Abbu v Minister for Immigration and Multicultural Affairs
[2006] AATA 898
•20 October 2006
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2006] AATA 898
ADMINISTRATIVE APPEALS TRIBUNAL )
) No W2005/284
GENERAL ADMINISTRATIVE DIVISION ) Re MAHOMED RAFIK ABBU Applicant
And
MINISTER FOR IMMIGRATION AND MULTICULTURAL AFFAIRS
Respondent
DECISION
Tribunal Deputy President S D Hotop Date20 October 2006
PlacePerth
Decision The Tribunal affirms the decision under review.
......(Sgd S D Hotop).............
Deputy President
CATCHWORDS
IMMIGRATION AND CITIZENSHIP – Business Skills visa – applicant obtained substantial ownership interest in eligible business in Australia – applicant has not utilised his skills in actively participating at senior level in day-to-day management of that business or made a genuine effort to do so – discretionary power to cancel applicant’s visa thereby enlivened – relevant considerations on balance favour cancellation of applicant’s visa – applicant’s visa should be cancelled – decision under review affirmed
Migration Act 1958 (Cth) s 134
Re Gunawan and Minister for Immigration and Multicultural Affairs [2006] AATA 852
Hope v Bathurst City Council (1980) 144 CLR 1
Re Juliana Leo and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 308
Re Saleh Leo and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 309
Re Yam and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 283
REASONS FOR DECISION
20 October 2006 Deputy President S D Hotop Introduction
1. Mahomed Abbu (“the applicant”), who was born in Malawi and is a British National, was granted a Business Skills (Subclass 127 – Business Owner) visa by a delegate of the Minister for Immigration and Multicultural Affairs (“the respondent”) under s 65 of the Migration Act 1958 (Cth) (“the Act”) on 14 March 2002. By reason of that visa, being a “permanent visa”, the applicant was permitted to remain in Australia indefinitely: see s 30(1) of the Act. The applicant first entered Australia on 2 April 2002.
2. On 13 July 2005, however, a delegate of the respondent cancelled the applicant’s visa under s 134(1) of the Act. By letter of the same date the delegate notified the applicant of that decision.
3. The applicant has applied to the Tribunal for a review of the delegate’s decision.
The Issues and the Tribunal’s Determination
4. The general issues for the Tribunal’s determination are whether any of the alternative grounds prescribed by s 134(1) of the Act (set out in paragraph 6 below) for the cancellation of the applicant’s visa is or are satisfied in this case, and, if so, whether his visa should be cancelled under that subsection.
5. For the reasons which follow, the Tribunal has determined that a ground for cancelling the applicant’s visa under s 134(1) of the Act is satisfied in this case, and that his visa should be cancelled under that subsection.
The Relevant Legislation
6. Section 134 of the Act relevantly provides:
“(1) Subject to subsection (2) and to section 135, the Minister may cancel a business visa (other than an established business in Australia visa, an investment‑linked visa or a family member’s visa), by written notice given to its holder, if the Minister is satisfied that its holder:
(a) has not obtained a substantial ownership interest in an eligible business in Australia; or
(b) is not utilising his or her skills in actively participating at a senior level in the day‑to‑day management of that business; or
(c) does not intend to continue to:
(i) hold a substantial ownership interest in; and
(ii) utilise his or her skills in actively participating at a senior level in the day‑to‑day management of;
an eligible business in Australia.
(2) The Minister must not cancel a business visa under subsection (1) if the Minister is satisfied that its holder:
(a) has made a genuine effort to obtain a substantial ownership interest in an eligible business in Australia; and
(b) has made a genuine effort to utilise his or her skills in actively participating at a senior level in the day‑to‑day management of that business; and
(c) intends to continue to make such genuine efforts.
(3) Without limiting the generality of matters that the Minister may take into account in determining whether a person has made the genuine effort referred to in subsection (2), the Minister may take into account any or all of the following matters:
(a)business proposals that the person has developed;
(b)the existence of partners or joint venturers for the business proposals;
(c)research that the person has undertaken into the conduct of an eligible business in Australia;
(d)the period or periods during which the person has been present in Australia;
(e)the value of assets transferred to Australia by the person for use in obtaining an interest in an eligible business;
(f)the value of ownership interest in eligible businesses in Australia that are, or have been, held by the person;
(g)business activity that is, or has been, undertaken by the person;
(h)whether the person has failed to comply with a notice under section 137;
(i)if the person no longer holds a substantial ownership interest in a particular business or no longer utilises his or her skills in actively participating at a senior level of a (sic) day‑to‑day management of a business:
(i) the length of time that the person held the ownership interest or participated in the management (as the case requires); and
(ii) the reasons why the person no longer holds the interest or participates in the management (as the case requires).
...
