1515176 (Migration)

[2016] AATA 4398

1515176 (Migration) [2016] AATA 4398 (15 September 2016)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  The Trustee for 136 The Parade Trust

CASE NUMBER:  1515176

DIBP REFERENCE(S):  BCC2015/1660243

MEMBER:Christopher Smolicz

DATE:15 September 2016

PLACE OF DECISION:  Adelaide

DECISION:The Tribunal affirms the decision not to approve the nomination.

Statement made on 15 September 2016 at 10:14am

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 29 October 2015 to refuse to approve the applicant’s nomination under s.140GB of the Migration Act 1958 (the Act) and r.2.72 of the Migration Regulations 1994 (the Regulations).

2. The applicant applied for approval on 10 June 2015.

3. A nomination of an occupation for a Subclass 457 visa is made under s.140GB of the Act and r.2.73 of the Regulations. The proposed occupation was Corporate Services Manager (ANZSCO 132111). The nominee, visa applicant is a Mr Zixiao Zhao, a citizen of China.

4. Regulations 2.72(3) to (12) prescribe the criteria that must be satisfied for the Minister to approve a nomination by a person. These criteria are extracted in the attachment to this decision. For nomination applications made from 23 November 2013, additional criteria are specified in s.140GBA.

5. The delegate decided not to approve the nomination on the basis that the applicant did not satisfy regulation 2.72(10(f) because the delegate was not satisfied that the position associated with the nominated occupation is genuine.

6. The Tribunal conducted a hearing on 17 August 2016. Mr Hong Tao Liu gave evidence on behalf of The Trustee for the 136 The Parade Trust (the applicant). The Tribunal also received oral evidence from the visa applicant.  The Tribunal hearing was conducted with the assistance of an interpreter in the Mandarin and English languages. The applicant was represented in relation to the review by its registered migration agent.

7. For the following reasons, the Tribunal has decided to affirm the decision under review to refuse the nomination.

   CONSIDERATION OF CLAIMS AND EVIDENCE

8. The Tribunal must approve the nomination if the applicable requirements in r.2.72 and, for nomination applications made from 23 November 2013, s.140GBA have been met: s.140GB(2). The issue in the present case is whether the position associated with the nominated occupation is genuine: r 2.72(10)(f).

9. For the following reasons the Tribunal finds that the requirements of r.2.72(10)(f) are not met.

10. Mr Hong Tao Liu is the director of the 136 The Parade Pty Ltd. The company is involved in the business of commercial leasing and land development. The business was registered on 12 September 2014 and has a commercial real estate project located at 136 The Parade Norwood, South Australia. The property consists of a two story retail/commercial mixed building of approximately 1,124 square metres with about eleven to twelve tenants.

11. The applicant purchased the property in September 2014 for about $4,750,000. The net income as of 1 July 2014 was $300,000. The Tribunal questioned Mr Liu about the current financial position of the business. Mr Liu said that the business was making a small profit and the current turnover was about $400,000. The Tribunal was provided with BAS covering the period July 2015 to June 2016 and accepts the business is lawfully operating.

12. The Tribunal discussed with Mr Liu the following ANZSCO definition of Corporate Services Manager.

13. According to the ANZSCO, Corporate Services Managers plan, organise, direct, control and coordinate the overall administration of organisations. Most occupations in this unit group have a level of skill commensurate with a bachelor degree or higher qualifications. At least 5 years of formal qualifications may substitute for formal qualifications.

14. According to ANZSCO the tasks of a Corporate Services Manager include:

    oproviding high level administrative, strategic planning and operational support, research and advice to senior management on administrative matters such as staff management, financial planning, facility management and information services

    odeveloping and managing the organisation's administrative, financial, physical and staff resources

    odeveloping and implementing administrative, financial and operational procedural statements and guidelines for use by staff in the organisation

    oanalysing complex resource management issues and initiatives that affect the organisation, and preparing associated reports, correspondence and submissions

    oproviding information and support for the preparation of financial reports and budgets

    oleading, managing and developing administrative staff to ensure smooth business operations and the provision of accurate and timely information

    orepresenting the organisation in negotiations, and at conventions, seminars, public hearings and forums, and promoting existing and new programs and policies

15. The Tribunal asked Mr Liu to explain his role in the business. Mr Liu described his position as Chairman of the Board. He said he was the only director. Mr Murray Munro was a 10 per cent shareholder. Mr Munro is the Managing Director of the Murray Munro Property Group who manages all the business lease agreements, tenants, rental contracts, collects the rent from tenants and prepares financial reports for their external accountants. Mr Munro is paid a commission for his services.

