BAKRI And MINISTER FOR IMMIGRATION AND MULTICULTURAL AFFAIRS
[2007] AATA 14
•12 January 2007
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2007] AATA 14
ADMINISTRATIVE APPEALS TRIBUNAL )
) No W2003/491
GENERAL ADMINISTRATIVE DIVISION ) Re ABDUL AZIZ BAKRI Applicant
And
MINISTER FOR IMMIGRATION AND MULTICULTURAL AFFAIRS
Respondent
DECISION
Tribunal Mr S Penglis, Senior Member Date12 January 2007
PlacePerth
Decision The Tribunal sets aside the reviewable decision dated 4 November 2003 and substitutes in lieu thereof the decision that the applicant’s Sub-class 840 business skills visa should not be cancelled.
...........[Sgd. S Penglis]...........
Senior Member
CATCHWORDS
Immigration – business skills visa – eligible business – genuine efforts – turns of own facts
Migration Act 1958 (Cth), s134
Gomaidy and Minister for Immigration and Multicultural Affairs [2006] AATA 475
Hope v Bathurst City Council (1980) 144 CLR 1
Hindrodjojo and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 724
Kok and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 579
Lau and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 703
Ng and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 299
Wong and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 54
REASONS FOR DECISION
12 January 2007 Mr S Penglis, Senior Member 1. The applicant applies for a review of decision made by a delegate of the respondent made on 4 November 2003 to cancel the applicant’s business skills visa under s134 (1) of the Migration Act 1958 (the Act).
2. The applicant is a Malaysian businessman. He visited Australia on a tourist visa a number of times from 1996 to 1999. On 22 June 1999 the applicant was granted a sub-class 457 business (long stay) temporary visa.
3. On 13 September 1999 the applicant lodged an application for a business skills visa (sub-class 840). By that time he had obtained a 50% shareholding in an Australian company called Castell Group Pty Ltd, a building company based in Perth
4. The applicant’s financial investment in the company exceeded $1 million.
5. On 20 March 1999 the applicant acquired a 60% shareholding in a company linked to Castell Group Pty Ltd, namely Allied Edge Projects Pty Ltd (Allied Edge).
6. On 13 March 2000 the applicant was interviewed by an officer of the DIMIA in connection with his business skills visa application. The interviewer noted that the applicant had by then established an Australian construction company called Castell Group Pty Ltd which had already completed “many projects” and was “currently working on a house which is projected to cost $1.4 million to build”. The interviewer noted that the applicant “owns 55% of the business and has already injected $1.7 million into it. He intends to sell most of his Malaysian business and invest the capital here. I therefore am more than satisfied that he meets regulation 840.217”.
7. Regulation 840.217 (since repealed) was in the following terms:
“the applicant genuinely has a realistic commitment
(a) to either
(i) establish an eligible business in Australia: or
(ii) participate in an existing eligible business in Australia: and
(b) to maintain a substantial ownership interest in that business: and
(c)to maintain direct and continuous involvement in management of that business from day to day and in making decisions that affect the overall direction and performance of the business in a manner that benefits the Australian economy.”
8. On 15 August 2000 the applicant was granted a sub-class 840 business owner visa. DIMA reminded the applicant of his obligation to report on his business activities over the next 3 years and stated that survey forms will be sent to his residential address at the 2 and 3 year milestones.
9. No survey forms were in fact received by the applicant as the applicant did not keep DIMA informed of his address. Nor did the applicant provide any information to DIMA regarding his business activities.
10. As a consequence, the applicant was issued with a notice of intention to cancel his visa on 2 July 2003 (Notice).
11. On 11 August 2003 DIMA received the applicant’s response to the Notice. The applicant stated he had invested over $2.4 million into Castell Group Pty Ltd, that he had a 52% shareholding in that company, and that the company was a parent company of four companies, including Allied Edge. He further advised that the subsidiaries of Castell Group Pty Ltd other than Allied Edge had been placed into administration/liquidation in March 2000 and that Castell Group Pty Ltd had in fact been de-registered on 18 February 2002.
