Noorozi (Migration)

[2018] AATA 130

Noorozi (Migration) [2018] AATA 130 (2 February 2018)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANTS:  Mr Mehdi Noorozi
Mrs Ronak Nariman Moradi
Miss Avisa Noorozi
Master Avesta Noorozi

CASE NUMBER:  1612232

DIBP REFERENCE(S):  bcc2015/3204665 BCC2015/3204825 BCC2015/3204826

MEMBER:Bridget Cullen

DATE:2 February 2018

PLACE OF DECISION:  Brisbane

DECISION:The Tribunal remits the applications for Business Skills (Residence) (Class DF) visas for reconsideration, with the direction that the first named applicant meets the following criteria for a Subclass 892 State/Territory Sponsored Business Owner (Residence) visa:

·cl.892.212 of Schedule 2 to the Regulations

Statement made on 02 February 2018 at 9:46am

CATCHWORDS
Migration – Business Skills (Residence) (Class DF) visa – Subclass 892 (State/Territory Sponsored Business Owner) – Net value above threshold – Loaned personal funds to business setup – Running a genuine business – Credible witness

LEGISLATION
Migration Act 1958, s 65
Migration Regulations 1994, Schedule 2 cl 892.212

STATEMENT OF DECISION AND REASONS

APPLICATION FOR REVIEW

1. This is an application for review of a decision made by a delegate of the Minister for Immigration to refuse to grant the applicants Business Skills (Residence) (Class DF) visas under s.65 of the Migration Act 1958 (the Act). The applicants applied for the visas on 2 November 2015. The delegate refused to grant the visas on 28 July 2016.

2. The delegate made the decision on the basis that the delegate found the primary review applicant, Mr Noorozi, did not meet the requirements of cl.892.212, and was unable to satisfy two of the three alternate requirements of cl.892.212 overall. Because the primary review applicant did not meet the criteria, the second, third, and fourth named applicants (Mr Noorozi’s wife and children) did not meet the secondary visa criteria requiring them to be members of the family unit of a person who held a subclass 892 visa.

   DECISION

3. The applicants lodged the review applications with the Tribunal on 8 August 2016.

4. On 10 January 2018, the applicants attended a hearing in the Tribunal, and gave evidence and presented submissions to the Tribunal.  They were assisted by a NAATI Level 2 interpreter in the Persian and English languages, and were represented by a registered migration agent, who is also a solicitor.  

5. Clause 892.212 provides as follows:

   Unless the appropriate regional authority has determined that there are exceptional circumstances, the applicant meets at least 2 of the following requirements:

   (a) in the period of 12 months ending immediately before the application is made, the main business in Australia, or main businesses in Australia, of the applicant, the applicant's spouse or de facto partner , or the applicant and his or her spouse or de facto partner together:

   (i) provided an employee, or employees, with a total number of hours of employment at least equivalent to the total number of hours that would have been worked by 1 full-time employee over that period of 12 months; and

   (ii) provided those hours of employment to an employee, or employees, who:

   (A) were not the applicant or a member of the family unit of the applicant; and

   (B) were Australian citizens, Australian permanent residents or New Zealand passport holders;

   (b) the business and personal assets in Australia of the applicant, the applicant's spouse or de facto partner , or the applicant and his or her spouse or de facto partner together:

   (i) have a net value of at least AUD 250 000; and

   (ii) had a net value of at least AUD 250 000 throughout the period of 12 months ending immediately before the application is made; and

   (iii) have been lawfully acquired by the applicant, the applicant's spouse or de facto partner, or the applicant and his or her spouse or de facto partner together;

   (c) the assets owned by the applicant, the applicant's spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, in the main business or main businesses in Australia:

   (i) have a net value of at least AUD 75 000; and

   (ii) had a net value of at least AUD 75 000 throughout the period of 12 months ending immediately before the application is made; and

   (iii) have been lawfully acquired by the applicant, the applicant's spouse or de facto partner, or the applicant and his or her spouse or de facto partner together.

6. According to the primary decision record, and submissions filed in the Tribunal by the applicants’ agent[1], there was no claim made in relation to cl.892.212(a). Therefore, the applicant was required to satisfy subclauses 892.212(b) and (c) in order to satisfy cl.892.212.

   [1] Folio 135-140.

7. The delegate found that the relevant period for the purposes of cl.892.212 was from 2 September 2015 to 1 November 2015. However, the Tribunal finds that the delegate has inadvertently miscalculated the relevant period. Under Departmental policy, the term “immediately before the application is made” is interpreted as the three month period prior to the date the visa application was received. The application was lodged on 2 November 2015; therefore the three month period prior to the date the application was received is from 2 August 2015, rather than 2 September 2015. The Tribunal finds that the relevant period is from 2 August 2015 to 1 November 2015.