16. Mr Liu said that the business employs Mr Zhao, and an Assistant Manager (Ms Lang) who is paid about $38,000 per annum. There are no other employees.

17. The applicant advertised for a Corporate Services Manager in December 2014 on the Seek website. On 8 March 2015 the nominee entered into an employment agreement with the applicant for the position of Corporate Services Manager for a term of 4 years with a base salary of $57,340. At the hearing the Tribunal was provided with Mr Zhao’s 2016 PAYG payment summary confirming that his salary had increased to $60,647.

18. The Tribunal questioned Mr Liu about the recruitment process. Mr Liu said that biggest problem in recruiting a suitable Australian applicant was communication and cultural differences. Mr Liu said he could not find an Australian citizen employee who could communicate with him in his own language and understood “the Chinese way of doing business”. Mr Liu said that the visa applicant was recommended to him by a friend in China.

19. The Tribunal referred the applicant to the delegate’s decision and noted that Departmental officers conducted a site visit and spoke to Mr Munro. Mr Munro said that Mr Liu and the nominee were responsible for the redevelopment of the business. Mr Munro said that the goal is for the nominee to learn to become a Property Manager. Mr Munro also said that there is a need for Mr Zhao to oversee the development of the property and deal with the architects, engineers and tenants while the building is being developed.

20. The Tribunal questioned Mr Liu about the progress of the development of the building since the application was lodged. Mr Liu said that he is considering building seven levels on top of the existing building. He does a lot of trading with China and knows wealthy Chinese business people and may consider selling the building to a Chinese investor. He said that the current development of the property situated at 136 The Parade was still in the planning stage and he is in the process of looking at a third set of plans before he commits to any development. He has not set a budget for the development, he has not submitted any plans to council and does not have building approval or signed any building contracts.

21. Mr Liu said that he is involved in three other companies in Australia and has a vineyard business. He is looking to purchase further suitable real estate. When his business grows he anticipates having many Chinese customers.

22. After further questioning Mr Liu said that 136 The Parade Pty Ltd does not have any properties that are currently under development and has not made any other investments in the property market.

23. The Tribunal questioned Mr Liu about Mr Zhao’s current duties as Corporate Services Manager. He said that Mr Zhao is employed in a position that is “just below that of Chief Executive Officer”. His main duty is to look for business opportunities and develop future properties. Mr Liu said that because the company is new there is not a lot to do in the business at the moment. He communicates with the accountant, deals with real estate agents and deals with customers. Mr Liu said that he trusts Mr Zhao to deal with all the financial aspects of the business and to provide figures to the company’s external accountant.

24. The Tribunal asked Mr Liu if Mr Zhao works for any of his other companies. Mr Liu said that Zhao only works for 136 The Parade Pty Ltd but in the future he may work for his other companies. Mr Liu said that Mr Zhao is working out of the Murray Munro Property Group offices.

25. The Tribunal referred Mr Liu to the delegate’s decision and noted that the Departmental officers were of the view that the nominee was not undertaking duties as a Corporate Services Manager. The delegate found that the nominee was learning about property management and his goal was to become a Project Manager (ANZSCO 612112). The delegate found that the position of Corporate Services Manager is typically associated with large scale enterprises where there is significant financial turnover.