12. The applicant also stated that Allied Edge was a viable business but required an injection of capital, and to that end the applicant had returned to Malaysia “to realise some asset holding to acquire funds to inject into Allied Edge”.
13. The applicant also provided to DIMA a statutory declaration dated 8 August 2002 from the sole director of Allied Edge, Vincent Costantino, who stated that after the demise of the Castell Group subsidiary companies, the applicant had spent the majority of his time in Malaysia “organising his affairs by realising his assets with a view to injecting in future capital into Allied so that it may continue to trade as a project development company”.
14. Notwithstanding the applicant’s response to the Notice and the statutory declaration provided therewith, the respondent’s delegate was satisfied that the applicant had not met his visa obligations and on 4 November 2003 made a decision to cancel it.
15. That is the decision which the applicant has applied to the Tribunal to review.
The Act
16. Section 134(1) of the Act provides as follows:
“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 inactively 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.”
17. Section 134(2), which s134(1) is expressly subject to, provides as follows:
“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.
18. In determining whether a person has made a “genuine effort” for the purposes of s134(2) of the Act, s134(3) provides as follows:
“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 day-to-day management of a business;
(j)the length of time that the person held the ownership interest or participated in the management (as the case requires); and
(k)the reasons why the person no longer holds the interest or participates in the management (as the case requires).”
19. Section 134(10) of the Act provides that an “ownership interest” in relation to a business means:
“An interest in the business as
(a) a shareholder in a company that carries on with business; or
(b) a part owner in a partnership that carries on with business; or
(c) a sole proprietor of the business;
Including such an interest held indirectly through one or more interposed companies, partnerships or trusts”
20. Section 134(10) of the Act further provides as follows:
“Eligible business means that 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 international markets;
(b)the creation or maintenance of employment in Australia;
(c)the export of Australian goods or services;
(d)the production of goods or provisions of services that would otherwise be imported into Australia;
(e)the introduction or new or improved technology to Australia;
(f)an increase in commercial activity and the competitiveness of the sectors of the Australian economy”.
21. In addition to s134(10) of the Act, in determining whether a person has made a “genuine effort” within the meaning of s134(2) of the Act, it is permissible to have reference to Migration Series Instruction 133, paragraph 4.5.1, which relevantly provides as follows:
“… decision makers may take account of these notes to guide them in interpretation …
a.business proposal which is considered genuine, realistic and achievable;
b.formal contract with partners or joint venturers;
c.written evidence of details consultations with at least three business advisers (accountant, lawyer, bank/financial institutions, State/Territory government business development office, Austrade, business/trade associations);
d.physical presence in Australia for more than six months since first arrival as a Business Skills migrant;
e.transferred to, and retained in, Australia at least 50% of the funds indicated as available for transfer within two years …
f.minimum A$100,000 or 10% ownership previously held by the person. If the person is no longer in business, the reasons for the lass 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 s137, ie mandatory monitoring of Australian address and return of survey forms.”
22. In addition, Migration Series Instruction 133, paragraph 4.5.2 provides as follows:
“While failure to meet one or more of these indications 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) in reaching a decision on that basis. For example, while the factors in 4.5.1 above may be indicative of “genuine effort”, lack of them will not be necessarily be decisive. The decision maker must decide, ordinary meaning of the words, whether the visa holder has made a “genuine effort”. The decision maker may still decide not to exercise the discretion empowered to cancel the business visa even if it is assessed that no genuine effort has been made”.
Relevant Principles
23. Whilst the Tribunal is required to consider the position as at the date of the cancellation of the visa, it is entitled to consider subsequent events to the extent that those later events assist in evaluating the relevant intentions and actions of the visa holder as at the date of the cancellation of the visa: Gomaidy and Minister for Immigration and Multicultural Affairs [2006] AATA 75 47: Kok and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 579 21.
