Chan and Minister for Immigration and Multicultural Affairs
[2000] AATA 724
•18 August 2000
DECISION AND REASONS FOR DECISION [2000] AATA 724
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N1999/1490
GENERAL ADMINISTRATIVE DIVISION )
Re CHUN YI CHAN
Applicant
And MINISTER FOR IMMIGRATION AND MULTICULTURAL AFFAIRS
Respondent
DECISION
Tribunal Mr M J Sassella, Senior Member
Date 18 August 2000
Place Sydney
Decision The Tribunal affirms the decision under review.
..............................................
M J Sassella
Senior Member
CATCHWORDS
CITIZENSHIP – whether residential requirements met – whether applicant engaged in activities overseas that are beneficial to the interests of Australia – applicability of guidelines – discretions allowing grant.
Australian Citizenship Act 1948 ss 13(1), 13(4)(b)(i)
Drake v Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634
Minister for Immigration, Local Government and Ethnic Affairs v Roberts (1993) 41 FCR 82
Re McCarthy and Minister for Immigration, Local Government and Ethnic Affairs (1993) 30 ALD 447
Re Tsui and Minister for Immigration, Local Government and Ethnic Affairs (1991) 24 ALD 236
REASONS FOR DECISION
This is an application by Mr Chun Yi Chan ("the Applicant") for review of a decision of the Minister for Immigration and Multicultural Affairs ("the Respondent") dated 24 August 1999 not to grant the Applicant Australian citizenship.
At the hearing of this matter, Mr Chan was represented by Mr Phillip Au and the Respondent was represented by Ms Veena Jattan.
The documents lodged with the Tribunal pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 (TD1) were taken in as evidence along with the following material:
Exhibit No Description Date
A1 A2 A3 A4 A5 A6 R1 R2 R3 R4 R5 R6 Applicant's observations in response to the reasons for the decision under review Letter from Phillip Au & Associates to the Tribunal with attachments Letter from Phillip Au & Associates to the Tribunal enclosing documents from the Australian Bullion Company (NSW) Pty Ltd Letter from Phillip Au & Associates to Damien Hannan of the Department of Immigration and Multicultural Affairs Letter from Phillip Au & Associates to Jennifer Pitt of the Department of Immigration and Multicultural Affairs with attachments Applicant's written submissions Respondent's Statement of Facts and Contentions Facsimile from the Australian Bullion Company (NSW) Pty Ltd to the Department of Immigration and Multicultural Affairs Search Report of Companies in Hong Kong in which the Applicant is named a director Summary of invoices prepared by the Respondent outlining dealings between Mansen Pty Ltd and the Australian Bullion Company (NSW) Pty Ltd Timeline prepared by the Respondent Summary of Movements of Chun Yi Chan prepared by the Respondent 7 October 1999 20 November 1999 2 December 1999 29 December 1999 22 May 2000 5 June 2000 5 January 2000 16 May 2000 13 May 2000 undated undated 2 June 2000
BACKGROUND
Mr Chan was born in the People's Republic of China on 16 May 1964. He later became a citizen of Hong Kong and he carries a Hong Kong passport. On 27 February 1989 he married Sui Yin Ng, who was born in Hong Kong on 2 November 1968. They have three children, Hiu Wa (born 23 September 1989), Hung Fai (born 2 April 1991) and Kit Fai (born 18 November 1992), all born in Hong Kong.
Mr Chan first arrived in Australia on 10 June 1995 on a visitor's visa and departed on 15 June 1994. He returned to Australia on 9 November 1995, accompanied by his wife and children, and was granted permanent residence on either that date or 11 November 1995, the documentary materials before the Tribunal being inconsistent on that point. Mr Chan made a number of arrivals and departures between 10 June 1994 and 31 May 2000 that are summarised in Exhibit R6.
Mr Chan bought a house in Roseville, with a certificate of title recording him as the registered proprietor of this property being issued on 15 January 1996 (Exhibit A1). He also established a corporation, Mansen Pty Ltd, with a certificate of registration being issued on 1 May 1996 (T4, p58).
Mansen Pty Ltd describes its principal activity as "commodities trader" and operates from its registered office that is also Mr Chan's house in Roseville (Exhibit A5). Mansen Pty Ltd operates as a buyer of gold bullion exclusively from the Australian Bullion Company (NSW) Pty Ltd and as a seller of this bullion to entities in Hong Kong. Mr Chan gave evidence that $A500,000 worth of gold bullion had been exported to Hong Kong from Australia by Mansen Pty Ltd since 1996. $A35,000 worth was exported in 1996; $A220,000 worth in 1997; $A307,000 worth in 1998 in 1998 and $A34,000 worth in 1999.
Mr Chan's children commenced their schooling in Australian schools and the Applicant's wife and children were granted Australian citizenship in around August 1998. They left Australia soon after, on 30 August 1998, and have effectively lived in Hong Kong with Mr Chan ever since. They have made only one return trip to Australia for about 10 days since August 1998.
LEGISLATIONSection 13 of the Australian Citizenship Act 1948 ("the Act") outlines the qualification criteria for the grant of Australian citizenship. As relevant it provides:
"Grant of Australian citizenship
13. (1) Subject to this section, the Minister may, in the Minister's discretion, upon application in accordance with the approved form, grant a certificate of Australian citizenship to a person who satisfies the Minister that:
(a) the person is a permanent resident;
(b) the person has attained the age of 18 years;
(c) the person understands the nature of the application;
(d) the person has been present in Australia as a permanent resident for a period of, or for periods amounting in the aggregate to, not less than one during the period of 2 years immediately preceding the date of the furnishing of the application;
(e) the person has been present in Australia as a permanent resident for a period of, or for periods amounting in the aggregate to, not less than 2 years during the period of 5 years immediately preceding the date of the furnishing of the application;
(f) the person is of good character;
(g) the person possesses as basic knowledge of the English language;
(h) the person has an adequate knowledge of the responsibilities and privileges of Australian citizenship; and
(j) if granted a certificate of Australian citizenship, the person is likely to reside, or to continue to reside, in Australia, or to maintain a close and continuing association with Australia.