26. In post hearing submission the Tribunal was provided with correspondence from Mr Munro regarding Mr Zhao’s current and future duties. It was submitted that Mr Zhao was involved in the day to day management and administration of the company and is working closely with the Munro Property Group Commercial Team to understand the retail and commercial property management issues. It was submitted that Mr Zhao has been actively engaged in the following property management duties:

    ·Tenancy and arrears management

    ·Promoting current vacant commercial tenancies for short term leasing

    ·Leasehold amendments negotiations to include demolition/relocations clause acceptance

    ·Major maintenance

    ·Ruptured fire cervices main pipe that is under the concrete slab and the compliance issues with authorities.

    ·Storm damage and subsequent water damage claims.

27. It was submitted that once the cultural business centre is developed Mr Zhao will continue to manage the centre and tenancy business.

28. The Tribunal finds has regard to Mr Munro’s submissions and finds that Mr Zhao’s duties are more closely aligned to that of a Property Manager (ANZSCO 612112). According to ANZSCO a Property Manager undertakes the following duties:

    ·accepting and listing properties and businesses for sale and lease, conducting inspections, and advising buyers on the merits of properties and businesses and the terms of sale or lease

    ·advising vendors of sales and marketing options such as sale by auction and open house inspections

    ·cataloguing and detailing land, buildings and businesses for sale or lease and arranging advertising

    ·assessing buyers' needs and locating properties and businesses for their consideration

    ·offering valuations and advice for buying and selling properties and businesses, and structuring the terms of settlement

    ·collecting and holding rent monies from tenants, and remitting to owner on agreed basis

    ·monitoring and addressing non-compliance with terms and conditions of tenancy and pursuing rental arrears

    ·developing and implementing business plans, budgets, policies and procedures for the agency

    ·may arrange finance, land brokerage, conveyancing and maintenance of premises

    Findings

29. The Tribunal is not satisfied that the position associated with the nominated occupation is genuine. The company (136 The Parade Pty Ltd) commenced trading in September 2014 and only has two employees. Its main source of business income is from commercial tenancies. Since lodging the nomination application in June 2015 the business has not commenced any investment or development projects. The Tribunal found Mr Liu’s evidence about selling the property to Chinese client’s speculative. Mr Liu has not settled on a final plan for the proposed development of property. He does not have a final budget, he does not have development approval or any investors.

30. The Tribunal finds Mr Liu’s evidence that he has other business ventures in Australia and access to Chinese investors of limited relevance in accessing the current nomination application and whether there is a genuine need for a Corporate Services Manager. The Tribunal finds that the current commercial lease contracts are being dealt with by Mr Munro who deals with tenants, prepares figures and reports for the external accountant.

31. Apart from general claims about future property investment, no evidence was provided to the Tribunal about how the nominated position would provide high-level administrative, strategic planning and operational support, research or advice to senior management in the company.  

32. The Tribunal was not provided with any examples of management reports or financial planning reports which need to be prepared for senior management of the company.

33. The Tribunal finds that apart from the visa applicant the company only has one other employee. The Tribunal is not satisfied that there is a need for a Corporate Services Manager to lead, manage and develop administrative staff in the company.

34. In conclusion having considered the evidence and post hearing submissions, the Tribunal has had regard to the ANZSCO definition of Corporate Services Manager and the size and scope of the business operations and is not satisfied that the position associated with the nominated occupation is genuine. The Tribunal finds that Mr Zhao is currently is training to become a Property Manager and his duties are not consistent with that of a Corporate Services Manager which is the subject of the nomination.

35. For the reasons given above, the Tribunal is not satisfied that the applicant meets the applicable criteria for the nomination to be approved. Accordingly, the decision under review must be affirmed.

    DECISION

36. The Tribunal affirms the decision not to approve the nomination.

    Christopher Smolicz
    Member

    
    

    ATTACHMENT - EXTRACTS FROM THE MIGRATION REGULATIONS 1994

    2.72 Criteria for approval of nomination — Subclass 457…

    (1)This regulation applies to a person who is:

    (a)a standard business sponsor; or

    (b)a party to a work agreement (other than a Minister);

    who, under paragraph 140GB (1) (b) of the Act, has nominated an occupation in relation to a holder of, or an applicant or a proposed applicant for, a [Subclass 457 visa].