24. The question of what is a substantial ownership interest of an eligible business is one of the fact and degree; Wong and Minister for Immigration, Multicultural and Indigenous Affairs [2002] AATA 54.
25. Commercial realities are to be taken into account. In particular, many genuine business attempts will fail despite the best efforts of participants: Lau and Minister of Immigration and Multicultural Affairs [2002] AATA 703 29.
26. As to what constitutes “genuine efforts”, in written submissions provided to the Tribunal after the hearing, the respondent contended that the following propositions can be discerned from the authorities:
“ -a “genuine effort” must be more than an superficial or token effort;
-use of the word ‘genuine’ implies that it must be a real and honest effort and not one which is false, fictitious or a pretence;
-the use of the word ‘effort’ implies that some exertion or endeavour must be involved. The requirement is that an effort is made and the respondent contends that this requires some activity on behalf of the applicant.
-It must be a genuine effort to obtain substantial ownership interest in an eligible business or to utilise an applicant’s skills in the day to day management of an eligible business at a senior level. Efforts that cannot realistically satisfy either of these criteria cannot be said to be genuine efforts. Mere expressions of interest or enquiries fall short of genuine effort.
-In determining whether a genuine effort has been made, there is good reason for a decision-maker to have regard to the facts set out in MSI-133.
-In determining whether an applicant has made genuine efforts or not the decision-maker should only have regard to events which occurred on or before the date of the cancellation decision unless evidence is put forward of prior intentions”.
27. In his written submissions provided after the hearing, the applicant did not take issue with any of the propositions contended by the respondent and I am satisfied that the respondent’s contentions fairly summarise the law as to what constitutes a “genuine effort”.
Issues for Determination
28. It was submitted by counsel for the respondent that the delegate’s decision to cancel the applicant’s subclass 840 business skills visa should be affirmed because the applicant has failed to:
(a)obtain a substantial ownership interest in an eligible business in Australia;
(b)utilise his skills and actively participate in a senior level in the day-to-day management of the business, and
(c)make a genuine effort to obtain a substantial interest in an eligible business in Australia or to utilise his skills in actively participating in a senior level in the day-to-day management of an eligible business.
29. They are therefore the issues which the Tribunal must determine, subject to the following:
(a)if (a) and (b) are resolved in favour of the applicant, (c) does not arise: see s134(1)
(b)if either or both of (a) and (b) are resolved against the applicant, but (c) is resolved in favour of the applicant, s134(2) of the Act compels the Tribunal not to cancel the visa;
(c)if either or both of (a) and (b) are a resolved against the applicant, and (c) is likewise resolved against the applicant, the Tribunal nevertheless retains a discretion as to whether or not the applicant’s business visa ought to be cancelled.
Summary of Applicant’s Contentions
30. The applicant’s contentions may be summarised as follows:
(a) He acquired a substantial ownership interest in Allied Edge;
(b) Allied Edge is an eligible business;
(c)He has utilised his skills and actively participated in a senior level in the day-to-day management of that business;
(d)Alternatively, he has made a genuine effort to re-establish Allied Edge as an eligible business and to utilise his skills in actually participating in a senior level in the day-to-day management of that business.
Summary of Respondent’s Contentions
31. The respondent’s contentions may be summarised as follows:
(a)Whilst the applicant held a substantial ownership interest in Allied Edge, it was no longer carrying on business and therefore was not an “eligible business” within the meaning of the Act;
(b)The applicant is not and has never been a director of Allied Edge and there is no evidence establishing his participation at a senior level in the day to day management of any business the company may have conducted;
(c)The evidence did not establish the applicant having undertaken any genuine effort to make Allied Edge an eligible business or to actually participate at a senior level in the day-to-day management of an eligible business.
The Evidence
32. In addition to documentary evidence received by the Tribunal, the applicant gave evidence before the Tribunal, as did Vincent Costantino. Both were cross-examined by Mr Blades, Counsel for the respondent.