(10) In this section:
...
eligible business means a business that the Minister reasonably believes is resulting or will result in one or more of the following:
(a)the development of business links with the international market;
(b)the creation or maintenance of employment in Australia;
(c)the export of Australian goods or services;
(d)the production of goods or the provision of services that would otherwise be imported into Australia;
(e)the introduction of new or improved technology to Australia;
(f)an increase in commercial activity and competitiveness within sectors of the Australian economy.
...
ownership interest, in relation to a business, means an interest in the business as:
(a) a shareholder in a company that carries on the business; or
(b) a partner in a partnership that carries on the business; or
(c) the sole proprietor of the business;
including such an interest held indirectly through one or more interposed companies, partnerships or trusts.
...”
The Evidence
7. The evidence before the Tribunal comprised oral and documentary evidence presented by the applicant, and the “T Documents” (T1-T29, pp 1-191) lodged by the respondent in accordance with s 37 of the Administrative Appeals Tribunal Act 1975 (Cth).
The applicant’s evidence
8. The applicant gave the following evidence-in-chief.
9. He confirmed the contents of his witness statement and supplementary witness statement which had been filed with the Tribunal.
10. The contents of the applicant’s witness statement, dated 13 February 2006, are as follows:
“…
4. I first arrived in Australia on 2 April 2002. During my time in Australia in April 2002, I talked to various business people. These persons were mainly relatives and friends who had just migrated to Australia. However, I also spoke to persons that had been in Australia for many years. I discussed with those persons the various businesses they were involved in and the successes and failures of the various ventures.
5. Between April 2002 and September 2004 I made several inquiries into business opportunities in Australia.
6. I was introduced to Gilete G & B Logistics Pty Ltd (‘G & B Logistics’) by Mr [C H] from the Gilete Group. I had a meeting with Mr [C H] in Harare, Zimbabwe. Mr [C H] introduced me to three businesses – Optel Audio Visual Pty Ltd, Raine & Horne Real Estate Pty Ltd and G & B Logistics. I decided to invest in G & B Logistics because its line of business was similar to my business in Malawi.
7. After meeting with Mr [C H] I came to Australia in September 2004 where I finalised arrangements for obtaining an interest in G & B Logistics. I met with [D E], the general manager of G & B Drainage Pty Ltd (the major shareholder in G & B Logistics), and the staff. After considering all the options I decided to invest in G & B Logistics and take up a position in the management of that company.
8. G & B Logistics provides plant and equipment and transport resources to its parent company, Gilete G & B Drainage Pty Ltd and other businesses and government agencies in the North-West and Kimberley regions of Western Australia. G & B Logistics has recently purchased equipment from Volvo comprising of two graders, two wheel loaders and two excavators.
9. In September 2004 I was appointed Strategic Manager of G & B Logistics. This involved monitoring all aspects of the business, providing advice and facilitating growth.
10. On 20 October 2004, I purchased a 25% shareholding in G & B Logistics for $250,000 and was issued with a share certificate for 250,000 ‘A’ class shares.
11. I have participated in management meetings, and kept in contact with G & B Logistics by email on a regular basis.
12. As part of my role as Strategic Manager, I have advised the business about equipment for civil and drainage projects. I recommended obtaining finance for the purchase of this equipment. I also recommended that the finance conditions include a moratorium period as part of the payment terms. This recommendation was followed by the business.
13. I intend to maintain my interest in G & B Logistics and my position as Strategic Manager.
14. I am a director of Master Construction Civil Engineering Contractors and Master Car Breakers in Malawi. As a result, I have experience in marketing and sourcing of new projects.
…” (Exhibit A1)
11. The contents of the applicant’s supplementary witness statement, dated 3 August 2006, are as follows:
“…
2. I entered Australia in April 2002 (initial entry) Brisbane (sic). I opened a bank account in Brisbane.
3. During this period I was looking for business opportunities and/or an investment in Australia. I was looking at opportunities in retail businesses and property development.
4. I did not follow through with those investigations because in 2004 I was introduced by my cousin in Zimbabwe to [C H] from Gilete Group Pty Ltd. [C H] was in Zimbabwe offering investment opportunities to new migrants being investments in subsidiary companies of the Gilete Group. I flew to Zimbabwe from Malawi to meet with the Gilete Group and discussed investing in a Gilete Group subsidiary, Gilete G & B Logistics Pty Ltd (‘G & B Logistics’).
5. [C H] who was accompanied by a Mr [A H]… convinced me to invest in G & B (sic). I was advised by them that G & B Logistics would be purchasing new plant and machinery and would hire out these plant and machinery to their sister company Gilete Drainage and other companies. This fitted with my experience as I am conducting a similar business involving plant and machinery in Malawi trading as Master Construction. It was therefore attractive to me. The required investment was 25% ‘A’ Class shares each from two new migrant investors and 50% would be held by Gilete Civils Ltd – the assurance and the investment model with guarantees.