…
(4) For the purposes of the application of subsection (1) in relation to an applicant for the grant of a certificate of Australian citizenship
…
(b) subject to paragraph (a), the Minister may, in the Minister's discretion:
(i)treat a period during which the applicant:
(A)was a permanent resident;
(B)was not present in Australia; and
(C)was engaged in activities that the Minister considers beneficial to the interests of Australia;
as a period during which the applicant was present in Australia as a permanent resident;
…"
CONSIDERATION
Mr Chan satisfied these legislative requirements on the day of his application to the following extent:
He had attained the age of 18 years, in fact being 34 years of age;
Mr Chan appears to have understood the nature of the application;
There was nothing to suggest that Mr Chan was other than of good character;
Mr Chan apparently possessed a basic knowledge of the English language although he had an interpreter to assist him during the hearing; and
Mr Chan apparently had an adequate knowledge of the responsibilities and privileges of Australian citizenship.
The problem for Mr Chan was his inability to satisfy s 13(1)(d) and (e) of the Act because:
Mr Chan had not been present in Australia for a period of, or for periods amounting in the aggregate to, not less than one year during the period of two years immediately preceding the date of his application, as required by s 13(1)(d) of the Act; and
Mr Chan had not been present in Australia for a period of, or for periods amounting in the aggregate to, not less than two years during the period of five years immediately preceding the date of his application, as required by s 13(1)(e) of the Act.
Mr Chan may not have been in a position to satisfy the Minister that, if granted a certificate of Australian citizenship, he would be likely to reside, or to continue to reside, in Australia, or to maintain a close and continuing association with Australia, as required by s 13(1)(j) of the Act.
At the date of application for Australian citizenship, Mr Chan had spent only 160 days in Australia in the preceding two years. This was 205 days less than the minimum required by s 13(1)(d). He had spent only 258 days in Australia in the five years immediately before applying for citizenship. This was 472 days less than the minimum required by s 13(1)(e). It should be noted that the only days spent within Australia that can be included in these calculations are those during which Mr Chan was a permanent resident. His period in Australia on a visitor's visa cannot be included.
Mr Au argued that the Applicant should be given the benefit of the discretion provided for in s 13(4)(b) of the Act in that while outside Australia he was engaged in activities beneficial to the interests of Australia. If such an approach were taken, it may be possible for days Mr Chan spent outside Australia, engaged in activities beneficial to Australia, to be included as if they were periods spent within Australia.
Mr Au argued that Mr Chan was engaged in such beneficial activities in that his business activities generated foreign income for Australia; his work was opening up new markets for Australian bullion and his work was generating employment in Australia for workers in the fields of legal and accounting services.
The Respondent applies policy guidelines known as the Australian Citizenship Instructions ("the Instructions") in its decision making under s 13 of the Act. Chapter Four of the Instructions lays down a number of principles to be considered in a case like Mr Chan's. The Instructions state:
"…
4.5.11 The legal preconditions for use of this discretion are as follows:
the periods concerned must be within the relevant period (ie the 5 years and/or 2 years before application);
for any periods counted, the applicant must be a permanent resident…;
the applicant must have been engaged in activities overseas (not just, for example, the company or organisation for which the applicant worked);
the applicant must have been engaged in activities as opposed, for example, to a one-off transaction;
the activities must have been 'beneficial to the interests of Australia' during the relevant period/s. The provision will not apply on the basis of future benefits potentially accruing to Australia (McCarthy AAT case).
4.5.12In assessing whether activities are beneficial to the interests of Australia, consider the following:
It requires 'something in the nature of activities which provide some advantage to Australia, whether commercial or otherwise. The concept necessarily connotes some public interest of Australia…and means more than the private interests of the [applicant]. The section requires some objective benefit to Australia.' (Federal Court in Roberts.)
It requires 'something in the nature of activities which achieve recognition of Australia or of Australian achievements or commercial advantage for Australia, or increase the international respect and goodwill for Australia…[it] refers to the public interests of Australia.' (AAT in Fraser.)
'The claim that the applicant's employer has enhanced the reputation of its Australian parent company and Australian companies in general, falls short of demonstrating the applicant's activities were beneficial to the interests of Australia.' (AAT in McCarthy.)
4.5.13'There should be a close nexus between the overseas activities and the subsequent benefit to the Australia to exercise the discretion' (AAT in Tsui). The benefit should be largely as a result of the applicant's activities and must not be residual, remote, indirect or speculative (see, for example the AAT case of McCarthy).
4.5.14If the discretion is available, current policy is that decision-makers should normally follow the guidelines approved by the then Minister in August 1985 that the discretion will usually only be exercised if all the following requirements are satisfied:
(a)The applicant was:
(i) either for an extended period or on a regular short-term basis:
required to work overseas by a Federal, State or Territory Department, semi-government authority or private employer; or
self-employed and frequent travel abroad was essential to the successful operation of their business; or
(ii) engaged overseas in activities of a social, cultural, economic or political nature which are clearly beneficial to the interests of Australia and are widely recognised as such either by:
the Australian community generally; or
prominent persons associated with their field of endeavour (for example, people engaged in aid programs, artists and entertainers of world standing).