33. The applicant’s evidence was that he had invested an amount exceeding $2.4 million into what he called the Castell Group since 1997. That translated into a shareholding of 52 percent. The applicant was the Chairman of the Board. He was directly involved in “setting the policies of the business” and “effectively chaired all the Board of Directors Meetings”. He was also “actively involved in the marketing aspect of the company, and was successful in getting high-net-worth clients from Malaysia, Singapore and Indonesia”. However, he “was not involved directly on the day-to-day management of the Group” that was “then headed by the then Managing Director, Vince Di Rosso”.
34. The applicant also purchased a 60 percent shareholding in Allied Edge for $300,000.
35. Allied Edge carried on business as a developer of real estate housing projects. It was developing property in Mount Lawley, Western Australia, namely Lots 12, 13, 14, 15, and 16 Regent Street, for which it had contracted with a building company called Parklane Constructions Pty Ltd (Parklane) and in respect of which it had entered into five separate policies of insurance with Vero Insurance Ltd (formerly Royal & Sun Alliance Insurance Australia Ltd) to indemnify Allied Edge against loss (other than indirect, incidental or consequential loss) resulting from the non-completion of building work by Parklane.
36. In about March 2000, Parklane was placed into voluntary administration. It was unable to and did not complete the work which Allied Edge had contracted it to do.
37. Allied Edge made claims under its policies of insurance, which were declined.
38. Allied Edge has commenced legal proceedings against Vero Insurance Ltd (Vero) in the Supreme Court of Western Australia.
39. The applicant stated that in his view, “if it were not for the fact that the Insurers defaulted… Allied Edge would have continued strongly as a business entity, and likewise fulfilled all the legal requirement under the applicant’s obligation on the permanent visa conditions”.
40. The applicant said he was committed to utilising any funds received from the litigation against the insurers for “Allied Edge Projects Pty Ltd business expansion and diversification”.
41. He said that Mr Vince Costantino, currently the sole director of Allied Edge and he had agreed that he “shall be appointed a director, and would jointly manage the company”.
42. The applicant said that, whilst he spent much time overseas, he has maintained continuous contacts with communications with Mr Costantino by telephone calls, faxes and e-mails.
43. The applicant has provided the necessary funding for the legal proceedings against Vero.
44. Mr Blades canvassed various matters with the applicant in cross-examination. The propositions put to the applicant were largely to the effect that Allied Edge was “in a dormant state”, not much was being done to get it out of its dormancy and in any event it was Mr Costantino, not the applicant, “who was the driving force behind the business”, with the applicant “merely a passive investor in the business”.
45. In respect of these propositions the applicant’s evidence may be summarised as follows:
(a)Allied Edge was not “lying dormant” as it was actively pursuing litigation against the insurers;
(b)Nor was it dormant “because between me and Mr Vince Costantino we are exploring – pursuing activities that could activate, that could constitute an eligible business”.
(c)The proposition that it is really “Mr Costantino who is the driving force behind the business and that (the applicant is) merely a passive investor in the business” was “not totally right … because I still correspond with Mr Vince and jointly make decisions what to do or what to pursue. Furthermore, “some of the businesses involved trading between Malaysia and Australia or even Singapore. There are businesses that we are pursuing … where, I believe, I am not a passive in that sense of the word. I am actively pursuing associations, soliciting businesses that can tie up eventually with Allied Edge”.
46. When asked what evidence he had to present to the Tribunal in that regard, the applicant referred to a list that he had separately provided to the Tribunal and also made reference to the fact that he had been approached “by an Australian company” based in Brisbane with respect to sourcing from Malaysia the supply of concrete electrical poles to replace existing wood poles. He said that there was “a massive requirement for those poles” for rural areas. The applicant also made reference to investigating the potential of exporting livestock from Australia to Malaysia, for ultimate dispatch to the Middle East.
