Hadiwarsito and Ors and Minister for Immigration and Multicultural and Indigenous Affairs
[2004] AATA 644
•22 June 2004
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2004] AATA 644
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2003/1177
GENERAL ADMINISTRATIVE DIVISION ) Re Suhartono Hadiwarsito Applicant
And
Minister for Immigration and Multicultural and Indigenous Affairs
Respondent
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2003/1178
GENERAL ADMINISTRATIVE DIVISION )
Re Fifi Sukmawati Wirnata
Applicant
AndMinister for Immigration and Multicultural and Indigenous Affairs
Respondent
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2003/1179
GENERAL ADMINISTRATIVE DIVISION )
ReIndriani Kusuma
Hadiwarsito
Applicant
AndMinister for Immigration and Multicultural and Indigenous Affairs
Respondent
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2003/1180
GENERAL ADMINISTRATIVE DIVISION )
Re Indra Purnomo Hadiwarsito
Applicant
AndMinister for Immigration and Multicultural and Indigenous Affairs
Respondent
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2003/1181
GENERAL ADMINISTRATIVE DIVISION )
ReAgatha Christiani
Hadiwarsito
Applicant
AndMinister for Immigration and Multicultural and Indigenous Affairs
Respondent
DECISION
Tribunal Mr RP Handley, Deputy President Date22 June 2004
PlaceSydney
Decision The Tribunal affirms the decisions under review.
..............................................
RP Handley
Deputy President
CATCHWORDS
IMMIGRATION – Business Skills Visa - cancellation of business skills visa – cancellation of family unit member visa holders – whether principal visa holder has a genuine involvement in business in Australia – whether business is an “eligible” business in Australia – whether principal visa holder has “utilised his skills” in that business – examination of the principal visa holder’s business activities in Australia and Indonesia – whether there will be hardship to the Applicants and their three children if visas are cancelled – examination of the effect of the cancellation of the associated business visa on the Applicant’s daughter currently studying in Australia and whether it will result in extreme hardship to her – held Applicant’s business activities do not satisfy the criteria for a business visa – decision to cancel the Applicant’s business visa is affirmed – held that the Applicant’s daughter will not suffer “extreme hardship” by having to return to Indonesia – decision under review is affirmed.
Migration Act 1958 ss 134(1), 134(1)(a)(b), 134(2), 134(10)
Freeman v Secretary, Department of Social Security (1988) 19 FCR 342
Hope v Bathurst City Council (1980) 144 CLR 1
Re Huang and Ministerfor Immigration and Multicultural and Indigenous Affairs [2002] AATA 656
Re Griffiths and Migration Agents Registration Authority [2001] AATA 240
Re Salim and Ors and Ministerfor Immigration and Multicultural and Indigenous Affairs [2002] AATA 899
Re Setiawan and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 260
Re Yam and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 283
REASONS FOR DECISION
22 June 2004 Mr RP Handley, Deputy President Summary
1. A delegate of the Minister cancelled Suhartono Hadiwarsito’s business visa on the grounds that he does not have a substantial ownership interest in an eligible business in Australia, he does not utilise his skills in participating in that business, and he does not intend to continue that business in the future. The delegate also cancelled the secondary business skills visas held by Mr Hadiwarsito’s spouse, Fifi Sukmawati Wirnata, and their children, Agatha Christia Hadiwarsito, Indra Purnomo Hadiwarsito and Indriani Kusuma Hadiwarsito. These are the decisions to be reviewed by the Tribunal.
Background
2. Mr Hadiwarsito, who was born in Indonesia on 26 October 1956 and is aged 48, and his wife, Fifi Sukmawati Wirnata, who was born on 12 February 1960 and is aged 44, have three children: Agatha who is aged 16, Indra who is aged 11, and Indriani who is aged seven. Ms Wirnata and the three children are listed as family members in respect of Mr Hadiwarsito’s business visa (T p22).
3. Mr Hadiwarsito is a qualified electrical engineer who is the managing director and a principal shareholder of a business in Jakarta. On 29 February 2000, he was granted a business skills (subclass 127) visa and a secondary business visa was granted to his wife covering their three children (T18 p155). The visas were valid for three years from the date of entry into Australia. Mr Hadiwarsito entered Australia on 12 March 2000 (T18 p155). By letter dated 23 May 2002 from the Department of Immigration, Multicultural and Indigenous Affairs (“DIMIA”), Mr Hadiwarsito was asked to complete a “Survey of Business Skills Migrant – 24 Months (Form 1010)” to be completed and returned by 11 July 2002 (T4 p28). On 28 October 2002, DIMIA again wrote to Mr Hadiwarsito, noting that he had not responded to the Department’s previous letter and informing him that it was mandatory that he complete the Survey and return it to the Department by 16 December 2002 (T5 p29). On 1 November 2002, Mr Hadiwarsito returned the form and supporting documents to the Department (T7 p32). By letter dated 21 November 2002, the Department asked Mr Hadiwarsito for further documentary evidence to verify the nature of his business and the level of his involvement (T8 p66). On 28 January 2003, Mr Hadiwarsito provided the Department with bank statements, invoices, and copies of letters of support relating to the business (T9 p68).