(b)The applicant has established a prior primary identification with Australia, intends to continue to live in Australia and can shown that he or she has commitments here such as substantial assets, or has close ties with the business community, or has family members established in the country…
(c)The applicant is in Australia. If the applicant is overseas, the discretion will normally not be exercised.
4.5.15In assessing (b) above:
The primary identification should be evidenced by reference to matters prior to the application for citizenship.
Relevant factors include whether they can show they have commitments here such as substantial assets, close ties with the business community, or family members established in the country and that those commitments outweigh those which they have in any other country.
The applicant's physical and emotional tie with Australia should be weighed against ties in any other country (for example residence, house, schooling or children, residence of spouse, citizenship held by immediate family, business ties, family and friends ties, and general identification).
'The weight of the applicants' physical and emotional inclinations to Australia should exceed the weight of the applicants' inclination to any other country. Physical inclinations are assets and time spent in residence. Emotional inclination can be assessed by taking into account the record of the applicant's supportive actions directed towards the citizens of the country (usually family) and towards the enhancement of activities which constitute the public policy of the country.' (AAT in Tse.)
More weight should be given to emotional inclinations as emotional ties tend more to bond the individual to a country. Emotional bonding leads to a higher level of identification with a country than physical or material transactions because physical links can be more easily engineered to demonstrate commitment. Usually the strongest identifying factor to a place is having friends and relatives living there. Home is the critical point.
…" (T3, p24-26)
It was in applying these instructions to Mr Chan's case that the primary decision-maker decided the discretion in s 13(4)(b)(i) should not be exercised in his favour (T1, p5-10).
Set out below are the reasons given by the decision-maker not to grant Australian citizenship, with appropriate comments from the Tribunal.
Reason 1 – Registered OfficeIt would appear that Mansen Pty Ltd does not have an office in Sydney because its "registered office" is Mr Chan's residential address in Roseville. Ms Jattan noted that this appears also to be the address of Mr Chan's brother, Mr Chun Tak Chan, who is the co-owner and co-director of Mansen Pty Ltd. In oral evidence the Applicant stated that his brother has a different residential address. The Applicant's response to this reason for decision was that many businesses elect to maintain home offices from where they run their business activities (Exhibit A1). This appears a fair point as there is no obvious reason why a residential address cannot, in principle, be the registered office of an Australian corporation.
Reason 2 – Mansen Pty Ltd has slight financial returnsThe primary decision-maker was concerned that, for a company that claims to be a multi-million dollar company, its financial returns are very slight. The value of gold bullion exported by Mansen Pty Ltd is outlined in paragraph seven above. The Applicant argues that this concern demonstrates the Respondent's lack of understanding of the gold bullion trading market. Mr Au submitted that gold is a very expensive commodity and large sums of money are required for its purchase and sale. It is for this reason the Applicant claims the company has traded gold worth over $500,000 in the market but with much lower returns (Exhibit A1). The Tribunal does not find this explanation totally satisfying. The Applicant's argument can be interpreted to suggest that the total quantity of gold bullion traded each year by Mansen Pty Ltd was in itself not great and this argument supports the Respondent's position.
Reason 3 - The financial structure of Mansen Pty Ltd is unclear and the extent to which there is a flow-on effect to the Australian economy is not establishedThe Applicant submitted numerous copies of invoices for bullion purchased in Australia and sent to Hong Kong (Exhibits A2, A3 and A5). The Applicant claims that the activities of Mansen Pty Ltd do have a beneficial flow-on effect for the Australian economy and made the following comments in response:
a) Mr Chan's activities create international goodwill, partnerships with overseas enterprises and exposure of the Australian trading sector at a time when Australia accounts for a very small percentage of total trading volume in the international market and when Australia is trying to enter larger and tighter markets overseas;
(b) The gold bullion market is booming and Australia can compete well in that market;
(c) The Applicant's efforts will increase the export of gold bullion from Australia and this will enhance employment prospects in Australia; and
(d) Bullion sales have generated taxation revenue in Australia (Exhibit A4).
There are problems, however, in accepting that Mansen Pty Ltd contributes measurably to Australia's benefit in any of these respects. This is so if for no other reason than the relatively low volumes of sales of bullion achieved by the Applicant.
Reason 4 - The exact nature of Mr Chan's role in Mansen Pty Ltd and the extent his work is beneficial to the interests of Australia is unclear
There are a couple of points to this reason:
(a) As regards the Applicant's personal role in any benefits accruing to Australia through Mansen Pty Ltd, the Applicant referred to letters from Mr Chan's business associates in Hong Kong (T13, p202-204) testifying that they have been dealing with Mr Chan on sales of gold bullion (Exhibit A1). These letters relate to only some of the bullion sales in Hong Kong and it is difficult to discern even approximately what contribution Mr Chan's work made to the total sales of bullion achieved in Hong Kong. The Applicant agreed in evidence that the sale records do not distinguish between sales made by him and those concluded by his brother; and
(b) The Applicant claims he has spent a significant sum of money in attracting customers to his business and to provide the greatest exposure of Australian gold bullion to potential customers in the Asia Pacific region, particularly Hong Kong (Exhibit A5). The Applicant submitted, however, that the main form of advertising was conducted by him through word of mouth and that this was a typical characteristic of business in the Asian market place. He asserted that this has been very effective for Mansen Pty Ltd because Asian markets are difficult to penetrate and because the Asian trading economy is based heavily on personal characteristics and reputation. The Tribunal accepts that there may be aspects of an "Asian way of doing business" that are best handled by personal presence and the establishment of personal relationships. Additionally, Mr Chan's Chinese background may be an advantage when doing business in Hong Kong, however, the Applicant appears to have overstated his case in several respects. The value to Australia of the business the Applicant has attracted, even assuming Mr Chan is responsible for most of that business, is not great. It is highly unlikely that the volume and value of that business has contributed at all to employment in Australia. The brochure included in Exhibit A5 appears unsophisticated and unlikely to impress Asian business people. It also appears to the Tribunal that Mr Chan could foster his personal business relationships in Hong Kong and at the same time spend considerably more time in Australia in an age of almost instantaneous electronic communications and given that other family members who are engaged in business of various sorts are resident in Hong Kong.
