Chen and Ors and Minister for Immigration and Citizenship
[2010] AATA 511
•9 July 2010
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2010] AATA 511
ADMINISTRATIVE APPEALS TRIBUNAL )
) Nos: 2009/5342, 2010/0425
GENERAL ADMINISTRATIVE DIVISION ) 2010/0426, 2010/0427
ReMinhua CHEN, Yanling FAN, Ting CHEN & Anor
Applicants
AndMinister for Immigration and Citizenship
Respondent
DECISION
TribunalMr RP Handley, Deputy President
Mr DM Connolly AM, Member
Date9 July 2010
PlaceSydney
DecisionThe decisions under review are affirmed.
....................[sgd]....................
Mr RP Handley
Deputy President
CATCHWORDS
IMMIGRATION – business class visa cancellation – validity of notice of cancellation - delegation to appropriate person - no legislative requirement for decision-maker of cancellation to also issue notice of cancellation – difference between wording of notice and legislative provisions not likely to mislead – invitation to respond to Locked Bag did not invalidly restrict form that representations might take - notice given to parent of minor satisfied legislative requirement - cancellation of primary visa holder is not a pre-condition to issuing notice to secondary visa holders - genuine effort to obtain substantial ownership interest in an eligible business in Australia – utilise skills in actively participating at a senior level in the day-to-day management of a business – secondary visa holders will not suffer extreme hardship
WORDS AND PHRASES – “not utilising” – “have not utilised”
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RELEVANT ACT
Migration Act 1958: ss 134, 135
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CITATIONS
Re Lin and Minister for Immigration and Citizenship [2009] AATA 938
Re Adams and Minister for Immigration and Citizenship (2007) 49 AAR 473; [2007] AATA 1180
Re Zhong v Minister for Immigration and Citizenship (2008) 171 FCR 444; (2008) 102 ALD 86; [2008] FCA 507
Hope v Bathurst City Council (1980) 144 CLR 1; (1980) 41 LGRA 262; (1980) 29 ALR 577; (1980) 54 ALJR 345; (1980) 80 ATC 4386; (1981) 12 ATR 231
Tung-Liang Liang v Minister for Immigration and Citizenship (2009) 175 FCR 184; (2009) 107 ALD 88; [2009] FCA 189
Re Huang and Minister for Immigration, Multicultural Affairs [2002] AATA 656
Re Burg and Minister for Immigration and Citizenship [2007] AATA 1630
Kim v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 38 AAR 304; [2004] FCA 31
Man Ki Kim v Minister for Immigration and Ethnic Affairs (1995) 37 ALD 481
Re Wang and Minister for Immigration and Multicultural Affairs [2000] AATA 961
Re Roeloffze and Minister for Immigration and Citizenship [2008] AATA 345
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REASONS FOR DECISION
| 9 July 2010 | Mr RP Handley, Deputy President Mr DM Connolly AM, Member |
This matter involves business visas granted to Mr Minhua Chen, his wife, Ms Yanling Fan, and Mr Chen’s two children, Mr Ting Chen and Ms Zeqian Chen, that were cancelled by the Minister on the ground that Mr Chen had not made a genuine effort to obtain a substantial ownership interest in an eligible business in Australia or to utilise his skills in actively participating at a senior level in the day-to-day management of such a business.
Background
Mr Chen, the primary visa holder, was born in China and is aged 53. By application lodged at the Office of the Australian Consulate-General in Hong Kong on 29 June 2005, Mr Chen applied for a Business Skills – Business Talent (Migrant) (Class EA) (Subclass 132) visa, including Ms Fan, now aged 37, and his two children, Mr Ting Chen who is aged 26 and Ms Zeqian Chen who is aged 12. Mr Chen, his wife and his two children are all Chinese citizens. By letter dated 30 March 2006, a delegate of the Minister notified Mr Chen that he, his wife and his two children had been granted Subclass 132 visas, a condition of which was that Mr Chen and his family had to enter Australia on or before 20 August 2006. Mr Chen first entered Australia with his family utilising his business visa on 7 July 2006.
In a letter accompanying Mr Chen’s visa application, Mr Chen’s agent, Dr Feng, stated that Mr Chen had a successful business career, had established an advertising company in Fujian province of which he was the Managing Director and Chairman, and which, at that time, employed 83 staff and had advertising contracts with a number of significant businesses. Mr Chen’s total assets at the time of the visa application were stated to be worth the equivalent of A$6.2m, with A$1.7m available for transfer to Australia within two years of the visa being granted.