4. On 18 February 2003, the Department notified Mr Hadiwarsito of its intention to cancel his business visa under s 134 of the Migration Act 1958 (“the Act”) for failure to meet the requirements of his visa. Mr Hadiwarsito was invited to respond by 26 March 2003 (T10 p71). By letter dated 18 February 2003, the Department also notified Ms Wirnata of its intention to cancel her business skills visa and those of her three children (T10 p76). On 4 March 2004, Mr Hadiwarsito responded stating that he had tried unsuccessfully to develop a new business “which is not in our skill line”. However, his business had resumed selling “Waste Water/Sewerage Treatment Plant” the results of which “is not too bad” (T11 p78). He stated the family would suffer “sadness” if their visas were cancelled because their daughter was now studying in Sydney and would be very sad if she had to return to Indonesia. His now growing Waste Water/Sewerage Treatment Plant would become “nothing” (T p79). Between March 2003 and June 2003, Mr Hadiwarsito provided the Department with further documentary evidence including financial statements and invoices.
5. On 20 June 2003, a delegate of the Respondent decided to cancel Mr Hadiwarsito’s business skills visa on the grounds that while Mr Hadiwarsito had a 50% share in the registered business name “Ausega”, this enterprise did not meet the definition of business; that the company had only been involved in two transactions over a three year period which did not indicate an active and ongoing business concern; that given the lack of business activity of Ausega it was unlikely that Mr Hadiwarsito was utilising his senior management skills on a daily basis to improve the business and its operations; that the lack of business of Ausega indicated that he was not making a genuine effort to improve his Australian business interests; and that as at 20 June 2003, he had only resided in Australia for 21 days since the issue of the visa (T2 pp17-18). On the same day, the business skills visas of Ms Wirnata and their children were also cancelled (T2 p19). On 18 July 2003, Mr Hadiwarsito and Ms Wirnata lodged applications for a review of these decisions by the Tribunal. This decision also relates to the applications of the three children: Indriani – file No N2003/1179; Indra – file No N2003/1180 and Agatha – file No N2003/1181. Agatha is currently attending St Scholastica’s College in Glebe as a boarder, where she is in Year 11.
6. At the hearing, the Applicants were represented by Barrie Goldsmith, Solicitor, of Goldsmiths, Solicitors, and the Respondent was represented by Murray Allatt, Solicitor, of the Australian Government Solicitor’s office. The evidence before the Tribunal comprised the documents produced pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (“the T Documents”) together with the evidence tendered by the parties at the hearing. Mr Hadiwarsito and Agatha Hadiwarsito gave evidence in person.
Applicable Legislation
7. Section 134 of the Act empowers the Minister to cancel a business visa in certain circumstances. The relevant provisions in Mr Hadiwarsito’s case 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 of a 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).
8. Section 134(10) of the Act includes the following definitions:
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.
established business in Australia visa means a business visa a criterion for whose grant:
(a) relates to the applicant having an established business in Australia; or
(b)is that the applicant is a member of the family unit of the holder of a visa a criterion for whose grant is as mentioned in paragraph (a)
…
ownership interest, in relation to a business, means an interest in the business as:
(a) a shareholder in a company that carries on the business; or
(b) a partner in a partnership that carries on the business; or
(c) the sole proprietor of the business;
including such an interest held indirectly through one or more interposed companies, partnerships or trusts.
9. In the case of Ms Wirnata and the children, ss 134(4), (5) and (6) are relevant:
(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.
(6) The Minister is taken not to have cancelled a person's business visa under subsection (4) if the Administrative Appeals Tribunal has set aside the decision of the Minister to cancel the business visa of the relevant person to whom paragraph (4)(a) applied.
Evidence
Suhartono Hadiwarsito
10. Mr Hadiwarsito provided a statement dated 3 April 2004 (A5). He is a qualified electrical engineer who started his first business in 1985 and is now the managing director and a principal shareholder. The business has two main activities: the manufacture and supply of electrical switchboards, and the supply of sewerage treatment plant to construction companies. It has a factory in Jakarta and employs about 150 people. With regard to the supply of sewerage treatment plant, Mr Hadiwarsito said much of the work is sub-contracted. While part of the plant is manufactured in Indonesia, part – the high output sewerage pumping equipment – is imported from overseas and purchased by his business from an Indonesian importer.
