Re Andiwidjaja and Minister for Immigration and Multicultural and Indigenous Affairs
[2003] AATA 397
•30 April 2003
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2006]AATA 964
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2005/1028
GENERAL ADMINISTRATIVE DIVISION ) Re Fillip Puspawardana Applicant
And
Minister for Immigration and Multicultural Affairs
Respondent
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2006/570
GENERAL ADMINISTRATIVE DIVISION ) Re Astrid Wardana Applicant
And
Minister for Immigration and Multicultural Affairs
Respondent
DECISION
Tribunal Professor GD Walker, Deputy President Date15 November 2006
PlaceSydney
Decision The decisions under review are affirmed. ..............................................
Professor GD Walker
Deputy President
CATCHWORDS
IMMIGRATION – business skills visa – cancellation of business skills visa and secondary visa – Nex Australia not an eligible business and applicant not utilizing his skills at a senior level on a day-to-day basis in managing the business – company registered three years after visa granted – no evidence of the company trading in Australia – primary applicant has only spent 98 days in Australia since grant of business visa – no genuine effort – insufficient grounds for exercising discretion – no grounds for finding extreme hardship for secondary visa holder – decisions affirmed.
Migration Act 1958 ss 127
Freeman v Secretary, Department of Social Security (1988) 19 FCR 342
Kim v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 31
Nong v Minister for Immigration and Multicultural and Indigenous Affairs (2000) 106 FCR 257
Man Ki Yam v Minister for Immigration and Ethnic Affairs [1995] 37 ALD 481
Migration Agents’ Registration Authority v Shi [2006] FCA 1236
Re Andiwidjaja and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 397
Re Griffiths and Migration Agents Registration Authority [2001] AATA 240
Re Halim and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 767
Re Haman and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 1113
Re Huang and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 656
Re Lau and Minister for Immigration and Multicultural Affairs [2002] AATA 703
Re Lip Tek Ho and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 1258
Re Nagaria and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 579
Re Pang and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 1056
Re Yam and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 283
Re Wang and Minister for Immigration and Multicultural Affairs [2000] AATA 961
Re Wong and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 54
REASONS FOR DECISION
15 November 2006 Professor GD Walker, Deputy President Summary
1. The applicant, Fillip Puspawardana, aged 60, is a citizen of Indonesia. On 6 March 2002, he was granted a subclass 127 business skills visa valid from his date of entry into Australia, 27 March 2002. A secondary business skills visa was also granted to his wife, Felicia Tirtadihardja, and their children, Norbert Wardana and Astrid Wardana.
2. A delegate of the then respondent, the Minister for Immigration and Multicultural and Indigenous Affairs, decided to cancel Mr Puspawardana’s business skills visa on the grounds that he does not have a substantial ownership interest in an eligible business in Australia, he does not utilise his skills in participating in that business, and does not intend to continue with that business in the future. The delegate also cancelled the secondary visas of his wife and children. Those are the decisions to be reviewed by the tribunal.
Issue
3. The issue for the tribunal is whether it is satisfied that the applicant has failed to comply with any of the requirements of s 134(1) of the Migration Act and, if so, whether he has made a genuine effort to obtain a substantial ownership interest in an eligible business in Australia, has made a genuine effort to utilise his skills in actively participating at a senior level in the day-to-day management of the business and whether he intends to continue to make a genuine effort and if it is satisfied that the applicant does not meet one or all of the criteria, whether it should exercise its discretion to cancel the business visa granted to Mr Puspawardana and to Ms Tirtadihardja, Norbert Wardana and Astrid Wardana as secondary visa holders.
Background
4. Mr Puspawardana, who was born in Metro Central, Lampung, Indonesia on 17 July 1946 and is aged 60 and Ms Felicia Tirtadihardja, who was born in Jogyakarta, Indonesia on 22 October 1946 and is aged 60, have two adult children: Norbert Wardana aged 30 and Astrid Wardana aged 27. Ms Tirtadihardja, Norbert and Astrid are listed as secondary visa holders in respect of Mr Puspawardana’s business skills and visa.
5. Mr Puspawardana has a bachelor of engineering from the Bielefeld University, Germany (T p65). Between January 1979 and May 1980 and May 1980 and July 1982, Mr Puspawardana was employed as a technical salesman for PT Regnum Teknik and PT Makindo Perkasa respectively. Between August 1982 and February 1984 he was the assistant president and director of PT Antang Plywood. In March 1984 he established his own business, PT Konexindo Abadi (Abadi), of which he is the managing director. In June 1993 he established Konexindo Glory Pte Ltd and in 1997 he established PT Norasti Bangun Sejati. He is also chairman and managing director of both companies, the former of which is based in Jakarta and the latter in Singapore. He has houses in both cities and states that his wife lives about half the time in Singapore, and about half the time in Jakarta, while his address is in Jakarta.
6. On 31 May 1999, Mr Puspawardana lodged an application for a business skills visa at the Australian Embassy in Jakarta (T8 pp63-107). On 6 March 2002, he was granted a subclass 127 business skills visa and secondary visas were granted to his wife and two children, on the condition that he and the other visa holders must enter Australia no later than 19 April 2002 (T9 p108). The visas were valid for a period of three years from entry. On 27 March 2002, Mr Puspawardana entered Australia (T p230).
7. By letter dated 5 March 2004 sent to Mr Puspawardana at his address at 24/361 Kent Street, Sydney, he was asked to complete a “Survey of Business Skills Migrant – 24-month (form 1010)”, to be completed and returned by 23 April 2004 (T10 p111). Mr Puspawardana did not respond to this survey.
8. On 14 March 2005, a delegate of the business skills section of the then Department of Immigration and Multicultural and Indigenous Affairs wrote to Mr Puspawardana at his address 45/278 Sussex Street, Sydney, advising him that he was considering cancelling his business skills visa under s 134 of the Migration Act 1958 (“the Act”) on the ground that he had failed in his obligation to complete his 24-month business survey and therefore there was insufficient evidence that he had a substantial ownership interest in an eligible business in Australia, that he utilised his skills at a senior level in the day-to-day management of that business, that he intended to continue to hold a substantial interest in an eligible business and utilise his skills at a senior level in the day-to-day management of that business. Mr Puspawardana was invited to respond and provide documentary evidence including inter alia, copies of his business plans, financial statements, and funds transferred to Australia, by 20 April 2005. By the same date, the department also notified Ms Tirtadihardja, Norbert Wardana and Astrid Wardana of its intention to cancel their secondary visas (T pp117-125).
9. By email of 13 April 2005 sent to the business section of the department, Mr Puspawardana advised the delegate that he did not receive the department’s letter of 5 March 2004 enclosing the 24-month survey. He requested a further copy be sent to him, assuring the officer that he would provide all the necessary information by 20 April 2005 (T12 p126). The officer responded by email on 14 April 2004 advising the applicant the letter was addressed to 24/361 Kent Street, Sydney, being the address provided by Mr Andrew Truong (T13 p127).
10. By letter dated 15 April 2005, Mr Puspawardana responded to the department’s notice of intention to cancel his visa. He stated that since the grant of his visa, he had been very active in exploring and promoting Australian business opportunities, that he and his daughter had jointly purchased a property in Sydney and that he had taken his time to decide on the appropriate corporate vehicle to set up and that “partially, but not entirely, prompted by your letter, I have established a new company, Nex Australia Pty Ltd (ABN 93 113 526 953) (Nex) in March 2005. Nex immediately wrote some business relating to a shipment to Indonesia of some China-sourced mineral consumables used in ceramic production”. He said that since January 2004 he has been in constant contact with National Project Consultants (NPC), a Sydney-based project management company which has the skills to have Nex strongly established in Sydney. Further, he had spent considerable time and effort researching the export of luminaries (light fittings), export of Australian wine to Italy and India, to establish a design and construction team to build a new town in Indonesia, import tapioca and modified starches from Thailand, export water saving equipment to Malaysia, export Australian-grown kenaf, retailing of tiles imported from Turkey and other countries, wholesaling of bathroom wares from Malaysia, export of zircon sand to Spain, import of industrial products from Indonesia, retailing of personal stationery from Italy, import of steel cold rolling machines to Indonesia, export of recycled paper products to Indonesia, import of charcoal products from Thailand, export of backing paper used in decalcomania products, and export of fresh fruit to South East Asia (T pp129-133). He stated he had made eight business-related trips to Australia (his son five) and some 30-40 trips outside Indonesia and Singapore, on the majority of which Australian business opportunities were discussed or investigated. Mr Puspawardana also submitted his completed 24-month survey, the answers to which were to the effect that the business had not established a history nor had it established a current net worth, and other documents in support of his submissions (T pp136-212).
11. On 15 July 2005, a delegate of the respondent decided to cancel Mr Puspawardana’s business skills visa on the grounds that he had not obtained a substantial interest in an eligible business in Australia, he was not utilising his skills at a senior level in the day-to-day management of that business, and he did not intend to continue to hold a substantial interest in the business and utilise his skills in that business (T2 p6). The delegate found that he did not provide evidence of funds transferred into Nex Australia, such that he could be satisfied the applicant held a substantial ownership, he was not satisfied Nex was an eligible business because it did not operate on a continuous and repetitive basis for the purpose of making a profit (the only business transaction recorded by Mr Puspawardana, being one shipment of ceramic products exported from China to Indonesia, did not involve Nex Australia), there was no evidence of future business ventures, and there was no evidence that he was involved in the day-to-day management, at a senior level, of the company, such as business correspondence, evidence of negotiations and decision making, or evidence of how he manages the business from overseas such as emails, facsimiles, telephone accounts, or minutes of meetings. The delegate also took into account that Mr Puspawardana had only spent a total of 98 days in Australia since the grant of his visa over three years ago. Having considered all the evidence, the delegate was not satisfied that the applicant had obtained a substantial ownership interest in an eligible business in Australia, was utilising his skills at a senior level on a day-to-day basis in the management of that business, that he intended to continue to hold a substantial interest or continue to utilise his skills in that business and used her discretionary powers to cancel his visa. On the same day, the secondary visas of Ms Tirtadihardja, Mr Wardana and Ms Wardana were also cancelled (T3 p20).
12. On 11 August 2005, Mr Puspawardana lodged an application for a review of this decision. On 16 June 2006, Astrid Wardana lodged an application for review with the tribunal in respect of the decision made to cancel her secondary visa, an application for an extension of time to do so having been granted by the tribunal on 15 June 2006.
13. At the hearing, the applicants were represented by Ben Zipser, counsel, instructed by Alim Lim, solicitor, Accentro Legal, and the respondent was represented by Anthony Cox, solicitor, Phillips Fox lawyers. The evidence before the tribunal comprised the documents produced pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (“the T documents”) together with the evidence tendered by the parties at the hearing. Oral evidence was given in person by Fillip Puspawardana and Astrid Wardana.
Applicable Legislation
14. Section 134 of the Act empowers the Minister to cancel a business visa in certain circumstances. Departmental policy with regard to the cancellation of business visa is contained in s 134 of the Migration Series Instructions No 133 – Visa cancellation under subdivision G – cancellation of business visas.
