MacDonald and Minister for Immigration and Multicultural and Indigenous Affairs

[2004] AATA 1298

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 1298

ADMINISTRATIVE APPEALS TRIBUNAL     Nº V2004/396

Nº V2004/397

GENERAL ADMINISTRATIVE  DIVISION

Re:      ALISTAIR HUGH MACDONALD AND

KIRSTEN ROSEMARY MACDONALD

Applicants

And:      MINISTER FOR IMMIGRATION AND
  MULTICULTURAL AND INDIGENOUS

AFFAIRS

Respondent

DECISION

Tribunal:       G.D. Friedman, Member

Date:             6 December 2004

Place:            Melbourne

Decision:The Tribunal affirms the decision under review.   

(sgd) G.D. Friedman
  Member

CITIZENSHIP ‑ application for Australian citizenship ‑ failure to satisfy residence requirements ‑ employment with Australian company in United Kingdom ‑ whether activities outside Australia beneficial to the interests of Australia ‑ exercise of discretion

Australian Citizenship Act 1948 s 13(1)(d), 13(1)(e), 13(1A), 13(4)(b)(i), 13(9)

Minister for Immigration, Local Government & Ethnic Affairs v Roberts (1993) 41 FCR 82

Re Ho and Minister for Immigration and Ethnic Affairs (1994) 34 ALD 664

Re McCarthy and Minister for Immigration, Local Government and Ethnic Affairs

(1993) 30 ALD 447

Re Singh and Minister for Immigration and Multicultural Affairs [1998] AATA 329

REASONS FOR DECISION

6 December 2004  G.D. Friedman, Member

1.      This is an application by Alistair Hugh MacDonald and Kirsten Rosemary MacDonald (the applicants) for review of a decision of a delegate of the Minister for Immigration and Multicultural and Indigenous Affairs (the respondent) dated 16 February 2004 to refuse to grant Australian citizenship to the applicants.

2.      At the hearing of this matter on 26 November 2004 the applicants represented themselves and Ms E. Arduca, a solicitor with the Australian Government Solicitor, represented the respondent.

3. The Tribunal received into evidence the documents lodged under s 37 of the Administrative Appeals Tribunal Act1975 (T1‑T9), plus one exhibit (Exhibits A1) lodged by the applicants.

BACKGROUND

4.      Mr MacDonald was born in the United Kingdom (UK) on 6 January 1964.  Ms MacDonald was born in the UK on 1 February 1961.  They were married on 14 October 1995 and have two children: Andrew Fleming MacDonald, born on 6 January 1997, and Gregor Forbes MacDonald, born on 21 January 2000.  The family lives in Edinburgh, UK, where Mr MacDonald is employed as an investment manager with an Australian company, Perennial Investment Partners Limited (Perennial).

5.      Mr MacDonald first arrived in Australia on 31 July 1997 as the holder of a subclass 457 (long stay) business visa, to take up a position with Colonial First State Investment Managers (Australia) Limited (Colonial First State), and Ms MacDonald first arrived on 17 September 1997.  On 12 February 2001 the applicants were granted resident visas (subclass 121) valid until 12 February 2006 and migrated to Australia with their children on 25 July 2001.  They last departed Australia on 26 August 2001, when the family returned to the UK. 

6.      On 25 February 2002 the applicants lodged an application with the Department of Immigration and Multicultural and Indigenous Affairs (DIMIA) for the grant of Australian citizenship.  In the five years before the application Mr MacDonald spent 33 days in Australia and in the two years before the application he spent 33 days in Australia.  In the five years before the application Ms MacDonald spent 33 days in Australia and in the two years before the application she spent no days in Australia.  On 16 February 2004 a delegate of the respondent refused the application on the grounds that the applicants did not meet the residence requirements under the Australian Citizenship Act 1948 (the Act).  The delegate was not prepared to exercise the discretion permitted by the Act, that during the period in which Mr MacDonald was overseas his activities should be treated as activities considered beneficial to the interests of Australia. 

7.      On 31 March 2004 the applicants sought review by the Tribunal.

8.      The issue before the Tribunal is whether Mr MacDonald was engaged in activities outside Australia between 25 February 1998 and 25 February 2002 (the relevant period) that are beneficial to the interests of Australia, such as to justify exercise of the discretion in his favour. 

EVIDENCE

9.      In a written statement dated 15 August 2004 (Exhibit A1) the applicants described how they came to Australia in 1997 and Mr MacDonald was employed by Colonial First State in Sydney.  In 1999 he joined Perennial, which he helped to set up; and which is one of only two companies offering international equity management in Australia.  The applicants said that because of the global nature of the industry Mr MacDonald established a small office for Perennial in the UK, while another office was set up in the United States.