47. Mr Costantino gave evidence broadly corroborating the applicant’s evidence. Importantly, in his statement of evidence dated 25 June 2005, he said this:
“Mr Bakri’s broad business experiences and wide networking is invaluable to the business of Allied Edge Projects Pty Ltd. He is still actively promoting the company’s business while overseas. He may not be all the time in Australia. However, we as business partners have maintained frequent consultations and communication via telephone, faxes and the internet e-mails”.
48. In his evidence to the Tribunal, Mr Costantino referred to a proposed development at the corner of Beaufort and Aberdeen Streets, North Perth. Negotiations commenced in December 2000 in respect of that property and on 17 January 2001 a proposal was put to the vendor and various cost flow analyses were prepared. An agreement “in principle” was reached with the vendor, but it did not proceed as the applicant could not get the necessary funds into Australia due to “the currency controls that had been applied by the Malaysian Government”.
49. Another project which Allied Edge had considered and in respect of which the applicant played a role was a potential acquisition of a Ginkgo Biolba project. In regard this Mr Costantino’s evidence was as follows:
“This is a natural herb to make medicine. There was a going operation in Baldivis that had some 3 million ginkgo plants under cultivation on 20 acres of reticulated shade house and a propagation shed. Mr Bakri and myself and the accountant for the vendor and the vendor met at the property a number of times. Financial proposals were put to us. We analysed them. Mr Bakri went back to Malaysia. Spoke to investors. Got the OK. Came back to Australia. We had further discussions. Mr Bakri, I think, went back or he got a firm commitment of funds to be placed into Allied and a joint venture partner to proceed with the acquisition. And the vendor changed his mind.”
50. A further matter which was to be considered was for the development of a property at 432 Beaufort Street, Highgate. This was a refurbishment of 30 single bedroom flats. Again this did not go ahead because of the applicant’s difficulties of getting funds into Australia.
51. In cross-examination by Mr Blades, the evidence which Mr Costintano gave included the following:
(a)Mr Costintano was the driving force behind Allied Edge and the person involved in doing all the leg work in relation to research and investigation of business proposals. The applicant’s involvement was with respect to the provision of funds.
(b)Allied Edge had obtained funding from investors with whom the applicant liaised, but that was prior to 2000.
(c)The fact that since making the statement in August 2003 to the effect that he believed the applicant will invest further in an Australian business that employs Australian workers, there has been no further investment, was as a result of, considerable financial difficulties and hardship that the applicant had suffered in Malaysia. Mr Costintano said that he believed that the applicant “has now quite recently sorted out a lot of his financial issue that he had in Malaysia and that is why we are looking in earnest at the importation of power poles. Also with the litigation that is afoot in relation to repudiation of insurance policy that would have enabled Allied Edge to, if it had been paid - … complete the project and make a substantial profit. Allied Edge would be cashed-up for want of a better word, from the profit it should have made out of the project that he had had to forfeit”.
(d)Allied Edge operated out of Mr Costintano’s home.
(e)Because of the financial difficulties Allied Edge encountered, Mr Costantino has had to find other work and has received no remuneration from Allied Edge since 2001.
(f)Mr Costantino had copies of faxes and emails that might demonstrate the extent of his communication with the applicant, but did not have them with him at the Tribunal.
(g)The applicant’s active promotion of Allied Edge’s business whilst he is overseas was not limited to securing more overseas investors for the company: it also extended to the importation of power poles. In this regard Mr Costantino said:
“The importation of power poles is a very viable business. Mainly because of the problem with the wooden poles throughout the country. You won't put poles in the metropolitan area because the preference is to go underground. The problems with the wooden poles is pole top fires. And you have Western Power being sued and an alternative is a concrete pole. And with some funding in Allied Edge, because it does - is an expensive operation to promote and research and exercise, but the core essence of the business is quite sound.
Is it fair to say then at the present time that as far as Allied Edge goes, you're waiting for this litigation to be finalised and then, with the expected settlement or damages from that litigation, you will be able then to complete the projects that Allied Edge has embarked upon and the company will be able to reap its potential?‑‑‑I believe so, yes.
