd, not himself.  As QCG Pty Ltd had a separate legal personality to the applicant, the loan could not be considered as being from the applicant.  As the first and second named applicants hold 50% of the shares in QCG Pty Ltd, the most that could be attributed to them was $57,500.  The effect of this was to give the first and second named applicants total net personal and business assets of $212,939 as at 28 February 2014.

17. The Tribunal also explained that even if 50% of the additional claimed loans from QCG Pty Ltd to QCG No 1 Pty Ltd of $48,000 were considered, this would only increase their total net personal and business assets to $236,939 as at 28 February 2014. 

18. The applicant told the Tribunal that he and the other shareholder of QCG Pty Ltd had each loaned $200,000 to the company.  It was intended that his $200,000 would be applied to QCG No 1 Pty Ltd, and the other shareholder’s $200,000 should be applied to QCG No 2 Pty Ltd, a company in which the applicant has no interest.

19. The Tribunal acknowledged that may have been the applicant’s intention, but the loan was not personally from the applicant to QCG No 1 Pty Ltd.  The loan was from QCG Pty Ltd, and he owned 50% of that company.  The applicant may have structured the loan in that way for taxation purposes, but having done so the Tribunal could not undo it for immigration purposes.  The applicant could not, as it were, have his cake and eat it too.

20. The applicant repeated several times that his intentions were clear, and that if had known he would have loaned the money directly.

21. The applicant’s representative asked the Tribunal to consider QCG Pty Ltd as a main business.  The Tribunal indicated that QCG Pty Ltd would have difficulties meeting cl.892.211(2) as a main business, as no BAS statements were provided with the visa application.  The representative stated that QCG Pty Ltd was not trading.  The Tribunal indicated that this may cause difficulties in it meeting the definition of main business and qualifying business.  The representative then stated that it may have been trading.  The Tribunal invited the representative to provide further evidence and written submissions in relation to QCG Pty Ltd within 7 days.  These were provided on 2 June 2015.

22. The Tribunal is not satisfied that any more than 50% of the loans from QCG Pty Ltd to QCG No 1 Pty Ltd should be attributed to the applicant.  This is because the first and second named applicants have only a 50% shareholding in QCG Pty Ltd.  As a consequence, the Tribunal finds on the basis of the evidence available to it that the first and second named applicants’ total net personal and business assets were $236,939 as at 28 February 2014. 

23. The Tribunal notes that the submissions dated 2 June 2015 list the first and second named applicants’ net assets in QCG Pty Ltd as $0 as at 28 February 2014, presumably on the basis that they terminated their relationship with QCG Pty Ltd on 22 March 2013.  A Dissolution Agreement of the same date was provided, in which any outstanding loans were forgiven.  Accordingly, consideration of QCG Pty Ltd does not increase the first and second named applicants’ total net personal and business assets as at 28 February 2014.

24. For those reasons, the Tribunal is not satisfied the total net value of the first and second named applicants’ personal and business assets in Australia was not less than $250,000 throughout the 12 months immediately before the application was made. The applicant therefore does not meet the requirements of cl.892.212(b).

25. As the applicant satisfies only cl.892.212(a), the Tribunal finds the applicant does not meet the requirements of cl.892.212 overall.

26. In the alternative, the applicant has submitted that QCG Pty Ltd should be considered as a main business.  The Tribunal finds that the applicant does not meet the requirements of cl.892.211(2), which requires for each main business that all BAS required by the ATO for at least 2 years immediately before the application was made to “have been submitted to the ATO and have been included in the application”.  No BAS statements for QCG Pty Ltd were included with the visa application.  BAS statements for portions of this period were provided to the Tribunal, however it remains the case that these statements were not included with the application lodged on 21 March 2014.

    DECISION

27. The Tribunal affirms the decision not to grant the applicants Business Skills (Residence) (Class DF) visas.

    Glen Cranwell
    Member