    (2)For subsection 140GB (2) of the Act, the criteria that must be satisfied for the Minister to approve a nomination by a person are set out in subregulations (3) to (12).

    (3)The Minister is satisfied that the person has made the nomination in accordance with the process set out in regulation 2.73.

    (4)The Minister is satisfied that the person is:

    (a)a standard business sponsor; or

    (b)a party to a work agreement (other than a Minister).

    (5)The Minister is satisfied that the person has identified in the nomination the visa holder, or the applicant or proposed applicant for the visa, who will work in the nominated occupation.

    (6)If the person identifies a holder of a [Subclass 457 visa] (the visa holder) for subregulation (5), the Minister is satisfied that the person:

    (a)has listed on the nomination each other holder of a visa of that kind who was granted the visa on the basis of having the necessary relationship with the visa holder as mentioned in clause 457.321 of Schedule 2; and

    (b)if the Minister requires the visa holder to demonstrate that he or she has the skills necessary to perform the occupation — the visa holder demonstrates that he or she has those skills in the manner specified by the Minister.

    (7)For paragraph (6) (a), the Minister may disregard the fact that 1 or more persons required to be listed on the nomination are not listed, if the Minister is satisfied it is reasonable in the circumstances to do so.

    (7A)In addition to subregulation (6):

    (a)if:

    (i)       the person identifies a holder of a [Subclass 457 visa] (the visa holder) for subregulation (5); and

    (ii)      the [Subclass 457 visa] was granted after the Minister had waived the requirements of paragraph 4006A (1) (c) of Schedule 4 on the basis of a written undertaking made by the current sponsor of the visa holder (as set out in subclause 4006A (2) of that Schedule);

    the Minister is satisfied that the person has provided, in writing, an undertaking that is equivalent to the undertaking made by the current sponsor of the visa holder; and

    (b)if:

    (i)       the person identifies a holder of a [Subclass 457 visa] (the visa holder) for subregulation (5); and

    (ii)      the person has listed on the nomination a person described in paragraph (6) (a); and

    (iii)     the [Subclass 457 visa] was granted to the person described in paragraph (6) (a) after the Minister had waived the requirements of paragraph 4006A (1) (c) of Schedule 4 on the basis of a written undertaking made by the current sponsor of the visa holder (as set out in subclause 4006A (2) of that Schedule);

    the Minister is satisfied that the person has provided, in writing, an undertaking that is equivalent to the undertaking made by the current sponsor of the visa holder.

    (8)If the nomination was made before 1 July 2010 — the Minister is satisfied that the person has provided the following information as part of the nomination:

    (a)if there is a 6‑digit ASCO code for the nominated occupation — the 6-digit ASCO code;

    (b)if there is no 6-digit ASCO code for the occupation, and the person is a standard business sponsor — the name of the occupation as it appears in the instrument in writing made for the purposes of paragraph (10) (a);

    (c)if there is no 6-digit ASCO code for the occupation and the person is a party to a work agreement — the name of the occupation as it appears in the work agreement;

    (d)the location or locations at which the nominated occupation is to be carried out.

    (8A)If the nomination is made on or after 1 July 2010 – the Minister is satisfied that the person has provided the following information as part of the nomination:

    (a)if there is a 6-digit ANZSCO code for the nominated occupation - the name of the occupation and the corresponding 6-digit ANZSCO code;

    (b)if:

    (i)       there is no 6-digit ANZSCO code for the nominated occupation; and

    (ii)      the person is a standard business sponsor;

    the name of the occupation and the corresponding 6-digit code as they are specified in the instrument in writing made for paragraph (10)(aa);

    (c)if:

    (i)       there is no 6-digit ANZSCO code for the nominated occupation; and

    (ii)      the person is a party to a work agreement;

    the name of the occupation and the corresponding 6-digit code (if any) as they are specified in the work agreement;

    (d)the location or locations at which the nominated occupation is to be carried out.