Under cover of a letter dated 13 August 2008, Mr Chen’s agent in Australia, John Han, sent the Department Mr Chen’s 24-month business activity survey together with various accompanying documents. In his covering letter, Mr Han noted that Mr Chen had invested A$1.5m in HVGC Pty Ltd, a golf club business that had much potential, and that this was the beginning of Mr Chen gradually moving his businesses to Australia. On 14 April 2009, the Department wrote to Mr Han asking for further information. Mr Han provided this on 2 June 2009.
On 25 June 2009, the Department issued Mr Chen with a Notice of Intention to Consider Cancellation of his and his family’s visas and inviting a response. On the same date, the Department also sent similar Notices to Ms Fan and Mr Ting Chen. The Notice sent to Ms Fan also referred to the proposed cancellation of Ms Zeqian Chen’s visa. The Notices were sent to Mr Han who was authorised to receive correspondence on behalf of Mr Chen and his family. On 20 July 2009, Troy Martin, the Golf Manager of HVGC Pty Ltd sent the Department a letter of support for Mr Chen. On 21 October 2009, the Department notified Mr Chen of the cancellation of his and his family’s visas. On the same date, the Department separately notified Ms Fan and Mr Ting Chen of the cancellation of their visas. The letter sent to Ms Fan also notified her of the cancellation of Ms Zeqian Chen’s visa. On 9 November 2009, Mr Chen lodged an application for a review of the decision with the Tribunal. His wife and two children also subsequently lodged separate applications.
The Legislative Framework
The relevant provisions of the Migration Act 1958 (the Act) are as follows:
134.Cancellation of business visas
(1)Subject to subsection (2) and to section 135, the Minister may cancel a business visa (other than an established business in Australia visa, an investment‑linked visa or a family member's visa), by written notice given to its holder, if the Minister is satisfied that its holder:
(a) has not obtained a substantial ownership interest in an eligible business in Australia; or
(b) is not utilising his or her skills in actively participating at a senior level in the day‑to‑day management of that business; or
(c) does not intend to continue to:
(i)hold a substantial ownership interest in; and
(ii)utilise his or her skills in actively participating at a senior level in the day‑to‑day management of;
an eligible business in Australia.
(2)The Minister must not cancel a business visa under subsection (1) if the Minister is satisfied that its holder:
(a) has made a genuine effort to obtain a substantial ownership interest in an eligible business in Australia; and
(b) has made a genuine effort to utilise his or her skills in actively participating at a senior level in the day‑to‑day management of that business; and
(c) intends to continue to make such genuine efforts.
(3)Without limiting the generality of matters that the Minister may take into account in determining whether a person has made the genuine effort referred to in subsection (2), the Minister may take into account any or all of the following matters:
(a) business proposals that the person has developed;
(b) the existence of partners or joint venturers for the business proposals;
(c) research that the person has undertaken into the conduct of an eligible business in Australia;
(d) the period or periods during which the person has been present in Australia;
(e) the value of assets transferred to Australia by the person for use in obtaining an interest in an eligible business;
(f) the value of ownership interest in eligible businesses in Australia that are, or have been, held by the person;
(g) business activity that is, or has been, undertaken by the person;
(h) whether the person has failed to comply with a notice under section 137;
(i) if the person no longer holds a substantial ownership interest in a particular business or no longer utilises his or her skills in actively participating at a senior level in the day-to-day management of a business:
(i)the length of time that the person held the ownership interest or participated in the management (as the case requires); and
(ii)the reasons why the person no longer holds the interest or participates in the management (as the case requires).
(3A) Subject to section 135, the Minister may cancel an investment-linked visa (other than a family member’s visa), by written notice to its holder, if the Minister is satisfied that the person, or any of the persons, who held the relevant designated investment when the visa was granted has or have ceased, for any reason, to hold that investment within 3 years of that investment being made.
(4)Subject to subsection (5) and to section 135, if:
(a) the Minister cancels a person's business visa under subsection (1) or (3A); and
(b) a business visa is held by another person who is or was a member of the family unit of the holder of the cancelled visa; and
(c) the other person would not have held that business visa if he or she had never been a member of the family unit of the holder of the cancelled visa;
the Minister must cancel the other person's business permit or business visa by giving written notice to that person.
(5)The Minister must not cancel the other person's business visa under subsection (4) if the cancellation of that visa would result in extreme hardship to the person.
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(9)The Minister must not cancel a business visa under subsection (1), (3A) or (4) unless a notice under section 135 was given to its holder within the period of 3 years commencing:
(a) if its holder was in Australia when he or she was first granted a business visa‑‑on the day on which that first visa was granted; or
(b) if its holder was not in Australia when he or she was first granted a business visa‑‑on the day on which its holder first entered Australia after that first visa was granted.
