Ip and Minister for Immigration and Citizenship
[2007] AATA 1413
•7 June 2007
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2007] AATA 1413
ADMINISTRATIVE APPEALS TRIBUNAL )
) No V 200600729
GENERAL ADMINISTRATIVE DIVISION ) Re WAI CHAU IP Applicant
And
MINISTER FOR IMMIGRATION AND CITIZENSHIP
Respondent
DECISION
Tribunal Mrs Josephine Kelly, Senior Member Date7 June 2007
PlaceMelbourne
Decision The reviewable decision to cancel Mr Ip’s business visa is affirmed. Mrs J Kelly
Senior Member
CATCHWORDS
Migration Act 1958 (Cth) s 134 (1) (a), s 134(1) (b) and (c), s 134(2) (b) and (c), s 134(3), s 134(4), s 134(5), s 134(8) and s 134(10)
Hope v Bathurst City Council (1980) 29 ALR 577
Kim v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 31
Ming Tang and Minister for Immigration and Multicultural Affairs [2000] AATA 997
Neat Domestic Trading Pty Limited v AWB Limited and Another (2004) 216 CLR 277
Re Drake v Minister for Immigration (No 2) (1979) 2 ALD 634
REASONS FOR DECISION
7 June 2007 Mrs J Kelly, Senior Member INTRODUCTION
1. On 21 July 2006, the Minister for Immigration and Citizenship cancelled the business visa held by Mr Wai Chau IP. Mr Ip has sought review of that decision in this Tribunal. The business visa had been granted to Mr Ip, his wife and three children on 3 January 2003.
2. The relevant legislation is the Migration Act1958 (the Act). For the reasons that follow, I affirm the Minister’s decision to cancel Mr Ip’s business visa.
the issues
3. The issues in this case are:
a.At the date of cancellation:
(i)did Mr Ip have a substantial ownership interest in an eligible business in Australia (s 134(1)(a) of the Act)?
(ii)if so, was he utilising his skills in actively participating at a senior level in the day to day management of that business (s 134(1)(b) of the Act)?
(iii)If so, did he intend to continue to (i) hold a substantial ownership interest in; and Utilise his skills in actively participating at a senior level in the day to day management of an eligible business in Australia (s 134(1)(c) of the Act)?.
b.If Mr Ip does not satisfy me on those matters, s 134(2) requires that I must not cancel the business visa under subsection (1) if I am satisfied as of the date of cancellation, that he:
(i)has he made a genuine effort to obtain a substantial ownership interest in an eligible business in Australia, and
(ii)has he made a genuine effort to utilise his skills in actively participating at a senior level in the day to day management of that business; and
(iii)intends to continue to make such genuine efforts?
4. Section 134(3) of the Act specifies various matters that I may take into account when considering whether I am satisfied that Mr Ip has met the criteria set out in s 134(2)
other relevant legislation and policy guidelines
5. Section 134(10) defines eligible business:
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.
6. For the purposes of this decision, I accept that the meaning of business as discussed by Mason J in Hope v Bathurst City Council (1980) 29 ALR 577 at 9 applies in the statutory context of s 134, as held by Deputy President McMahon in Ming Tang and Minister for Immigration and Multicultural Affairs [2000] AATA 997 at 20 and applied in later cases.
7. I have also been referred to Migration Series Instruction 133 – Visa Cancellation under subdivision G – Cancellation of business visas. This document provides policy guidance but is not binding on the Tribunal (Re Drake v Minister for Immigration (No 2) (1979) 2 ALD 634; Neat Domestic Trading Pty Limited v AWB Limited and Another (2004) 216 CLR 277, Gleeson CJ at 17 and 24, Kirby J at 138 and 150).
mr ip’s case
8. Mr Ip represented himself. He spoke to the Tribunal by telephone from Hong Kong where he resides. An interpreter was required and was present in the hearing room.
9. Mr Ip contends that he has been involved relevantly in the ownership and operation of two businesses in Australia:
As a director of Koala Garment Pty Ltd (Koala) having a 50% interest;
As a director of Noble Group Management Pty Ltd (Nobel) with a 1/3 shareholding which intended to open a day spa in Melbourne;
10. Mr Ip also relied on a proposed new business, involving taking a franchise in a business variously described as just a franchise, a donut manufacturing shop, and a crepe and gelato café.