11. When Mr Hadiwarsito first came to Australia in 1995 for a holiday, he “fell in love with the country” and decided that in due course he would like to move to Australia with his family. He lodged an application for a business skills visa which was granted on 29 February 2000. At the time he applied, Mr Hadiwarsito stated that he had assets worth approximately US$1,000,000. His intention was to retain his business in Indonesia and transfer between Aus$200,000 and Aus$300,000 to Australia as the starting capital for establishing a new business in Australia. Mr Hadiwarsito said he is unable to recall exactly what he told the Department of Immigration at the time.
12. Mr Hadiwarsito stated that the grant of his business skills visa coincided with an economic slump in Indonesia which affected his business. His “obvious priority was to focus on my Indonesian business activities rather than my future plans for Australia”. Consequently, he “did not undertake any business activities in Australia until about July 2002 although certainly I did make some enquiries and did do some research about business prospects in Australia before that time”.
13. Mr Hadiwarsito said he arrived in Australia with his wife on 12 March 2000 and stayed for about two weeks. They stayed at the home of Mr Eng Hian Khouw, his wife’s uncle, who is also now Mr Hadiwarsito’s business partner in his Australian business, and whom he has known for many years. Mr Hadiwarsito undertook some research to ascertain in what kind of business he might get involved in Australia, including visiting several large stores selling technical equipment such as electrical switchboards similar to those that his business in Indonesia manufactures and supplies.
14. In February 2001, Mr Hadiwarsito met Mr Kristiono, a Marketing Officer with Austrade in Jakarta. At that time, Mr Hadiwarsito was considering the possibility of his future Australian business exporting soya beans to Indonesia. He made enquiries of some Australian suppliers and of potential customers in Jakarta. In July 2001, he had a further meeting with Austrade in Jakarta, meeting with Barbara Try, an Export Adviser. He and his wife visited Australian again in July 2001, staying for about a week, and he took samples of soya beans back to Indonesia with him. Ultimately, after further meetings and discussions with potential customers in Jakarta, Mr Hadiwarsito concluded that Australian sourced soya beans would not be price competitive in Indonesia with other imported soya beans.
15. In May 2001, Mr Hadiwarsito attended an exhibition in Jakarta at which manufacturers from around the world exhibited their electrical equipment. He met with Ken Bridges, the Managing Director of a Queensland company, and discussed Mr Bridge’s company’s electrical products and their potential for the Indonesian market. Mr Hadiwarsito said once he had established a company in Australia, the company could export such products from Australia into Indonesia. Again, ultimately, Mr Hadiwarsito concluded that these products were not suitable for the Indonesian market.
16. Mr Hadiwarsito said that by early 2002, the Indonesian economy had started to pick up and he was more confident of being able to proceed with his business plans in Australia. After discussions with Mr Khouw in July 2002, they registered the business name “Ausega” in New South Wales. Their initial aim was to develop a business in commodities and equipment used in the construction industry for export to Indonesia. Mr Hadiwarsito stated that he wanted to establish a viable Australian business before relocating his entire family to Australia. Initially, Mr Khouw would look after the Australian side of things and Mr Hadiwarsito would look after the Indonesian side.
17. Having established the Australian business, Mr Hadiwarsito continued to explore the possibility of importing other Australian produce into Indonesia. In July/August 2002, he started to explore the prospect of importing unsalted butter and powdered milk and obtained samples to ascertain the reaction of potential Indonesian customers. Once again, the products proved not to be price competitive. In about November 2002, he explored the possibility of importing Australian tomato paste, including with H J Heinz in Indonesia (A5). This too did not proceed. In early 2003, Mr Hadiwarsito explored “the possibility of importing into Indonesia industrial fans from Australia” (A5 p5) but this also proved not to be a viable proposition.
18. Mr Hadiwarsito said he did not receive the Department’s 24 months survey form dated 23 May 2002 until September 2002 when he received this by fax in Jakarta from his migration agent in Perth. Mr Hadiwarsito said the address in Beverly Hills, NSW, to which the Department’s letter of 28 October 2002 (T5) was sent is the home of his business partner.
19. In 2002 Mr Hadiwarsito said he undertook some research in relation to waste treatment equipment and had discussions with Kelair Pumps Australia Pty Ltd of Arndell Park, NSW. He located a customer in Indonesia, PT Grahadika Adpurnajsa, who purchased waste treatment equipment from Ausega in October 2002 and February 2003, which Ausega in turn sourced from Kelair Pumps.