(10)In this section:
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“eligible business” means a business that the Minister reasonably believes is resulting or will result in one or more of the following:
(a) the development of business links with the international market;
(b) the creation or maintenance of employment in Australia;
(c) the export of Australian goods or services;
(d) the production of goods or the provision of services that would otherwise be imported into Australia;
(e) the introduction of new or improved technology to Australia;
(f) an increase in commercial activity and competitiveness within sectors of the Australian economy.
…
135.Representations concerning cancellation of business visa
(1)Before cancelling a visa under subsection 134(1), (3A) or (4), the Minister must give its holder a written notice:
(a) stating that the Minister proposes to cancel the visa; and
(b) inviting its holder to make representations to the Minister concerning the proposed cancellation within:
(i)if the notice is given in Australia‑‑28 days after the notice is given; or
(ii)if the notice is given outside Australia‑‑70 days after the notice is given.
(2)The holder may make such representations to the Minister within the time specified in the notice.
(3)The Minister must give due consideration to any representations.
(4)If:
(a) the time specified in the notice ends after the end of the period referred to in subsection 134(9); and
(b) at the end of the period of 90 days commencing at the time specified in the notice, the Minister has not made a decision on whether to proceed with the cancellation;
the Minister is not to proceed with the cancellation.
(5)If the Minister decides not to proceed with the cancellation, the Minister must give its holder written notice to that effect.
The Issues – Mr Chen
The issues for the Tribunal in relation to Mr Chen are, first, whether the decision to cancel his visa was made in accordance with the provisions of the Act and, second, if so, whether his visa should be cancelled having regard, in particular, to:
(a)Whether he has obtained or made a genuine effort (and intends to continue to make such effort) to obtain a substantial ownership interest in an eligible business in Australia (s 134(1)(a) and s 134(2)(a) and (c)). This requires that the Tribunal determine whether he has been involved in (i) a business, that (ii) is an ‘eligible business’ (as defined in s 134(10)). And
(b)Whether he has utilised or has made a genuine effort (and intends to continue to make such effort) to utilise his skills in actively participating at a senior level in the day-to-day management of that business (s 134(1)(b) and s 134(2)(b) and (c)).
The Issues – Ms Fan, Mr Ting Chen and Ms Zeqian Chen
If the Tribunal affirms the Minister’s decision to cancel Mr Chen’s visa, the issues for the Tribunal in relation to Ms Fan, Mr Ting Chen and Ms Zeqian Chen are, first, whether the decisions to cancel their visas were made in accordance with the provisions of the Act and, second, if so, whether their visas should not be cancelled because they will suffer extreme hardship as a result (s 134(4) and (5)).
Were the decisions to cancel made in accordance with the Act?
Mr Dobbie, for the Applicants, contended that the decisions to cancel had not been made in accordance with the Act and were therefore invalid. He relied on a number of grounds.
Was the delegate empowered to make the decision to cancel?
In his Statement of Facts and Contentions, Mr Dobbie contended that there is no evidence of an appropriate delegation to the persons who made decisions in relation to this matter. The Minister subsequently provided a copy of the relevant Instrument of Delegation and Authorisation, dated 3 April 2009, and the Tribunal is satisfied that both the delegate who issued the Notice of Intention to Consider Cancellation and the delegate who made the decision to cancel had the necessary delegation.
Mr Dobbie contended in the alternative that assuming both the person who issued the Notice and the person who made the decision to cancel had the necessary delegation, then only the person who issued the Notice was empowered to subsequently make the decision to cancel. The letters dated 21 October 2009 notifying the Applicants of the decisions to cancel their visas stated incorrectly that the Applicants had previously been notified of “my intention to consider cancellation of your visa”, meaning the delegate who had decided to cancel the visas, whereas in fact the Notices were issued by a different delegate.
In the Tribunal’s view, the fact that the decision to cancel was made by a different delegate from the person who issued the Notice of Intention to Consider Cancellation does not affect the validity of the cancellation. There is no legislative requirement that the (s 134(1) and s 134(4)) decision to cancel is made by the same delegate who issued the (s 134(9) and s 135) Notice. The letters notifying the Applicants of the cancellation of their visas appear to be standard ‘form’ letters and the fact that there was a minor error in the letters does not, in our view, affect their validity.
Was the Notice invalid by reason of its employing incorrect wording?