The Applicant's representative made much of the peculiarities of Asian markets and the role the Applicant has assumed in promoting Australia's gold bullion sales in this difficult market (Exhibit A1). While it is entirely reasonable to accept that a person of Asian birth may have an advantage over an Australian with no Asian ancestry in carving out an Asian market it is not clear that Mr Chan has succeeded to any degree likely to generate significant benefit to Australia. This conclusion is drawn from the absolute value of sales achieved and from the recent trend in sales by Mansen Pty Ltd.
Reason 5 - Mr Chan's contribution to Australia's taxation collection is unclear
The primary decision-maker sought information as to Mr Chan's Australian taxation position, an obvious request as Mr Chan argued that his taxes are of benefit to Australia. While some information was eventually forthcoming it was not entirely satisfactory. Mr Chan's migration agent wrote, on 12 October 1998:
"…
The Applicant's only source of personal income is the dividends paid as a result of his shareholding in Mansen Pty Limited, which are not taxed because of the present imputation credit system. Although he is a director of Mansen Pty Limited, the Applicant does not receive director's fees as such. Thus he does not have Group Certificates for the financial years ending 1997 and 1998 as requested.
…" (T9, p192)
Also before the Tribunal were the financial accounts for Mansen Pty Ltd for the financial years ending in 1998, 1997 and 1996 (T4, p93-160), in addition to the financial accounts for Mansen Pty Ltd for the financial year ending in 1999 (Exhibit A5). The 1999 accounts indicate that no dividends were paid in that year and none were recommended for payment. Operating profit before abnormal items and income tax was only $763.51. The profit and loss statement shows that gross profit from trading was $1,075.54, while expenses amounted to $312.03. The company had spent $32,850.75 on purchases and had received only $33,926.29 from sales. The income tax attributable to operating profit was only $274.68. Retained profits at the start of the financial year were $33.454.47. These grew to $33,943.30 by the end of the year with the addition of that year's after tax profits. The balance sheet showed that the company's total assets at year's end were valued at $55,210.03, with cash accounting for $54,344.03 and property, plant and equipment accounting for $866.00. Liabilities were a total of $21,066.73 including $20,792.05 as directors' loans and $274.68 provision for taxation. Shareholders' equity was $200.00 in share capital and the retained profits. At the directors' meeting held on 14 July 1999 it was resolved to pay no dividend.
The equivalent data for the financial year ending in 1998 appear as follows. The 1998 accounts show that no dividends were paid in that year and none were recommended for payment. Operating profit before abnormal items and income tax was $27,086.55. The profit and loss statement shows that gross profit from trading was $30,878.32 while expenses amounted to $3,791.77. The company had spent $246,407.23 on purchases and had received $277,285.55 from sales. The income tax attributable to operating profit was $9,750.96. Retained profits at the start of the financial year were $16,118.88. These grew to $33,454.47 by the end of the year with the addition of that year's after tax profits. The balance sheet showed that the company's total assets at year's end were valued at $55,362.03, with cash accounting for $54,344.03 and property, plant and equipment accounting for $1,018.00. Liabilities were a total of $21,707.56 including $2,890.00 as directors' loans and $18,817.56 as provision for taxation. Shareholders' equity was $200.00 in share capital and the retained profits. At the directors' meeting held on 14 July 1998 it was resolved to pay no dividend.
The equivalent data for the financial year ending in 1997 appear as follows. The 1997 accounts show that no dividends were paid in that year and none were recommended for payment. Operating profit before abnormal items and income tax was $22,167.48. The profit and loss statement shows that gross profit from trading was $25,444.45 while expenses amounted to $3,276.97. The company had spent $195,732.55 on purchases and had received $221,177.00 from sales. The income tax attributable to operating profit was $7,980.12. Retained profits at the start of the financial year were $1,931.52. These grew to $16,118.88 by the end of the year with the addition of that year's after tax profits. The balance sheet showed that the company's total assets at year's end were valued at $28,275.48, with cash accounting for $26,357.48 and property, plant and equipment accounting for $1,918.00. Liabilities were a total of $11,956.60 including $2,890.00 as directors' loans and $9,066.60 as provision for taxation. Shareholders' equity was $200.00 in share capital and the retained profits. At the directors' meeting held on 15 December 1997 it was resolved to pay no dividend.
The equivalent data for the financial year ending in 1996 appear as follows. The 1996 accounts show that no dividends were paid in that year and none were recommended for payment. Operating profit before abnormal items and income tax was $3,018.00. The profit and loss statement shows that gross profit from trading was $3,208.00 while expenses amounted to $190.00. The company had spent $32,084.00 on purchases and had received $35,292.00 from sales. The income tax attributable to operating profit was $1,086.48. There had been no retained profits at the start of the financial year but by the end of this financial year there was $1,931.52 made up of that year's after tax profits. The balance sheet showed that the company's total assets at year's end were valued at $6,108.00, with cash accounting for $3,290 and property, plant and equipment accounting for $2,818.00. Liabilities were a total of $3,976.48. Shareholders' equity was $200.00 in share capital and the retained profits. At the directors' meeting held on 15 December 1996 it was resolved to pay no dividend.