20. The value of these orders to Ausega was $32,300 and $35,150 respectively, including freight charges. Ausega’s net profit on the first order was $455.65 without taking into account the time of Mr Hadiwarsito or Mr Khouw. Mr Hadiwarsito agreed that this profit did not cover the costs of generating the order. He confirmed that Ausega’s profit on the second transaction was of a similar amount. He had accepted that he might initially have to suffer a loss in order to establish a business in Australia. He took a long term view and was prepared at first to accept a very small profit margin in order to be competitive against other tenderers. He had therefore worked on a profit margin of about five per cent.
21. Mr Hadiwarsito said he and Mr Khouw contributed equal amounts to Ausega’s bank account to facilitate the purchases from Kelair Pumps prior to the export of the equipment to Indonesia. Mr Hadiwarsito and Mr Khouw had a separate joint personal account from which they transferred the necessary funds to Ausega. Mr Hadiwarsito noted that a further two export orders were placed by the same Indonesian company after Mr Hadiwarsito’s visa was cancelled, including an order for waste treatment equipment at a cost of $54,180 placed on 10 June 2003 (T p154).
22. Mr Hadiwarsito stated that at the end of 2002, he had discussions with a stock feed manufacturer and wholesaler in Western Australia, Thompson & Redwood Stock Feed Manufacturers and Wholesalers, about the possibility of “importing horse pellets and other feed into Indonesia” (A5 p10). In about April/May 2003, Mr Hadiwarsito had discussions with potential customers in Indonesia which resulted in orders for chaff from PT Pentamitra Abadi in December 2003 and in January 2004 for the amounts of $9,026.93 and $7,297.26 respectively (A5 Annexure F). Ausega in turn placed orders with Thompson & Redwood for the supply of this produce.
23. Mr Hadiwarsito said that during the currency of his business visa he was in Australia for just over 20 days. However, he said that between July and November 2002, he devoted about 80 per cent of his time during business hours to Ausega’s business. He spent only about ten hours a week on his Indonesian business even though he remained the managing director of that business.
24. With regard to Ausega’s financial statements, Mr Hadiwarsito confirmed that the total proprietors’ funds of the partnership were $500 ($250 each) (T p85), and he and Mr Khouw both loaned Ausega $5,000 (T p87). Thus, Ausega had working capital of $10,000 and he and Mr Khouw contributed additional funds as necessary to make the required purchases in order to fill orders placed with Ausega. In addition, Mr Hadiwarsito has private bank term deposits in Australia of approximately $50,000. He said he was prepared to use these funds for the business if required.
25. Mr Hadiwarsito insisted that he was primarily targeting the export of goods from Australia rather than their import into Indonesia. For example, with the orders for sewerage treatment equipment, the orders were on a CIF (cost insurance freight) basis and the Indonesian purchaser made the importation arrangements. However, he agreed that in the case of the unsalted butter and powdered milk, it was his intention to be involved in both the export of those products from Australia and their importation into Indonesia.
26. Mr Hadiwarsito said he visited Australia in March 2002 with his wife and children. He had previously surveyed some schools in NSW during his visit in July 2001 and was favourably impressed by St Scholastica’s. During their March 2002 visit, Agatha visited the school and had an interview with the Principal. Agatha commenced at the school in July 2002.
27. Mr Hadiwarsito said Agatha previously attended a private school in Jakarta. However, he believes schools in Australia are superior because pupils get more attention from the teachers. Currently, Mr Hadiwarsito sees Agatha about four times a year during the school holidays. Agatha has told him that she is very pleased with the school and the environment in which she lives, including the teachers and other pupils. She has talked about having friends at the school from China, Thailand and Australia.
28. Mr Hadiwarsito said he has read Agatha’s school reports and is very pleased to see her marks are excellent. Over the past two years she has been at school in Australia, she has become more self-reliant, independent and better able to discuss things. Before she came to Australia, she was a spoilt and over-affectionate child. He is concerned that if her visa is cancelled, Agatha will not get as good an education in Indonesia. He would like to see her finish school in Australia and apply to enter an Australian university.
29. Mr Hadiwarsito said he first told Agatha of the cancellation of his visa in the school holidays in September 2003. He told her that he would appeal the decision. During the Christmas/New Year holidays of 2003/2004 and again during the Easter holidays of 2004, Mr Hadiwarsito noticed that Agatha was very sad. She cried and said she did not want to return to school in Jakarta. If she had to do so, she would have to start Year 10 again. She would also loose her Australian school friends and study environment.
30. Mr Hadiwarsito said he explained more fully the circumstances of the cancellation of his visa to Agatha in February 2004 before she returned to school. He has noticed the stress that the possible cancellation of her visa has caused her and is concerned that she will be depressed if she has to return to school in Indonesia.