15. Section 134 of the Act empowers the Minister to cancel a business visa in certain circumstances. The relevant provisions in Mr Puspawardana’s case are as follows:
134. Cancellation of business visas
(1) Subject to subsection (2) and to section 135, the Minister may cancel a business visa (other than an established business in Australia visa, an investment-linked visa or a family member's visa), by written notice given to its holder, if the Minister is satisfied that its holder:
(a) has not obtained a substantial ownership interest in an eligible business in Australia; or
(b) is not utilising his or her skills in actively participating at a senior level in the day-to-day management of that business; or
(c)does not intend to continue to:
(i)hold a substantial ownership interest in; and
(ii)utilise his or her skills in actively participating at a senior level in the day-to-day management of;
an eligible business in Australia.
(2)The Minister must not cancel a business visa under subsection (1) if the Minister is satisfied that its holder:
(a)has made a genuine effort to obtain a substantial ownership interest in an eligible business in Australia; and
(b)has made a genuine effort to utilise his or her skills in actively participating at a senior level in the day-to-day management of that business; and
(c)intends to continue to make such genuine efforts.
(3) Without limiting the generality of matters that the Minister may take into account in determining whether a person has made the genuine effort referred to in subsection (2), the Minister may take into account any or all of the following matters:
(a) business proposals that the person has developed;
(b) the existence of partners or joint venturers for the business proposals;
(c)research that the person has undertaken into the conduct of an eligible business in Australia;
(d) the period or periods during which the person has been present in Australia;
(e) the value of assets transferred to Australia by the person for use in obtaining an interest in an eligible business;
(f) the value of ownership interest in eligible businesses in Australia that are, or have been, held by the person;
(g) business activity that is, or has been, undertaken by the person;
(h) whether the person has failed to comply with a notice under section 137;
(i)if the person no longer holds a substantial ownership interest in a particular business or no longer utilises his or her skills in actively participating at a senior level of a day-to-day management of a business:
(i) the length of time that the person held the ownership interest or participated in the management (as the case requires); and
(ii) the reasons why the person no longer holds the interest or participates in the management (as the case requires).
16. Section 134(10) of the Act includes the following definitions:
eligible business means a business that the Minister reasonably believes is resulting or will result in one or more of the following:
(a)the development of business links with the international market;
(b)the creation or maintenance of employment in Australia;
(c)the export of Australian goods or services;
(d)the production of goods or the provision of services that would otherwise be imported into Australia;
(e) the introduction of new or improved technology to Australia;
(f)an increase in commercial activity and competitiveness within sectors of the Australian economy.
established business in Australia visa means a business visa a criterion for whose grant:
(a) relates to the applicant having an established business in Australia; or
(b)is that the applicant is a member of the family unit of the holder of a visa a criterion for whose grant is as mentioned in paragraph (a)
…
ownership interest, in relation to a business, means an interest in the business as:
(a) a shareholder in a company that carries on the business; or
(b) a partner in a partnership that carries on the business; or
(c) the sole proprietor of the business;
including such an interest held indirectly through one or more interposed companies, partnerships or trusts.
17. In the case of Ms Tirtadihardja, Mr Wardana and Astrid Wardana, ss 134(4), (5) and (6) are relevant:
(4) Subject to subsection (5) and to section 135, if:
(a) the Minister cancels a person's business visa under subsection (1) or (3A);and
(b) a business visa is held by another person who is or was a member of the family unit of the holder of the cancelled visa; and
(c) the other person would not have held that business visa if he or she had never been a member of the family unit of the holder of the cancelled visa;
the Minister must cancel the other person's business permit or business visa by giving written notice to that person.
(5) The Minister must not cancel the other person's business visa under subsection (4) if the cancellation of that visa would result in extreme hardship to the person.
(6) The Minister is taken not to have cancelled a person's business visa under subsection (4) if the Administrative Appeals Tribunal has set aside the decision of the Minister to cancel the business visa of the relevant person to whom paragraph (4)(a) applied.
18. Paragraph 4.3.2 of the Migration Series Instructions (MSI) notes that eligibility relates to the achievement of the stated objectives through the activities of the business, not directly to the size or scale of the business.
19. Paragraph 4.5.1 of the MSI also provides guidance as to whether a genuine effort has been made for statutory purposes. While the guidelines are not binding on the tribunal and should not be applied so as to impose requirements which go beyond the statute (see Re Drake and Minister for Immigration (No 2) (1979) 2 ALD 634), the guidelines militate against inconsistency in decision making (see Skoljarev v Australian Fisheries Management Authority (1995) 133 ALR 690 at 695). The guidelines state:
4.5 What is a “genuine effort”?
4.5.1 If, after 24 months, a migrant is not in business, he/she must establish that a “genuine effort” has been made to engage in business since arrival. The Minister must assess “genuine effort”. S 134(3) of the Act lists any or all of the factors which the Minister may take into account:
…
[Notes referring to factors listed above. Decision makers may take account of these notes to guide them in the interpretation of 4.5.1
a. business proposal which is considered genuine, realistic and achievable;
b. formal contract with partners or joint venturers;
c. written evidence of detailed consultations with at least three business advisers (accountant, lawyer, bank/financial institution, State/Territory government business development office, Austrade, business/trade association);
d. physical presence in Australia for more than six months since first arrival as a Business Skills class migrant;
e. transferred to, and retained in, Australia at least 50% of the funds indicated as available for transfer within two years (under Factor 4 of the Business Skills Points test);
f. minimum A$100,000 or 10% ownership previously held by the person. If the person is no longer in business, the reasons for loss of ownership are also relevant.
g. minimum A$100,000 business activity as indicated by turnover. This may include other business activity not considered “eligible business” but cannot include passive investment, eg, purchase of shares.
h. failure to comply with a notice for information under s 137, mandatory monitoring of Australian address and return of survey forms.]
4.5.2While failure to meet one or more of these indicators may normally lead to a visa being cancelled, it will not necessarily mean that a visa will be cancelled. The decision maker must give weight to all relevant factors in a case (of which those set out in subsection 134(3) above may only be some) and reach a decision on that basis. For example, while the factors listed in 4.5.1 above may be indicative of “genuine effort”, lack of them will not necessarily be decisive. The decision maker must decide, on the ordinary meaning of the words, whether the visa holder has made “genuine effort”. A decision maker may still decide not to exercise the discretionary power to cancel the business visa even if it is assessed that no genuine effort has been made.
Evidence
20. Mr Puspawardana gave oral evidence. His solicitor also filed a written statement dated 5 January 2006 (Exhibit A3) that he adopted at the hearing. His statement included, as attachments, five ring-binders titled 2003, 2004 Volume 1, 2004 Volume 2, 2005 Volume 1 and 2005 Volume 2 (Exhibit A5). The folders contained information relating to projects undertaken by Iain McLean, National Project Consultants (NPC) and the applicant’s companies Konexindo Glory and Abadi. A further statement dated 2 September 2006 was also filed the day before the hearing (Exhibit A4) and adopted by Mr Puspawardana in his oral evidence.
21. In his written statement of 5 January 2006, the applicant stated he was the director of three companies PT Konexindo Abadi (“Abadi”), Konexindo Glory (“Glory”) Pte Ltd and PT Norasti Bangun Sejati and that the three companies supplement one another in the course of carrying on business. They all had goodwill and solid reputations in Asia and Europe and establishing Nex Australia Pty Ltd (“Nex”) was part of his business plan. Referring to an expiry date of 2007, he was “on track”. “New businesses need time to grow Nex Australia Pty Ltd, in the course of its business dealings, still relies mainly on the reputation of Konexindo Glory Pte Ltd, PT. Konexindo Abadi and PT. Norasti Bangun Sejati for financial and business introduction network support in order to survive on its own eventually, by 2007”.
22. Ms Wardana also gave oral evidence, adopting her statement (Exhibit A6).
23. Mr Puspawardana arrived in Australia on a subclass 127 business visa on 27 March 2002. Nex was not incorporated, however, until 24 March 2005, 10 days after the notice of intention to consider cancellation of his visa was sent to him. Asked at the hearing why he did not form Nex, a two-shareholder company that could be created quickly, until 2005, he became rather vague and said that he needed to research the market and was more concerned with unstated other matters, he did not have a house and needed to obtain one before he could find office space and start a corporation. He agreed that he has not migrated to Australia but said that most of his overseas trips between 2002 and 2005 were for the purposes of his Australian business, even though Nex had not been established at that stage. He agreed that nothing had developed out of those travels for Nex’s benefit. He was unable to recall Nex’s present address.
24. When Mr Puspawardana said that he had not received the department’s letter of 5 March 2003 (Tp111), the respondent’s counsel asked him if he had received the notice of intention to cancel the visa (T p113). He replied that he did enquire of the department why they had cancelled, but said he could not recall the notice of intention. When it was pointed out to him that his letter of 15 April 2005 (T p128-135) was expressly a response to the notice of intention, he became evasive but then admitted that he had replied to the notice. His attention was then drawn to the passage in his letter (T p128) that reads “Partially, but not entirely, prompted by your letter, I established a new company, Nex Australia Pty Ltd … in March 2005”. He denied that he had established Nex for the purpose of giving himself an answer to the notice of intention to cancel, emphasising that “it had nothing to do with it” because the project of establishing Nex had already been prepared. Later, however, he retracted that statement but remained reluctant to explain the connection between Nex’s establishment and the notice of intention to cancel the visa. Ultimately his position was that he had still been researching the Australian market.
25. He also conceded that between its establishment in March 2005 and the cancellation of his visa in July 2005, Nex had not transacted any business except some shipments of ceramics and flint pebbles from China to Indonesia, neither of which had anything to do with Australia. Nex had invoiced both purchasers, but although asked several time he was unable to explain why the invoicing had not been done by one of his Indonesian companies. Finally he said that the Indonesian companies could not issue the invoices because the contracts were c & f, but it did not explain why that would make any difference. In 2006 he had transferred $30,000 to Nex for its operating expenses, following an earlier transmission of $70,000 to Australia for the same purpose.
26. He later admitted that Nex was just a shell company that existed for the convenience of his other companies.
27. When he completed the form 1010 survey on 15 April 2005, he stated that he had transferred funds totally $1,500,000 to Australia since migrating (T p170, q23). He had not migrated, however, and the money so transferred had been used to purchase an apartment at Pyrmont for $1,300,000 and a BMW car for $86,000, both for his daughter Astrid. The balance had been used to buy furniture for the apartment and to defray operating costs. He conceded that the whole amount went on personal expenses.
28. In response to question 9 in the survey (T p168) he had ticked the box stating “I am currently engaged in business in Australia”. When it was twice put to him that the answer was untrue, he hesitated at some length before saying, “You want to know item? In 2005? Water meters”. He said he could not recall all the transactions and that it was necessary to look at the documents. As will appear below, the supply of water monitoring or metering equipment to Malaysia was an idea largely developed by the applicant’s Australian business consultants, NPC, though NPC did keep Abadi informed. The correspondence by email between 21 April 2004 and 11 May 2004 shows that Abadi’s role in the project was minimal at best. The idea was abandoned in May 2004 (Exhibit A5).
29. He said he could not recall what assets Nex owned at the time the visa was cancelled in July 2005, but suggested the flint pebbles order (which was apparently not repeated) and what he described as the “standing order for wine”. As will be seen below, the negotiation for the export of wine to Italy led only to a trial order for 200 bottles and no subsequent orders. For the above reasons, among others, I am not persuaded that the applicant was an altogether reliable witness.