The conclusion that may be drawn from the documentary evidence is that the Australian Taxation Office may have received company taxes from Mansen Pty Ltd but that the Applicant's personal Australian income taxation liability appears to have been nil in these years. The Applicant's representative emphasised that the Applicant receives his remuneration from the dividends of the company as
"…
…a matter of efficacy and allows for greater legal tax benefits to the Applicant both as a Director and shareholder in Mansen Pty Ltd…
…" (Exhibit A1)
It is strange that the Applicant is said to receive dividends when none have been declared on the official accounts.
Reason 6 - Mr Chan's work does not provide employment opportunities in Australia as suggested in his application
In the decision record the decision-maker states:
"…
…clearly [the Applicant's] work does not provide employment opportunities, as claimed in his application….
…" (T1, p9)
In his application for Australian citizenship the Applicant stated:
"…
The Applicant's activities overseas also indirectly benefit employment within Australia, outside the principal suppliers, in support industries such as, accounting firms and legal firms.
…" (T4, p45)
From the oral and documentary evidence it appears that Mansen Pty Ltd provides little direct or indirect employment. The amount of work Mansen Pty Ltd generates amongst principal suppliers of bullion is not great. A key is left for someone to open the registered office for a few hours on business days when the Applicant is not in Sydney. There may be some work generated for accountants and the legal profession but it seems minor in scale. The most active employees of Mansen Pty Ltd appear to be Mr Chan and his brother. The view taken by the Respondent would appear reasonable.
Reason 7 - The Applicant's family does not live in Australia
The decision-maker stated:
"…
In his application Mr Chan's agent states that her client and his family have settled permanently in Australia. They have purchased a property at 12 William Street, Roseville and the family lives there with the children attending local schools. However, I note that this is the address given in the applicant's brother's application for citizenship and he claimed to be living there with his wife and children. It is also the address of Mansen Pty Ltd., Mr Chan's business. It is true that his wife and children are Australian citizens. But they no longer live in Australia or attend local schools. Soon after being issued with Australian passports, the applicant's wife and children left Australia (on 30/08/98) and have been back for a ten day visit only since that time. Naturally they are entitled to do this but it can not be argued that they reside in Australia and are a part of the Australian community at this point of time, as claimed in the application.
…" (T1, p10)
The Applicant responded as follows:
"…
…The argument by the Department that because the Applicant's wife and family no longer reside in Australia or attend local schools then they are no-longer (sic) part of the Australian community is upsetting and drastically incorrect. Not only does this conclusion fail to take into consideration the proper welfare of the Applicant's young children but it undermines the idea that as Australian Citizens, unless one renounces their citizenship, they will always be part of the Australian community irrespective of their place of existence and employment. When an individual attains the grant of Australian Citizenship through a display of their desire to be an Australian then that person will always be an Australian irrespective of where necessity predicates that they be located.
Amongst the factors the Department took into consideration in refusing the Applicant's application for Australian Citizenship, the Department also took into consideration the fact that the Applicant's children are no-longer (sic) attending school in Australia and that the Applicant's wife does not currently reside in Australia.
Whilst the Applicant accepts that his children are not attending schooling in Australia, the Applicant requests that his children's age be taken into consideration. Clearly the Applicant's children are too young of age to be left to the care of minders in Australia whilst the Applicant continues his business activities overseas. It may be argued against this that the Applicant's wife could maintain the welfare of the children if she were in Australia, but due to the strong relationship bonds between the Applicant and his wife and children, the Applicant believes that the best interests of the family will be served if they all remained (sic) together as a family unit at the location of necessity for the Applicant.
…
…The weight that the Department placed on the choice for the Applicant's wife to also reside with her husband outside of Australia should also not be given the attention the Department seeks. It is only fair for the Applicant's entire family that unless the law predicates it, they should not be kept apart especially as the children are of tender age and require the nurture and guidance of both parents for their healthy development.
…" (Exhibit A1)
The decision-maker is correct in her conclusion regarding the usual place of residence of the other members of the Applicant's family who, although Australian citizens, have not effectively lived in Australia since August 1998, the same month they were granted Australian citizenship. It was the Applicant who quoted the Australian citizenship status of his immediate family as an argument in favour of the exercise of the Minister's discretion in his favour. It is then difficult for the Applicant to argue, as he attempts to do, that there are good reasons why the Australian citizens in his immediate family should be able to choose to live outside Australia without this disadvantaging the Applicant in this action. This is a matter of minor importance compared with those factors that bear upon whether an applicant for Australian citizenship, during a period when he or she is a permanent resident but not present in Australia, is engaged in activities that the Minister considers beneficial to the interests of Australia. It may, however, be relevant in considering whether an applicant for citizenship is likely to satisfy paragraph 13(1)(j) of the Act. This requires a person applying for Australian citizenship to satisfy the Minister that, if granted a certificate of Australian citizenship, the person is likely to reside, or to continue to reside, in Australia, or to maintain a close and continuing association with Australia. It should be easier to satisfy the Minister as to these matters if the person's immediate family members are Australian citizens and reside in Australia.
EVIDENCE PRESENTED AT THE HEARINGAdditional evidence was forthcoming at the hearing. This covered several subject areas. In his oral evidence Mr Chan said that his brother became an Australian citizen in 1999. He mentioned also that he has a range of private property holdings in Australia, notably a car, savings in the Commonwealth Bank of Australia and his interest in Mansen Pty Ltd. He explained that he formed a particular interest in promoting sales of Australian gold bullion because there is a high demand in South-East Asia and China for gold. He started a company in Australia rather than Hong Kong because he and his family would prefer to live in Australia.