8. The applicant, at the time of application, was operating the business Laptop Clinic (ABN 4058158270) as a sole trader.  On the advice of his accountant, he restructured his business, and since January of 2015, has been operating as the director and sole shareholder of trustee company Taktim Group Pty Ltd, and is the primary beneficiary of Taktim Group Trust (ABN 33515465543).

9. For the following reasons, the Tribunal has concluded that the matter should be remitted for reconsideration.

   CONSIDERATION OF CLAIMS AND EVIDENCE

10. The issue for the Tribunal is whether the applicant met cl.892.212 at the time he made his visa application on 2 November 2015. As explained above, he must satisfy both cl.892.212(b) and (c) in order to satisfy cl.892.212 as a whole.

11. The Tribunal notes that the delegate was not satisfied that the applicant met cl.892.212(c) on the basis that:

    The applicant provided a balance sheet as at 30 June 2015 in support of his net business asset claims. This date is outside the 3 month period allowed for under policy and therefore cannot be accepted for the purpose of calculating the applicant’s net business value. Furthermore, the applicant did not include financial statements for 2014 in his application.

    On 28 June 2016 the applicant was requested to provide complete financial statements as at 30 September 2014 and 30 September 2015. On 20 July 2016 the applicant provided financial statements as at 30 June 2015 and 30 June 2016. These dates do not cover the period of 12 months ending immediately before the application was made and thus cannot be accepted for the purpose of assessing the applicant against subclause 892.212(c).

    As a result, I cannot be satisfied that the applicant meets the financial requirements set out under subclause 892.212(c).

12. The delegate concluded that as the applicant did not satisfy 2 out of the 3 subclauses in cl.892.212, he therefore could not satisfy the clause overall. As he did not meet cl.892.212, the delegate refused the visa without considering the other criteria. The delegate noted that the applicant had not indicated that he was seeking to satisfy the criteria for any of the other subclasses within Class DF and there was no evidence that he had applied in any other subcategory.

13. The applicants' agent provided a submission addressing this criterion to the Tribunal on 22 December 2017, together with statements of financial position obtained from a new accountant. In summary, he argued that:

    ·The statements of financial position show total assets of AUD 578,988.43 as at 30 September and of AUD 556,394.39 as at 30 September 2014.

    ·This amount is comprised of current and noncurrent assets.  The assets were transferred from the applicant’s previous sole-trader business, Laptop Clinic. The tax invoices provided to the Department in conjunction with the visa application, issued in 2012, indicate that the applicant purchased essential equipment and inventory to run his business, and then transferred all of the assets to Taktim Group Pty Ltd. No resolution was required to validly transfer these assets to the trust, as the previous business structure was that of sole trader.

    ·The assets are above the threshold requirement of the net value of the business and personal assets in Australia of the applicant, stated in Clause 892.212(b) that at least AUD 250,000 should be maintained throughout the 12 months immediately before the application is made.

    ·The assets are above the threshold requirement of AUD 75,000, the net value of the business assets that the applicant must show to satisfy Clause 892.212(c). The Financial position statement now provided fulfills the 3-months requirement criteria specific to subclause 892.212.

    ·The applicant had instructed that his accountant provided financial statements for the business previously using the usual financial year (June to June and December to December) for tax purposes.  The accountant should have prepared this on a calendar year basis, which was what the applicant needed for purposes of the subclass 892 visa application as the Department’s policy was that the evidence of his and the business’ financial position needed to be no more than 3 months old and he applied for the visa on 2 November 2015.

    ·The applicant has now enclosed financial statements for 2014.  He could not submit this in response to the Department’s 28 June 2016 request for additional documents because in 2014, the applicant was running his business as a sole trader, and the visa application was made on the basis of the Taktim Group Trust business structure.  The financial statements reflect the applicant’s total assets as at 30 September 2014 to be AUD 557,065.39 and his capital contribution for the business to be AUD 508,636.39.

    ·A similar issue was discussed in 1417465 (Migration)[2]. In this case, the accountant provided the statement based on annual tax returns. New statements were provided addressing the specific subclass 892 three-month requirement, obtained from another accounting firm.

    [2] 1417465 (Migration) [2016] AATA 3460 (3 March 2016), p.24.

