Ng and Minister for Immigration and Citizenship
[2008] AATA 509
•16 June 2008
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2008] AATA 509
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2007/4657
GENERAL ADMINISTRATIVE DIVISION ) Re CHIN LEH NG Applicant
And
MINISTER FOR IMMIGRATION AND CITIZENSHIP
Respondent
DECISION
Tribunal Mr A Sweidan, Senior Member Date16 June 2008
PlacePerth
Decision The Tribunal sets aside the decision under review and decides that the applicant’s sub-class 127 business skills visa not be cancelled.
.........(sgd) Mr A Sweidan..........
Senior Member
CATCHWORDS
MIGRATION – sub-class 127 business skills visa – whether grounds for cancellation exist – cancellation decision set aside.
LEGISLATION
Migration Act 1958 (Cth) s 134
CASES
Bakri and Minister for Immigration and Multicultural Affairs [2007] AATA 14
Re CIGA investments Pty Ltd (1995) 13 ACLC 1047
Hindrodjojo and Ors and Minister for Immigration, Multicultural and Indigenous Affairs [2004] AATA 274
Re Juliana Leo and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 308
Karim Jo and Minister for Immigration and Multicultural and Indigenous affairs [2004] AATA 77
Kok and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 579
Re Lau and Minister for Immigration and Multicultural and Ethnic Affars [2002] AATA 703
Re Lok Yung (Michael) Wong and Minister for Immigration and Multicultural Affairs [2006] AATA 277
Puzey v Commissioner of Taxation [2003] FCA 19
Re Saleh Leo and Minister for Immigration and Multicultural and Indigenous affairs [2006] AATA 309
Shaikh and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 1119
Yam and Minister for Immigration, Multicultural and Indigenous Affairs [2004] AATA 283
REASONS FOR DECISION
16 June 2008 Mr A Sweidan, Senior Member Background
1. This is an application to the Administrative Appeals Tribunal (the Tribunal) for review of a decision made by a delegate of the Minister for Immigration and Citizenship (the respondent) on 13 September 2007 cancelling the business skills visa of Chin Leh Ng (the applicant).
2. The applicant was granted a sub-class 127 business skills visa on 21 April 2004.
3. The applicant first entered Australia on 11 June 2004. Prior to cancellation of his visa he had spent a total of 22 days in Australia.
4. On 19 July 2004, the applicant notified the Department that his Australian address would be 1 Eve Court, Booragoon, WA.
5. On 26 July 2006, the Department sent a letter to the applicant requesting him to complete a 24 month business skills survey.
6. On 22 September 2006, the applicant responded to the 24 month business skills survey enclosing Australian Securities and Investments Commission (ASIC) documents, financial statements, business activity statements, bank statements, invoices and directors’ resolutions for Charthill International Pty Ltd (Charthill).
7. On 31 January 2007, the Department wrote to the applicant requesting further evidence that he was meeting his visa requirements.
8. On 6 May 2007, the applicant wrote to the Department providing further evidence.
9. On 29 May 2007, the Department wrote to the applicant giving notice of intention to consider cancellation of the applicant’s business skills visa (NOIC).
10. On 26 June 2007, the applicant wrote to the Department providing his response to the NOIC.
11. On 10 and 13 July 2007, the applicant faxed further documentation to the Department.
12. On 13 September 2007, a delegate of the respondent decided to cancel the applicant’s business skills visa. As a consequence of the cancellation of the applicant’s visa, the visas of the applicant’s family (Nina Tine Lee and Jun Jive Ng) were cancelled as well, by decision dated 13 September 2007.
Tribunal’s Findings of Fact
13. The Tribunal finds that the evidence before the Tribunal establishes the following relevant facts:
13.1The applicant has a substantial ownership interest, being a 20% interest in Charthill for which he paid $50,000;
13.2Charthill is an eligible business and meets the requirements of s 134(10) of the Act;
13.3The applicant has actively participated in the senior management of Charthill and is utilising his skills in doing so;
13.4The applicant has also acquired a 50% interest in Australian Compressor Co Pty Ltd (Australian Compressor) an Australian company;
13.5Australian Compressor has entered into a joint venture arrangement with Westair International Pty Ltd (Westair) for the production of screw compressors in Australia. Commencement of production has been delayed by circumstances beyond the control of the applicant.