30. In his statement (Exhibit A4), Mr Puspawardana said that the five folders comprising Exhibit A5 contained documents relating to about 29 projects that he had sought to develop between 2003 and 2005 for the purpose of establishing an “eligible business” in Australia within the meaning of s 134 of the Migration Act. In that Exhibit each project was given a number and a title. I now consider each one in turn.
1.01 Alpha tiles project (“Alpha project”)
31. Mr Puspawardana explained that for many years he had had a business relationship with a Kuala Lumpur tile manufacturer called Yi-Lai Sdn Bhd (“Yi Lai”). In 2003 he conceived the idea of importing tiles manufactured by Yi-Lai into Australia, using an Australian company with established networks in tile distribution, Sichar Ceramica Australia Pty Limited (“Sichar”). He met with representatives of Yi-Lai and Sichar, and prepared documents envisaging the establishment of an Australian company called Alpha General Trading Pty Limited in which Yi-Lai, Sichar and Abadi would be partners or joint venturers. He thought Abadi’s investment in the joint venture would contribute to his having a “substantial ownership interest in an eligible business in Australia” within the meaning of s 134(1)(a) of the Migration Act.
32. Actually, from the correspondence it rather appears as if the detailed proposals and draft structures were developed and put forward by Mr Adam Dilati of Sichar, rather than by the applicant (email 12 June 2003 – the business structure diagram also appears to have been prepared by Mr Dilati or to have been based on his proposals).
33. The proposal was abandoned in October 2003 because Yi-Lai declined to grant sole distributorship rights because of the participants’ limited financial resources which would inhibit their ability to take supplies on a consignment basis.
34. In his statement (Exhibit A4) Mr Puspawardana argued that the documents he prepared for the Alpha project illustrated the proposition made in his letter to the department of 15 April 2005, when he wrote “I have taken time to decide on the corporate vehicle(s) to set up. Frankly, the nature of the opportunity should dictate the corporate structure for a start-up entity” (T p128). In cross-examination, however, he proved unable to give an idea of the range of choices that were available for the Alpha project. Finally he conceded that he could have used one company for all the products he handled and did not need to take time to consider the most appropriate corporate vehicles to establish. He also said that he would have supplied all of the funding for the Alpha project and would personally have owned 100 percent of the company. He retracted that proposition in re-examination, saying that he intended the project to be a joint venture with the Indonesian company and another company (but, again, not mentioning the intended participation of Yi-Lai).
2.01 Fruit exports from Australia to Indonesia
35. The applicant said that in October 2003 he had the idea of exporting fruit from the Northern Territory to Indonesia, because of the short distance between Darwin and Indonesia and Australia’s reputation in the field of fresh food products. He approached an Indonesian fruit distributor and the Northern Territory government to explore the possibilities. The proposal was “quickly dismissed”, however, because available suppliers were already dealing with Indonesia and he could not secure competitive prices.
36. It is relevant to notice that two of Mr Puspawardana’s emails to Australian trading authorities include the following paragraph:
Allow us to introduce ourselves. We are a trading company based in Jakarta, with an office in Singapore as well. We are keen to export agricultural products from Australia (Exhibit A5, emails 31 October 2003, 6 November 2003).
Absent is any reference to the establishment of an Australian business, or indeed any personal business link between the applicant and Australia at all.
3.01 Kenaf exports from Australia
37. In his statement (Exhibit A4) the applicant said that a great deal of work to develop an export market for this project (kenaf is a plant that originated in central Africa but is grown in Australia) was done by Iain McLean of NPC, the applicant’s son Norbert Wardana, his daughter the applicant Astrid Wardana (who for reasons that were never explained, though I asked if there were any, also uses the name Astrid Tan) and himself. They had to develop a reliable kenaf supply source in Australia and identify overseas purchasers. Meetings with prospective suppliers and purchasers were held. Mr Puspawardana personally met with representatives of a Queensland producer, an industry consultant and an Italian potential customer.
38. The initial contact appears to have come from Norbert Wardana who approached a Korean investment banker named Charlie Kim and a Japanese consultant named Yusuke Koyama (Exhibit A5, emails 30 December 2003). Mr Kim tells Mr Koyama that “I have finally managed to contact my friend in Indonesia. Actually he normally stays in Singapore. Anyhow, his name is Norbert Wardana and I have briefly explained about what you said to me about kenaf”. There seemed to be a possibility of using kenaf as a material in automotive manufacturing, and also for use in Indonesian paper mills.
39. From the emails between December 2003 and May 2004, it would appear that most of the research and negotiation was conducted by Iain McLean of NPC. Indeed, it was Mr McLean who was actively considering what the appropriate corporate structures would be: “What is the best position and role for Konexiendo given we are talking forward contracts and so on?”, he emailed on 5 May 2004. “Can I have your thoughts on this?”.
40. The project was abandoned in about June 2004 because sufficient commercial quantities of kenaf could not be procured in Australia.
41. Mr Puspawardana said that it had been his task to research the production of kenaf in Queensland. He conceded that it was hard to show from the documents that it was he who had carried out the research, but said he was the motor that drove the project, and he was the one with the knowledge about kenaf. He had located on the web and printed out the information on kenaf in Exhibit A5. Mr McLean had been involved in the project pursuant to a memorandum of understanding with Glory, but Mr Puspawardana said he had not been performing the work as managing director of Glory. It was his company and they had been working for Australia. “You are asking questions like kindergarten”, he added dismissively.
42. From the documents it does not, in fact, appear that the applicant did significant research. Most of it was done by Mr McLean pursuant to the memorandum of understanding, with some contribution from Norbert Wardana. In re-examination he said that if the project had proceeded, it would be on account of the Australian company, which would have reaped his share of the profits pursuant to the memorandum of understanding. The documents, however, make no reference to any business interests he might have, or plan to have, in Australia.
4.01 Decalcomania
43. In about November 2003 the applicant had received an email from an Indonesian contact seeking a supply source for base paper used to manufacture decalcomania paper, which is used in the manufacture of decals. He discussed the idea with Mr McLean, who visited the contact in Indonesia, in company with Mr Puspawardana, to ascertain the customer’s precise requirements. “Iain then did the work of trying to find a supply source for decalcomania paper in Australia. He was unable to find a source”, the applicant stated (Exhibit A4).
44. Once again, it was Mr McLean who did most of the research, pursuant to the memorandum of understanding, and he also prepared the specification for the base paper (Exhibit A5, email 4 May 2004).
45. In re-examination Mr Puspawardana referred to the discussions in connection with decalcomania base paper in 2004 and 2005 (actually, it was 2003 and 2004). He said that if the project had succeeded, it would have been conducted by the Australian company, which would have retained his share received pursuant to the memorandum of understanding. But the documents make no reference to any proposed establishment of a local company. The Australian end of the transaction was wholly handled by NPC.
5.01 Powerload – fastener guns
46. The applicant said that a principal activity of one of his Indonesian companies is to import and export building materials into and from Indonesia. He became aware of a market for fastening guns in Indonesia and thought it might be possible to export them from Australia to Indonesia. In Exhibit A4 he said that if the project had been feasible, he envisaged creating an Australian company to export the fastener guns to Indonesia.
47. In January 2004 he met in Sydney a representative of Ramset Fasteners (Australia) Pty Limited (“Ramset”), and also identified and contacted a potential purchaser in Jakarta. He arranged for a sample gun to be shipped by Ramset to the potential purchaser, but as the guns could be obtained more cheaply from Germany and the charges from China, the plan did not proceed.
48. At the hearing Mr Puspawardana conceded that it did not matter where the project was sourced and, after some prompting, that the project had nothing to do with establishing a company in Australia.
6.01 Road marking machine
49. According to Exhibit A5, the applicant has a good relationship with an Indonesian company that produces a road marking paint distributor machine, and decided to look into the opportunities for marketing it in Australia in about April 2004. At about that time Mr McLean of NPC visited the Indonesian manufacturer and research was conducted on road marking in Australia and its regulation. The research product consists partly of web search material and partly of documents obtained from relevant Australian authorities. There is nothing to indicate who carried out the research.
50. The project was closed when it was concluded that the Australian industry has high regulatory and other barriers to entry, and when it proved impossible to find a suitable local partner.
51. The applicant did not refer to this project in his statement, his oral evidence or his Statement of Facts and Contentions.
7.01 Fabriano paper retailing
52. The applicant has the exclusive rights to promote Fabriano security paper in Indonesia. As the Italian company also manufactures other paper products, he planned to promote their fine paper and art paper in Australia, and in about June 2004 had initial talks with them about the idea.
53. The applicant was interested in opening a retail store in Sydney as a joint venture with Fabriano (Exhibit A5, email 17 September 2004). Promotional materials were sent to Abadi in Jakarta and to Astrid Wardana at an address in Sussex Street, Sydney. Ms Wardana had come down from Jakarta for the purpose of conducting research on the Sydney market (email 2 October 2004). The applicant invited NPC to become a part owner in the project, but it declined. “We gave it a lot of thought and decided that NPC should thank you for the opportunity but that we should not take an equity position in this retailing opportunity”, Mr McLean wrote (Exhibit A5, email 1 November 2004). He had doubts about the overall commercial feasibility and did not think the market showed great potential. When NPC declined to back the project, the applicant abandoned it.
54. At the hearing Mr Puspawardana confirmed that he had planned the operation to be a joint venture with NPC. He said that if it had proceeded, it would have been conducted by his Australian company and his share of the profits would have belonged to the local entity.
8.01 Storage system
55. On 19 March 2004 Abadi was appointed by an Indonesian manufacturing company, PT Aneka Star, as its export agents to Australian territory for the company’s storage system, safety security box and related products line in the field of security. The appointment followed an enquiry from NPC about Abadi’s ability to supply industrial pallet racking. Some research was undertaken, using the Yellow Pages and online sources, but it is not clear by whom. The project was abandoned but the reasons are somewhat obscure.
56. This project was not referred to in Mr Puspawardana’s statement or oral evidence.
9.01 Hinged fire doors
57. PT Aneka Star also manufactured hinged fire doors, and the applicant looked into the possibility of exporting them to Australia.
58. Online research revealed that the Australian industry is heavily regulated and an entrant would face high entry barriers. It does not appear who conducted the research, but the project was abandoned in about May 2004. The applicant makes no reference to this proposal in his statement or oral evidence.
10.01 Used Carton board and waste paper
59. A principal activity of one of Mr Puspawardana’s companies in Indonesia is to provide security paper to the Bank of Indonesia. He has thereby gained a good knowledge of the Indonesian paper industry, and in about March 2004 concluded that there was a demand for used carton board and waste paper from paper manufacturers in Indonesia. He thought it might be possible to import used carton board and waste paper into Indonesia from Australia, among other possible sources. He met with four potential purchasers of carton board and waste paper in Indonesia, and in March 2004 instructed NPC to conduct the necessary market research. He also asked Mr McLean if he had any contacts in the United Kingdom who could supply waste paper, and directly emailed an Italian contact to ask if he knew any manufacturers in that country who could supply it (email April 26, 2004).