6. The involvement of Gilete Civils convinced me to invest in G & B Logistics. I was also persuaded by annual turnovers and figures with forecast of income etc etc that were given to me.
7. I came to Perth in September 2004 to see if all was genuine. I was introduced to the Managing Director, Mr [K S], and others, who showed me around their offices and companies including the Accountants Concord Accounting Pty Ltd. The Managing Director, Mr [K S], reconfirmed the nature of investment which seemed genuine and satisfactory.
8. It appears that the Gilete Group was already in financial difficulty during this period. However, at that point in time I had no idea that the Gilete Group was having financial problems. It did not occur to me that would be the case and who (sic) never told by anyone in the Gilete Group. I only found out much later. This was mentioned to me by email only in January-March 2006.
9. However, in October 2004 I invested my lifetime savings of AUD 250,000.00 obtaining 25% ‘A’ Class shares in G & B Logistics. My understanding was that in due course I would gradually move permanently to Perth and play a more active role with G & B Logistics and with a three year agreed investment shares (sic) I would by then be comfortably settled in Australia.
10. Unfortunately for me I was badly let down by Gilete Group and all the people involved. The company I have invested in was placed in administration. It then went into liquidation. This was done because of the (sic) G & B owed $62,000.00 to GE Finance. G & B Logistics was placed into liquidation on 20 January 2006. I was only informed of this in March 2006 by Mr [K S].
11. I found out that G & B Logistics was in debt with GE Finance whereas Gilete Civils owed G & B $580,000.00 or so. This money was lent to Gilete Civils without shareholders’ knowledge or consent. At that point I had already received notice of cancellation of my visa by DIMIA.
12. Gilete CSI Pty Ltd, the holding company of the Gilete Group, was placed into administration on 31 May 2006. I believe it has now gone into liquidation.
13. I believe I was ‘misled’ (to use a neutral term) by all involved in sourcing investors abroad. I was led to believe that the investment was a good risk free investment which would satisfy the terms of my sub class 127 visa. I invested my lifetime savings of AUD $250,000.00 on this understanding. As I mentioned earlier in my statement Gilete Group was already in financial difficulties at the time I was convinced to invest. In my view, the Gilete Group was totally mismanaged; funds were lent to sister companies without the knowledge of investors like me. I feel I was intentionally misled by some people in Australia and Gilete.
14. Unless a miracle occurs, I have lost all my investment amounts plus other expenses incurred by me in trying to meet the requirements of my Visa 127.
15. My intention to move to this country is genuine and I want to settle here with my family.
16. Although I seem to have lost my savings, at least I still have all my assets in Malawi which are in the range of US $1,000,000.00 or above…” (Exhibit A2)
12. The applicant tendered in evidence a bundle of documents relating to an investment by Abbu Nominees Pty Ltd in Gilete G & B Logistics Pty Ltd (Exhibit A3). Those documents include:
·an application by Abbu Nominees Pty Ltd, dated 19 October 2004 and signed on its behalf by the applicant, for 250,000 “A” class shares in Gilete G & B Logistics Pty Ltd;
·a Share Certificate, dated 20 October 2004, issued by Gilete G & B Logistics Pty Ltd, certifying that Abbu Nominees Pty Ltd is the registered holder of 250,000 “A” class shares (numbered from 750,001 to 1,000,000) in Gilete G & B Logistics Pty Ltd.
Those documents also include the following statement by the Director of Gilete G & B Logistics Pty Ltd:
“Management Role to be provided by Mahomed Abbu
Gilete G & B Drainage Pty Ltd has operated profitably in the West Australian market for over 10 years and currently has a turnover of $15 million and employs 60 people. Gilete G & B Logistics Pty Ltd is a subsidiary of G & B Drainage and as such the parent will retain the majority shareholding. G & B Logistics provides plant, equipment and transport resources to G & B Drainage and other businesses in the North West and Kimberley regions of Western Australia. Core activities include providing earthmoving plant and equipment on a hire basis and providing regional transport service for plant and equipment. Its services are provided on a direct hire basis. It will operate from its leased premises in Broome and head office in Bunbury.
The Company is forecast to turnover $1 million in its first year, with 70% of its income to be derived from G & B Drainage in its first year.
It was determined that with our limited financial resources, the growth plans envisaged would not be achieved. Consequently, an opportunity arose to obtain an active investor, Mr Abbu, who would play a critical role in implementing the expansion strategy.