CONSIDERATION
did mr ip have a substantial ownership interest in an eligible business in australia at the date of cancellation (s 134(1)(a) of the act)?
11. Koala was textile manufacturing company which was incorporated in 1998. While the financial records showed it traded for a few years during the period 2002 to 2004, it is not in dispute that it was wound up in 2006. Mr Ip’s migration agent stated in a letter dated 24 April 2006 responding to the Notice of Intention to Cancel the visa dated 16 March 2006, that between 2001 and 2003 Koala employed more than 15 Australian full time staff but due to economic conditions in the USA since 2002, Koala’s turnover declined from $3,815.213 in 2002 to $719,210 in 2004. The migration agent also stated that the directors had resolved to wind up the company in the 2006 financial year. Mr Ip’s evidence was that it may have manufactured a small quantity of material in 2005 but he was not sure. There was no documentary evidence supporting that statement.
12. On the evidence, I find that Koala was not an eligible business within the meaning of s 134(10) of the Act at the time the visa was cancelled, and therefore Mr Ip did not satisfy s 134(1)(a) as he did not have a substantial ownership in an eligible business. Clearly from 2002, Koala’s activities were declining, and by 2005 there was little activity, if any, of significance, and by April 2006 the decision had been taken to wind up the company in the 2006 financial year.
13. I also find on the evidence that Koala was a very small part of a Hong Kong based garment business of which Mr Ip owns 28%. The value of the production of that business was 1.8 billion Hong Kong dollars in 2006 according to Mr Ip. In Australian dollars, applying either a conversion rate of 4 or 6, the business is a multi-million dollar business. The knitting machines used by Koala were brought into Australia from, and returned to the Hong Kong based venture which has manufacturing facilities in China.
14. Having found that Koala was not an eligible business, it is therefore unnecessary for me consider s 134(1)(b) and (c) of the Act in relation to Koala.
15. Nobel investigated leasing premises in Flinders Lane Melbourne for the purpose of a health, sauna and massage centre. A firm of solicitors gave advice about the terms of the Heads of Agreement for Lease in August 2004. That advice was addressed to Mr Alan Ling who was a director of Nobel and who also worked for Banks Group, which I infer from the evidence was the accountancy firm used by Koala (see pp119 to 144 of the T‑documents) and also by Mr Ip (p43 of the T‑documents). There was no reference to Nobel in the advice.
16. A firm of architects provided a Fee Proposal for the Noble House to Mr Alan Ling on 1 September 2004 with an approximate budget of $400,000. It was not signed. A second copy of this document was in evidence, which I understand was provided by Mr Ip in response to the 24 month survey. That copy was initialled and signed by Mr Ling and dated 16 December 2004.
17. There was also in evidence a Draft Heads of Agreement to Lease in relation to the same premises dated 1 December 2004. The lessee’s name was blank. Another copy of that document was in evidence in which the lessee’s name had been filled in handwriting: Noble Group Management Pty Ltd (CAN 098 925 627). The pages were dated in handwriting 7 December 2004 and signed on behalf of the tenant by a director, whose signature I find was Mr Ling’s. Various handwritten amendments had been made to the proposed terms of the lease. It had not been signed on behalf of the lessor. There was also a letter from the lessor to Mr Alan Ling about the premises dated 15 December 2004 raising various issues about plumbing and drainage, the location of certain facilities and the type of wall/ceiling structures.
18. On 8 February 2005, a Survey of Business Skills Migrant – 24-months, was sent to a company in Hong Kong which apparently represented Mr Ip. On 31 March 2005 Mr Ip wrote replied directly seeking an extension of time to reply until 30 April 2005 and requesting any further written communications to be sent to him directly at an address in Hong Kong. The request was granted by e-mail on 5 April 2005.