Evidence
14. The applicant gave evidence which was supported by various documents.
15. The substance of his evidence is largely contained in a document which he filed prior to the hearing, an edited version of which follows.
“Substantial ownership interest
I have obtained a substantial ownership in an eligible business in Australia, Charthill International Pty Ltd.
Charthill International Pty Ltd
1. I have fulfilled my 20% investment on Charthill by paying up the total of $AUD50K (T328). A Form 484 was filed with ASIC on 10 July 2007 (T348) stated my shareholding from 2 July 2007 was 12,500 ordinary shares out of total of 62,500 ordinary shares issued, and that $50,000 was paid for the 12,500 ordinary shares.
2. Enclosed please find the five photocopies of cheques made out to Charthill totalling $AUD50,000. (Pg 8-12)
2.1 EON Bank Berhad cheque for $AUD15,000 made out to Charthill International Pty Ltd dated 24 July 2006.
2.2 RHB Bank Berhad cheque for $AUD5,000 made out to Charthill International Pty Ltd dated 14 August 2006
2.3 EON Bank Berhad cheque for $AUD10,000 made out to Charthill International Pty Ltd dated 31 October 2006
2.4 RHB Bank Berhad cheque for $AUD10,000 made out to Charthill International Pty Ltd dated 6 March 2007
2.5 RHB Bank Berhad cheque for $AUD10,000 made out to Charthill International Pty Ltd dated 26 June 2007
Australian Compressor Co Pty Ltd
3. The delay in the formation of the joint venture between Australian Compressor and Westair International Pty Ltd is out of my expectation. It is also beyond my control as the existing premise power supply and limited floor space is insufficient to start the production of screw compressor. This is clearly explained by my joint venture partner, the Managing Director of Westair, Mr. Jamie McKinnell in his letter to the Tribunal on April 23, 2008. (Pg 13-14)
4. However, the following capital and asset has been injected to Australian Compressor Pty Ltd for the preparation of the joint venture. (Pg 15-22)
4.1 Maybank Bhd telegraphic transfer for $AUD11,000 made out to Australian Compressor Co Pty Ltd dated 22 Feb 2008
4.2 United Overseas Bank Limited telegraphic transfer for $AUD9,000 made out to Australian Compressor Co Pty Ltd dated 19 Feb 2008
4.3 Investment of Term Deposits under Australian Compressor Co Pty Ltd at ANZ Bank for $AUD15,000
4.4 I had Delivered One unit of Carling Screw Compressor, Model CA22-8 bar to Westair for them to do research and make appropriate modification to suit local regulation.
Business
Charthill International Pty Ltd
5. Enclosed are invoices from June 2006 to January 2008 relating to other professional fee income e.g. real estate, sales commission etc. (Pg 23-29)
6. Invoice 665, 673 and 671 enclosed for the three real estate transactions advertisement at S458 –S460. I conclude these three advertisement generated income. (Pg 40-46)
7. Other significant property transaction includes a sale of an $AUD12mil hotel in Northbridge, WA. Invoice 701. (Pg 39)
Australian Compressor Co Pty Ltd
8. Absence of business activity, profit and loss statements, balance sheets or invoices is due to the delay in the joint venture arrangement on paragraph [3] above.
9. The five purchase orders issued by Australian Compressor between 27 September 2006 and 5 February 2007 (T427 – T431) are for the purchase of subcomponents for Carling screw compressor that will be partial assembled (labour intensive works) in lower labour cost factory in Malaysia. These partial assembled compressor will need to be final assemble in Australia at the joint venture factory situated in Bibra Lake.
10. Enclosed the copy of telegraphic transfer payment to the above supplier from NAB. (Pg 47)
‘Eligible’ Business
11. The following facts explain Charthill and Australian Compressor can be characterized as eligible businesses and fulfil section 134(10).