Mr Dobbie contended that the Notice of Intention to Consider Cancellation was invalid because it did not correctly set out the prescribed circumstances, which would enliven the power to cancel under s 134(1). Whereas s 134(1)(b) refers to the business visa holder “not utilising” his or her skills, thereby employing the present tense, the Notice, in referring to s 134(1)(b), expressed the requirement as being in the past tense, employing the words “have not utilised your skills”. Mr Dobbie argued that this was a significant departure from the wording of the legislation and invalidated the Notice because it might be interpreted as only requiring reference to present and not past activity.
The Tribunal agrees with the Minister that when regard is had to the whole of s 134(1) and the utilising of skills “in actively participating at a senior level in the day-to-day management of that business”, it is clear enough that it is intended that the Minister should take into account the visa holder’s participation in the management of the business over a period of time rather than only at the time that consideration is being given to the cancellation of the visa. The emphasis in the paragraph is on the active participation in the management of the business and the period in question is the period leading up to the time when a decision will be made about whether to cancel the visa. In the Tribunal’s view, the minor difference in the wording of the Notice is not one that is likely to mislead and does not invalidate the Notice.
Did the notice invalidly restrict the form that representations might take?
Mr Dobbie contended that the Notices of Intention to Consider Cancellation were invalid because they unlawfully fettered the way in which representations could be made in response to the Notices: s 135(1)(b) invites the visa holder “to make representations to the Minister concerning the proposed cancellation”, whereas the purported Notices in this case required the visa holders to only make representations in writing to a Locked Bag in Western Australia. The Notices stated: “You are invited to submit a response to this office in writing to Locked Bag 7, Northbridge WA 6865 concerning the proposed cancellation of your visa under section 134 of the Act.”
Mr Dobbie acknowledged that this argument had recently been rejected by Deputy President Handley in Re Lin and Minister for Immigration and Citizenship [2009] AATA 938 (Lin), where, at [22] to [26], he followed Deputy President Walker’s decision on this issue in Re Adams and Minister for Immigration and Citizenship[2007] AATA 1180 (Adams). In Adams, at [18], DP Walker rejected a similar argument put by Mr Dobbie, noting that the contact details and address of the delegate were stated on the notice, which also referred to further information about the process on the Department’s web page and stated that further information could be obtained by contacting the Department by email, telephone or fax. DP Walker commented, at [19], that:
While in retrospect the notice might have been worded more clearly, it did not impose a condition but merely indicated an address which the applicant could be confident would ensure that his representations would reliably reach the minister’s delegate.
The Notices in the present case are very similar to those used in Adams and Lin and we agree with the comments made in those decisions, noting, in particular, what Deputy President Handley said in Lin, at [26]:
In my view, the “invitation” is not prescribing the form that the response should take but requesting that representations should be in writing to the Locked Bag – presumably for the sake of convenience and so that the representations are made in a tangible form. The provision of other means of contact on the notice, including the street address, email address, telephone and fax number alongside the same Locked Bag number is sufficient to facilitate other means of communicating the person’s representations.
Moreover, we note that Mr Chen’s then agent, Mr Han, responded to the Notice by email on 23 July 2009. We reject Mr Dobbie’s contention that the Notice was invalid on this ground.
Was a Notice of Intention to Consider Cancellation given to Ms Zeqian Chen?
Mr Dobbie contended that no Notice of Intention to Consider Cancellation was given to Ms Zeqian Chen as required by s 134(9). Section 134(9) states that “the Minister must not cancel a business visa under subsections (1), (3A) or (4) unless a notice under section 135 was given to its holder”. In Ms Chen’s case, the purported cancellation was made under s 134(4) but no s 135 Notice of Intention to Consider Cancellation was given to her. Instead, in the Notice addressed to her mother, Ms Fan, notifying her of the proposed cancellation of her visa, there is also reference to the proposed cancellation of Ms Chen’s visa. However, Mr Dobbie pointed out that the Notice, which is headed “Notice of Intention to Consider Cancellation of Your Visa”, invites Ms Fan to submit a response “concerning the cancellation of your visa” and addresses the consequences “[i]f your visa is cancelled” [emphasis added].
Mr Dobbie contended that because no separate Notice was given to Ms Chen within the period of three years from the day on which she first entered Australia after the visa was granted, then in accordance with s 134(9), the Minister “must not cancel” her visa. The purported cancellation of her visa was therefore made without power to do so.