Mahomed Abbu has invested $250,000 in the business, entitling him to a 25% share of the capital of the company. This injection has been absolutely critical in ensuring that the company has the necessary capital to pursue the growth opportunities available. He will join the Management Team of Gilete G & B Logistics Pty Ltd as Strategic Manager. His responsibilities include:-
·Assist the Managing Director in the preparation of strategic plans and business plans
·Appraisal, analysis and recommendation of new project prospects
·Update of the strategic plan and business plan, review of its progress and modification in accordance with the company’s present and planned resources
·Participate in the setting of marketing objectives with senior management
·Co-ordinate policy formulation and review, including evaluation of policy options
·Oversee the implementation of organisational directives and policies
·Special assignments, such as investigative reports
He will work closely with the management team and will be involved in the monthly management meetings and the day to day management of the company.
Mr Abbu’s senior management experience as Director of Master Construction Civil Engineering Contractors and Master Car Breakers includes the management of the company, the marketing of the business, forecasting and sourcing of new projects. His experience will contribute to the overall marketing, strategic direction and general management of the company and his managerial background at senior levels will enhance the company profile and will be key to supporting the operating activities of the company. His involvement will put him in a position of control and authority, which allows him to make decisions that affect the overall direction and performance of the business.”
13. The applicant also tendered in evidence a document entitled “MINUTES OF MEETING OF DIRECTORS” (sic) in respect of Gilete G & B Logistics Pty Ltd in which it is recorded that on 7 September 2004 the following resolution was made by the sole director present at the “meeting”:
“a.That the company create a new class of ‘A’ class shares in the capital of the Company from the Company’s unclassified shares.
b. …
c.That the ‘A’ class shares in the capital of the Company have the same rights attached to them as ordinary shares including voting rights, with the exception that ‘A’ class shares shall have no dividend entitlements attached to them and no pre-emption rights to other shares issued or transferred in the company in future.”
14. The applicant confirmed that Abbu Nominees Pty Ltd is his private family company.
15. The applicant said that his role as Strategic Manager of Gilete G & B Logistics Pty Ltd was to be involved in all the purchasing of earthmoving equipment, such as front end loaders, excavators, graders and related plant and machinery. More specifically, he said that, because of his background and experience with that kind of equipment, the directors (sic) of the company would consult him about proposed purchases of such equipment and seek his advice.
16. The applicant was referred to documentation in the T Documents (T23, pp 119-121) indicating that in November 2004 Gilete G & B Logistics Pty Ltd purchased equipment comprising 2 Volvo graders, 2 Volvo wheel loaders and 2 Volvo excavators at a cost of $1,650,000.00 which was fully financed by GE Commercial Finance. The applicant said that he was in favour of that purchase and that he wrote to the company confirming his approval. The applicant confirmed that he had sent an email to the company on 31 October 2004 commenting on an earlier proposal to purchase Komatsu equipment (which did not proceed) and indicating his preference for Caterpillar equipment (T23, p 172). The applicant also sent a short report, dated 30 November 2004, to the company confirming his approval of the terms of the commercial hire purchase agreement with GE Commercial Finance for the purchase of the abovementioned Volvo equipment (T23, p 173).
17. Finally, the applicant said that he was “born and bred” in Malawi and had spent most of his 53 years there. He said that he would not mind staying there himself but that he was seeking to leave Malawi for the sake of his family. He said that the “first option” was the United Kingdom but the climate was “totally against” them. They then thought Australia would be the “best bet” because they have relatives who live in Brisbane. He said that his intention is to gradually move to Australia with his family and leave his son to run their business in Malawi. He said that his daughter has just been accepted for study at a university in England and his intention is to allow her to commence her university studies in England and then, after about 12 months, relocate his family (including his daughter) in Brisbane, Australia.
18. In cross-examination the applicant said that he commenced his own business in Malawi in 1991. He said that he works from 8.00 am to 5.00 pm on weekdays, and from 8.00 am to 12:30 pm on Saturdays, at his Malawi business. He agreed that he has considerable experience and knowledge in the construction business, and sufficient knowledge, skills and experience to develop and manage a successful business in Australia.
19. The applicant confirmed that on his first visit to Australia in April 2002 he stayed for 19 days and then returned to Malawi. He acknowledged that, during that visit, the investigations that he undertook were limited mainly to talking to relatives and friends who had recently migrated to Australia and that the duration of that visit was insufficient for him to find a suitable business in Australia at that time.
20. The applicant acknowledged that, despite not finding a suitable business in Australia in April 2002, he did not return to Australia until 29 months later in September 2004, and that he remained in Australia for only 9 days during that visit.
21. The applicant said that during that 9-day visit in September 2004 he spoke to his lawyer in Brisbane who made some inquiries about the Gilete group of companies on his behalf, but he did not seek advice from an accountant or any other professional adviser in Australia regarding his proposed investment in Gilete G & B Logistics Pty Ltd. He said, however, that his accountants in Malawi had advised him to go ahead with that investment.
22. A regards his acquisition of 250,000 “A” class shares in G & B Logistics Pty Ltd, the applicant said that, although those shares did not give him the right to receive dividends, they did give him voting rights. He said that he decided to acquire “A” class shares, rather than ordinary shares, because he had been advised that his investment would be secure for a period of 3 years after which he could convert the “A” class shares to ordinary shares.