Charthill International Pty Ltd
12. Charthill’s business has resulted the development of business links with the international market by representing Curtin University of Technology to recruit international students from Malaysia, Cambodia, Laos, Vietnam, Thailand and Myanmar. Enclosed letter from Mr. Walter Ong, Dean of International Student Admissions, Curtin University of Technology, Perth WA confirming our activity. (Pg 48)
13. Charthill has creation and maintenance of employment of four Australians in Australia. Enclosed with one of the AMP Contribution Schedule. (Pg 49-50)
14. Charthill has been appointed to act as an agent for marketing and recruitment of overseas student. Letter from Department of Education and Training dated 8 December 2006 (Pg 51-52). Letter of appointment as official recruitment agent for Global College in Sydney, NSW (Pg 53). Enclosed are invoices, overseas student confirmation of enrollment (Coe) and letters of offer from Perth Institute as evidence that such referrals take place on a regular basis. (Pg 54-62)
Australian Compressor Co Pty Ltd
16. The joint venture between Australian Compressor and Westair will produce world class export quality Australian made Carling screw air compressor and provide after sales and services to its local and international customer especially in Asia that I have strong customer contact thru my 15 years of experience in Malaysia and Asean.
17. Australian Compressor introduced new and improved technology to Australia as our joint venture partner, Westair does not currently manufacture or sell energy efficiency screw type air compressor. Westair only distribute and sell piston type air compressor.
18. The joint venture between Australian Compressor and Westair will increase in commercial activity and competitiveness within sectors of economy because Australia is leading the world in the area of energy efficiency and electronic as confirmed by Mr. Jamie Mckinnell. (Pg 13-14)
Active participation at a senior level in the day-today management of an eligible business-s134(1)(b)
Charthill International Pty Ltd
19. The Managing Director of Charthill, Mr. Charles Wu has on 8 March 2007 written a letter to the Department of Immigration & Citizenship providing information concerning my involvement in the company’s business. The letter has sufficient evidence to prove my capacity as a director and my active participation in day-today decision in the company. (Pg 63-64)
Australian Compressor Co Pty Ltd
20. Please understand that Australian Compressor is purely a joint venture vehicle to Westair (Pg 13-14). It is also part of the marketing strategies to correspond with overseas customers who has potential to purchase Australian made screw compressor from the joint venture company.
21. The delay in the joint venture is clearly explained in the letter by Mr. Jamie of Westair (enclosed). Australia Compressor is a company registered in Australia on 26 July 2004 with the aim of promoting high energy efficiency screw compressor technology into the Australia market. This technology is originated from Germany with successful track record in marketing in Malaysia under Carling Air Compressor Sdn Bhd.
22. The two meetings with Westair took place on 21 September 2007 and 4 December 2007 is a proof of genuine effort in making this joint venture successful. We do not cancel the on going activities even though these meetings took place after the date of cancellation. I do not have any intention to cancel the joint venture arrangement with my joint venture partner, Westair and so are they. (Pg 65-68)
Genuine efforts – s134(2)
23. I have made genuine effort to obtain substantial ownership interest in an eligible business in Australia and utilize my skills in actively participating at a senior level in the day-to-day management of that business.
24. Genuine effort to obtain a substantial ownership interest in an eligible business in Australia is strongly proven by my 20% shareholding in Charthill International and the on-going activities to complete the joint venture with Westair.
23. I am the main applicant of the visa and have made genuine effort which is purely non superficial or token because all transactions and activities are supported by documents, minutes and letters witnessed by my partner in Charthill, Mr. Charles Wu and the Managing Director of Westair, Mr. James McKinnell.
Applying the genuine efforts principles to the applicant’s circumstances
24. I do not agree with the respondent’s conclusions on my lack of continuous activity points to a lack of genuine efforts in Charthill and Australian Compressor.
25. Evidence of Charthill activities between 21 April 2004 and 31 July 2006. Enclosed correspondence between Charles and my wife, Stephanie on the negotiation of becoming a shareholder of Charthill. (Pg 69-70)
26. Delay in the injection of capital (third and fourth payments) to Charthill should not be considered as “sporadic and desultory activity” as our partner, Mr. Charles Wu confirm there is no financial effect on Charthill.
27. There is also no “mere window dressing” in the dates of injection of funds. I have made genuine effort to transfer the funds with intention to become a shareholder in Charthill. I have made a full payment for my portion of 20% shareholding in Charthill. Also, Mr. Charles Wu has no objection on the dates of the fund transfer.
28. I have been looking for a joint venture partner since 2004. My approach to Mr. Horace Duval, Melbourne was not turned down due to his unwillingness to relocate to Perth, WA (Pg 71). Subsequently, I came to know Westair and realize that they are interested to expand their product range from piston type to screw type compressors.