14. The documents attached to the agent’s submissions consisted of the following:

    ·Itemised account by Tax Office processes date from January 2014 to July 2017 for The Trustee for TAKTIM GROUP TRUST;

    ·Itemised account by Tax Office processes date from Jan 2011 to July 2017 for Laptop Clinic;

    ·Tax Portal processed BAS for 2015;

    ·Tax Portal processed BAS for 2016;

    ·Tax Portal processed BAS for 2017;

    ·Business bank statements for 2017;

    ·Business bank statements for 2016;

    ·Business bank statements for 2015; and

    ·Tax invoices issued to customers and customer satisfaction feedback.

15. In relation to the different accountants used by the applicant to provide information about his business’ financial position, the Tribunal accepts the explanation given that his former accountant has not prepared the financial statements previously provided on a calendar year basis.  This submission was confirmed by the applicant in his oral evidence before the Tribunal.  The applicant said that he believed he met the net business and personal assets requirements, was operating a genuine business, and left the accounting to his professional advisor. It is clear that the Tribunal is able to consider new financial data provided to it in deciding whether the applicant met the criteria in 892.212 at the time of application. The Tribunal is satisfied that the financial statements now before it for 2014 and 2015[3], prepared by Tax Basics Pty Ltd, are credible and are a reliable source of information regarding the net assets of the business. 

    [3] Folios 36-47.

16. In relation to the Laptop Clinic and Taktim, the applicant confirmed that he is in the business of computer repair, which he acquired the necessary skills to do whilst working in Iran.  The assets transferred to Taktim from the Laptop Clinic were assets that he ordered and selected himself, with the particular needs of his business in mind.  The Tribunal accepts that customer tax invoices and feedback before it demonstrate that the applicant is running a genuine business of computer repair.

17. The Tribunal found the applicant to be a credible witnesses who openly responded to the Tribunal’s questions at hearing.  The Tribunal also finds that the applicant’s evidence is consistent with his agent’s submissions, and the financial documentation provided to the Tribunal.

18. The applicant swore in his statutory declaration, and confirmed at the hearing, that he loaned a total of $536,273.00 of his personal funds to the business.  The source of the funds were derived from earnings whilst working in Iran.  The loan is unsecured.  In circumstances where the applicant commenced operations of the Laptop Clinic as a sole trader, and is presently the sole director and shareholder of the company, the Tribunal does not find the fact that the loan is unsecured to be unusual. 

19. The applicant references 1417465 (Migration), in support of his assertion that the Tribunal should allow the value of any loans made by the applicant to be added to the business’ net value, in accordance with Departmental policy. 

20. The Tribunal is satisfied from the documentary and oral evidence provided that the applicant invested his personal funds in setting up the business, and organising and funding all of the specialised equipment to be purchased to establish the business. There is no suggestion in the materials before the Tribunal that would suggest otherwise. The Tribunal is further satisfied that the applicant loaned these funds to the business, and that they should therefore be included in the calculation of his net assets in the business and his net personal assets for the purposes of cl.892.212(b) and (c).

21. The Tribunal finds that the applicant had net business and personal assets of the following amounts:

    • $578,988.43 as at 30 September 2015; and
    • $556,394.39 as at 30 September 2014.

22. The Tribunal finds that this is above the threshold requirement stated in Clause 892.212(b) that at least AUD 250,000 should be maintained throughout the 12 months immediately before the application is made. The Tribunal is further satisfied that these funds were lawfully acquired by the applicant and his wife. Given the above, the Tribunal is satisfied that the applicant meets the requirements of cl.892.212(b).

23. The Tribunal finds that the applicant had net business assets of the following amounts:

    • $578,988.43 as at 30 September 2015; and
    • $556,394.39 as at 30 September 2014.

24. The Tribunal therefore finds that the net assets in the applicant’s main business had a net value of at least $75,000 at the time of application and throughout the period of 12 months immediately before the application was made. The Tribunal is further satisfied that these funds were lawfully acquired by the applicant. Given the above, the Tribunal is satisfied that the applicant meets the requirements of cl.892.212(c).

25. Given the above findings that the applicant satisfies the requirements of cl.892.212(b) and cl.892.212(c), it follows that he meets cl.892.212 in its entirety. It is therefore appropriate to remit the application for reconsideration on that basis. The Tribunal finds that as the second, third, and fourth named applicants applied on the basis of being family unit members of the first named applicant, their applications will be determined by reference to the outcome of the first named applicant’s application on remittal to the Department for reconsideration.

    DECISION

26. The Tribunal remits the applications for Business Skills (Residence) (Class DF) visas for reconsideration, with the direction that the first named applicant meets the following criteria for a Subclass 892 State/Territory Sponsored Business Owner (Residence) visa:

    ·cl.892.212 of Schedule 2 to the Regulations.

    Bridget Cullen
    Member