10.     The applicants stated that Perennial is establishing skill sets with a network of fund managers and analysts which ultimately will enable Perennial to compete with the larger and best fund managers in the world.  They emphasised that this can only be of benefit to Australia by providing value added jobs and tax revenues, rather than losing money and skilled jobs to overseas‑based companies.  The applicants said that their commitment to Australia remains as strong as ever.  They stated that Mr MacDonald has foregone a considerable amount in salary rises by staying with Perennial, but he believes that the company has a bright future in the long term and that they will be able to move back to Australia.  The applicants stressed that their original intention was to spend six months of the year in Australia to assist in marketing, but budgetary constraints had prevented this in the past three years.  However, they said that under a new budget they hoped to be able to travel more extensively.

11.     In oral evidence by telephone Mr MacDonald said that his particular area of expertise is in the management of European equities, and when Perennial was established the company took the view that he should be based in the UK to provide a close link with the markets.  He said that he began by travelling back to Australia regularly, but one of his children is of school age, so this has become less frequent.  Mr MacDonald told the Tribunal that he is helping to build a new investment management company in Australia that is capable of growing and competing with other international companies in this field, for the benefit the company’s investors and the whole of Australia.

12.     Mr MacDonald said that he and Ms MacDonald feel strongly committed to Australia and their two sons now identify enthusiastically with the Australian way of life.  He stated that they look forward to moving to Australia permanently in due course, which might be in three to five years, or sooner depending on the growth of the business, although recent gains in the value of the Australian dollar have eroded some of the recent gains in the business.  

13.     In oral evidence by telephone Ms MacDonald told the Tribunal that she and Mr MacDonald have no immediate family in Australia but have friends and a network of people who would be able to assist them to settle permanently in Australia.  She emphasised her desire to raise her family in Australia, but recognised that Mr MacDonald’s skills were best utilised in the UK at present.   

14.     In a letter of support dated 29 March 2004 (T2, page 10) Mr R. Turner, Managing Director, IOOF Funds Management (IOOF), stated that IOOF is the controlling shareholder in Perennial.  He said that Mr MacDonald joined Perennial in 1999 as a founding member of staff and has helped to establish the company in Australia as a respected manager of international equities.  He said that the initial business strategy was for the applicants to spend half their time in Australia as the business grew, but the collapse of global equity markets in 2000 resulted in Perennial falling short of growth targets and revenues.  He noted that the applicants remain committed to Australia and intend to live here when resources permit.  Mr Turner emphasised that Mr MacDonald has shown a commitment to Perennial and to Australia in terms of salary and position over the past five years, and will be a credit to Australia in the years to come.

15.     In a letter of support dated 22 March 2004 (T2, page 11) Mr S. King, Co‑head of International Equities, Perennial, stated that he has worked with Mr MacDonald since 1999.  He stated that Mr MacDonald has sought to build up Perennial and to retain strong links with Australia.  Mr King stated that Mr MacDonald intends to return to Australia with his family to live here, but that he will remain in the UK until the company has the resources to find a replacement.  He said that Mr MacDonald has already shown the commitment to Australia to be a worthy citizen.

16.     In an undated letter of support (T3, page 43) Mr J. Diamond, Vice‑President ‑ Institutional Business, Nicholas Applegate Capital Management, stated that Mr MacDonald fulfils an important role in the management of European equities for Perennial.  He said that Australia is becoming an investment base and provides significant opportunities in the Asian region, and that expertise such as Mr MacDonald’s will assist Australia’s development in the region.

17.     In an undated letter of support (T3, page 47) Mr C. Cuffe, Chief Executive Officer, Colonial First State, stated that Mr MacDonald has impressed both in terms of professional knowledge and presentational ability.  He said that in two years with Colonial First State, Mr MacDonald was a valued member of the international equities team as a senior portfolio manager.

CONSIDERATION OF THE ISSUES

18.     Under s 13(1) of the Act:

13.(1)Subject to this section, the Minister may, in the Minister’s discretion, upon application in accordance with the approved form, grant a certificate of Australian citizenship to a person who satisfies the Minister that:

…

(d)the person has been present in Australia as a permanent resident for a period of, or for periods amounting in the aggregate to, not less than one year during the period of 2 years immediately preceding the date of the furnishing of the application;

(e)the person has been present in Australia as a permanent resident for a period of, or for periods amounting in the aggregate to, not less than 2 years during the period of 5 years immediately preceding the date of the furnishing of the application…

19. In relation to residency requirements, s 13(1A) of the Act gives the respondent discretion as follows:

13.(1A)  The Minister shall not grant a certificate of Australian citizenship to a person under subsection (1) at a time when the person is not present in Australia unless:

(a)the person is a permanent resident; and

(b)the Minister considers that the person is engaged in activities outside Australia that are beneficial to the interests of Australia.