29. Australian Compressor was incorporated Australia since 26 July 2004. It is a vehicle for joint venture. My other company, Carling Air Compressor Sdn Bhd cum manufacturing plant in Malaysia that has a proven track record in business for the past 15 years. It is a way of introduction to Westair to understand my product, operation, manufacturing, marketing activities before we can come to a mutual agreement on joint venture.
30. There is an e-mail correspondent proposing joint venture with Westair dated on June 24, 2007 (before the date of cancellation September 13, 2007) stated “my actual aim or permanent plan is to form a new joint venture company with Westair or buying share into Westair thru my Australia Compressor Co. Pty Ltd”. I also visited Westair facilities in October 2006 to inspect their premise and goods; to develop business relationship and try to understand the local practice. (Pg 72)
31. I have fulfilled the following matters under Section 134(3) that the Minister may take into account.
31.1 A market research has been conducted on bringing the screw compressor technology into the Australia based on 2006 market research of Australia top three compressor companies and their market share in % and sales turnover covering year 2002 – 2006. (Pg 73-74)
31.2 There are correspondence and minutes of meeting on the discussion issue of joint venture. The delay in signing the formal contract is clearly explained in the letter by Mr. James McKinnell of Westair to the Tribunal dated 23 April 2008. (Pg 13-14)
31.3 The minutes of meeting dated September 21, 2007 and December 4, 2007 has develop closed relationships between Australian Compressor and Westair and gain a understanding of local practices (Pg 65-68). “Andy will be required to spend significant time at our Perth facility for training of our staff, assisting in the process coordination and final assembly of compressors and commissioning of new units at our customers premises” letter to the Tribunal by Mr. James McKinnell of Westair dated 23 April 2008. (Pg 13-14)
31.4 The value of assets transferred for use in obtaining an interest in an eligible business is clearly stated in paragraph [2.1- 2.5] (Charthill International) and [4.1- 4.3] (Australian Compressor).
31.5 The value of ownership interest in the eligible business in Australia which has been held by myself in Charthill is 20% shareholding. Australian Air Compressor will hold 50% shares in the joint venture with Westair holding the other 50%.
31.6 I have undertaken and participate in the business activity both Charthill and Australian Compressor based on the development of the business since the beginning of my involvement with their business models and activities.
Residual discretion
I believe the Tribunal should exercise its residual discretion, on the basis that:
32. The joint venture is definitely a practical benefit to the Australian economy as screw compressor is a new and advance energy efficiency (MEPS II compliance) technology, which is currently not produced by Westair.
33. My spending of 22 days in Australia is supported by the medical procedure that my wife has gone thru in Malaysia between the period of January 2006 till April 2008.
34. I am expected and required to play a substantial role in Australian Compressor when Westair warehousing and assembly capacity at Bibra Lake new factory is ready. This is stated clearly in the letter dated 23 April 2008 to the Tribunal by Mr. James McKinnell.
35. The cancellation of the visa will incurred inconvenience for me to travel and work in Australia for the completion of the joint venture and to ensure the continuous operation of the joint venture factory legally. Due to the new and increased technological nature of the product, there will be process coordination, technical training, final assembly of compressors and commissioning of new compressors that cannot be conducted without my continuous present in Australia.
Conclusion
I submit to the Administrative Appeals Tribunal for review of the erroneous decision by the respondent on 13 September 2007 to cancel my visa because:-
36. I have obtained a substantial ownership interest in an eligible business in Australia;
37.I have utilized my education and skills actively participating at a senior level day-to-day management of the business;
38. I have made genuine and continuous efforts to obtain a substantial interest in an eligible business in Australia and utilize my skills in actively participating at a senior level in the day-to-day management of theses two eligible business;
39. My commitment to be stationed in Carling Air Compressor, Malaysia factory at this moment is very crucial to the development of the joint venture with Westair in the near term. The tie to Malaysia will ensure a good transition on transferring the technology to Australia for final assembly and commissioning
40. This is definitely an appropriate case for the exercise of the Tribunal residual discretion.”
16. The statement of Mr Charles Wu filed in support of the applicant’s application reads, relevantly, as follows:
“1. In addition to my letter of 8 March 2007 addressed to the DIAC, I would like to provide further support to Mr Ng’s appeal in connection with his participation in Charthill International Pty Ltd and in the light of the Statement of Facts and Contentions of the Respondent (Minister for Immigration and Citizenship) reference NO W2007/4657 by Peter John Corbould, solicitor for the Respondent.