Ms Jattan for the Respondent raised a number of issues. She highlighted a discrepancy between a document provided to the Respondent on the Applicant's behalf and the results of searches conducted in Hong Kong. The Applicant's representative stated, "…the Applicant is not involved in any…activities overseas [other than bullion sales]" (T9, p192). However, searches of the Hong Kong share register (Exhibit R3) disclosed that the Applicant is a director of three Hong Kong registered companies despite the fact that in examination the Applicant denied that he was. The Applicant explained that he had misunderstood the question he was answering when he had provided instructions as to an answer.
The Applicant then addressed his involvement in the three Hong Kong companies. He said that the setting up of Fellex Limited, and any work done by him for Fellex Limited, predated his Australian activity. Material in Exhibits R2 and R4 may tend to belie this evidence. Exhibit R4 shows that the Australian Bullion Company despatched gold bullion to Fellex Limited on 5 January 1998 and 29 November 1999. The Applicant said that Hung Shing Industrial Co Ltd is a "family company" that was established in 1986. It traded until 1992 when it became a limited company. It had been formed by the Applicant's parents and a third person. The Applicant's father retired in 1992 and his shares were transferred to the Applicant and his brother in 1994. The Applicant's sister has been the company's general manager since 1994. He described the company as a trading business exporting travel equipment and accessories sourced from Taiwan. Exhibit R3 shows that the Applicant has substantial shares in this company. There are 2.5 million shares, of which the Applicant owns one quarter. The Applicant said that he has little involvement in Hung Shing Industrial Co Ltd. Company number three, Terry Ltd, was described as dormant. It was established to explore mainland Chinese trading possibilities.
The Applicant denied spending any time doing work for any other Hong Kong companies. However, in evidence he mentioned that he assists his mother sometimes in her work for her company which also imports and exports bullion.
The Applicant responded to observations about his removal of his wife and children from Australia by saying that his wife is very young and naturally wants to follow him in his residential arrangements. He said that, although the children were outside Australia at present, he intended that they would enter an Australian school. The Applicant's daughter has a place reserved for her in year six in an Australian school in 2001 and the Applicant's son is in a similar position. Mr Chan said that he wanted to keep his money in Australia. He proceeded to sum up by saying that he wants to live in Australia but cannot because of the operation of the bullion market; that he wants to promote bullion sales but keep his money in Australia; that he is emotionally committed to Australia; that all his money, savings and assets are in Australia; that he has bought properties in Australia; and that his wife and children will follow him wherever he goes. It is not strictly accurate, of course, to say that all of his assets are in Australia. He has considerable shares in Hung Shing Industrial Co Ltd in Hong Kong. The Applicant believes he would feel more secure in doing business if he were an Australian citizen.
In response to further questions, the following matters were established:
The house in Roseville, NSW, is held in the Applicant's name only and he fully owns it;
No one lives in that house when the Applicant is away;
The Applicant's sources of income are interest on the savings he accrued before coming to Australia, money from Mansen Pty Ltd (but this may be problematic as Mansen Pty Ltd company records suggest that the Applicant receives no money from this source) and money deposited in the Commonwealth Bank of Australia, including some $60,000 in an account owned by the Applicant and his wife;
The Applicant's brother also works with Mansen Pty Ltd in Hong Kong and has his own customers. He also assists his mother to sell gold to mainland China and elsewhere;
The Applicant believes that his wife and children will be back for the long term in Australia in about one year when the Applicant will be making enough money to stay in Australia. This will occur because the Asian bullion market is recovering very well and because Mansen Pty Ltd plans to diversify into exports of Australian wine and food. Mainland China was said to be lowering import duties on wine; and
It was pointed out to the Applicant that his wife was in Australia for a lengthy period while he was often outside Australia before she was given Australian citizenship. The Applicant agreed that this was so but said that he needs her help and wants her with him. It was put to the Applicant that his wife and children had lived in Australia simply to gain citizenship and had ceased to do so when citizenship was granted. The Applicant responded that his and his wife's original intention was to migrate to Australia and reside here.
Two witnesses gave evidence on the Applicant's behalf. Mr Bruce Hill, a Justice of the Peace who has known Mr Chan for four years, provided a character reference dated 26 November 1999 (Exhibit A2) and gave evidence at the hearing. He regards the Applicant, whom he knows socially, as a person of good character and standing with a good knowledge of international business. He says that the Applicant regrets his time necessarily spent outside Australia. Mr Hill sees the Applicant as hard working and a genuine family man. He supports the Applicant in his quest for citizenship, saying that he can be expected to create employment in Australia and to advantage Australia in a business sense in other ways. He has useful Hong Kong contacts.
The second witness was Mrs Hill, the wife of the first witness, who attested to the strength of Mr Chan's ties with Australia and to "the profit Mr Chan contributes to Australia". Her written statement dated 28 November 1999 speaks mainly of Mr and Mrs Chan's good character (Exhibit A2).
CONSIDERATION OF DECIDED CASES
Re Tsui and Minister for Immigration, Local Government and Ethnic Affairs (1991) 24 ALD 236The Respondent referred the Tribunal to a number of relevant decided cases. In the first of these, Re Tsui and Minister for Immigration, Local Government and Ethnic Affairs, (1991) 24 ALD 236 the applicant was a Hong Kong national who, at the time he applied for Australian citizenship, had spent only four days in Australia in the preceding two years. He had spent only 604 days in Australia in the preceding five years. The applicant and his family were granted permanent resident status in Australia in August 1984. The applicant's wife and family had been granted Australian citizenship in 1986 and had returned to Hong Kong some weeks later, remaining there ever since.