The Minister notes that at the time Ms Chen’s visa was granted she was eight years old and that she was only 10 years old when the Notice of Intention to Consider Cancellation was sent. The s 135 requirement was satisfied appropriately by the Notice of the proposed cancellation of her visa being sent to her through her mother. The Notice was sent to and received by Ms Fan’s authorised representative, Mr Han, who responded on behalf of the family. No practical unfairness flowed from Ms Chen receiving the Notice in conjunction with her mother and, as intended by the legislation, she was afforded an opportunity to respond.
The Tribunal notes that the Notice sent to Ms Fan states:
The Act gives you an opportunity to comment on these grounds for cancellation. Your representation should say why the visas held by you and members of your family unit (eg dependent children) would result in extreme hardship. You may include documents that support your claims.
In our view, given that Ms Chen was a minor and, at the time the Notice was issued, aged 10, it was appropriate to include her in her mother’s notice so that, as the Minister contends, her mother could either assist her to make representations or make representations on her behalf. While no specific guidance is provided by the legislation as to the process for giving notice to minors, in this instance a Notice, including reference to Ms Chen, was given to her mother and Mr Han responded on behalf of the family as a whole. Thus, in our view, the implicit objective of the legislation was satisfied: Ms Chen was afforded an adequate opportunity to respond and, we agree with the Minister, no practical unfairness flowed from the process followed. We therefore find that the requirements of s 134(9) and s135(1) were satisfied.
Was the cancellation of the primary visa holder’s visa a pre-condition to the cancellation of the secondary visa holder’s visas?
Mr Dobbie submitted that it is a condition precedent to the valid exercise of the delegate’s power to issue a notice proposing to cancel the visas held by secondary visa holders that the visa held by the primary visa holder has already been cancelled. Section 134(4)(a) states that if “the Minister cancels a person’s business visa under subsection (1)”, then the Minister must cancel the business visas held by members of the person’s family unit. Mr Dobbie acknowledged that DP Handley rejected this argument in Lin, at [17] to [18], but contended that this decision overlooked the significance of s 134(4)(a) and s 135(1)(a), with the consequence that there would be an apprehension that the Minister of his delegate had predetermined that the primary visa holder’s visa should be cancelled.
The Minister stated that because it is a legislative necessity (under s 134(4)) that secondary visa holders’ visas be cancelled at the time of cancelling the visa held by the primary visa holder, it is appropriate prior to the cancellation of the primary visa holder’s visa to invite secondary visa holders (via the s 135(1) Notice) to make any representations as to extreme hardship which might lead to the Minister deciding not to cancel the secondary visa holder’s visas pursuant to s 134(5).
In our view, we should follow DP Handley’s decision in Lin. He distinguished the Federal Court decision in Zhong v Minister for Immigration and Citizenship (2008) 171 FCR 444; (2008) 102 ALD 86; [2008] FCA 507, also relied on by Mr Dobbie in this case, stating, at [17]:
In my view, the decision in Zhong is distinguishable on the facts since it was concerned with non-compliance and the relevant section of the Act in that case required the Minister to have first decided that the holder of the visa had not complied with specific provisions of the Act before giving the holder of the visa a notice. While s 134(4) is subject to s 134(5) and to s 135, s 134(4) is purely about cancelling visas by giving written notice of cancellation to the visa holders, and does not itself deal with the grounds for cancellation. There is no requirement in the subsection for the Minister to have attained a particular state of mind.
The Deputy President therefore rejected Mr Dobbie’s argument that the cancellation of the primary visa holder’s visa is a pre-condition or condition precedent to the issuing of a notice to the secondary visa holder under s 135. We agree.
Having rejected the Applicants’ contentions that the decisions to cancel were not made in accordance with the Act and were therefore invalid, we turn now to the second issue relevant to the review of the decision concerning Mr Chen, namely whether his visa should be cancelled having regard to whether he has obtained or made a genuine effort (and intends to continue to make such effort) to obtain a substantial ownership interest in an eligible business in Australia (s 134(1)(a) and s 134(2)(a) and (c)). This requires that the Tribunal determine whether he has been involved in (i) a business, that (ii) is an ‘eligible business’ (as defined in s 134(10)).
Does Mr Chen have a substantial interest in an ‘eligible business’?
Does Mr Chen have a ‘business’?
The word ‘business’ used in this context means “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”: Mason J in Hope v Bathurst City Council (1980) 144 CLR 1; (1980) 29 ALR 577, at CLR [14]; see also Tung-Liang Liang v Minister for Immigration and Citizenship (2009) 175 FCR 184; (2009) 107 ALD 88; [2009] FCA 189, at [30] (Logan J).