23. The applicant said that the core business of Gilete G & B Logistics Pty Ltd involved purchasing heavy plant and machinery, such as graders and loaders, and hiring it out to a sister company and other companies in Western Australia.
24. As regards the applicant’s role as Strategic Manager of Gilete G & B Logistics Pty Ltd, he said that he attended only one management meeting of the company in Perth and he thereafter corresponded with the company by email. The applicant was referred to the “T Documents” which contain:
·minutes of a management meeting of Gilete G & B Logistics Pty Ltd on 15 September 2004, at which the applicant is recorded as being present and is described as “Proposed Shareholder” (T23, pp 166-167);
·3 reports form the applicant to Gilete G & B Logistics Pty Ltd dated 27 September 2004, 12 October 2004, and 30 November 2004 (T23, pp 168, 171 and 173);
·an email from the applicant to Gilete G & B Logistics Pty Ltd dated 31 October 2004 (T23, p 172).
Asked whether those documents comprise the total managerial involvement he had in the company, the applicant responded:
No. There was much more which unfortunately we don’t have them here but there was, you know, other emails.” (Transcript, p 39)
His cross-examination continued:
“Okay. I see looking to the actual emails themselves to me at least it appears that you are making suggestions and you are making some suggestions there but did you make any actual decisions yourself in the management of the company? --- You mean on purchasing? You see, they asked us for comments and that’s what I gave him.
So just so I’ve got it straight in my mind? --- Yes.
They would send you by email, what is listed before here? --- Yes, yes.
And then you would make a few comments and email back? --- Agree with that, yes.
And so that is, you could say that was the – you know, the sum total of your managerial involvement in the company? --- That’s right.” (Transcript, p 40)
Additional evidence
25. The “T Documents” contain voluminous documentation relating to Gilete G & B Logistics Pty Ltd, including:
·Certificate of Registration on Change of Name, issued by the Australian Securities and Investments Commission (“ASIC”) on 7 June 2004, certifying that Rastino Pty Ltd (a company registered under the Corporations Act 2001 in Victoria on 13 March 2003) changed its name to Gilete G & B Logistics Pty Ltd on 7 June 2004 (T14, p 76);
·financial statements in respect of Gilete G & B Logistics Pty Ltd for 2004/2005 and 2005/2006 (T23, pp 150-163);
·Master Finance Agreement and Asset Purchase Agreement between Gilete G & B Logistics Pty Ltd and GE Commercial Finance, dated 23 February 2005, in relation to the purchase of 2 loaders, the total amount payable under the Agreement being $469,005.23 (T23, pp 122-147);
·ASIC historical extracts in relation to Gilete G & B Logistics Pty Ltd and Abbu Nominees Pty Ltd (T25, pp 176-183).
Analysis and Findings
Did Gilete G & B Logistics Pty Ltd carry on a business?
26. On the basis of the evidence relating to the activities of Gilete G & B Logistics Pty Ltd up to the date of cancellation of the applicant’s visa, the Tribunal has no difficulty in finding that those activities constituted a “business” within the meaning, and for the purposes, of s 134 of the Act in that they comprised “activities undertaken as a commercial enterprise in the nature of a going concern, that is, activities engaged in for the purpose of profit on a continuous and repetitive basis”: Hope v Bathurst City Council (1980) 144 CLR 1 at 8-9 (per Mason J).
Was the business of Gilete G & B Logistics Pty Ltd an “eligible business in Australia”?
27. The phrase “eligible business” is exhaustively defined in s 134(10) of the Act (set out in paragraph 6 above). On the basis of the material before it, the Tribunal is satisfied that the business of Gilete G & B Logistics Pty Ltd, as at the date of cancellation of the applicant’s visa, fulfilled at least the criterion specified in para (f) of the definition in s 134(10)), namely,
“resulting or will result in… an increase in commercial activity and competitiveness within sectors of the Australian economy”.
It is, furthermore, common ground that the activities of Gilete G & B Logistics Pty Ltd were carried out entirely within Western Australia.
28. Accordingly, the Tribunal finds that the business of Gilete G & B Logistics Pty Ltd was, at all material times, an “eligible business in Australia” within the meaning, and for the purposes, of s 134 of the Act.
Had the applicant not obtained a “substantial ownership interest” in the business of Gilete G & B Logistics Pty Ltd?
29. The phrase “ownership interest”, in relation to a business, is also exhaustively defined in s 134(10) of the Act. That expression is relevantly defined for present purposes as:
“an interest in the business as… a shareholder in a company that carries on the business… including such an interest held indirectly through one or more interposed companies”.