60. Astrid Wardana relayed to the applicant in Jakarta some questions raised by Mr McLean, including “How would konexindo [Abadi] make a proposal/tender?” (Exhibit A5, email 9 March 2004).
61. At the hearing Mr Puspawardana said that if it had proceeded, the operation would have been conducted by the Australian company, which would have sold the carton board and waste paper, whether it came from Italy, the United Kingdom, Australia or anywhere else, and would have retained Arbadi’s share of the earnings pursuant to the memorandum of understanding with NPC.
62. The evidence shows, however, that in 2004 the concept was to be an Abadi project administered from Jakarta. It was not until January 2006 that Nex was being introduced into the negotiations with potential Australian suppliers (Exhibit A5, Minutes dated 5 January 2006).
11.01 Lido Development, Bogor, Indonesia
63. One of Mr Puspawardana’s business contacts wishes to purchase and develop a 600 hectare tract of land in Bogor, Indonesia. As NPC specialises in property development and project management, Mr Puspawardana saw a possible opportunity for NPC to be engaged to develop and manage the project. He introduced Mr McLean to the purchaser and in May 2004 accompanied Mr McLean on a visit to the development site.
64. Exhibit A5 includes a detailed expression of interest in the name of, and prepared by NPC. The proposal seems to be almost wholly an NPC project with no discernible connection with Australia or Nex. Abadi appears to have a role, pursuant to a proposed co-operation agreement or memorandum of understanding (Exhibit A5, email 15 April 2004).
65. According to the evidence the project is being delayed by a legal dispute relating to the site, but once that has been satisfactorily resolved, NPC will be able to commence operation.
66. In oral evidence the applicant confirmed that the transaction was essentially about NPC selling management services to the Indonesian company, pursuant to a memorandum of understanding and with a 50/50 division of the profits. Asked what research he had carried out, he referred to the copy of the plan in Exhibit A5, but then said his company had not actually produced it, he had only discussed it.
12.01 Water monitoring
67. NPC had a remote water meter monitoring system that is web-based and communicates via telephone land-lines so that customers can log on to see their meter data by using a password. Software that could take the data and prepare an invoice for billing was included.
68. NPC sent details of the system to Andrew Tan at Gernium Corporation Sdn Bhd in Malaysia on 21 April 2004. The project was conducted entirely by NPC, though Abadi was kept informed, presumably in pursuance of the memorandum of understanding.
69. At the hearing Mr Puspawardana cited this proposal as an example of how he was conducting business in Australia in 2005 when he completed the survey form. But not only was the program abandoned in May 2004 because of the specific requirements of the Malaysian water system, but also Abadi’s role was minimal. It had no bearing on whether or not Mr Puspawardana was conducting business in Australia.
13.01 Charcoal exports to Australia
70. Another proposal abandoned early in 2004 related to the possible export to Australia of smokeless charcoal for use in barbeques and similar applications. In an email of 2 April 2004, the applicant informed Mr McLean of NPC that “we have good prospects for charcoal barbeque and briquette, and at the moment we are in the middle of processing to export to Sydney” (Exhibit A5, email 2 April 2004). He then asks Mr McLean to undertake research into import duties, taxes and other costs and requirements.
71. After receiving that information, the applicant again emailed Mr McLean, stating “For this project kindly study and let us know whether you prefer to act as our agent, importer, or distributor (Exhibit A5, email 19 April 2004) [emphasis added].
72. The applicant’s statement and oral evidence did not mention this proposal, but in any event, as the above communications show, the idea was that Abadi would be exporting the charcoal from Indonesia, while NPC would handle the Australian import end of the transaction. It supports the view that the applicant was continuing to conduct business in Indonesia, not in Australia.
14.01 Tile exports from Spain to Australia
73. This proposal, which was briefly explored between September 2004 and February 2005 but was not pursued, appears to be separate from the Alpha Tile idea described above. On 8 September 2004, Abadi received a quotation from Quimicer SA (Quimicer) in Spain for a range of wall tiles. Then on 21 September 2004, Mr Puspawardana asked Quimicer to send some samples to Mr Adam Dilati, of Sichar Ceramic Tiles Pty Limited in Sydney. From Quimicer’s email of 15 January 2005 it appears that Abadi would be acting purely as a broker in the transaction between Quimicer and Sichar, receiving five per cent commission.
74. Mr Puspawardana did not mention the proposal in his statement or in oral evidence, and it is plain that it had nothing to do with the establishment of any business activity in Australia by the applicant.
15.01 BHP Steel – Angle rolling machine
75. On 1 July 2004 Abadi wrote to Mr McLean saying that it had a potential customer interested in a machine that could roll steel into a 90 degree angle and asked if Mr McLean could find a company that could supply such a machine and accessories.
76. NPC appears to have obtained relevant information from the web and other sources.
77. The project was abandoned in 2004 when it was discovered that the only Australian company that could supply such a machine already had an agent in Indonesia.
78. The applicant did not refer to this proposal in his statement or in his oral evidence, and the documents show that it did not involve the carrying on of business in Australia by the applicant or his Indonesian company. It was purely a proposal for an import transaction.
16.01 Wine exports to India and Italy
79. Having received in October 2004 an enquiry for the possible export of Australian wine to India and Italy, Abadi asked NPC to research the market. No Indian orders eventuated, but the Italian enquiry led to the shipment of a trial order of 200 bottles in December 2005 for a total price of $1756.70. The order did not originate from a commercial importer, as an email of 9 December 2004 explained:
we are just a group of friends who like wine and want to see if there is any good opportunity. So, no network, no expertise, no wines already imported, no idea on volumes (for the time being).
80. Mr Puspawardana made it clear to NPC that the transaction was to be essentially between NPC and the Italian buyer: “In this case we will act only as middle party under commission basis” (Exhibit A5, email 10 December 2004). NPC told the applicant that its understanding was that the applicant’s role in the transaction was to be through Abadi in Jakarta (Exhibit A5, emails 29 November 2004, 7 December 2004). NPC’s communications with the Australian wine supplier were to the same effect: “I have today discussed the proposed basis of the commercial arrangements with my Client, the Australian-side company of an Asian based trading company” (Exhibit A5, email 6 June 2005). NPC selected the samples and made the shipping arrangements and informed the supplier that the purchase orders “will be written by a company in Singapore” (Exhibit A5, email 24 November 2005) and Glory duly issued the invoices on the same day.
81. In re-examination Mr Puspawardana said the Italian wine business was to be part of his Australian company’s operations and his share of the profits would accrue to the Australian company.
82. The purchase orders were forwarded to the supplier, Zilzie Wines, by Astrid Tan under cover of an email that opened with this paragraph: “I am referred to you by Iain McLean. Allow me to introduce Nex Australia. It is the local company who will be receiving the commission for this transaction”. That interposition of Nex, coming as it did five months after the applicant’s visa was cancelled, appears calculated to give the impression that the applicant was carrying on business in Australia. The reality was that the transaction was part of the continuing relationship between Abadi and Glory on the one hand, and NPC on the other, with Glory playing the role of a commission agent. In his oral evidence Mr Puspawardana said he had a “standing order” to supply Australian wine to Italy, but in fact there has been no order since the sample shipment totalling $1,756.70.
17.01 GBH sanitary ware
83. The applicant’s business relationship with a Malaysian sanitary ware manufacturer, GBH Bathroom Products Sdn Bhd, raised the prospect of exporting sanitary ware to Australia. The plan was that Sichar, not one of Mr Puspawardana’s companies, would take up the role of sole distributor. In his correspondence with GBH, the applicant tended to overstate Abadi’s role in the project, referring to the forthcoming visit to Kuala Lumpa of “our Mr Adam Diletti [sic]”, when Mr Dilati was actually the principal of Sichar (Exhibit A5, email 8 December 2004).
84. Mr Dilati seemed rather lukewarm about the project. In an email on 5 January 2005, he declared that the manufacturer would have to decide whether it wanted Sichar to be a wholesaler or a retailer. If it were to be a wholesaler, turnover would need to be very high, whereas if it were to be a retailer, the profit margin would be higher but the quantity would not be very high. After quoting some wholesale prices, he asked Mr Puspawardana for a commitment, otherwise he would concentrate on some Chinese manufacturers who were ready to co-operate with him. At about that time, GBH withdraw from the discussions and the project did not proceed.
85. The GBH proposal was not referred to in the applicant’s statement or in his oral evidence. Under the plan, Glory would have taken a purely brokering role, if any. It did not tend to show that the applicant was carrying on business in Australia.
18.01 Zirconium sand
86. As part of his building materials importing business in Indonesia, the applicant for a number of years has purchased zirconium silicate, fritz and glaze from Quimicer in Spain. Quimicer’s manufacturing operations themselves use zirconium sand, which is mined in Australia. In the second half of 2004 Mr Puspawardana had the idea of assisting to establish a supply source of zirconium sand directly from Australia to Quimicer, and asked Mr McLean of NPC to research the Australian market. Mr McLean did so, and also arranged for samples to be sent to Quimicer.
87. In his statement (Exhibit A4) Mr Puspawardana said that he envisaged establishing an Australian company that would be a broker or joint venturer in the project. The documentary evidence, however, while it shows that Glory in Singapore would have taken a minor brokering role, does not suggest that Glory would establish an Australian subsidiary as a joint venture. In an email dated 12 October 2004, the applicant advanced two possibilities. One is that Quimicer would buy the sand and process it in Spain. The other was that Quimicer would purchase a quarry itself. Both options faced obstacles, however, as Mr McLean pointed out in an email to the applicant on 2 November 2004: “This is a tough one. I have yet to find a company with any product for sale – the large players are fully contracted through to the end of next year … On one call I was told I was the third person that day to call looking to buy zircon sand! The large players tell me they are looking for new mining opportunities and just cannot source any – finding the stuff in the ground and the environmental issues associated with obtaining approvals”. The following day Mr McLean informed the applicant that he had contacted yet another company that was about 12 months away from starting production. He thought there was a possibility that a customer such as Quimicer might be able to take an equity position in the business and thereby gain an advantage in obtaining supplies (T p199, email 1 February 2005).
88. At the hearing the applicant said that if the project had gone ahead, it would have been operated by his Australian company, although it had not yet been established at that stage. The Australian company would have retained the applicant’s 50 per cent share pursuant to the memorandum of understanding. He said he had wanted to buy a zirconium sand quarry himself, but no land was available.
89. That interpretation does not accord with the documentary evidence. As Mr McLean’s letter to the Department of 3 April 2005 confirms, the proposal by the applicant and NPC was that Quimicer would take an equity position in a start-up zirconium sand mining company (T p199). It was the mining companies that were having difficulty obtaining suitable quarry land, not Mr Puspawardana. His minor role in the proposed operation was such that it was never suggested he should establish an Australian subsidiary, and he made no attempt to do so before the idea was abandoned early in 2005.
19.01 Jin Sung Lighting
90. In January 2005 Norbert Wardana at the Glory office in Singapore emailed a Korean contact about the possibility of exporting weatherproof luminaires (light fittings) to Australia. NPC undertook the necessary research, requesting further information from Norbert Wardana and obtaining advice from an electrical engineer, Mr Bob Stopani.