2. I would like to offer my apologies for not being able to present myself as a witness to the hearing due to prior commitments. I have an assignment in the city on most weekday mornings and I am unable to take time off for the hearing, hence this statement of support.
3. I am glad to note in Mr Daniel Estrin’s email to Mr Ng of 7 May 2008, that “the Minister now accepts that you have obtained a substantial ownership interest in an eligible business…”.
4. Mr Ng participation in Charthill International Pty Ltd is an important and strategic one for the company. Firstly, for a small business like Charthill’s, his capital injection of $50,000 spread over about 12 months from July 2006 made a big difference and it greatly strengthened the liquidity position of our company. We became more confident in developing new business and as a result we do not now need to rely on external finance which in the current market has become very costly with the high interest rates.
5. With Mr Ng’s involvement, Charthill was able to venture, albeit in baby steps, into student recruitment and overseas labour recruitment (areas of expected high growth in the coming years for Australia) due in no small way by Mr Ng’s connections in Malaysia/Singapore and even in Indo-China although at this stage, the latter has not yet been exploited. These activities will add to the export dollars (overseas students) and increase the productivity (overseas skilled labour for the overstretched local skilled labour) for our Australian economy. Further his participation in the company has enabled me to not to have to travel overseas as much as I used to and leave me with more time on the domestic front.
6. Mr Ng is not only well qualified professional (holds an U.S.A. engineering degree and an MBA) but has many years of entrepreneurial business experience. I know he will be an invaluable business partner that no employee can provide in terms of loyalty and long-term commitment. In addition, as a business partner, his costs to the business are a lot less than hiring an employee of Mr Ng’s calibre.
7. As far as day-t-day management and decision making are concerned, may I just point out that as is common with most small businesses as Charthill’s is, there are not many nor frequent decisions to make. Where there are, such as staff recruitment or office move, new ventures etc, I will first be in discussion with Mr Ng on these matters and where we have agreed on any significant matter, it will be recorded by way of directors’ resolutions, some of which have already been provided to DIAC previously. May I seek the AAT’s understanding of the reality of small businesses like ours that there just aren’t that many decisions and indeed even management that require Mr Ng’s and indeed my day to day presence in the office. His contribution to the company is better achieved whilst he is overseas, managing and developing the overseas market which takes time and costs. In terms of day to day activities, they are straightforward. Each one of us just gets on with our respective areas of work and where directors’ decisions are sought, Mr Ng is always involved.
8. As for financial matters, Mr Ng like me gets to see the quarterly results after the Business Activity Statements for the quarter are completed and our review are recorded as well by way of board resolutions. In these past 20 months or so Mr Ng and I have worked well together in our management of the business.
9. I understand DIAC’s concern of whether Mr Ng is genuine and sincere in his efforts in relation to the business. As far as Charthill is concerned, I wish to advise that I know Mr Ng and his wife rather well by now and through our times together these 20 months or so as business partners, I can assure the AAT that he is genuine and sincere in his efforts, and also his desire to spend more time in Australia. It is understandable to assume that since he still has involvement and responsibility over his other Malaysian businesses which also take his time, he is not committed to fulfilling his business obligations in Australia. This would be an unfortunate and indeed an erroneous supposition. His Malaysian businesses are not wholly owned by him but involve his siblings and investors. At this time, it would be imprudent and untimely for him to relinquish his interests and responsibilities there since they will be of benefit to Charthill’s business and his other start-up business in Perth in the long-run.
10. I would also assure the AAT that I am not into “dressing up” for Mr Ng’s sake. For me, it has not been easy to find an able and “younger-than-me” business partner who has the potential to be a significant contributor to my business, like Mr Ng. I know, despite perhaps the lack of the usual sort of evidence that one might look for, Mr Ng is genuine and sincere in his efforts. Finally, may I urge the AAT not to cancel Mr Ng’s visa, as I believe he is and will be an increasingly positive asset to Australia, and in particular to Charthill. Thank you.”