The word “substantial” is not defined in the Act and, being an ordinary English word, it should be given its ordinary meaning. In the Tribunal’s opinion, the following dictionary definitions of the word “substantial” provide the appropriate meaning of that word for the purposes of the present case:
“2 of ample or considerable amount, quantity, size, etc.: a substantial sum of money.”
“6 of real worth or value: substantial reasons.”
(Macquarie Dictionary)
“3 Of ample or considerable amount or size; sizeable, fairly large.”
“4 Having solid worth or value, of real significance; solid; weighty; important, worthwhile.”
(The New Shorter Oxford English Dictionary)
30. In the present case the uncontradicted evidence is that on 20 October 2004 the applicant, through his family company, Abbu Nominees Pty Ltd, obtained 250,000 “A” class shares in Gilete G & B Logistics Pty Ltd (comprising a 25% shareholding in that company) for a consideration of $250,000.00, and that he continued to hold that interest in that company as at the date of cancellation of his visa.
31. Accordingly, the Tribunal finds that the applicant, as at the date of cancellation of his visa, had obtained, and continued to hold, an “ownership interest” (as defined in s 134(10) of the Act) in the business of Gilete G & B Logistics Pty Ltd (being an “eligible business in Australia”) for the purposes of s 134 of the Act.
32. The Tribunal is, furthermore, satisfied that the applicant’s “ownership interest” in the business of Gilete G & B Logistics Pty Ltd – consisting of 250,000 “A” class shares purchased for $250,000.00 and comprising a 25% shareholding in that company – was “substantial” (as defined in the abovementioned dictionary definitions), notwithstanding that those shares did not include dividend entitlements or pre-emption rights to other shares in that company issued or transferred in the future (see Exhibit A4 referred to in paragraph 13 above). In reaching that conclusion the Tribunal respectfully disagrees with the contrary conclusion reached by the Tribunal in relation to similar shareholding interests in Re Juliana Leo and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 308 at paras 58-60 and Re Saleh Leo and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 309 at paras 55-57; see also Re Gunawan and Minister for Immigration and Multicultural Affairs [2006] AATA 852 at paras 40-41.
33. Accordingly, the Tribunal finds that the applicant, as at the date of cancellation of his visa, had obtained, and continued to hold, a “substantial ownership interest in an eligible business in Australia” within the meaning, and for the purposes, of s 134(1)(a) of the Act.
Was the applicant “not utilising his… skills in actively participating at a senior level in the day-to-day management of” the business of Gilete G & B Logistics Pty Ltd?
34. Although it appears from the material before the Tribunal that the applicant was appointed as “Strategic Manager” of Gilete G & B Logistics Pty Ltd with specified “responsibilities” (see the statement set out in paragraph 12 above), there is no material before the Tribunal which indicates the precise date of that appointment; nor is there documentation from Gilete G & B Logistics Pty Ltd recording the appointment itself. Although the applicant’s evidence was that he was appointed Strategic Manager of Gilete G & B Logistics Pty Ltd in September 2004 (see para 9 of his witness statement dated 13 February 2006 (Exhibit A1) set out in paragraph 10 above), documentation prepared by the Director of that company suggests that the appointment occurred at a later date and probably coincided with his investment of $250,000.00 in the company on 20 October 2004: see the letter from Gilete G & B Logistics Pty Ltd to the applicant, dated 8 October 2004 (T14, p 77), and the statement from the Director of that company summarising “the management role to be provided” by the applicant (T15, p 82; part of Exhibit A3) set out in paragraph 12 above. The Tribunal also notes the submission made on behalf of the applicant by Australian Visa & Migration Services to the Department of Immigration and Multicultural and Indigenous Affairs, dated 12 October 2004 (T14, pp 63-65), which also suggests that the applicant’s appointment as Strategic Manager of Gilete G & B Logistics Pty Ltd was to coincide with, or occur shortly after, his investment of $250,000.00 in that company. Accordingly, the Tribunal, on the basis of the whole of the material before it, finds that the applicant was appointed Strategic Manager of Gilete G & B Logistics Pty Ltd on, or shortly after, 20 October 2004, and that, prior to that date, he did not have a senior – or indeed any – management role in that company.
35. Although the applicant’s evidence was that he has “participated in management meetings, and kept in contact with Gilete G & B Logistics by email on a regular basis” (see para 11 of his witness statement dated 13 February 2006 (Exhibit A1) set out in paragraph 10 above), the only documentation before the Tribunal which evidences a contribution by the applicant to the management of Gilete G & B Logistics Pty Ltd since 20 October 2004 comprises:
·an email dated 31 October 2004 in which the applicant enquires about the company’s proposal to purchase earthmoving equipment, and makes some suggestions (T23, p 172);
·a document entitled “Report”, dated 30 November 2004, in which the applicant confirmed his approval of the terms of a hire purchase agreement between the company and GE Commercial Finance for the purchase of Volvo earthmoving equipment (T23, p 173 – see paragraph 16 above).