91. Why the proposal went no further is not clear, but the file includes an email dated 14 February 2005 from the applicant to Mr McLean enclosing a revised draft memorandum of understanding specifically for the importation of lighting products. The three parties were Mr Adam Dilati of Sichar, Mr Iain McLean of NPC and the applicant, representing Nex, which was described in the memorandum as “a Sydney based export and import company. Its head office is Konexindo Glory Pte Ltd which is incorporated and operating in Singapore”. At that date, Nex had not yet been incorporated.
92. Mr Puspawardana did not refer to this proposal in his statement or his oral evidence.
20.01 White crystal sugar
93. A business contact of the applicant’s in Dubai contacted the applicant in about April 2005 about the possibility of white crystal sugar from Australia being supplied to Iraq. Astrid Wardana (Tan), by then working for Nex from its shared office at Clarke Street, Crows Nest, obtained a specification for the sugar required and faxed it to at least one major supplier on 26 April 2005. Subsequently, an enquiry was received about the possibility of exporting sugar to Brazil. In neither case did it prove possible to obtain the quantities required.
94. At the hearing Mr Puspawardana said that if the plan had been implemented, the Australian company would have operated the project and retained his share of the profits. That appears to be correct, as by that time, Nex did exist and was seeking to advance the project. But Mr McLean said the idea “was pursued based on a briefly-open importation window” (T p199) and the proposal did not go beyond the preliminary investigation stage.
21.01 Silica flint pebbles
95. Silica flint pebbles are in demand in Indonesia for use in the grinding of ceramic tiles. In February 2005 Glory contacted a potential supplier of the pebbles in China and on 1 April 2005 a contract was entered into between the supplier and Glory as purchaser, with a view to on-selling to its customer in Indonesia. The contract was at some later stage amended to substitute Nex for Glory as the buyer. A delivery was made to the Indonesian factories in April 2005, and two more in August.
96. The transaction had no discernible connection with Australia and Mr Puspawardana had difficulty in explaining why it was Nex that invoiced the customers rather than Glory or Abadi, and eventually offered the unconvincing explanation that it was because the contracts were c & f. The fact that the Nex invoice dated 29 August 2005 gives the United Overseas Bank in Singapore as the beneficiary bank reinforces the conclusion that Nex was brought into the transaction purely in order to give the appearance that the applicant was carrying on business in Australia.
22.01 Stone chips
97. This abortive project resulted from an Indonesian roofing manufacturer’s interest in purchasing stone chips, resulting in an enquiry received by Abadi in Indonesia in about March 2005. All the research was conducted by NPC, which located a possible supplier in New Zealand and obtained samples. By about July 2005 it became apparent that the customer could obtain supplies from France at a much lower price than Nex was able to quote.
98. The applicant did not refer to this proposal in his statement or in his oral evidence.
23.01 Frevos tapioca
99. SalDoce Fine Foods of Mascot, New South Wales, uses Brazilian-grown tapioca starch as an ingredient in the manufacture of “Frevos”, a bread-like flavoured snack food originating in Brazil. Mr Puspawardana was interested in supplying SalDoce from other sources, and in January 2005 met with Mr Martin Talacko, SalDoce’s managing director.
100. Although Astrid Wardana did some research on the matter for NPC (email 18 March 2005), Norbert Wardana at the Glory head office had the primary responsibility. On 17 February 2005, he asked Mr McLean to ask the Manildra Group for a sample and suggesting that he [falsely] represent himself “as doing a consulting project for an Asian food processing factory in oz [Australia]”.
101. Minutes of a meeting on April 6, 2005, with Mr Talacko, record the following:
The purpose of this meeting is to introduce Konexindo’s Sydney office: NEX AUSTRALIA PTY LTD “Nex”, which has just been set [sic] established.
Nex is to serve the needs of Saldoce and other tapioca starch buyers in Australia.
102. Nevertheless, when a draft memorandum of understanding was prepared for execution by a Thai supplier, it was expressed to be with Konexindo Glory Pte Limited and noted that “Konexindo will act as the main partner of Asia Fructose in the promotion and marketing of the Products”. There is no mention of Nex or of any business being conducted in Australia as such. Similarly, an agenda for a meeting of the parties on 16 May 2005 in Thailand makes no mention of Nex. The applicant, Norbert Wardana and Astrid Wardana are shown as representing Konexindo.
103. Because of the effects of drought, the season’s tapioca harvest was relatively small, causing prices to rise and become uncompetitive. The project is currently in abeyance until the next tapioca harvesting season. In any event the proposed transaction appears in reality to be between Glory and Asia Fructose with Nex playing a purely formal role.
23.02 APS tapioca; Redox
104. This project also contemplated the supply of tapioca by Asia Fructose to Australia, with the difference that in this case the purchaser was Austral Packaging Services, which proposed to use the tapioca starch in carton manufacture.
105. Once again, Norbert Wardana appears to have been in charge. On 3 May 2005 he emailed Astrid Tan to tell her that Asia Fructose would be sending her some technical data. Once it had been received, he said, she should “’dress’ it up so that asia fructose [sic] logo and contacts are deleted then pass info to factory. swap for their details i.e. ask for the current starch they are using?”.
106. The same conclusions apply as to project 23.01.
107. A related proposal mentioned in Exhibit A1 involves Astrid Wardana conducting negotiations with an Australian company called Redox which is interested in purchasing Thai tapioca starch for use in the food industry. At present the project is in the exploratory stages with Redox organising specifications and the necessary certificates of analysis. It would appear that no sales contracts have yet been entered into.
24.01 and 24.02 Developments at Kogarah and Rockdale, New South Wales
108. Mr Puspawardana stated that in about April 2005 he conceived the idea of becoming involved in property development in Australia, following an invitation from a property developer, Mr Albert Hadit, to consider projects in Kogarah and Rockdale. He asked NPC to undertake some research on the legal, commercial and marketing aspects of the proposal and suggested that NPC might wish to join with Glory by providing consultancy services in relation to the development.
109. Mr Adam Dilati of Sichar was also invited to take part in the project and a Mr Safdar Ghafoor was apparently to organise the funding side of the operation. On the applicant’s side, the project was to be conducted by Glory, and there is no mention of Nex in the correspondence or the minutes.
110. After conducting his research, Mr McLean of NPC concluded that the Kogarah proposition was not viable. In a report to the applicant, with copies to Norbert Wardana at Glory and Astrid Tan, he wrote, “I recommend you do not go any further with investigating this opportunity” (Exhibit A5, email 9 May 2005).
111. Mr Puspawardana said at the hearing that his role in the Rockdale and Kogarah investigations consisted of obtaining information from real estate agents about the land available and about the possible market, and approaching government bodies and building contractors. The detailed research, however, was clearly carried out by NPC.
112. Mr Hadit’s proposal for a mixed development at Princes Highway, Rockdale, was also rejected at about the same time following a preliminary investigation.
25.01 Carpet
113. In June and July 2005, the applicant developed a proposal to bid for the supply of carpet to an apartment development operated by Buzrio Pty Limited at Parramatta, New South Wales. How Mr Puspawardana became aware of the opportunity is not stated, but he visited a manufacturer in Surabaya, Indonesia, PT Classic Prima Carpet Industries, and negotiated a price for submission to the developer. The quotation and a sample were forwarded to Buzrio, but the applicant decided not to proceed with the negotiations when the chief executive officer of Buzrio was the subject of criminal charges and committal proceedings in Sydney.
114. The documents in Exhibit A5 indicate that Nex was substantially involved in the negotiations. This project was not, however, the subject of any reference in Exhibit A4 or in the applicant’s oral evidence.
26.01, 26.02, 26.03 Meat exports
115. In June and July 2005, Konexindo Glory and Abadi investigated the possibility of exporting Australian pork to China. Most of the research and correspondence appears to have been conducted by Astrid Tan, who approached a number of potential suppliers, including Craig Mostyn, which had the necessary licence to export to China.
116. According to Exhibit A5, Craig Mostyn’s price was not competitive and the Chinese purchaser was not interested. Communications were shown as emanating from Konexindo (not specifying Abadi or Glory) and there is no specific reference to Nex in the documents.
117. In January 2006, Astrid Tan forwarded to the applicant in Jakarta a quotation for the supply of beef products to a distributor in Indonesia. This followed an enquiry received in November 2005. In these negotiations, Nex is named as the contact in Australia. Thus Astrid Tan emailed a meat company on 13 December 2005, stating inter alia that, “Nex Australia has a relationship with an Indonesian meat distributor who is looking for an alternative beef supplier”. Most of the correspondence and research appears to have been conducted by Astrid Tan. The negotiations are continuing.
118. According to Exhibit A5, in May 2005 an enquiry was received from Algeria about the possible supply of sheep meat, followed in August 2005 by a similar enquiry from Italy. It is not clear to whom the enquiries were directed, but most of the correspondence is addressed to or signed by Astrid Tan. Although she still used Konexindo’s email address, she made it clear that she was negotiating on behalf of Nex (Exhibit A5, email 9 August 2005).
119. While Algeria’s particular inspection requirements proved an obstacle, negotiations with the Italian purchaser are said to be continuing.
27.01 and 27.02 Vegetables exports
120. On 15 June 2005 the applicant emailed Astrid Tan saying that the Hero supermarket chain in Indonesia was interested in buying Australian carrots. Their usual suppliers were in China. Ms Tan thereupon contacted a number of Australian producers of Nantes carrots, but by 18 July 2005 had to report that the prices quoted were not competitive with those charged by Chinese exporters and the proposal lapsed.
121. The Hero chain in Indonesia was also offered Australian asparagus but declined, the reason this time being the low level of Indonesian demand for it. Once again, Astrid Tan conducted the correspondence. Nex’s letterhead was used on some of it. The applicant said that by that time Ms Tan was working full-time for Nex.
28.01 Confectionery imports
122. On 20 June 2005, a Spanish confectionery company Frutosa SA emailed the applicant in Indonesia saying that his company was interested in introducing its nougats and candies to the Asian market. He also thought that Astrid Tan would be interested in developing a market for the products in Australia.
123. Astrid Tan undertook research and handled the correspondence, and in July 2005, drafted a statement of Nex’s terms and conditions for engaging in the project. “Please comment and let me know if it is ok to send” she wrote in an email to her father, the applicant.
124. Ms Tan’s enquiries with Australian importers revealed that demand for nougat in Australia was low, and there were already Australian producers in the field. Consequently, competition for the Spanish exports would be high, and the project was closed.
125. While Astrid Tan was responsible for making the necessary contacts and undertaking the required research, it appears from the above that it was Mr Puspawardana in Jakarta who was making the decisions. This project was not referred to in Exhibit A4 or in the applicant’s oral evidence.
29.01 Polypropylene sacks for fertilizer
126. An Australian company sought a quotation for the supply of polypropylene sacks for fertilizer to meet a requirement of the Fiji government. It does not appear to whom the enquiry was directed, but most likely it was to Glory in Singapore. Although the later correspondence is in Nex’s name, the project seems to have been run from Singapore. Thus, Norbert Wardana at Glory emailed Astrid Tan on 17 July informing her that “this is the news from Peter, our Chinese supplier. You may contact him directly”. Astrid Tan thereupon emailed “Peter” on 18 July 2005, explaining that “I am referred to you by Norbert Wardana from Konexindo”. Later she seeks a sample of the product adding that “I would need the sample in my Australia office (the address is attached in the signature of this email)”. The project is apparently still pending.