19. There is in evidence an invoice dated 1 April 2005 from the same firm of solicitors who provided the advice to Mr Ling in August 2004 but addressed to Noble Group Management Pty Ltd. There was also an invoice dated 15 March 2005 for overdue fees from 31 January 2005 addressed to Noble. It was from the same firm of architects who had written to Mr Ling in September 2004. The address in both letters the same. I infer that it was a post office box used by Mr Ling, as his street address was also in the suburb where the post office box was located (p146 of the T‑documents).
20. The migration agent stated in her letter of April 2006 that the business could not go ahead. Mr Ip’s evidence at the hearing was that it did not go ahead because the landlord wanted the lessee to lease a larger space than it required. In any event, the proposed lease of the premises for the purpose of a health, sauna and massage centre did not proceed. On the evidence, there was no activity in relation to the proposal after December 2005.
21. Before leaving Noble, I should refer to the proposed new business. In the April 2006 letter from the migration agent, there was no reference to Noble pursuing the new business. Rather under a separate heading Proposed New Business, the migration agent simply said that Mr Ip had instructed his accountant, Banks Group, whom I infer means Mr Ling, to continually seek potential business to buy, which was described as an active trading business that had the potential to develop a franchise arrangement and which would require an injection of $600,000, and would create additional employment for 10-15 Australia citizens or permanent residents. She also said that Mr Ip was waiting for the report from the accountant on the financial status of the new business. No such report was in evidence.
22. In a letter to the Tribunal dated 1 February 2007, Mr Ip said that he was still planning to set up one donut manufacturing shop which would create new employment of 20 to 25 to the society. In a further facsimile dated 9 March 2007 Mr Ip referred to propose crepes and gelato café in Dandenong. He had to go and visit the location and make a conclusion. He included a proposal to open three new shops in major shopping plans and develop a franchise business, requiring $600,000 to $1 million (Australian).
23. He talked about the proposed new business during his oral evidence. He said that he had visited a café in Dandenong and has had discussion with people but that they want too much money. I found Mr Ip’s evidence about when he had meetings and with whom, rather confusing. However, doing the best I can, I understood Mr Ip to say that he was waiting to see if the other people would reduce the amount. He also mentioned that Mr Ling and Mr Tang, both directors of Noble, were involved.
24. Assuming that it was Noble that has carried out the activities Mr Ip described in relation to the proposed business, and taking into account the activities in relation to the health, sauna and massage centre, I find that at the date of cancellation of the business visa, Noble was not a business that I reasonably believe was resulting in or would result in, any of the outcomes set out in the definition of eligible business in s 134(10) of the Act. That nothing has occurred since then of any substance fortifies me in coming to that conclusion.
25. Accordingly, I conclude that at the time Mr Ip’s visa was cancelled in 2006, Nobel was not an eligible business within the meaning of s 134(10) of the Act. Mr Ip therefore did not have a substantial ownership interest in an eligible business in Australia and therefore did no satisfy s 134(1)(a) of the Act. It is therefore unnecessary to consider s 134(1)(b) and (c) in relation to Noble.
Am I satisfied pursuant to s 134(2) of the Act that Mr Ip:
(a) has made a genuine effort to obtain a substantial ownership interest in an eligible business in Australia, and
(b) has he made a genuine effort to utilise his 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?
26. Given my findings in relation to s 134(1), I can address this issue as follows. I am not persuaded that Mr Ip intends to make a genuine effort such as to satisfy s 134(2)(b) and (c) of the Act. In coming to that conclusion I take into account the matters set out in s 134(3) and MSI 133.
27. Clearly, Mr Ip’s attention is on his multi-million dollar garment business based in Hong Kong where he resides. The garment industry is his area of expertise. The evidence before me was that he has spent only 36 days in Australia since receiving the business visa.
28. I accept that Mr Ip owned a substantial interest in Koala which did create employment and exports in Australia for a few years, however, I am not persuaded by his evidence that he spent 40-odd hours per week working in relation to Koala while it was operating, given his evidence about various managers in the business, his absence from Australia, his involvement in the Hong Kong business, and the decline in Koala’s production from 2002, or that he was actively involved in Noble’s activities relating to leasing premises for the health, sauna and massage centre. On the evidence, I find that Mr Ling carried out the activities that were done in relation to leasing premises, which I find were of a preliminary nature in any event.