Legislation and Policy
17. Section 134 of the Migration Act 1958 (the Act) provides that the Minister has a discretion to cancel the visa if satisfied that the visa holder has not obtained a substantial ownership interest in an eligible business in Australia, is not utilising his skills in actively participating at a senior level in the day-to-day management of the business, or does not intend to do these things. The Minister must not cancel the visa if satisfied that the visa holder has made genuine efforts and intends to continue to make such genuine efforts.
18. Eligible business and ownership interests are defined in section 134(1) of the Act and discussed at paragraphs 7.2 - 7.4 of PAM3 (T22-T61).
19. Section 134(10) provides that eligible business means a business that the Minister reasonably believes is resulting or will result in one or more of the following:
19.1. the development of business links with the international market;
19.2. the creation or maintenance of employment in Australia;
19.3. the export of Australian goods and services;
19.4. the production of goods or the provision of services that would otherwise be
imported into Australia;
19.5. the introduction of new or improved technology to Australia; and
19.6. an increase in commercial activity and competitiveness within sectors of the
Australian economy.
REASONS FOR TRIBUNAL’S FINDINGS
20. In light of the Tribunal’s findings of fact the Tribunal is of the view that the applicant’s visa should not be cancelled for the reasons which follow.
21. While the respondent conceded that the applicant’s interest in Charthill is a substantial ownership interest in an eligible business, the respondent contended that the applicant did not meet the “senior level management” or the “genuine efforts” tests.
22. The Tribunal rejects both of the respondent’s assertions in that regard, in view of the evidence of the applicant, supported by the statement of Mr Wu and the documentary evidence.
23. The respondent placed considerable reliance on the fact that the applicant had spent most of the time in Malaysia and had only been in Australia for 22 days since his visa was granted.
24. However the Tribunal notes the following in this regard.
25. In the Tribunal’s opinion the applicant utilised all forms of communication such as email, telephone and when possible, “in person” to actively comply with his responsibilities through regular advice and contact on day-to-day matters in the business of Charthill. Corporations law recognises the advantages of technology in communication that allow senior management to still carry out their duties effectively without having to be “physically” at the registered office, or in the country for that matter, via email or telephone/video conferencing. The use of technology in management is supported in the case Re CIGA Investments Pty Ltd (1995) 13 ACLC 1047. In the case of Hindrodjojo, at paragraph 36, the Tribunal cited with approval its decision in Karim Jo, at paragraph 77, and stated that given the “modern means of travel and communication” a business may be “managed and strategically directed from almost anywhere in the world”. The applicant can therefore be “actively involved” in the business and management of the company through telecommunication mediums and not solely by personal attendance.
26. Hindrodjojo, at paragraph 36, also agreed with the decision in Karim Jo that section 134(1)(b) emphasises “senior management rather than the day to day administrative tasks under the direction of a senior manager”. Hindrodjojo, at paragraph 36, further agreed with the decision in Re Lau and Minister for Immigration and Multicultural and Ethnic Affairs [2002] AATA 703 that “management input at a senior level by an experienced business person will often be intangible and may involve ideas and planning, as much as researching products, securing orders and suppliers and transacting shipping”.
27. The Tribunal notes that the Full Federal Court decision in Puzey, at paragraph 46, though admittedly within the context of tax legislation, states that “a person may appoint another to take the steps which constitute the business activity”. Here, the applicant availed himself of the opportunity to rely on the services of others in the day to day administrative tasks of relating to the management of Charthill.
28. Puzey goes onto state, at paragraph 46, that “a person may carry on a business, notwithstanding that the person had some other activity, such as full time employment”. Indeed, the fact that the applicant had both a senior management role in a business in Australia and a business in Malaysia is not unique. Puzey, at paragraph 47, contemplates this by stating that “there will be significant periods of what may be referred to as inactivity”.
Time Spent in Australia
29. It is clear that the applicant is not required to cease all business activities overseas or to occupy the most senior management positions in Charthill.
30. The Act does not provide for any special considerations or “benefits” for business migrants that choose to reside in Australia, nor does it stipulate time periods or number of trips a business migrant can make overseas. There are also no legal requirements under the Act or the Corporations Act for a person to be in Australia when shares in a company are issued to him or her.