20.     Section s 13(4) of the Act provides:

13.(4)  For the purposes of an application of subsection (1) in relation to an applicant for the grant of a certificate of Australian citizenship:

…

(b)      subject to paragraph (a) the Minister may, in the Minister’s discretion:

(i)treat a period during which the applicant:

(A)was a permanent resident;

(B)was not present in Australia; and

(C)was engaged in activities that the Minister considers beneficial to the interests of Australia;

as a period during which the applicant was present in Australia as a permanent resident;

…

21. Under s 13(9) of the Act:

13.(9)   Subject to sub-section (11), the Minister may, in the Minister’s discretion, upon application in accordance with the approved form, grant a certificate of Australian citizenship to a person:

…

(c)who is a permanent resident and is the spouse, widow or widower of an Australian citizen…

22.     Chapter 4 of the Australian Citizenship Instructions (the Instructions) sets out the policy guidelines which are to be applied by delegates of the respondent in assessing applications for the grant of a Certificate of Australian Citizenship under the provisions of s 13 of the Act.  The Instructions relevant to this application are:

Applicants outside Australia (s 13(1A))

4.2.23An applicant overseas might seek the use of the discretion in s 13(4)(b)(i) to treat periods spent overseas as a permanent resident towards the residence requirements. This discretion will not normally be used while the applicant is overseas.

Residence discretion: residence outside Australia (s 13(4)(b)(i))

4.3.19Periods during which the applicant was a permanent resident and was outside Australia engaged in activities beneficial to the interests of Australia may be counted towards the residence requirements.  This discretion applies to both residence requirements (ie, both “2 years in the last 5” and “1 year in the last 2”). 

4.3.20  The legislation is interpreted as requiring the following:

·the applicant must have been a permanent resident (see 1.4) during any of the periods counted;

·the periods spent outside Australia to be counted must be:

‑within the last 5 years for the 2 years in the last 5 years requirement; and

-within the last 2 years for the 1 year in the last 2 years requirement;

·the applicant must have been personally engaged in activities overseas beneficial to the interests of Australia, not just, for example, the company or organisation for which the applicant worked.

…

·The activities must have been “beneficial to the interests of Australia” during the relevant period/s.  It is not intended that the provision apply where there are no current benefits irrespective of whether benefits may accrue in the future.

4.3.21Under Ministerial policy the discretion will usually only be exercised if the applicant is in Australia and was either:

·required to work overseas by a Federal, state or territory Department, semi-government authority or private employer; or

·self-employed and frequent travel abroad was essential to the successful operation of their business, whether for an extended period or on a regular short‑term basis; or

·engaged in activities of a social, cultural, economic or political nature which are clearly beneficial to the interests of Australia and are widely recognised as such either by:

‑the Australian community generally; or

‑prominent persons associated with the applicant’s field of endeavour (for example, people engaged in aid programs, artists and entertainers of world standing);

4.3.22  If the applicant is overseas, the discretion will normally not be exercised.

…

4.3.26  In assessing whether activities are beneficial to Australia…

·It requires “something in the nature of activities which provide some advantage to Australia, whether commercial or otherwise.  The concept necessarily connotes some public interest of Australia…and means more than the private interest of the (applicant).  The section requires some objective benefit to Australia” (Federal Court in Roberts).

·It requires “something in the nature of activities which achieve recognition of Australia or of Australian achievements or commercial advantage for Australia, or increase the international respect and goodwill for Australia…(it) refers to the public interests of Australia.” (AAT in Fraser).

·“The claim that the applicant’s employer has enhanced the reputation of its Australian parent company and Australian companies in general, falls short of demonstrating the applicant’s activities were beneficial to the interests of Australia.” (AAT in McCarthy).

·“There should be a close nexus between the overseas activities and the subsequent benefit to Australia to exercise the discretion” (AAT in Tsui).  The benefit should be largely as a result of the applicant’s activities and must not be residual, remote, indirect or speculative (see, for example, the AAT case of McCarthy).

23. The applicants acknowledged that they do not satisfy the residence requirements of s 13(1)(d) and s 13(1)(e) of the Act, but submitted that the Tribunal should exercise the discretion provided for in s 13(1A) and s 13(4)(b)(i) of the Act in their favour and grant Australian citizenship to them. Mr MacDonald said that, in the period since he left Australia, he has been engaged in activities beneficial to the interests of Australia. He said that the promotion of Australian commercial interests and support of Australian business through Perennial are activities which have provided objective economic and commercial benefit to Australia. In this sense, they have furthered the public interest of Australia and not only his private interests.

24.     Ms Arduca noted that Mr MacDonald was required by Perennial to re‑locate to the UK to establish and develop the business as investment manager in the equities market, and submitted that while his activities overseas during the relevant period may have contributed to, or will further, the private interests of the Australian company that employs him, it does not follow that these activities benefit the interests of the Australian community at large or stimulate the Australian economy.  Ms Arduca said that little evidence has been advanced of some objective public benefit to the whole of Australia, other than a claim that in the longer term the success of Perennial will be of benefit to Australia.