36. In the Tribunal’s opinion the evidence before it falls far short of establishing that the applicant had, prior to and/or as at 13 July 2005 (the date of cancellation of his visa), been “actively participating at a senior level in the day-to-day management of” the business of Gilete G & B Logistics Pty Ltd.
37. Accordingly, the Tribunal, having regard to the whole of the evidence before it, finds that, at all material times, the applicant was “not utilising his… skills in actively participating at a senior level in the day-to-day management of” the business of Gilete G & B Logistics Pty Ltd, for the purposes of s 134(1)(b) of the Act.
The discretionary power to cancel the applicant’s visa is enlivened
38. It follows from the lastmentioned finding that the Tribunal also finds that, as at 13 July 2005, the ground specified in para (b) of s 134(1) of the Act for cancelling the applicant’s visa was satisfied in this case, and that the discretionary power conferred by s 134(1) to cancel that visa is thereby enlivened.
Is the exercise of the discretionary power to cancel the applicant’s visa prohibited by s 134(2) of the Act?
39. Pursuant to s 134(2) of the Act, if the Tribunal is satisfied that, as at 13 July 2005, the applicant fulfilled the requirements specified in paras (a), (b) and (c) of that subsection, it “must not” cancel his visa pursuant to s 134(1) of the Act.
40. The Tribunal has found (see paragraph 37 above) that, at all material times, the applicant was “not utilising his... skills in actively participating at a senior level in the day-to-day management of” the business of Gilete G & B Logistics Pty Ltd. The question arises, however, whether the Tribunal is satisfied, for the purposes of para (b) of s 134(2) of the Act, whether the applicant, as at 13 July 2005, had “made a genuine effort” to do so.
41. Section 134(3) of the Act (set out in paragraph 6 above) lists (non-exhaustively) matters that may be taken into account in determining whether a person has made the “genuine effort” referred to in s 134(2). Departmental policy guidelines regarding the matters listed in s 134(3) are contained in the Migration Series Instructions – specifically, in “MSI-133: Visa Cancellation under Subdivision G – Cancellation of Business Visas”, which relevantly states:
“4.5 What is ‘genuine effort’?
4.5.1 If, after 24 months, a migrant is not in business, he/she must establish that a ‘genuine effort’ has been made to engage in business since arrival. The Minister must assess ‘genuine effort’. S 134(3) of the Act lists any or all of the factors which the Minister may take into account:
...
[Notes referring to factors listed above. Decision makers may take account of these notes to guide them in interpretation of 4.5.1.
a.business proposal which is considered genuine, realistic and achievable;
b.formal contract with partners or joint venturers;
c.written evidence of detailed consultations with at least three business advisers (accountant, lawyer, bank/financial institution, State/Territory government business development office, Austrade, business/trade association);
d.physical presence in Australia for more than six months since first arrival as a Business Skills class migrant;
e.transferred to, and retained in, Australia at least 50% of the funds indicated as available for transfer within two years (under Factor 4 of the Business Skills Points test);
f.minimum A$100,000 or 10% ownership previously held by the person. If the person is no longer in business, the reasons for loss of ownership are also relevant.
g.minimum A$100,000 business activity as indicated by turnover. This may include other business activity not considered ‘eligible business’ but cannot include passive investment, eg, purchase of shares.
h.failure to comply with a notice for information under s 137, ie mandatory monitoring of Australian address and return of survey forms.]
4.5.2 While failure to meet one or more of these indicators may normally lead to a visa being cancelled, it will not necessarily mean that a visa will be cancelled. The decision maker must give weight to all relevant factors in a case (of which those set out in subsection 134(3) above may only be some) and reach a decision on that basis. For example, while the factors listed in 4.5.1 above may be indicative of ‘genuine effort’, lack of them will not necessarily be decisive. The decision maker must decide, on the ordinary meaning of the words, whether the visa holder has made a ‘genuine effort’. A decision maker may still decide not to exercise the discretionary power to cancel the business visa even if it is assessed that no genuine effort has been made.”
Although these guidelines are not binding on the Tribunal, it will have regard to them where relevant.
42. In Re Yam and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 283 the Tribunal (at para 53) expressed the following views regarding the concept of “genuine effort” for the purposes of s 134(2) of the Act:
·the relevant visa holder must himself or herself have made some real or genuine effort;
·the degree of effort made must be beyond that which is purely superficial or token;
·relevant efforts may suffice for the purposes of s 134(2) even if they fall short of the matters specified in s 134(3).
These views have subsequently been adopted by the Tribunal in various cases and are adopted by the Tribunal in the present case. The Tribunal would simply add that the phrase “genuine effort” is an ordinary English phrase and that, in its opinion, the appropriate ordinary meaning of that phrase for present purposes is “real and sincere endeavour or strenuous attempt”.