The applicant was outside Australia engaged on a major computer project and had told the respondent that he expected not to return to live here until two or three years had passed. He owned a house in Sydney but had no other links with Australia. He had no family members living in Australia. He argued that his employment in Hong Kong which was to result in new computer systems, some of which would be implemented in Australia, would contribute to the improved performance in Australia by the bank which employed him in Hong Kong.
The tribunal found against the applicant. It regarded any benefit to the interests of Australia resulting from the applicant's overseas activities as remote and open to argument. They were contingent in three respects. First, the applicant's activities would have to benefit his employer. Second, only some of the applicant's activities as adopted by his employer would have any positive impact on his employer's Australian activities. Third, there was a question whether any improved Australian performance by the applicant's employer can be seen as beneficial to the interests of Australia.
The Tsui case (supra) has many parallels with the instant application. Notable amongst these are the family's move to Hong Kong once attaining citizenship, lack of precision as to plans for a return to Australia, a limited period of residence in Australia during the relevant two and five year periods, and the dubious value of any benefit to the interests of Australia. The major difference is that in the instant application Mr Chan is essentially self-employed.
Minister for Immigration, Local Government and Ethnic Affairs v Roberts (1993) 41 FCR 82In Minister for Immigration. Local Government and Ethnic Affairs v Roberts (1993) 41 FCR 82, Mr Roberts applied for Australian citizenship on 24 April 1991. He had been in Australia from 6 December 1964 until 30 July 1989. He then returned on 2 October 1990. Between December 1989 and July 1990 he worked in the United Kingdom. On 19 November 1990 he left Australia for employment by a United Kingdom company. He returned on 29 March 1991. The applicant could not show that he had spent in Australia at least half of the two years before applying for citizenship. The tribunal in that matter had found that the Minister's discretion in section 13(4)(b)(i) should be available to the applicant. It decided to water down the accepted requirements in view of the fact that Mr Roberts had lived in Australia for more than 20 years. It held that in his work on oil rigs Mr Roberts had been engaged in activities beneficial to the interests of Australia. Einfeld J in the Federal Court decision quoted the tribunal (at 86-87) as follows:
"…
At par 30 the Tribunal concluded:'Coming then to the issue, does the Tribunal consider that Mr Roberts' activities in oil rig construction are relatively beneficial to the interests of Australia? Having regard to –
(i)the importance of oil rig construction in terms of national resource policy;
(ii) the desirability of having Australian citizens engaged in it;
(iii) the length of Mr Roberts' prior association with Australia;
(iv) his strong family connections with this country;
(v)the likelihood of those associations continuing, particularly if he gained citizenship so that he is enabled to readily return to this country to maintain those associations;
the Tribunal considers that Mr Roberts' activities in oil rig construction overseas during the two year period prior to his application were beneficial to the interests of Australia.'
…"
Einfeld J did not endorse this analysis. He said (at 87):
"…
…the term 'activities beneficial to the interests of Australia' means something in the nature of activities which provide some advantage to Australia, whether commercial or otherwise. The concept necessarily connotes some public interest of Australia, even if of a general or non-specific character, and means more than the private interests of the respondent. The section requires some objective benefit to Australia.
The importance to Australia of the Australian oil industry cannot be doubted. Although there was no evidence in this case on the specific importance of the construction of oil rigs, it was reasonably open to the Tribunal to find that oil rig construction, as an intrinsic part of the Australian industry, is itself a benefit to Australia. But it is quite another matter as to whether the construction of rigs in the United Kingdom and Brunei represent any such benefit, still less whether Mr Roberts' work as a rigger at those places was advantageous to this country. To reach such conclusions, some evidence would have been required demonstrating the benefits propounded. For example, if the person concerned was studying or using new techniques or materials with a view to introducing them to Australian construction, or if he was taking Australian technology to these places, the benefits would be established. If it was established that experiences overseas increased the particular person's chances for remunerative work and advancement in the industry in Australia, a relevant advantage may well be evidenced. Even if the particular person paid Australian tax on the wages earned in such places, Australia might derive some benefit…I regret being unable to see the nexus between Mr Roberts' overseas work and our natural resource and employment policies…
Family ties and a close association with Australia are in a similar category. Although relevant to the application by virtue of s 13(1)(j), these matters are in my opinion not relevant to the consideration of whether activities overseas are 'beneficial' to Australia…
…"
Applying the principles derived from this case to Mr Chan's application, the following propositions are apt:
The beneficial effect on the interests of Australia must amount to more than a benefit to the private interests of an applicant. In the present case, the Applicant sought to satisfy this requirement by indicating a beneficial effect for the Australian bullion industry from the Applicant's work in opening Asian markets to Australian exports. Had the Applicant been able to show such a beneficial effect, and the Tribunal does not accept that he has for reasons discussed earlier, he would have satisfied this requirement expounded in the Roberts case (supra);
The benefit to Australia may be of a general or non-specific character. Again, if Mr Chan had been able to sustain his arguments, the benefit in this case arising from substantial bullion sales would have been a relevant kind of benefit; and
Mr Chan is unable to take advantage of the examples in the Roberts case (supra) of acceptable activities that are likely to be beneficial to the interests of Australia. Thus, in the present case, the Applicant was not studying or using overseas techniques in industry to bring to Australia; the Applicant was not taking Australian technology overseas for application in foreign countries; the Applicant's overseas experience was not enhancing his chances for remunerative work and advancement in an industry in Australia; the Applicant had paid little or no Australian tax on his foreign activities.