25.     Ms Arduca said that because the applicants spent a short time in Australia within the two years and five years before their application, they need to demonstrate significant benefit to Australia, and have been unable to do so.  She submitted further that in the letters of support there is no compelling evidence of benefits to Australia.

26. In relation to the exercise of the discretion in s 13(1A) and s 13(4)(b)(i) of the Act, the Tribunal notes that in Minister for Immigration, Local Government & Ethnic Affairs v Roberts (1993) 41 FCR 82, Einfeld J said at 86:

…all factors that are relevant should be taken into account and their consideration should not be denied because they fall outside guidelines which have been prepared.

Therefore, in reaching its decision the Tribunal takes relevant matters into account including documents, oral evidence and written and oral submissions as well as the Instructions.

27. The Tribunal acknowledges that the applicants lived in Australia between 1997 and 1999 and have expressed a desire to become Australian citizens and to reside here in the future. There was no dispute that the applicants did not meet the residence requirements of s 13(1)(d) and s 13(1)(e) of the Act.

28.     The phrase activities beneficial to the interests of Australia has been considered in cases before the Tribunal and the Federal Court of Australia, and the Tribunal has also considered the guidelines set out in the Instructions.  The Tribunal notes that in Re Ho v Minister for Immigration and Ethnic Affairs (1994) 34 ALD 664 the Tribunal considered the application of the discretion in s 13(4)(b)(i). Deputy President McMahon stated at 671:

…The discretion contained in s 13(4) is not intended to offer an alternative method of complying with s 13(1)(d) and (e).  It is intended to allow some flexibility, in exceptional circumstances, when specific activities, which are the applicant’s substantial activities during specific periods, can be demonstrated.  The presence of the applicant in Australia for specific periods is one of the prerequisites to a grant of citizenship.  It is not an optional requirement interchangeable with certain activities outside Australia.

29.     The Tribunal takes into account the comments of Deputy President McMahon in Re McCarthy and Minister for Immigration, Local Government and Ethnic Affairs (1993) 30 ALD 447 at 448 that the claim that:

… the applicant’s employer has enhanced the reputation of its Australian parent company, and Australian companies in general, must be regarded as falling short of demonstrating activities in which the applicant was engaged that were beneficial to the interests of Australia.  Furthermore, having regard to the observations of Senior Member Gibbs in Re Tsui (1991) 24 ALD 236, it might also be said that such activities are so remote, indirect or speculative in relation to the beneficial interests of Australia that they could not be taken into account.

30.     In Roberts Einfeld J said at 87:

It seems to me that the term "activities beneficial to the interests of Australia" means something in the nature of activities which provide some advantage to Australia, whether commercial or otherwise.  The concept necessarily connotes some public interest of Australia, even if of a general or non-specific character, and means more than the private interests of the [person applying for citizenship].  The section requires some objective benefit to Australia.

The principles set out in Roberts were followed by the Tribunal in Re Singh and Minister for Immigration and Multicultural Affairs [1998] AATA 329.

31.     The Tribunal accepts the evidence of the applicants that since returning to the UK in 1999 Mr MacDonald has been furthering the interests of Perennial in the global equities market, and that for the immediate future the company’s best interests are served by his presence in the UK.  The Tribunal also accepts that success of the company’s UK operations may have some indirect benefit to Australia in the longer term by increasing the company’s profits and possibly increasing employment in Australia, with flow‑on effects for the Australian economy.  However, the Tribunal accepts the submission from Ms Arduca that, during the relevant period, the nexus between Mr MacDonald’s activities as an individual working for a listed company and the Australian national interest is too remote to conclude that any public benefits have been direct, ascertainable and immediate rather than indirect, intangible or speculative (Re McCarthy).

32. For these reasons the Tribunal finds, on balance, that the applicants have not demonstrated that Perennial or Mr MacDonald provide clear and objective benefit to the public interests of Australia. The Tribunal concludes that none of Mr MacDonald’s time spent overseas should be taken to have been spent in Australia. Therefore, the Tribunal concludes that the discretion in s 13(1A) and s 13(4)(b) of the Act should not be exercised in Mr MacDonald’s favour, and his application does not succeed. Consequently, under s 13(9) of the Act, Ms MacDonald does not succeed in her application.

DECISION

33.     The Tribunal affirms the decision under review.

I certify that the preceding thirty-three [33] paragraphs are a true copy of the reasons for the decision of G.D. Friedman, Member

(sgd)    Olympia Sarrinikolaou

Clerk

Date of hearing:  26 November 2004

Date of decision:  6 December 2004
Advocate for the applicants:               Self-represented
Advocate for the respondent:             Ms E. Arduca
Solicitor for the respondent:                Australian Government Solicitor