43. The evidence before the Tribunal regarding the applicant’s activities as Strategic Manager in relation to the business of Gilete G & B Logistics Pty Ltd was referred to in paragraph 35 above, and the Tribunal has found, having regard to that evidence, that, at all material times, the applicant was “not utilising his... skills in actively participating at a senior level in the day-to-day management of” that business, for the purposes of s 134(1)(b) of the Act. That evidence is, furthermore, insufficient to satisfy the Tribunal that, in the period up to 13 July 2005, the applicant had “made a genuine effort to utilise his... skills in actively participating at a senior level in the day-to-day management of” that business, for the purposes of s 134(2)(b) of the Act. In this connection the Tribunal notes that, in the period of over 3 years from 14 March 2002 (when the applicant was granted the visa) to 13 July 2005 (when the visa was cancelled), the applicant spent a total of only 28 days in Australia – 19 days on a visit in April 2002, and 9 days on a visit in September 2004. According to his evidence, during his first visit he merely held discussions with relatives and friends who had recently migrated to Australia, and during his second visit he consulted with his lawyer and met officers and staff of the Gilete group of companies and attended a management meeting of Gilete G & B Logistics Pty Ltd on 15 September 2004 (in the Minutes of which, the Tribunal notes, he is described as “Proposed Shareholder” – T23, p 166). As regards the applicant’s business activities in Malawi (where he resides), his evidence was that he works from 8.00 am to 5.00 pm on weekdays and from 8.00 am to 12.30 pm on Saturdays at his Malawi business. There is, in short, insufficient evidence before the Tribunal from which it might reasonably infer that the applicant has “made a genuine effort to utilise his... skills in actively participating at a senior level in the day-to-day management of” the business of Gilete G & B Logistics Pty Ltd.
44. Having regard to the whole of the evidence before it and to such of the abovementioned considerations and guidelines which it regards as relevant, the Tribunal is not satisfied that the applicant has, at any time, “made a genuine effort to utilise his... skills in actively participating at a senior level in the day-to-day management of” the business of Gilete G & B Logistics Pty Ltd, for the purposes of s 134(2)(b) of the Act.
45. Because the Tribunal is not satisfied that, as at 13 July 2005, the applicant fulfilled the requirement specified in para (b) of s 134(2) of the Act, it necessarily follows that s 134(2) of the Act does not operate to prohibit the exercise of the discretionary power, conferred by s 134(1) of the Act, to cancel the applicant’s visa.
Should the applicant’s visa be cancelled in exercise of the discretionary power conferred by s 134(1) of the Act?
46. The applicant did not seek to rely on any considerations which might arguably militate against an exercise of discretionary power to cancel his visa under s 134(1) of the Act.
47. The Tribunal, however, notes the following considerations which, in its opinion, militate in favour of cancellation of the applicant’s visa:
·its finding that in the period from 14 March 2002 (when the visa was granted) until 13 July 2005 (when the visa was cancelled), he was not utilising his skills in actively participating at a senior level in the day-to-day management of an eligible business in Australia, nor had he made a genuine effort to do so;
·during the abovementioned period he visited Australia on only 2 occasions and spent a total of 28 days in Australia;
·during the abovementioned period he and members of his family unit have continued to reside in Malawi;
·he has a substantial business in Malawi at which he works from 8.00 am to 5.00 pm on weekdays and from 8.00 am to 12.30 pm on Saturdays, and from which he derives most of his income.
The Tribunal, on the other hand, notes the applicant’s evidence that he wishes to move to Australia with his family, although not for at least 12 months (see paragraph 17 above). Presumably, the applicant, having regard to the matters referred to in paras 8-13 of his supplementary witness statement dated 3 August 2006 (Exhibit A2) set out in paragraph 11 above, would, if he were allowed to settle in Australia, not seek to maintain his interest in Gilete G & B Logistics Pty Ltd and his position as Strategic Manager of that company (cf para 13 of his witness statement dated 13 February 2006 (Exhibit A1) set out in paragraph 10 above).
48. Having regard to the whole of the evidence before it and all of the relevant circumstances of this case, the Tribunal is satisfied that they, on balance, militate in favour of cancellation of the applicant’s visa.
49. The Tribunal concludes, therefore, that the correct or preferable decision in this matter is that the applicant’s visa should be cancelled.
Decision
50. For the above reasons the Tribunal affirms the decision under review.
I certify that the 50 preceding paragraphs are a true copy of the reasons for the decision herein of Deputy President S D Hotop
Signed: ......(Sgd S da Motta).........
AssociateDate of Hearing 9 August 2006
Date of Decision 20 October 2006
Counsel for the Applicant Mr A Goldfinch
Solicitor for the Applicant Stables Scott
Counsel for the Respondent Mr S Ferguson
Solicitor for the Respondent Australian Government Solicitor
14
6
0