And Mr Bakri has indicated - sorry, I will start again. He has given you his undertaking that he will come to Australia to live here and to work in a business once it gets its momentum back?‑‑‑Yes.”
FINDINGS
52. Both the applicant and Mr Constantino gave their evidence in a clear and convincing manner. I consider both of them to be witnesses of truth and their evidence to be reliable.
53. I have no hesitation in concluding that, by reason of his 60 percent shareholding in Allied Edge (for which he paid $300,000), the applicant obtained a substantial ownership interest in an eligible business in Australia. It is clear that, when he acquired his shareholding in the company, and for a period thereafter, Allied Edge was actively involved in property development. Financial difficulties arose for Allied Edge when Parklane, a building company with which he had contracted, was placed into administration and the subsequent refusal of Allied Edge’s insurers to pay under policies of insurance which it had taken out to provide for such circumstances.
54. All of this pre-dates the issue of the applicant’s visa. Since that time, apart from proceeding with litigation against Vero, both the applicant and Mr Costantino have been looking for other projects and sources of funds for Allied Edge, although with no success.
55. The short point put by Mr Blades on behalf of the respondent was that the evidence therefore establishes that for the period commencing upon the issue of the applicant’s visa and concluding on the date that the respondent’s delegate made a decision to cancel it, Allied Edge had not carried on business. Accordingly, the applicant did not have an interest “in an eligible business in Australia”. In support of his submission, Mr Blades referred to the decision of the High Court of Australia in Hope v Bathurst City Council (1980) 144 CLR 1 where, at pg 8, Mason J said that the popular meaning of the word “business” is “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”.
56. It seems clear that by the time a visa was issued to the applicant (August 2000) Allied Edge had ceased to carry on business in any sense of the word. Its business had come to an unfortunate stop with the demise Parklane. Since then there has been no business transacted by Allied Edge: it has prosecuted a right of action against insurers and looked at re-establishing business operations, but without success.
57. Contrary to written submissions provided by the applicant after the hearing of this matter, I do not accept that the pursuit of a damages claim against Vero is a “business”: it is a one-off pursuit of a legal chose in action.
58. The applicant did not, therefore, have a substantial ownership interest in an eligible business in Australia.
Utilising skills in actively participating at a senior level in the day-to-day- management of that business
59. Given my finding that the undertaking of Allied Edge does not constitute “an eligible business in Australia”, the applicant cannot have been using skills in actively participating at a senior level in the day-to-day management of such a business.
Genuine efforts
60. Has the applicant made a genuine effort to make both Allied Edge an eligible business in Australia and to utilise his skills in actively participating in a senior level in the day-to-day management of that business? In my view he has.
61. The facts of this case are very unusual. This is a case where the applicant has expended $300,000 to acquire a controlling interest in a company that, at the time, was clearly conducting “an eligible business”. He applies for and obtains a visa, but shortly before the visa is issued, through no fault of the applicant or his company, the company’s business comes to an abrupt holt. The company had taken out insurance to cover it for such an eventuality. The insurer denies liability.
62. The applicant then funds the company to pursue litigation against the insurers so as to get in the funds which the company claims it is entitled to and which, with those funds, would enable it to re-establish its business.
63. In the unusual circumstances of this case, I do not see why I should not find such conduct to constitute genuine efforts on the part of the applicant to enable Allied Edge, a company in which he has a substantial ownership interest, to re-establish the “eligible business” it once had.
64. In addition, evidence was received with respect to efforts undertaken by the applicant to establish other business opportunities for Allied Edge. In this regard, I accept the submission by Mr Blades, Counsel for the respondent, that to the extent that such evidence post dates the date of the cancellation decision and does not constitute evidence of prior intentions, it ought to be disregarded for the purpose of determining this application.