Mr Chen’s Evidence
Mr Chen gave evidence about his business activities by conference telephone at the hearing. He said he has 10 companies of which he is the chairman, mainly involved either in tourism and holiday resorts, or in media and advertising. His media interests control six television stations. The businesses have developed rapidly in the past two or three years, particularly since the listing of six associated companies on the US NASDAQ index in 2007. Whereas previously he was involved more in establishing and administering the businesses, he is now involved in general direction and management and investment decisions. His business headquarters are in Fuzhou City in Fujian Province in China, but his businesses operate across a number of Provinces, employing about 2,000 employees.
Mr Chen said that his and his wife’s 57.4% interest in the US listed companies has a current market value of about US$180m. In the last financial year, these companies achieved a net profit of US$254 m and the forecast net profit for the current financial year is US$36m. The profits are largely generated by the companies’ interests in the rapidly developing tourist industry in China. Mr Chen said he owns 100 percent of his four unlisted companies which are worth about 500 yuan [at the current exchange rate about A$84.2m]. These companies are involved in hotels, media, trading and the internet.
Mr Chen said his initial proposal to develop a motel in Geelong did not proceed because after information gathering and a feasibility study, he found that the Hunter Valley had much more potential, and because, after 2005, his businesses in China, especially in tourism and holidays, experienced rapid growth so that his business model was lifted to a higher level. After his business visa was granted, he came to Australia for a week’s holiday during which he visited the Hunter Valley. He identified the development associated with the Crowne Plaza Resort (which opened in October 2006) as more suitable for investment and, when he returned to China, and after talking with his business adviser and accountant, he invited the Australian managers of this business to visit his headquarters in China. This occurred early in 2007.
In July 2008, Mr Chen transferred US $1.5m from the account of Hong Kong Yi Tat International Investment Ltd (a company owned by Mr Chen and Ms Fan) to the Westpac account of HVGC Pty Ltd, a company registered in NSW on 15 August 2006 which trades under the business name of the Hunter Valley Golf and Country Club. In August 2008, ASIC was notified that Mr Chen had been issued with 1.5m fully paid shares in HVGC Pty Ltd (making him the principal shareholder), and that on 3 July 2008 he had been appointed a director of the company. With the resignation of the two previous directors, this made him the sole director of HVGC Pty Ltd.
It appears that HVGC Pty Ltd is one of a number of companies associated with the Crowne Plaza Resort. Financial statements for the 2007/2008 financial year show that HVGC Pty Ltd derives income from the Proshop at the Resort, from green fees and hotel grounds maintenance. In that year, it had a total income of $2,031,236.59, expenses of $1,837,376.83 and, therefore, a gross profit of $193,859.76. A summary of HVGC’s payroll activity for the period 20 to 26 May 2009 records 13 employees.
When questioned about the other six shareholders in HVGC who, according to the ASIC records, hold only partially paid shares, Mr Chen recalled meeting some of them in a hotel in Australia but could not remember others. He did not recall Troy Martin, HVGC’s Golf Manager, who provided a letter to the Department in support of Mr Chen dated 20 July 2009. Mr Chen said he appointed a representative to manage his interest in HVGC in early 2009 but she left towards the end of 2009. She would email him documents concerning the business which he would deal with remotely from China. Mr Chen said that in terms of his business interests, this is a small investment and, because of his much larger businesses in China, it would be impractical for him currently to relocate to the Hunter Valley. However, he would still like to relocate to Australia in the longer term and his interests in tourism in China are compatible with promoting his Australian venture.
Mr Chen was asked about his plans for future investments in Australia. He said that his plans are currently on hold because of the problems he has encountered. His son was studying in Australia and when, after two years, he applied for Australian citizenship (on 11 June 2009), his application was declined. (The Minister’s representative, Ms Linacre, said no decision had yet been made on Mr Ting Chen’s application for citizenship.) Mr Chen had formed the view that his son’s application had no chance of succeeding and so he feared that any future application for citizenship that he might make would be treated similarly. His son has now returned to China.
Mr Chen said that in the light of this and the cancellation of his and his family’s visas, he has delayed any further investment in Australia until the situation is clearer. Without Australian citizenship, it would be difficult to travel in and out of the country. He admitted that his feelings had also been hurt. Moreover, he is cautious because of the current international financial situation. However, he noted that earlier this year he had spent the Chinese New Year in Sydney with his wife and daughter.
Mr Chen said he intends to take significant financial action on the NASDAQ index next year and has been in negotiation with the largest Australian investment bank in relation to finance. He said that if he relocated to Australia, he could list his companies on the Australian Stock Market, and could invest in the tourism and leisure industries either through his US listed companies or personally. If future investments are small, he will delegate management to a manager. If large, he might travel personally to Australia on a regular basis.