29. I find that Mr Ip has not made a genuine effort to utilise his skills in actively participating at a senior level in the day to day management of either Koala or Noble. In relation to the proposed new business, I find that it is so speculative that it does not reflect a genuine effort to pursue the business as variously described.
30. In summary, I do not accept hat Mr Ip has made a genuine effort as specified in s 134(2)(b) and therefore cannot satisfy s 134(2)(c) which requires that he continue to make such genuine efforts. In any event, I am not satisfied that as at the date of cancellation or at the date of hearing, Mr Ip intended to participate in business activity in Australia in the future.
mr ip’s son
31. During the course of the hearing I became concerned about what might happen to Mr Ip’s son, Kin Yeung, if I cancelled Mr Ip’s visa. Kin Yeung is currently a student in Melbourne, and has been for over 3 years. His visa was cancelled at the same time as Mr Ip’s, but he has not sought a review of that decision in this Tribunal. I sought assistance from Mr Eteuati who appeared for the Minister. I questioned whether I had the power to consider extreme hardship under s 134(5) in relation to Mr Ip’s son.
32. Having heard from Mr Eteuati and considered the provisions of the Act, I find that I have no role to play in relation to the visa held by Kin Yeung. The legislation contemplates different cancellation decisions in relation to each business visa held by a member of the family unit (s 134(4)). It is only in relation to such a decision that extreme hardship becomes a consideration (s 134(5)). No such decision is before me.
33. During the course of the hearing I explored whether Mr Ip was aware of the consequence for his son who had not made an application to this Tribunal if I affirmed the decision to cancel Mr Ip’s visa. Initially, I understood Mr Ip to say that he was, but that he was confident his appeal would succeed. Later he denied having any knowledge of the consequences. Mr Eteuati said that Mr Ip was made aware during conferences in the Tribunal that there was a concern if other visa holders had not applied to the Tribunal. I took into evidence conference reports for 16 October 2006 and 27 November 2006 and am satisfied that the matter was raised with Mr Ip through an appropriate interpreter, and that the conference registrar suggested that he may wish to seek legal or migration advice. I made the same suggestion to him during the course of the hearing.
RESIDUAL DISCRETION
34. Finally, I must consider the residual discretion in s 134(1) identified by Kiefel J in Kim v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 31. Her Honour said:
Whilst the discretion given in s 134(1) is not as broad as that considered in Samad, in the sense that it does not involve more choices, it cannot be said that a decision not to cancel a visa could serve no purpose. The Minister might be satisfied of the matters referred to in subs (1) and not be satisfied as to the efforts made as referred to in subs (2) but nevertheless consider in a particular case that further time should be given to the visa holder to undertake what was required of them. [paragraph 21]
35. This aspect of the case was not relied upon by Mr Ip. However, I must address it on the evidence that was before me. I do not consider that this is a case where it is appropriate to give Mr Ip further time to undertake what was required of him because I do not consider that he has a genuine intention to pursue business activity in Australia.
36. I do not consider the circumstances of Mr Ip’s son which I have just set out are such that I should exercise the residual discretion on that basis, assuming that it was a relevant matter which I doubt given my findings on the legislative regime. On the evidence, Mr Ip has chosen not to seek legal advice on that question, despite that being suggested to him. An application by his son could have been made to this Tribunal but has not been.
DECISION
37. For the reasons set out above, I affirm the reviewable decision to cancel Mr Ip’s business visa.
38. For Mr Ip’s assistance, I note that my decision to cancel his visa takes effect on the 28th day after the day on which I give this decision (s 134(8) of the Act).
I certify that the thirty-nine (38) preceding paragraphs are a true copy of the reasons for the decision herein of:
Mrs Josephine Kelly, Senior MemberSigned: ..........Dianne Eva
ClerkDate of Hearing 4 June 2007
Date of Decision 7 June 2007
Solicitor for the Applicant Self Represented
Solicitor for the Respondent Mr T Eteuati, Clayton Utz
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