    (9)The Minister is satisfied that either:

    (a)there is no adverse information known to Immigration about the person or a person associated with the person; or

    (b)it is reasonable to disregard any adverse information known to Immigration about the person or a person associated with the person.

    (10)If the person is a standard business sponsor — the Minister is satisfied that:

    (a)if the nomination was made before 1 July 2010 - the nominated occupation corresponds to an occupation specified by the Minister in an instrument in writing for this paragraph; and

    (aa)if the nomination is made on or after 1 July 2010 – the nominated occupation and its corresponding 6-digit code correspond to an occupation and its corresponding 6-digit code specified by the Minister in an instrument in writing for this paragraph; and

    (b)if required by the instrument mentioned in paragraph (a)  or (aa) — the nomination of an occupation mentioned in the instrument is supported, in writing to the Minister, by an organisation specified by the Minister in an instrument in writing for this paragraph; and

    (c)the terms and conditions of employment of the person identified in the nomination will be no less favourable than the terms and conditions that:

    (i)       are provided; or

    (ii)      would be provided;

    to an Australian citizen or an Australian permanent resident for performing equivalent work at the same location; and

    (cc)the base rate of pay, under the terms and conditions of employment mentioned in paragraph (c), that:

    (i)       are provided; or

    (ii)      would be provided;

    to an Australian citizen or an Australian permanent resident, will be greater than the temporary skilled migration income threshold specified by the Minister in an instrument in writing for this paragraph; and

    (d)if the nomination was made before 1 July 2010 - the person has certified as part of the nomination, in writing, that:

    (i)       the tasks of the position include a significant majority of the tasks of:

    (A)the nominated occupation listed in the ASCO; or

    (B)the nominated occupation specified in an instrument in writing for paragraph (a); and

    (ii)      if the person is lawfully operating a business outside Australia but does not lawfully operate a business in Australia:

    (A)the nominated occupation is a position in the business of the standard business sponsor; or

    (B)the nominated occupation is an occupation specified by the Minister in an instrument in writing for this sub-paragraph; and

    (iii)     if the person lawfully operates a business in Australia:

    (A)the nominated occupation is a position with a business, or an associated entity, of the person; or

    (B)the nominated occupation is an occupation specified by the Minister in an instrument in writing for this sub-paragraph; and

    (iv)     the qualifications and experience of the visa holder, or the applicant or proposed applicant for the visa, identified in relation to the nominated occupation are commensurate with the qualifications and experience specified:

    (A)for the occupation in the ASCO; or

    (B)if there is no ASCO code for the nominated occupation — for the occupation in the instrument in writing made for the purpose of paragraph (a); and

    (e)if the nomination is made on or after 1 July 2010 – the person has certified as part of the nomination, in writing, that:

    (i)       the tasks of the position include a significant majority of the tasks of:

    (A)the nominated occupation listed in the ANZSCO; or

    (B)the nominated occupation specified in an instrument in writing for paragraph (aa); and

    (ii)      if the person is lawfully operating a business outside Australia but does not lawfully operate a business in Australia:

    (A)the nominated occupation is a position in the business of the standard business sponsor; or

    (B)the nominated occupation is an occupation specified by the Minister in an instrument in writing for this sub-subparagraph; and

    (iii)     if the person lawfully operates a business in Australia:

    (A)the nominated occupation is a position with a business, or an associated entity, of the person; or

    (B)the nominated occupation is an occupation specified by the Minister in an instrument in writing for this sub-subparagraph; and

    (iv)     the qualifications and experience of the visa holder, or the applicant or proposed applicant for the visa, identified in relation to the nominated occupation are commensurate with the qualifications and experience specified:

    (A)for the occupation in the ANZSCO; or

    (B)if there is no ANZSCO code for the nominated occupation - for the occupation in the instrument in writing made for paragraph (aa).