Was the business an ‘eligible business’?
In the Tribunal’s view, the evidence establishes that HVGC Pty Ltd is a business. The financial statements provided, Business Activity Statements and other promotional evidence for the golf club clearly establish that it is a commercial enterprise currently trading with a view to profit. But is it an ‘eligible business’?
The definition of ‘eligible business’ is set out in s 134(10) of the Act in the following terms:
“eligible business” means a business that the Minister reasonably believes is resulting or will result in one or more of the following:
(a)the development of business links with the international market;
(b)the creation or maintenance of employment in Australia;
(c)the export of Australian goods and services;
…
It is also clear from the wording of s 134(1) and (2) that the eligible business must be in Australia.
The documentary evidence provided by Mr Chen indicates that there is potential for him to use his business interests in China in the travel and tourism industry and in the media to promote HVGC’s business in China, thereby attracting international customers for the Hunter Valley Golf and Country Club. Attracting customers for HVGC’s business will support the ongoing employment of its workforce of 13 people (in May 2009), and an expansion of its business will presumably lead to additional employment.
Mr Chen has invested $1.5m in purchasing shares in HVGC Pty Ltd and is its principal shareholder and sole director. The Tribunal is therefore satisfied that Mr Chen has a substantial interest in an eligible business.
Has Mr Chen made a genuine effort to utilise his skills in actively participating at a senior level in the day-to-day management of the business and does he intend to continue to make such an effort?
It is the Australian business that the visa holder must be involved in actively managing on a day-to-day basis. The Tribunal notes Departmental policy to this effect, in the form of the Procedures Advice Manual 3 (PAM 3) at [8.1]. The Act envisages that visa holders will settle in Australia and will use their skills in establishing a business here, while acknowledging that they may wish to travel overseas while conducting that business: Re Huang and Minister for Immigration, Multicultural Affairs [2002] AATA 656, at [12]; followed, for example, in Re Burg and Minister for Immigration and Citizenship [2007] AATA 1630, at [52] – [53]. Mr Dobbie conceded that Mr Chen does not satisfy s 134(1)(b) of the Act because he is not currently utilising his skills in actively participating at a senior level in the day-to-day management of HVGC Pty Ltd.
In relation to s 134(2) and whether Mr Chen has made a genuine effort to utilise his skills in actively participating at a senior level in the day-to-day management of HVGC Pty Ltd, the Tribunal notes the discussion of this in PAM 3 at [9.2]. To establish that a person has made a ‘genuine effort’ requires that there should be evidence that the visa holder has exerted him or herself in the management of a business at a senior level on a day-to-day basis.
Mr Dobbie submitted that the evidence provided by the manager of the Golf Club Troy Martin and by Mr Chen’s previous agent, Mr Han, supports this, as does Mr Chen’s statement dated 25 March 2010 in which he refers to his reviewing budget and financial issues. Mr Dobbie acknowledged that Mr Chen’s current participation in daily management is almost non-existent because Mr Chen lost confidence when his visa was cancelled and his son’s application for citizenship was not approved: Mr Chen did not feel welcome.
The Tribunal agrees with the Minister that there is insufficient evidence to establish the required genuine effort. While we accept that initially Mr Chen was keen to establish a business in Australia and took steps to achieve this, he appears to have only ever been involved on a fairly minimal basis in the day-to-day management of HVGC and his evidence suggests that with the rapid development of his businesses in China from about 2006/2007, those businesses have understandably been the focus of his attention. While Mr Chen indicated that he would still like to relocate to Australia in the longer term, his evidence suggests this is not something he anticipates in the foreseeable future and he is unlikely to be involved in the day-to-day management of any Australian businesses because of their relatively small size when compared to his Chinese interests. He is likely to appoint a local manager for his Australian interests as he did in 2009 with HVGC.
Thus, in the Tribunal’s view, Mr Chen does not satisfy s 134(2)(b) of the Act and it was open to the Minister to cancel his visa under s 134(1).
However, the Tribunal must also consider whether to exercise the residual discretion in s 134(1) not to cancel a visa: Kim v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 38 AAR 304; [2004] FCA 31, at [21]. We note that Mr Chen has spent very little time in Australia since the grant of his visa. His visits have been few and seem to have been limited to a week or two. Similarly, his wife and daughter have also spent very little time here and, although his son spent two years studying here, he has now returned to China. Apart from his investment in HVGC Pty Ltd, Mr Chen has very little connection with Australia and his main business interests and family seem to be firmly established in China. We are not satisfied that Mr Chen has shown a sustained commitment to Australia and, in our view, the evidence does not support the exercise of the residual discretion in his favour.