65. The efforts which were made prior to the date of the cancellation decision cannot, however, be described as false, fictitious or a pretence or merely a superficial or token effort. Whilst it is true that many of the “high net-worth purchasers approached and presented with business proposes” listed by the applicant and referred to by him in evidence would appear to be nothing more than “mere expressions of interest or enquiries”, the Ginkgo Biolba project and the proposed development in North Perth cannot be so described.
66. The evidence establishes that efforts with respect to each of the above projects were undertaken during the period August 2000 to November 2003. With respect to the Ginkgo Biolba project, in answers to questions put to him by the Tribunal, Mr Costantino said that the negotiations occurred in 2003, and continued until the end of 2003 when the vendor decided not to proceed.
67. Similarly, Mr Costantino said that the proposed development in North Perth occurred during the relevant period, and in particular commencing December 2000 and into 2001 for each and both of these reasons I conclude that the applicant has made a genuine effort to make Allied Edge an eligible business in Australia.
68. I therefore find that the applicant has undertaken “genuine efforts” to re-instate Allied Edge’s former eligible business and has undertaken “genuine efforts” to find alternative eligible businesses for Allied Edge.
69. In this regard I acknowledge that the applicant has spent little time in Australia between August 2000 and November 2003: he spent less than 3 months in Australia during that period. This falls well short of the 6 months referred to in the MSI guidelines. Whilst the authorities establish this fact (and the fact that many other parts of the MSI guidelines have not been satisfied on the facts of this case) is a matter to be taken into account when determining whether or not a “genuine effort” has been made, in the circumstances of this case I find that such matters do not outweigh the other factors to which I have referred.
70. For sake of completeness I note that, at the conclusion of the hearing, I gave to the applicant an opportunity to provide detailed written submissions. The applicant availed himself of that opportunity (albeit late). At the same time he provided further material in support of the application. As the respondent had no opportunity to “test” the additional material in the hearing before me (including cross-examining the applicant and Mr Costantino with respect to it), the rules of natural justice require me not to have regard to the same in determining this matter. Accordingly, I have not had regard to that material for the purpose of determining this matter.
71. The evidence of the applicant with respect of his participation in the day to day management of the business was fortified by his “partner”, Mr Constantino. He is clearly treated by Mr Constantino by “his partner” and an agreement has been made for the applicant to become a director of Allied Edge.
72. The evidence establishes that the applicant is not simply a passive investor. The evidence of the applicant and Mr Costantino clearly establish the applicant already has a senior day to day management role in the affairs of Allied Edge, and that if and when an “eligible business” is found for Allied Edge, it is intended by both the applicant and Mr Costantino that the applicant will have a senior day to day management role in that business. I so find.
Conclusion
73. Given the findings I have made, and given that I further accept that the applicant intends to continue to make “genuine efforts” (the contrary proposition was not pressed on behalf of the respondent at the hearing), it follows that, by virtue of s134(2) of the Act, the applicant’s business visa must not be cancelled.
74. For the sake of completeness I note that it is therefore not necessary for me to consider whether I would have exercised my discretion not to cancel the visa even if the applicant had not established “genuine efforts” as a matter of law. In this regard I note, but make no finding, that had I concluded that the facts as I have found them do not constitute “genuine efforts” for the purpose of the Act, I would have extended to the respondent an opportunity to be heard as to why I ought nevertheless set aside the review decision in the exercise of my discretion (given the highly unusual circumstances of this matter).
75. The reviewable decision dated 4 November 2003 is therefore to be set aside and substituted therefore a decision that the applicant’s business skills visa should not be cancelled.
I certify that the seventy three (75) preceding paragraphs are a true copy of the reasons for the decision herein of Mr S Penglis, Senior Member
Signed: ........[Sgd. Y Maker]......
AssociateDate of Hearing 25 January 2006
Date of Decision 12 January 2007
Counsel for the Applicant Applicant appeared in person
Counsel for the Respondent Mr D Blades
Solicitor for the Respondent Australian Government Solicitor
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