Re McCarthy and Minister for Immigration, Local Government and Ethnic Affairs (1993) 30 ALD 447
In Re McCarthy and Minister for Immigration, Local Government and Ethnic Affairs (1993) 30 ALD 447, the applicant had been born in Ireland in 1960. He had arrived as a temporary resident in Australia in 1986. He became a permanent resident on 27 February 1989. On 13 May 1989 he left Australia to take up a position in Brunei and had not returned by the time of this appeal. He applied for Australian citizenship on 11 July 1991 by which date he had spent only 75 days in Australia as a permanent resident. The applicant and his Australian employer argued that the Minister's discretion should be exercised in his favour for the following reasons:
In 1989 one of the subsidiaries of the employer won a significant contract to provide engineering design services to Brunei Shell Petroleum. It was the first Australian consulting engineering company to win a contract to provide such services to a major oil and gas producer in the region;
The applicant provided the services under this contract and the project was an unqualified success;
The employer was confident of receiving further work;
A key factor in the employer's success in Brunei is the presence of the applicant to provide expert advice; and
Mr McCarthy's presence in Brunei is of direct benefit to the employer and to Australia.
The tribunal did not accept these as sufficient to satisfy the statutory requirements. The problems were said to be as follows:
The applicant said that Australia's offshore industry would benefit only upon his return. The statute requires the activities to be beneficial at the time an applicant engages in them;
It was claimed that the applicant's experience would assist him in obtaining further consultancy work. Even if accurate, this would not be a relevant argument because the activities must be beneficial to the interests of Australia rather than to an applicant. Further, the applicant's activities may have provided a future benefit which is intangible. The fact that the three substantial projects referred to in the second letter were to be carried out in the future by the applicant's company was not relevant. What was relevant was whether between 13 May 1989 and 11 July 1991 the applicant was engaged in beneficial activities; and
The claim that the applicant's employer had enhanced the reputation of its Australian parent company, and Australian companies in general, must be regarded as falling short of demonstrating activities in which the applicant was engaged that were beneficial to the interests of Australia. Further, as in the Tsui case (supra), such activities may be so remote, indirect and speculative as regards Australia's interests that they could not be taken into account.
The McCarthy case (supra) may be difficult to reconcile in some respects with the Federal Court decision in Roberts (supra). The tribunal in McCarthy appears less flexible that the Federal Court in what it will accept as adequate to provide a benefit in the interests of Australia. The Federal Court would seem more tolerant of alleged benefits of the following types:
A benefit of a general or non-specific character; and
An increase in an applicant's "personal capital" that is likely to improve Australia's economic or industrial performance at a later date. The examples in Roberts (supra) of a person studying or using a new technique overseas to bring back to Australia, or enhancing his or her chances for remunerative work and advancement upon returning to Australia, are in turn examples of benefits that might not be recognised by the tribunal in the Tsui (supra) or McCarthy (supra) cases.
These observations would have greater importance in a different case where an applicant satisfies the requirements in the Roberts case (supra) but does not satisfy the McCarthy (supra) requirements. Most notably the tribunal appeared to reject the personal capital argument discussed in the last paragraph.
However, as discussed above, the Tribunal has difficulties accepting that Mr Chan's activities in Hong Kong have provided any demonstrable perceptible benefit to the interests of Australia both in fact and in law, as derived from the Act and the decided cases.
PRIOR PRIMARY IDENTIFICATION WITH AUSTRALIAIn paragraph 16 above, extracts from the Instructions are set out. The Instructions require that an applicant show a prior primary identification with Australia if the discretion in s 13(4)(b)(i) of the Act is to be exercised in his or her favour. Instructions 4.1.14 and 4.5.15 are relevant. These instructions are based on ministerial guidelines issued in August 1985. It appears to the Tribunal that this requirement is not consistent with s 13(4)(b)(i) of the Act in that it is a requirement additional to those specified in the legislation. The Tribunal understands that the Department of Immigration and Multicultural Affairs may itself have reached this conclusion. It has long been established, at least since the decision of the Federal Court in Drake v Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634, that ministerial policy should be respected and applied by the Tribunal unless there are cogent reasons for departing from it. These are often said to exist where the application of the policy would work an injustice in a particular case. The reason must be even more cogent where it is that the policy is ultra vires as the requirement for prior primary identification would seem to be in the context.
That is not the end of the story, however, because s 13(1)(j) of the Act requires an applicant for Australian citizenship to satisfy the Minister that, if granted a certificate of Australian citizenship, the person is likely to reside, or to continue to reside, in Australia, or to maintain a close and continuing association with Australia. It is the Tribunal's view that the criteria in the Instructions relating to prior primary identification with Australia are relevant to s 13(1)(j).
In the present case, as Mr Chan has not satisfied the Tribunal that the discretion in s 13(4)(b)(i) should be exercised in his favour, s 13(1)(j) does not come into contention. The Tribunal therefore declines to adjudicate on whether Mr Chan would be able to satisfy that provision.
DECISIONFor the reasons provided above the Tribunal affirms the decision under review. The Tribunal notes, however, that there is no reason present at the time of writing that would prevent the Applicant from successfully applying for a certificate of Australian citizenship at a future time when he has spent time in Australia sufficient to satisfy the requirements in s 13 (1)(d), (e) and (j) of the Act.
I certify that the 54 preceding paragraphs are a true copy of the reasons for the decision herein of Mr M J Sassella, Senior Member.
Signed: .....................................................................................
AssociateDate of Hearing 5 June 2000
Date of Decision 18 August 2000
Representative for the Applicant Mr P Au, migration agentRepresentative for the Respondent Ms V Jattan, advocate from the Department of Immigration and Multicultural Affairs
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