The Tribunal therefore affirms the decision to cancel Mr Chen’s visa.
Would Ms Fan, Mr Ting Chen or Ms zeqian Chen suffer extreme hardship by reason of the cancellation of their visas?
Having affirmed the decision to cancel Mr Chen’s visa, the Tribunal must consider whether cancellation of the visas of Ms Fan, Mr Ting Chen and Ms Zeqian Chen would result in their suffering extreme hardship so that, pursuant to s 134(5), their visas should not be cancelled.
The meaning of the words ‘extreme hardship’ was considered by Foster J in the Federal Court in Man Ki Kim v Minister for Immigration and Ethnic Affairs (1995) 37 ALD 481, at 487:
… it is, in my opinion, important to approach the phrase “extreme hardship” in a broad way. Clearly, it imports a high degree, perhaps a very high degree of hardship, but it must be applied in the context of the facts of the particular case. “Hardship” is in itself a relative term. What may be a “hardship” to a sensitive person, or one in a particularly vulnerable situation, may be no great burden at all to a person of more stoical disposition or in a more protected situation. Similarly, the word “extreme” must be evaluated against the facts of the particular case. Such an evaluation cannot, consistently with the duties imposed upon the decision-maker by the Act, be approached in a dismissive or perfunctory fashion. A full and proper consideration of the person allegedly suffering the hardship or prejudice must be undertaken.
His Honour went on to say that there can be differing degrees of hardship and that extreme hardship is at the very high end of the scale. As Deputy President McMahon also recognised in Re Wang and Minister for Immigration and Multicultural Affairs [2000] AATA 961, at [30], such hardship must necessarily result from the cancellation of the visa, and the test is subjective – the wording of s 134(5) is “if cancellation of the visa would result in extreme hardship to the person”. As the Tribunal stated in Re Roeloffze and Minister for Immigration and Citizenship [2008] AATA 345, at [63], “It is the effect on the individual resulting from the cancellation of the visa which is to be considered.”
In the case of Ms Fan and Ms Zeqian Chen, the Tribunal notes that since the grant of their visas, they have travelled to Australia on two occasions and, it appears, have spent less than a month here. In a statement dated 27 May 2010, Ms Fan states that cancellation of her visa has caused her extreme hardship because her family should be able to live together in Australia. There is no other evidence to support a claim that either Ms Fan or Ms Chen they would suffer extreme hardship as a result of the cancellation of their visas, and we are satisfied that s 134(5) does not apply.
In the case of Mr Ting Chen, the Tribunal notes that he spent nearly nine months in Australia in 2007 and 17 months here in 2008/2009, departing on 21 July 2009, during which time he completed a Masters degree. In a statement dated 27 May 2010, Mr Ting Chen said he loved the life and people in Sydney and made several friends. On 11 June 2009, Mr Ting Chen applied for Australian citizenship. He said this was a life changing decision and he committed to becoming Australian. He was devastated by the cancellation of his visa. (Ms Linacre informed the Tribunal that his application for citizenship had not yet been determined.)
Mr Dobbie said that if Mr Ting Chen’s visa is cancelled, he will be unable to attain Australian citizenship, and preventing him from becoming a citizen in these circumstances would cause him extreme hardship. The Minister states that Mr Chen has spent the majority of his life in China where he completed his education (to undergraduate level) and where he has been employed. There is no specific evidence of hardship.
In the Tribunal’s view, Mr Chen’s situation is similar to that of many students who have studied in Australia. The fact that his business visa has been cancelled does not prevent him from applying for a visa on his own account. Ultimately, if he is granted a visa entitling him to permanent residency, he may in future be able to apply for Australian citizenship. Thus, while Mr Chen may have preferred another outcome, the Tribunal is not satisfied on the basis of the evidence before it that he will suffer extreme hardship if his visa is cancelled, and we are satisfied that s 134(5) does not therefore apply.
The decisions under review are affirmed.
I certify that the 57 preceding paragraphs are a true copy of the reasons for the decision herein of Mr RP Handley, Deputy President
Signed: ........[sgd].................................................................
Associate
Date of Hearing: 28 June 2010
Date of Decision: 9 July 2010Applicant representative: Mr N Dobbie, Visa Immigration Specialists Australia Pty Ltd
Respondent representative: Ms A Linacre, Clayton Utz
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