Agatha Hadiwarsito
31. Agatha provided a statement dated 2 June 2004 (A2). She is now aged 16 and has been at school at St Scholastica’s College since July 2002. Her parents thought it was good for her to attend school in Australia so that she could learn English. Previously, she attended a private Catholic school in Jakarta – St Mary’s. They did not use technology as much there and the teachers were not so helpful. Like most students, she had to be dropped off and collected from school by a driver. In Jakarta, it is dangerous to go out by yourself. They have to be driven everywhere.
32. Agatha said she has made friends at St Scholastica’s and is doing well there. She likes her own room and being independent. If she had to go back to school in Jakarta, she would miss her teachers and friends and her study of music. She could not go out by herself and would be dependent on her parents again.
33. Agatha said she does not often visit her Auntie and Uncle in Sydney and rarely stays the night. However, she phoned her Uncle once when she was stressed about the cancellation of her visa and cried on the phone. She has been stressed since her father told her of the cancellation. She has lost three kilograms in weight and has bad dreams. Agatha said she had not seen Dr George Han before 1 June 2004 but her Auntie knows him. Agatha talked to Dr Han about her stress and loss of weight. She also saw a psychologist, Mr Onsy Mattar, on 1 June 2004.
Consideration of the Law and Findings
34. The Tribunal notes by way of preliminary observation that it should have regard to all relevant evidence to enable the making of findings of fact in relation to the cancellation of Mr Hadiwarsito’s and Ms Wirnata’s and their three children’s visas as at the date of the decision, that is 20 June 2003: Freeman v Secretary, Department of Social Security (1988) 19 FCR 342; Re Griffiths and MigrationAgents RegistrationAuthority [2001] AATA 240.
35. The decision to cancel Mr Hadiwarsito’s business skills visa was made pursuant to s 134(1) of the Act on the grounds that the delegate was not satisfied that (T p18):
(a)Mr Hadiwarsito had not obtained a substantial ownership interest in an eligible business in Australia; or
(b)that he was utilising his skills in actively participating at a senior level in the day-to-day management of that business; or
(c)that he did not intend to continue to:
(i)hold a substantial interest in; and
(ii)utilise his skills in actively participating at a senior level in the day-to-day management of;
an eligible business in Australia.
The terms “ownership interest” and “eligible business” are defined in s 134(10), set out above.
36. Section 134(2) provides that the Minister must not cancel a business visa under s 134(1) if the Minister is satisfied that the person:
(a)has made a genuine effort to obtain a substantial ownership 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.
When considering whether a person has made the genuine effort referred to in subsection (2), the Minister may take into account the matters set out in subsection (3), set out above.
37. Mr Goldsmith, for the Applicant, said the basis of Mr Hadiwarsito’s application is s 134(2) requiring that the Tribunal determines whether Mr Hadiwarsito satisfies all of the three subparagraphs (a) to (c). Turning then to s 134(2)(a), the first issue is whether Mr Hadiwarsito has made a genuine effort to obtain a substantial ownership in an eligible business in Australia. What constitutes an “eligible business” is defined in s 134(10), set out above. Mr Goldsmith referred the Tribunal to the recent decision of Senior Member Dwyer in ReYam and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 283 as a useful guide to the meaning of the relevant provisions.
38. With regard to the words “genuine effort”, Senior Member Dwyer notes at paragraph 88 that:
The Act does not specifically include any requirement that the “genuine effort” must be likely to succeed, or must meet any threshold level, beyond being genuine.
Mr Goldsmith submitted that Mr Hadiwarsito’s efforts were genuine, serious and intended to generate business. Mr Allatt, for the Respondent, took a different view. He submitted that the evidence provided by Mr Hadiwarsito is no more than a few business cards and brochures and the exploring of possible lines of business.
39. Mr Hadiwarsito first entered Australia on his business skills visa on 12 March 2000. He acknowledged that at the time the Indonesian economy was in a slump and his Indonesian business was his focus for the next two years. Essentially, he did very little at first with a view to becoming involved in a business in Australia. He made a few enquiries, met Austrade representatives in Jakarta on two occasions, considered the possibility of importing Australian soya beans into Indonesia and had some discussions with an Australian manufacturer of electrical equipment at an exhibition in Jakarta.
40. The Tribunal finds that it was in July 2002 that Mr Hadiwarsito and his friend Mr Khouw formed a partnership – it appears an oral partnership, no formal partnership agreement being produced. On 29 July 2002 (T p95), the business name “Ausega” was registered with the two business partners being the registered proprietors. The business obtained ABN (Australian Business Number) registration from 29 July 2002 (T p129) and was also registered for GST purposes from that date (T p128). Mr Hadiwarsito and Mr Khouw were issued with a Tax File Number on 22 August 2002 (T p127).