    (f)the position associated with the nominated occupation is genuine; and

    (g)if the person has identified in the nomination the holder of a Subclass 457 (Temporary Work (Skilled)) visa in relation to whom the requirements in subclause 457.223(6) of Schedule 2 were met—one of the following applies:

    (i)       the requirements in subclause 457.223(6) of Schedule 2 continue to be met;

    (ii)      if:

    (A)the holder would be required to hold a licence, registration or membership that is mandatory to perform the occupation nominated in relation to the holder; and

    (B)in order to obtain the licence, registration or membership, the holder would need to demonstrate that the holder has undertaken a language test specified by the Minister under subparagraph 457.223(4)(eb)(iv) of Schedule 2 and achieved a score that is better than the score specified for the test by the Minister under subparagraph 457.223(4)(eb)(v) of Schedule 2;

    the holder demonstrates that he or she has proficiency in English of at least the standard required for the grant (however described) of the licence, registration or membership;

    (iii)     the holder is an exempt applicant within the meaning of subclause 457.223(4) of Schedule 2;

    (iv)     unless subparagraph (ii) applies—the holder:

    (A)has undertaken a language test specified by the Minister under subparagraph 457.223(4)(eb)(iv) of Schedule 2; and

    (B)achieved within the period specified by the Minister in a legislative instrument for this subparagraph, in a single attempt at the test, the score specified by the Minister under subparagraph 457.223(4)(eb)(v) of Schedule 2; and

    (h)either:

    (i)       the person will:

    (A)engage the visa holder, the applicant for a visa or the proposed applicant for  a Subclass 457(Temporary Work (Skilled)) visa only as an employee under a written contract of employment; and

    (B)give a copy of that contract to the Minister; or

    (ii)      the nominated occupation is an occupation specified by the Minister in an instrument in writing for sub-subparagraph (e)(iii)(B).

    (10AA)For paragraphs (10) (c) and (cc), if no Australian citizen or Australian permanent resident performs equivalent work in the person’s workplace at the same location, the person must determine, using the method specified by the Minister in an instrument in writing for this subregulation:

    (a)the terms and conditions of employment; and

    (b)the base rate of pay, under the terms and conditions of employment;

    that would be provided to an Australian citizen or an Australian permanent resident to perform equivalent work in the person’s workplace at the same location.

    (10AB)Paragraphs (10) (c) and (cc) do not apply if the annual earnings of the person identified in the nomination are equal to or greater than the amount specified by the Minister in an instrument in writing for this subregulation.

    (10A)The Minister may disregard the criterion in paragraph (10) (cc) for the purpose of subregulation (2) if:

    (a)the base rate of pay will not be greater than the temporary skilled migration income threshold specified for that paragraph; and

    (b)the annual earnings are equal to or greater than the temporary skilled migration income threshold; and

    (c)the Minister considers it reasonable to do so.

    (11)If the person is a party to a work agreement (other than a Minister) — the Minister is satisfied that:

    (a)the nominated occupation is specified in the work agreement as an occupation that the person may nominate; and

    (b)if the nomination was made before 1 July 2010 - the person has certified as part of the nomination, in writing, that:

    (i)       the tasks of the position include a significant majority of the tasks of:

    (A)if the nomination is made using an ASCO code - the nominated occupation listed in the ASCO; or

    (B)if the nomination is not made using an ASCO code -the nominated occupation specified in the work agreement; and

    (ii)      the qualifications and experience of the visa holder, or the applicant or proposed applicant for the visa, identified in relation to the nominated occupation are commensurate with the qualifications and experience specified for the occupation in the work agreement; and

    (c)if the nomination is made on or after 1 July 2010 - the person has certified as part of the nomination, in writing, that:

    (i)       the tasks of the position include a significant majority of the tasks of:

    (A)if the nomination is made using an ANZSCO code - the nominated occupation listed in the ANZSCO; or

    (B)if the nomination is not made using an ANZSCO code -the nominated occupation specified in the work agreement; and

    (ii)      the qualifications and experience of the visa holder, or the applicant or proposed applicant for the visa, identified in relation to the nominated occupation are commensurate with the qualifications and experience specified for the occupation in the work agreement.

    (12)If the person is a party to a work agreement and the work agreement specifies requirements that must be met by the party to the work agreement — the Minister is satisfied that the requirements of the work agreement have been met.