127. The applicant does not refer to this proposal in Exhibit A4 or in his oral evidence. It would seem that his involvement in it is minimal.
Sugar industry machinery
128. Not referred to in Exhibit A5 is the applicant’s current investigation of the possibility of exporting to Indonesia machinery manufactured in Australia for the sugar industry. This year Mr Puspawardana identified and approached a person in Indonesia wishing to purchase a machine called a roller shell. He and Astrid Tan then located a supplier in Australia and worked on brokering a sale to the purchaser in Indonesia. The price was not competitive with Taiwan. While that transaction did not proceed, in recent times Mr Puspawardana has been communicating with an Indonesian who wishes to purchase a cane mud drum filter used in sugar processing, which costs about $1.3 million. Again, he and Astrid have located a potential supplier in Australia and are working on arranging the sale to the Indonesian purchaser.
129. The applicant says that both of these 2006 projects are being handled through Nex.
Consideration of the Law and findings of fact
130. The tribunal should have regard to all relevant evidence to enable the making of findings of fact in relation to the cancellation of Mr Puspawardana’s and the secondary family unit members’ visas as at the date of the decision, that is 15 July 2005: Freeman v Secretary, Department of Social Security (1988) 19 FCR 342; Migration Agents’ Registration Authority v Shi [2006] FCA 1236.
131. The tribunal has in the past held that it is entitled to look at activities after the date of visa cancellation and up to the date of the hearing where they can be related back to events prior to that date (see Re Lau and Minister for Immigration and Multicultural Affairs [2002] AATA 703; Re Halim and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 767; Re Griffiths and Migration Agents Registration Authority [2001] AATA 240). The predominant view now, however, appears to be that the tribunal when reviewing a cancellation decision cannot take into account material relating to facts arising after the date of cancellation: Re Yam and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 283 paras 12‑14, Re Andiwidjaja and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 397 at para 37, Re Wong and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 54 at para 37, Re Haman and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 1113 at paras 52‑53, Nong v Minister for Immigration and Multicultural and Indigenous Affairs (2000) 106 FCR 257 at 264.
132. The decision to cancel Mr Puspawardana’s business skills visa was made pursuant to s 134(1) of the Act on the grounds that the delegate concluded that (T p14):
(a)he has not obtained a substantial ownership interest in an eligible business in Australia; or
(b)is not utilising his or her skills in actively participating at a senior level in the day-to-day management of that business; or
(c)do not intend to continue to:
(i)hold a substantial interest in; and
(ii)utilise his or her skills in actively participating at a senior level in the day-to-day management of;
an eligible business in Australia.
The terms “ownership interest” and “eligible business” are defined in s 134(10), set out above.
133. Section 134(2) provides that the Minister must not cancel a business visa under s 134(1) if the Minister is satisfied that the person:
(a)has made a genuine effort to obtain a substantial ownership in an eligible business in Australia; and
(b)has made a genuine effort to utilise his or her skills in actively participating at a senior level in the day-to-day management of that business; and
(c)intends to continue to make such genuine efforts.
When considering whether a person has made the genuine effort referred to in subsection (2), the Minister may take into account the matters set out in subsection (3), set out above.
134. The business visa cancellation process is activated if the visa holder’s record and performance displays any of the shortcomings listed in s 134(1). The first of those is that the holder “has not obtained a substantial ownership interest in an eligible business in Australia” (s 134(1)(a)). What constitutes an “eligible business” is defined in s 134(10), set out above. At the hearing the applicant’s counsel very properly conceded that Nex was not an eligible business at the date of cancellation of the visa.
135. Statements of facts and contentions were also filed in respect of the application by Ms Wardana (Exhibit A2). In it, the applicant submitted that cancellation of the visa would cause extreme hardship to Ms Wardana as she has been settled permanently in Australia since 2004, is a full-time employee of Nex, owns her own residential property in which she lives, and is in a permanent relationship with an Australian resident, Michael Soesanto, whom she is planning to marry in November 2007.
136. It therefore becomes necessary to consider whether the applicant has made the genuine efforts specified by s 134(2)(a) and (b) and has the intention required by s 134(2)(c), taking into account the factors listed in s 134(3). ReYam and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 283 is a useful guide to the meaning of the relevant provisions. With regard to the words “genuine effort”, Senior Member Dwyer notes at paragraph 88 that:
The Act does not specifically include any requirement that the “genuine effort” must be likely to succeed, or must meet any threshold level, beyond being genuine.
137. As to whether Mr Puspawardana has made a genuine effort to obtain a substantial ownership interest in an eligible business (s 134(2)(a)), he does own a half-share in Nex, a two shareholder corporation in which the other share is held by his son Norbert. Nex was not formed until 24 March 2005 after the notice of intention to consider cancellation dated 14 March 2005. At the hearing the applicant conceded that the shares had no value at the date of cancellation.
138. An overriding sub-issue in relation to the question of genuine effort was the role and effect of the memorandum of understanding dated 22 April 2004 between Glory and NPC (Part Exhibit A3). The memorandum was expressed to establish a business cooperation arrangement including sale, import, agency and the rendering of all services necessary to create good business results for various products listed in an attachment. The cooperation could also be extended to other subjects mutually agreed upon later.
139. For each successful transaction, profits would be divided between Glory and NPC on a 50-50 basis. Glory agreed to support NPC fully in endeavouring to obtain Australian sales agency rights for the subject products. The parties also agreed, among other things, to establish a bank account in Singapore into which NPC would remit Glory’s profit share.
140. The respondent submitted that the efforts the applicant claimed to have made to establish an eligible business in Australia were actually undertaken pursuant to the memorandum of understanding. As the minutes of a meeting between the parties on 4 May 2004 showed, Nex itself was established pursuant to the memorandum. Similarly, as Astrid Wardana conceded as self-evident, any involvement by NPC in the relevant activities was pursuant to the memorandum.
141. The respondent further submitted that Glory has three other shareholders besides the applicant, namely his son Norbert Wardana, a Mr Yap and Ms Lin. As managing director of Glory, the applicant was answerable to them and he could not claim that his 50 per cent share of the profits generated pursuant to the memorandum could be appropriated for his Australian company. All the products in relation to which the applicant claimed to have made efforts, with the exception of sugar, were covered by the memorandum. Mr Puspawardana himself had admitted in cross-examination that Nex existed only as a shell company for the convenience of his other companies. The efforts that he described were therefore essentially only by way of investigating opportunities for his Singapore and Indonesian business interests, and also on behalf of Glory’s other shareholder owners. He was not working for the purpose of establishing an eligible business in Australia.
142. The applicant replied that the memorandum of understanding did not preclude Glory from establishing a corporation in Australia to carry out the applicant’s side of the agreement. Other documents pointed to that conclusion, notably Mr McLean’s letter of 3 April 2005 (T pp197-200). And while Mr Puspawardana did say that Nex was established as a shell for the convenience of his other corporations, it was necessary to look at the totality of his business operations in order to appreciate the effect of what he was saying. Substance rather than form should be the tribunal’s focus.
143. While it is true that the memorandum did not prevent the applicant from forming a company in Australia to carry out Glory’s side of the agreement, Nex was not registered until after the date of the notice of intention to consider visa cancellation. It had only one transaction to its credit by the time the visa was in fact cancelled, a sale of flint pebbles from China to Indonesia, but that transaction, as was shown above, had no real connection with Australia. The sale of wine to Italy was also put forward as part of the Nex business, but Nex was not brought into the transaction until five months after the visa was cancelled.
144. Mr McLean’s letter does express the opinion that the applicant was endeavouring to establish a substantial business in Australia (T p200), but his description of the dealings that led him to that conclusion is consistent with the analysis of those transactions set out above and adds nothing to it.
145. The totality of the applicant’s business dealings is no doubt the proper focus for enquiry, and substance rather than form is relevant to the operation of s 134(2). Mr Puspawardana repeatedly said in evidence that he was the driving force behind Abadi, Glory and Nex, and the corporate vehicles he used at any particular time were irrelevant to the nature of his efforts. But assessing the applicant’s personal efforts without regard to corporate structures produces a picture that is not relevantly different from that arrived at by analysing the operation of the memorandum of understanding and the dealings of the applicant’s various companies.
Section 134(2)(a)
146. As regards whether he had made a genuine effort to obtain a substantial ownership interest in an eligible business in Australia (s 134(2)(a)), the applicant relied mainly on five projects, Alpha tiles, the Lido development and Fabriano, and to a lesser extent zirconium sand and kenaf. These related to the business proposals criterion in s 134(3)(a).
147. The Alpha project antedated the memorandum of understanding, and if it had proceeded it could well have constituted an eligible business. The negotiations lasted for only a few months and it did not proceed because the supplier was disinclined to grant sole distributorship rights to the proposed company. And while the applicant did have some prior knowledge of the tile market in Australia because of some involvement ten years previously, the detailed proposals and draft structures were developed and put forward by Mr Adam Dilati of Sichar Ceramics, and the efforts were really his, not the applicant’s.
148. The Lido development at Bogor in Indonesia, as was pointed out above, appears to have been almost wholly an NPC project with no discernible connection with Australia or Nex. Mr Puspawardana had little to do with it.
149. The Fabriano proposal for a store in Sydney retailing quality paper as a joint venture with Fabriano and NPC could also have been an eligible business if it had come into operation, although Fabriano itself does not appear to have been interested except as a supplier. Discussions took place over a period of only about six weeks and proceeded no further once NPC expressed doubts about the market’s potential. The project thus went no further than the preliminary exploration stage.
150. As regards the idea of kenaf exports from Australia, the documents show that the initiative came from Norbert Wardana in Singapore and that most of the research and negotiation was conducted by Iain McLean of NPC and by Norbert Wardana. As was noted above, the documentary evidence makes no reference to any business interests the applicant might have, or plan to have, in Australia. The applicant conceded that it was hard to show from the documents that he had conducted any research, but he claimed that he was the motor that drove the project and who had the knowledge about kenaf.
151. In relation to zirconium sand, the evidence shows that while Glory in Singapore would have taken a minor brokering role, it was never suggested that the applicant would establish an Australian subsidiary, and he made no attempt to do so before the idea was abandoned early in 2005.
152. The five projects just mentioned, therefore, do not constitute weighty evidence of business proposals that the applicant has developed within the meaning of s 134(3)(a).
153. The same is true of the other projects outlined above, not all of which were referred to in the applicant’s oral evidence or submissions. In relation to some of them the applicant claimed credit for work actually done by others, usually NPC. That was true of decalomania, polypropylene sacks, water monitoring equipment, Jin Sung Lighting, stone chips, Frevos tapioca, APS tapioca and the Kogarah-Rockdale developments, as well as Alpha, kenaf and Lido.
154. Another group of proposals either had no connection with Australia or showed that the applicant was really carrying on business in Jakarta or Singapore and not striving to establish a business in Australia. That was the case in relation to fruit exports, Powerload fastener guns, used cartons and waste paper, charcoal exports to Australia, tile exports from Spain to Australia, BHP steel rolling equipment, wine exports to Italy, GBH sanitary ware, flint pebbles, Frevos tapioca, confectionery imports, pork exports to China, and polypropylene sacks.