41. On 7 March 2003, Mr Erwin Marzukie, Ausega’s Chartered Accountant, provided interim financial statements to the Department for the period to 31 December 2002. These statements show (T p81ff) that Mr Hadiwarsito and Mr Khouw each contributed $250 in proprietors’ funds to the business and each loaned the business $5,000. The turnover for the period comprised one sale in October 2002 of sewerage treatment equipment priced at $32,300 to an Indonesian in respect of which Ausega made a profit of $455.64 after deduction of $206.36 in expenses (accountancy, printing and stationery, telephone) but without deduction for any other costs incurred by the partners (for example time, travel etc). Mr Hadiwarsito acknowledged that in real terms this transaction represented a loss to the business but said he expected this as part of the cost of establishing the business. Ausega made a second sale of sewerage treatment equipment in February 2003 at a similar level of profit. Since the cancellation of Mr Hadiwarsito’s visa, there have been a further two sales of sewerage treatment equipment and two sales of chaff to Indonesia.
42. Even allowing for these post visa-cancellation transactions, Ausega is clearly not yet a viable business and the Tribunal is unable to conclude that it would become viable in the near future: the small number of transactions and the absence of any real profit from the transactions suggests otherwise. Moreover, Mr Hadiwarsito’s commitment to the business in terms of time spent in Australia identifying appropriate business lines has been negligible and no evidence has been provided about the efforts made by Mr Khouw on behalf of Ausega. Mr Hadiwarsito’s evidence is that he spent just over 20 days in Australia during the currency of his three year visa. While the Tribunal may also take into account Mr Hadiwarsito’s activity on behalf of the Australian business while residing overseas (Re Yam (supra) at paragraph 102), the fact of his having spent so little time in Australia is obviously a relevant consideration.
43. Even Mr Hadiwarsito’s solicitor acknowledged that Mr Hadiwarsito’s evidence of spending 30 hours per week on Ausega business in Indonesia in the period July to November 2002 was “not feasible” given that he is managing director of his Indonesian company. In the Tribunal’s view, Mr Hadiwarsito’s evidence of spending 30 hours per week on Ausega business and 10 hours per week on his Indonesian business is just not credible, especially in view of the fact that those efforts gave rise to at best two sales if one includes the sale in February 2003. The evidence also suggests that the business activity was as much about importing goods into Indonesia as about exporting goods from Australia.
44. The Tribunal concludes that while in the last nine months of the currency of Mr Hadiwarsito’s business visa, he took some additional steps to try and develop a business in Australia, those steps did not contemplate a viable Australian business in the near future which would be capable of generating an income to even partially support his family’s needs. The impression gained by the Tribunal is that Mr Hadiwarsito’s focus remains on his business activities in Indonesia and the successful operation of his company there.
45. An analysis of Mr Hadiwarsito’s business activity against the criteria set out in the definition of “eligible business” in s 134(10) leads the Tribunal to conclude that the only relevant criterion is paragraph (c) “the export of Australian goods or services” since Ausega’s business activity seems to be directed solely to the possibility of purchasing goods in Australia for export to Indonesia. Yet only two exports took place during the currency of the visa and four exports in the year since cancellation. The small number of transactions suggests a lack of continuity, which was one of the relevant factors identified by Justice Mason in Hope v Bathurst CityCouncil (1980) 144 CLR 1 at 8-9, in deciding whether particular activities constitute a business.
46. This leads the Tribunal to conclude that s 134(2)(a) is not satisfied because Mr Hadiwarsito has not made genuine efforts to obtain a substantial ownership in an eligible business in Australia. The Tribunal is not satisfied that as at the date of the reviewable decision he had made “genuine efforts”, and while he had a substantial ownership – a 50 per cent share in a partnership, the Tribunal is doubtful that the business was an “eligible business”.
47. With regard to 134(2)(b), the Tribunal finds that during the first two years and three months of the currency of his visa, Mr Hadiwarsito did not make a genuine effort to utilise his skills in actively participating in the day to day management of that business. Essentially, there was no business during that period. In the last nine months of the visa, there was a business, at least in name, but the Tribunal has found Mr Hadiwarsito’s evidence of his spending 30 hours per week on Ausega business not to be credible, given that he was also the managing director of an Indonesian company. There is little other evidence of his involvement in Ausega’s business and insufficient evidence to persuade the Tribunal that s 134(2)(b) is satisfied.