31. Deputy President Jarvis of the Tribunal held in Re Lok Yung Wong, at paragraph 41, that subsections 134 (1) and (2) do not require the relevant management of an eligible business to take place in Australia. Whilst a business visa confers an entitlement for a migrant to reside in Australia, the Act does not require the holders of those visas to take up that entitlement.
32. In Hindrodjojo the Tribunal found that the applicant had discharged his obligations relating to the management of an eligible business. The visa holder in Hindrodjojo had spent only 55 days in Australia since his first entry as a permanent resident, and conducted his management of the business primarily from Indonesia. The Tribunal concluded there is no requirement in the Act that prescribes that the participation by the business visa holder in the management of the business should occur from within Australia. If Parliament had intended that this management role be undertaken in Australia, it would have been very straightforward to include this specification in section 134(1)(b). However, this requirement was not included in the Act.
33. The Tribunal in Yam, at paragraph 99, added that there is some “justification” in the argument “that the attachment to the Notice of Intention to Cancel shows that the way the scheme is administered, it is not necessarily the case that a person must spend the majority of their time participating in the day to day management of their business in Australia.”
34. Yam, at paragraph 103, also approved of the following passage by Member Allen in Karim Jo (at paragraph 33) that:
“…However, I do not believe that it can be said that the Act demonstrates a requirement that the visa holder become ordinarily resident in Australia immediately in the sense that he or she spends the majority of his or her time in the country, only taking trips overseas from time to time. A number of factors have influenced that conclusion. In the first place, there is nothing in the documentation provided to me concerning the application made by the applicant for his visa …that indicates that the Australian government had any requirement that overseas businesses be disposed of or the applicant’s involvement in them scaled down. Specifically, the 24 months survey form that is used by the government to obtain information from visa holders asks the question (in section 7): “are you still actively involved in a business outside Australia?” and contains the statement: “note that there is no expectation or requirement that you discontinue any business outside Australia”…Secondly, the MSI at clause 4.5.1, when dealing with the issue of what constitutes “genuine efforts” in relation to the establishment of a business and involvement it its management, refers to whether or not the visa holder has been physically present in Australia for more than 6 months since first arrival. Bearing in mind that a cancellation decision will often be made between 3 and 3 and a half years after the first arrival, an expectation that the visa holder may have spent only 6 months in Australia suggests that, so far as the respondent is concerned, the visa holder is not expected to spend the majority of his or her time in this country – and may indeed spend as little as 15% of the total time between first arrival and cancellation. Finally, I note that s 134(1)(a) does not specifically require the active participation in the management of that business to occur in Australia. It would have been very easy for Parliament to have specified in s 134(1)(b) that the management activities must occur in Australia if that had been the intention”.
Future Intention
35. The applicant has said and the Tribunal accepts that he fully intends to continue to utilise his skills in actively participating at a senior level in the day to day management of the business of Charthill as well as the joint venture business of Australian Compressor.
Genuine Efforts
36. If the Tribunal is wrong in finding that the applicant has discharged his obligations under s134(1) of the Act, then the Tribunal finds in the alternative that the applicant’s visa should not be cancelled as he has made genuine efforts to fulfil his obligations.
37. Section 134(2) and (3) of the Act states:
(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 business 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 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;
(ii) the length of time that the person held the ownership interest or participated in the management (as the case requires); and
(iii) the reasons why the person no longer holds the interest or participates in the management (as the case requires).”
38. After considering all the evidence, referred to above, the Tribunal is of the view that the applicant has shown that he has made genuine efforts to meet these obligations and because of that his business visa should not be cancelled.
Residual Discretion
39. Having regard to the Tribunal’s findings as set out above it is not necessary for the Tribunal to consider the question of it’s residual discretion.
DECISION
40. The Tribunal sets aside the decision under review and in substitution therefor, decides that the visa of the applicant, Mr Chin Leh Ng should not be cancelled.
I certify that the 40 preceding paragraphs are a true copy of the reasons for the decision herein of Mr A Sweidan, Senior Member
Signed: .......(sgd) T Freeman......
AssociateDate/s of Hearing 12 and 13 May 2008
Date of Decision 16 June 2008
Applicant’s Representative Self Represented
Counsel for the Respondent Daniel Estrin
Solicitor for the Respondent Australian Government Solicitor
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