155. In relation to three projects, the documentary evidence did not show that the applicant had any significant involvement. These related to the road marking machine, storage systems and hinged fire doors.
156. A fourth category of projects had clear involvement by Nex but arose either after the visa was cancelled or, at the earliest, after the notice of intention to cancel. The Redox, carpet and sugar industry machinery projects were of the former kind. As regards vegetable exports, an enquiry for carrots was received one month before cancellation. In relation to meat exports, the earliest enquiry was received in May 2005. None of these projects has generated any income. They are either still the subject of continuing negotiations or have been abandoned.
157. Mr Cox contended that sugar was the only product not covered by the memorandum of understanding and therefore properly attributable to Nex. But Nex itself, he argued, was by the applicant’s own admission a mere shell that existed for the convenience of the applicant’s other companies. But even if one assumes that Nex, once established, was intended to be the vehicle for the applicant’s Australian business, the picture that emerges does little to advance the applicant’s case. Mr Puspawardana had an established record as a successful businessman operating from Jakarta and Singapore. He was the moving force behind three overseas companies that were and are going concerns. He had substantial business contacts with Australia, but most of those were pursuant to a memorandum of understanding in which NPC was the Australian partner and Glory, a Singapore corporation owned by the applicant and three other persons, was the overseas partner.
158. The applicant made no attempt to obtain an interest in an established Australian business or to take up residence in this country. Quite apart from the fact that most of his proposals for Australia came within the ambit of the memorandum of understanding, most of them, notwithstanding what he said at the hearing, were on behalf of his business interests in Singapore and Jakarta and were not related to establishing a business in Australia. He made no attempt to establish an Australian corporation until after he had received the notice of intention to consider cancellation of his visa. By the time his visa was cancelled, Nex had conducted no significant business in Australia.
159. It can be accepted that his personal involvement in the activity described was at a senior level (s 134(2)(b)). His own estimate that he spent about 25 hours a week working on his Australian business must, for the reasons given above, be treated with some reserve, but in any event it was not devoted to the management of an eligible business in Australia, but to his overseas businesses.
160. It is convenient at this point to consider the other criteria in s 134(3), even though they relate to s 134(2)(b) as well as s 134(2)(a). As regards s 134(3)(b), the applicant submitted that he had been negotiating with potential partners or joint venturers in relation to his proposals, specifically Alpha tiles and Fabriano. That is correct, but as was pointed out earlier those negotiations did not proceed far. The applicant also mentioned NPC, but that company cannot be treated as a partner or joint venturer for these purposes, as its involvement was pursuant to the memorandum of understanding with Glory and related to the applicant’s overseas interests.
161. As regards research conducted by the applicant into the conduct of an eligible business in Australia (s 134(3)(c)), the applicant conceded that he had delegated a good deal to Mr McLean of NPC and to his daughter Astrid Wardana, but claimed to have done part of it himself. He specifically mentioned studying the Australian ceramics market for the Alpha project, which antedated NPC’s involvement. He had acquired knowledge of that market some 20 years earlier. Fruit exports, the Lido development and the waste paper project also involved work by him. He may well have had pre-existing knowledge of the Australian ceramics market, but if that was gained 20 years before, it had nothing to do with satisfying the requirements of his visa. In any event, the detailed proposals and draft structures, as was noted above, were developed and put forward by Mr Dilati of Sichar, rather than by Mr Puspawardana. The documentary evidence in relation to the fruit export proposal is devoid of any suggestion about the establishment of an Australian business, or indeed any personal link between the applicant and Australia at all. The applicant did make enquiries about the demand for used carton board and waste paper from paper manufacturers in Indonesia, but the evidence shows that in 2004 the concept was to be an Abadi project administered from Jakarta. It was not until January 2006 that Nex was being introduced into the negotiations with potential Australian suppliers.
162. In relation to s 134(3)(d), the applicant conceded that he had spent only 98 days in Australia, but pointed out that some other successful applicants had spent even shorter periods here. The limited amount of time he had spent here before his visa was cancelled might not be a weighty factor if his absences overseas could be viewed as being in the service of his Australian business. As has already been noted, that was not the case. His activity here was on behalf of Glory pursuant to the memorandum of understanding.
163. As regards s 134(3)(e), the applicant conceded that most of the $1,500,000 that he said in his Form 1010 that he had transferred to Australia, went on personal expenditure, including the Pyrmont apartment and the BMW for Astrid. In his final submissions Mr Zipser estimated the total transferred for business purposes at approximately $112,000.
164. As regards s 134(3)(f), the applicant conceded that his interest in Nex at the time the visa was cancelled had no monetary value.
165. As regards s 134(3)(g), he said the main example, apart from the sending of samples overseas, was the export of wine. But that transaction was essentially between NPC and the Italian buyer, with Nex being interposed five months after the visa was cancelled. The transaction’s total value was $1,756.70. There were no repeat orders.
166. As regards s 134(3)(h), the applicant said that he had not received the department’s letter requesting that he complete the 24-month business skills survey (T pp111, 127).
Section 134(2)(b)
167. Turning then to s 134(2)(b), whether the tribunal is satisfied that the applicant has made a genuine effort to utilise his skills in actively participating at a senior level in the day-to-day management of the business, the applicant in his statement of facts and contentions (Exhibit A1), submits that he is the managing director of the company and actively participates in the day-to-day management of the company including marketing and business development as well as managing the finances and employee of the company. He said he has undertaken extensive research and put his best effort into exploring the possibility of quite a number of business opportunities in the years 2003 to 2005.
168. The respondent contended in her statement of facts and contentions (Exhibit R2) that there is no evidence of the applicant using his skills in actively participating in Nex Australia at a senior level on a day-to-day basis, particularly as the evidence provided by Mr Puspawardana showed that much of his activities related to a period before the establishment of the company, much of the activity was carried out by other people and, thirdly, much of the activity related to the applicant’s Indonesian business interests. In addition, the applicant had only spent 98 days in Australia since the date of grant of his visa, relying on Re Huang and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 656 where Senior Member Muller, at paragraph 6, stated “A Business Skills visa is designed to allow the overseas business person to travel to and from Australia and to live in Australia while conducting the business. It envisages that the holder of such a visa will acquire a significant interest in an Australian company and play a significant role in the day-to-day management of the company. It also envisages that the business person will probably wish to have close family members accompany them while they live in Australia”. See also Re Lip Tek Ho and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 1258 at paras 40-41.
169. I find that the applicant does not satisfy the criteria in s 134(2)(b).
Section 134 (2)(c)
170. With regard to whether the applicant intends to continue to make a genuine effort (s 134(2)(c)), the applicant submitted in his statement of facts and contentions that Nex Australia still subsists and there is ongoing development of the business, the company has now commenced exporting wine, it is presently exploring with an Australian company Redox the export of tapioca starch, the company was having talks with a potential buyer in Indonesia for the export of sugar roller shells, and the company was in final negotiations with National Project Consultants (NPC) to provide a business consultancy service.
171. The respondent in her statement of facts and contentions argued that there was no genuine effort on the part of the applicant for the further reasons that the business entity was formed only after he was notified of the intention to cancel his business visa, the minor wine delivery six months after the visa cancellation appears to have no connection to Nex Australia, the evidence provided by the applicant at annexures six, seven and eight of the applicant’s statement of facts and contentions have no identifiable authorship and no apparent connection to Nex, the business proposals outlined by the applicant appear wholly or substantially related to the applicant’s Indonesian business interests, as does the research undertaken (the memorandum of understanding dated 22 April 2004 referred to by the applicant was between Konexindo Glory Pte Ltd and National Project Consultants Pty Ltd and referred only to the distribution of profits and the provision of services between Konexindo and NPC), there is no evidence of the amount of assets transferred to Australia for use in Nex Australia, and the applicant was unable to provide the current net worth or total annual income and expenses of the company.
172. Section 134(2)(c) requires that the decision maker be satisfied that the visa holder intends to continue to make the genuine efforts referred to. The absence of any documented prospects of significant business activity on the part of Nex Australia at the time of cancellation (or since) does not suggest that such an intention is present. In the applicant’s statement of facts and contentions, he stated that he is currently having discussions with Redox, an Australian company, to explore the possible exportation of tapioca starch (Exhibit A1 annexure 6), with NPC on the provision of business consultancy services (Exhibit A1 annexure 7) and with a potential buyer in Indonesia of sugar roller shells (Exhibit A1 annexure 8). An examination of these documents reveal that they all pertain to activities by the Konexindo group in Indonesia and Singapore and not Nex Australia.
173. In conclusion, I am not satisfied that the applicant meets the requirements of s 134(2). Though his Australia-related business activities have involved his participation at a senior level, that would only be of assistance to him if he was participating in the management of an eligible business in Australia, and he conceded that Nex was not an eligible business at the date on which his visa was cancelled. He did not make a genuine effort to obtain a substantial ownership interest in an eligible business because the efforts committed to the approximately 29 projects mentioned in his evidence were either performed by others and not by himself, or were performed by him in pursuance of the memorandum of understanding with Glory or were otherwise in the service of his overseas business interests. He did not migrate to Australia, spent relatively little time here and made no attempt to establish a local corporation until after he had received the notice of intention to consider cancelling the visa. His local corporation, Nex, carried out no significant business before the applicant’s visa was cancelled.
174. It is therefore necessary to consider the discretionary factors.
Discretionary Factors
175. The tribunal has a discretion not to exercise the power to cancel a business visa even if the criteria set out in s 134(1)(a) to (c) are not satisfied (Re Nagaria and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 579). A common ground on which that discretion can be exercised in favour of an applicant is that further time should be given to the visa holder to undertake what was required of him or her (Kim v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 31, paragraph 21). In her statement of facts and contentions, the respondent referred the tribunal to clause 127.216 of Schedule 2 of the Migration Regulations 1994 which provides that at the time of the application:
The applicant genuinely had a realistic commitment, after entry to Australia as the holder of a Subclass 127 visa:
(a) to either:
(i) establish an eligible business in Australia; or
(ii) participate in an existing eligible business in Australia; and
(b) to maintain a substantial ownership interest in that business; and
(c) to maintain direct and continuous involvement in management of that business from day to day and in making decisions that affect the overall direction and performance of the business in a manner that benefits the Australian economy.
176. The respondent contended that the visa conditions contained in the regulations evidence an intention that business skills visas be available to persons who intend to immigrate to Australia for the purposes of establishing, or participating in, an eligible business, and to allow such persons to maintain direct and continuous involvement in the day-to-day management of that business within Australia. It would run counter to the legislative scheme to grant such a visa to a person who does not intend actively to establish and manage ongoing business activities in Australia. In her statement of facts and contentions (Exhibit R2), the respondent contended that the applicant has not demonstrated a genuine and realistic commitment to do the things referred to in clause 127.216 and that it would be contrary to the legislative scheme to allow the applicant to retain his visa. In particular, the applicant had orchestrated only one business transaction through Nex Australia, which was not an eligible business, his sourcing of potential opportunities was carried out for the benefit of his Indonesian companies, he had failed to transfer or retain substantial funds in Australia for the purpose of his eligible business and that he had spent only 98 days in Australia in a period of over three years.