48. Finally, with regard to s 134(2)(c), the evidence is that Mr Hadiwarsito has continued with some Ausega business activity since the cancellation of his visa. Nevertheless, the Tribunal continues to have doubts about Mr Hadiwarsito’s long term intentions in relation to the location of his family and his principal business activity given his apparent ongoing commitment to his Indonesian company and his limited financial and other commitment to business activity in Australia.
49. An examination of the matters which may be taken into account pursuant to s 134(3) also fails, in the Tribunal’s view, to provide assistance to Mr Hadiwarsito’s case. The business plan dated 12 March 2003 (T p 96) lacks specificity and fails to impress (s 134(3)(a)). Mr Hadiwarsito has a partner, Mr Khouw, but the Tribunal was provided with no evidence of him or his activities (s 134(3)(b)). While Mr Hadiwarsito had discussions and made inquiries of a business nature, they were not, in the Tribunal’s view, extensive (s 134(3)(c)). On his own evidence, he only spent just over 20 days in Australia during the three years currency of the visa (s 134(3)(d)). The value of assets transferred to Australia was not significant – a $50,000 term investment together with working capital, it would appear, of approximately $25,000 – Mr Hadiwarsito’s financial investment in Ausega was not significant (s 134(3)(c)). The value of Mr Hadiwarsito’s ownership interest in Ausega is negligible given the current state of business activity, discussed above (s 134(3)(f)). The Tribunal had regard to Mr Hadiwarsito’s business activity (s 134(3)(g)). He did not fail to complete the 24 month survey but was late in submitting it (s 134(3)(h)).
50. The Tribunal therefore determines that s 134(2) does not apply in Mr Hadiwarsito’s case. Turning then to the exercise of the Minister’s discretion under s 134(1), as the Tribunal has stated above, it doubts that the business in which Mr Hadiwarsito has an interest is an “eligible business”, and is not satisfied that he has utilised his skills in actively participating in the day to day management of the company. In the Tribunal’s view, there are adequate grounds to justify the exercise the Minister’s discretion to cancel Mr Hadiwarsito’s business visa pursuant to s 134(1).
51. The Applicant also contends pursuant to s 134(5), that if Mr Hadiwarsito’s business visa is cancelled, the Tribunal should not cancel Agatha’s associated business visa because this “would result in extreme hardship”.
52. Mr Goldsmith said that the impression he formed of Agatha from her giving evidence is that of a confident, smart and determined young person who has set her heart on completing her secondary education in Australia. She loves her school where she has made friends. If she has to return to Indonesia, she would have to go back into Year 10. She also feels stressed and depressed, is suffering from bad dreams and has lost weight. The medical report from Dr Han states that “displacing her from her current home will result in significant psychological trauma and damage” (A2). The report from Mr Onsy Mattar, Psychologist, states that she is suffering from anxiety, stress and depression.
53. Mr Goldsmith referred to the Tribunal decisions in ReSetiawan and Minister forImmigration and Multicultural and Indigenous Affairs [2002] AATA 260 and ReHuang and Ministerfor Immigration and Multicultural and Affairs [2002] AATA 656 where interference with a student’s tertiary education was found to constitute extreme hardship.
54. Mr Allatt said that Agatha’s being self-confident and knowing her own mind does not equate with extreme hardship. She has spent only two years in Australia. Having only received a copy of Agatha’s statement on the morning of the hearing, the Respondent was unable to challenge Agatha’s evidence of having to go back into Year 10 if she has to return to Indonesia. With regard to the medical evidence, both reports were based on only one visit and a history given by Agatha. Mr Allatt noted that Agatha’s presentation in the witness box did not give the impression of a person anxious or withdrawn. He submitted that the suggestion that she might suffer significant psychological trauma if she has to return to Indonesia is purely speculative.
55. Mr Allatt said while it is understandable that Agatha might suffer some stress if she has to return to Indonesia, she has only been away two years and has returned there for all her school holidays. It is not uncommon for children to have to move from one area to another with their parents. While they may suffer some initial stress, this is normally transitory.
56. Mr Allatt referred the Tribunal to similarities with the facts in Re Salim andOrsandMinister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 899, where the Tribunal held that emotional hardship experienced as a result of the secondary visa holders whose visas were cancelled having received a part or whole of their secondary or tertiary education in Australia was found not to constitute extreme hardship.
57. There was no issue between the parties as to the meaning ascribed to “extreme hardship”. This was explained by Deputy President Purvis in Re Setiawan (supra) at paragraph 7 as follows:
7. The meaning to be ascribed to the words “extreme hardship “ was considered by the Federal Court in Man Ki Kim v Minister for Immigration and Ethnic Affairs (1995) 37 ALD 481. At p 487 it was stated:
"...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 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 [sic] 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 on 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...