177. The applicant’s representative did not deal with the issue of discretion in his statement of facts and contentions in respect to Mr Puspawardana. However, with respect to Astrid Wardana, he submitted that she has been living in Australia since 2004, has been employed since that time and would suffer extreme hardship if her visa was cancelled. He submitted that she has bought a residential property free of encumbrances (being a home unit in Bowman Street, Pyrmont), a motor vehicle and has numerous bank deposits. He also submitted that Ms Wardana is in a permanent relationship with an Australian permanent resident, Mr Michael Soesanto, and that they are planning to marry in November 2007. A statement by Ms Wardana dated 2 September 2006 was filed the day before the hearing.
178. At the hearing the applicant submitted that as the applicant and Astrid Wardana were making a serious effort to build Nex into a viable business, this was an appropriate case for exercising the discretion in his favour on the basis of allowing him more time to meet the statutory requirements.
179. The applicant stated (Exhibit A4) that at the time he was granted a business visa in March 2002, his intentions were:
·He would establish a viable business in Australia;
·He and his wife would migrate to Australia;
·He would personally operate the business in Australia and would devote the majority of his working time to the business; and
·He would continue to own his three companies in Indonesia and Singapore but would allow the managers of those corporations to operate them.
“I continue to be interested in establishing a viable business in Australia and migrating to Australia”, he went on. “I have found the task of establishing a viable business in Australia more difficult than I expected. As the documents in the Folders (Exhibit A5) indicate, I have considered and worked on many projects, but none have so far been viable or come to fruition. However, I would like continue to attempt to establish a viable business in Australia”.
180. Opposing the exercise of the discretion in the applicant’s favour, the respondent contended that the applicant’s exploration of potential business opportunities was carried out in order to benefit his overseas companies and not Nex. Further, he had spent only 98 days in Australia since receiving his business skills visa over three years ago, had arranged only one business transaction through Nex and had failed to demonstrate that he had transferred and retained substantial funds in Australia for the purpose of engaging in an eligible business.
181. While most or all of his activity before visa cancellation must, on the evidence, be viewed as part of the business of his overseas companies, much of his activity since cancellation could be seen as seeking to find ways of giving Nex an independent commercial basis. There may be no intrinsic reason why a substantial branch operation within a larger multinational group could not meet the statutory criteria for an eligible business, at least if the applicant were to migrate to Australia at an appropriate time. But so far Nex shows no convincing signs of becoming a viable commercial entity, even as part of a larger group. It has effected only one transaction, a small sale to some wine buffs in Italy with no repeat orders or the likelihood of any. A number of possibilities have been explored but, as Mr. Puspawardana himself states, none has so far proved viable or come to fruition. There are insufficient grounds for thinking that Nex will develop into an eligible business, if given additional time, in the reasonably foreseeable future.
182. I therefore do not think that this is an appropriate case for exercising the discretion in the applicant’s favour.
Astrid Wardana’s application
183. Mr. Puspawardana’s daughter Astrid Wardana (also known as Astrid Tan) holds a secondary visa as a member of his family. When his visa was cancelled, Astrid Wardana’s secondary visa had also to be cancelled by the Minister pursuant to s 134(4), unless cancellation of that visa would result in extreme hardship to that person (s 134(5)).
184. In her statement (Exhibit A6) she said that she received her primary and high school education in Singapore, where she lived with her parents. From 1999 to 2001 she studied at Indiana University and at the hearing said that she had graduated with a degree of Bachelor of Arts. As the BA (or AB) degree in the United States is normally a four-year program, I queried those dates. She later explained through her counsel that she completed the degree in 3.5 years, graduating in 2002, not 2001 as previously stated.
185. In 2002 and early 2003 she worked in a marketing firm in San Francisco and in the first half of 2003 moved to Jakarta where she worked for Abadi for about six months. She migrated to Australia in December 2003 and until January 2005 worked in the recruitment industry. Since January 2005 she has worked for her father at Nex. From January to June 2005 she received a casual allowance from her father in relation to that work. Since June 2005 she has been employed and paid a wage by Nex, occupying a cubicle with a telephone in NPC’s offices at Crows Nest.
186. She further stated that in March 2004 she purchased her Pyrmont apartment off the plan for $1.3M, commencing occupation in January 2005, and in February 2005 purchased a new car for about $86,000. Her father, on the other hand, says he purchased the apartment using personal funds brought from Singapore. When it was pointed out to him that his daughter said that she had purchased the apartment, he replied that he did not understand. A little later he said that the apartment was a gift for his daughter and now belonged to her. He also said he purchased the BMW for her in February 2005, paying cash for it.
187. Her statement then turns to her relationship with Michael Soesanto, an Indonesian citizen with Australian permanent residency rights. “In February 2004 I met Michael Soesanto through the church I attend. In March 2006 we became engaged. I hope and expect we will get married. However, we need to spend more time together before we make a final decision to marry.” “If the relationship between Michael and me continues to progress well”, she continued, “we will marry” (Exhibit A6). At the hearing, however, she denied that they had not yet decided whether to marry. Asked about her statement that “we need to spend more time together before we make a final decision to marry”, she replied “Final decision as in you know officially get married, as in officially have a certificate to say that you are husband and wife. To make it like super official I guess” (transcript 6 September 2006 p38).
188. Ms Wardana assured the tribunal that her father had been aware of the engagement since the couple announced it on her birthday in March 2006. The name Michael Soesanto appeared to mean little to her father, however. When asked about him he took some considerable time to understand which Michael Soesanto he was being asked about. He said he knew him as a business friend in Indonesia but he was now working in Sydney. “I think I met him here in Australia”, he recalled. He only knew him through his father, and had met him at his father’s offices in Indonesia (transcript 6 September 2006 pp16-18). Asked in re-examination whether his daughter was in a relationship with a boy, he replied “Yes, I know. He is some boyfriend here in Sydney. The name is Michael Soesanto”. When asked further about the nature of the relationship, he replied “My understanding is between my daughter is already an adult. She is 25 years. So they free to look some boyfriend, to become – his fiancée in the future for want to marry” (transcript p27).
189. Ms Wardana submitted that she would have difficulty obtaining employment in Indonesia because she is not fluent in formal Indonesian, only in social Indonesian. Further, she could not imagine living apart from her fiancé and she has no friends in Indonesia. She enjoys working for Nex and did not enjoy the six months she spent in Jakarta working for Abadi. If she had to leave Australia she would need to sell her car and did not know what she would do with the apartment. Any financial loss in relation to the apartment or car would be a hardship for her, as would her separation from her fiancé and the difficulties she expected to have in re-integrating into Indonesian society. On the other hand, she conceded that she knew of no reason why she could not apply for a spouse visa or prospective spouse visa, given that Mr Soesanto is a permanent resident.
190. The meaning of “extreme hardship” was considered in a different immigration context by the Federal Court in Man Ki Yam v Minister for Immigration and Ethnic Affairs [1995] 37 ALD 481, in which Foster J said that “it imports a high degree, perhaps a very high degree of hardship, but it must be applied in the context of the facts of the particular case”. Deputy President McMahon in Re Wang and Minister for Immigration and Multicultural Affairs [2000] AATA 961 observed that “the deliberate choice of the word “extreme” by Parliament, requires one to understand what was meant by the use of that particular degree of hardship….[T]here must be shown to be not only hardship and not only undue hardship, but extreme hardship. Furthermore, that hardship must result from the cancellation.…The fact that the loss of a visa means that the applicant would need to leave Australia cannot of itself amount to hardship as this is the result contemplated by the statute upon cancellation” (at paras 29-32).
191. Mr Zipser submitted that while the test is indeed stated at a higher level, its application depends on the facts. In Re Pang and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 1056, the secondary visa holder, aged 23, had completed her secondary education in Australia and was in the penultimate semester of a double degree program in business and accounting at Macquarie University. The was no equivalent course offered at any Hong Kong university and her parents could not afford to pay her fees in Australia as a foreign student or to support her here. In Hong Kong she would also be required to study additional subjects not required for her Australian degrees and would incur an additional $17,000 in fees. She also referred to the hardship involved in leaving her friends and her “boyfriend” but did not expand on the nature of that involvement. The tribunal decided that to cancel her visa at this stage would be to inflict extreme hardship upon her.
192. Mr Zipser also relied on Re Huang and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 656 at para 20, where the tribunal noted that the secondary visa holder had lived permanently in Australia since November 1994 and had not lived in Taiwan since 1990. He had lost contact with Taiwan and was in the final stages of university studies in Australia.
193. The facts in the present case are materially different from those in Pang and Huang, however. Ms Wardana has lived in Australia for less than three years and is not undertaking any tertiary studies that would be disrupted, with or without adverse financial consequences, if she were to return to Indonesia. She would prefer not to live there, but as was pointed out in Wang, the fact that visa loss means that the applicant would need to leave Australia cannot of itself amount to hardship as it is the result contemplated by the statute in the event of cancellation.
194. As regards her engagement to Michael Soesanto, in her written statement that she adopted on oath she declared that they had not yet decided to marry, but in her oral evidence claimed that they had. Michael Soesanto, for his part, writes that “We would like to get married in November 2007; and we look forward to our future together in Australia” (Part Exhibit A1). He does not actually say they are engaged, but that might be inferred.
195. Equally notable is the fact that her father, with whom Ms Wardana obviously has a close filial relationship, appeared in his evidence to be totally unaware of any engagement, knew Michael Soesanto only as the son of a good friend in Indonesia and could only say that he thought he had met him in Australia.
196. Given the internal inconsistencies in her evidence, and the conflict with her father’s evidence, I do not find Ms Wardana an entirely convincing witness. She may consider herself to be engaged, but as betrothals go, this seems a rather odd one. She cannot give consistent answers about whether she has decided to marry or not and her father only thinks she has a boyfriend. I therefore think Ms Wardana has overstated the nature of her relationship with Mr Soesanto, but in any event there appears to be no reason why she could not apply for a spouse visa if the marriage goes ahead.
197. If she were to leave Australia and had to sell her assets, she would lose on the sale of the BMW as compared with its new price and might lose on the sale of the apartment, but these assets were gifts to her and if they were sold she would in all probability be left with proceeds exceeding $1M.
198. In those circumstances I conclude that visa cancellation would not cause Ms Wardana extreme hardship within the meaning of s 134(5).
199. It was conceded that Mr Puspawardana failed the test in s 134(1), and I have found that at the time of visa cancellation he had not made the genuine efforts required by s 134(2), bearing in mind the factors listed in s 134(3). I also consider that there are insufficient grounds for exercising the discretion implied in s 143(1) in his favour and for finding that Astrid Wardana will suffer extreme hardship within the meaning of s 134(5). The decision under review is thus affirmed.
I certify that the 199 preceding paragraphs are a true copy of the reasons for the decision herein of Professor GD Walker, Deputy President.
Signed: .....................................................................................
AssociateDate/s of Hearing 5 September 2006
Date of Decision 15 November 2006
Counsel for the Applicant Mr B Zipser
Solicitor for the Applicant Mr A Lim, Accentro Legal
Solicitor for the Respondent Mr A Cox, Phillips Fox lawyers
7
17
0