In addition to what I have already said, I consider that the application of the word "extreme" must also be approached with caution. Obviously there are varying degrees of hardship which may be suffered by any particular individual. "Trivial", "minor", "moderate" are adjectives which spring to mind as conveying such varying degrees. Clearly enough, "extreme" hardship must find itself at the very high end of the scale. This does not mean, however, that in any given case, "extreme hardship" means, in effect, a particular point on a continuum of hardship. It obviously connotes an area within which an ascertainable burden of hardship may fall and properly merit the description "extreme". Within that area there may be varying degrees of burden, one less than another, but each meriting the description...”
8. As was noted by the Tribunal in Siwei Wang v Minister for Immigration and Multicultural Affairs [2000] AATA 961 at paragraph 28, "Hardship" from the point of view of the person allegedly experiencing it "must be judged subjectively", and further at paragraph 29 "Clearly ...hardship involves more than inconvenience or detriment. Affectation must be to a considerable degree before it can properly be called hardship". At paragraph 30 the Tribunal considered the significance that should be ascribed to the word "extreme" as used in the statue. The Tribunal said:
"...The meaning of words will always be taken from the context in which they appear. However, the deliberate choice of the word "extreme" by Parliament, requires one to understand what was meant by the use of that particular degree of hardship. There are many meanings of the word "extreme" offered in the Macquarie Dictionary. Some of the more helpful suggestions are "of a character or kind farthest removed from the ordinary or average", "utmost or exceedingly great in degree", "farthest, utmost or very far in any direction", "going to the utmost lengths, or exceeding the bounds of moderation", "the utmost or highest degree, or a very high degree". The use of the word "extreme" can be contrasted with the use of the word "undue" found in Ministerial Guidelines relating to hardship associated with deportation. In order to enliven the prohibition against a Minister cancelling another person's business visa under subsection (4), there must be shown not only to be hardship and not only undue hardship, but extreme hardship."
58. In Re Salim (supra) at paragraph 14, Deputy President Purvis explained that:
The relevant hardship must be a necessary consequence of the cancellation of the visa, a mere possibility or probability would not be sufficient. There must be shown not only hardship of an extreme kind but hardship which would follow the cancellation. One is to look at the consequences to the applicant that would result from the cancellation. In Kumar v Minister for Immigration and Ethnic Affairs (1997) 50 ALD 488 the Federal Court referred to Man Ki Kim where it was stated (at 487) that “the proper application of [a provision of the Migration (1993) Regulations which contained within it the words extreme hardship] requires a focused consideration of the situation of the applicant” at the relevant date. The relevant date in the present applications is the date of the hearing.
59. The evidence before the Tribunal as to the hardship that would be suffered by Agatha is that of Agatha and her father and the one page letters from Dr George Han, Family Physician, and Mr Onsy Mattar, Consulting Psychologist, both dated 1 June 2004. The opinions expressed by Dr Han and Mr Mattar were based on a single visit by Agatha and on the history given by her. Both opinions appear to the Tribunal to be exaggerated. Dr Han speaks of Agatha suffering “significant psychological trauma and damage” if she has to return to Indonesia to finish her schooling. Mr Mattar states that if Agatha has to return to Indonesia “she will suffer permanent depression and stress and she could have some suicide thought [sic]”.
60. While Agatha’s evidence and that of Mr Hadiwarsito indicates that she is depressed and anxious about leaving St Scholastica’s and returning to Indonesia to complete her schooling, neither Dr Han nor Mr Mattar support their opinions other than by saying Agatha is presently suffering from anxiety, stress and depression. The Tribunal accepts that she is depressed and anxious about her present situation. This is perfectly natural. However, Agatha has only been in Australia for two years and has returned to Indonesia for each of her school holidays. She may suffer some disadvantage by having to repeat part or the whole of a school year in Indonesia and will obviously miss her friends and independence in Australia. This constitutes hardship for her. However, in the Tribunal’s view it is not “extreme hardship” within the meaning ascribed to the words by the Federal Court and the Tribunal in the decisions referred to above, and of the kind contemplated by s 134(5) of the Act.
61. The Tribunal therefore affirms the decisions under review to cancel Mr Hadiwarsito’s visa and the secondary visas of his wife and children.
I certify that the 61 preceding paragraphs are a true copy of the reasons for the decision herein of Mr RP Handley, Deputy President
Signed: .....................................................................................
AssociateDate/s of Hearing 3 and 4 June 2004
Date of Decision 22 June 2004
Solicitor for the Applicant Mr B Goldsmith, GoldsmithsSolicitor for the Respondent Mr M Allatt, Australian Government Solicitor's office
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