Re Lok Young (Michael) Wong v Minister for Immigration & Multicultural Affairs
[2006] AATA 277
•24 March 2006
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2006] AATA 277
ADMINISTRATIVE APPEALS TRIBUNAL )
) No S2005/147
GENERAL ADMINISTRATIVE DIVISION ) Re LOK YUNG (MICHAEL) WONG Applicant
And
MINISTER FOR IMMIGRATION AND MULTICULTURAL AFFAIRS
Respondent
DECISION
Tribunal Deputy President D G Jarvis Date24 March 2006
PlaceAdelaide
Decision The tribunal sets aside the decision under review and directs that the business skills visa of the applicant not be cancelled.
..............................................
Deputy President
CATCHWORDS
MIGRATION – Business Skills visa – cancellation of visa – proposed incorporated joint venture – applicant made a genuine effort to actively participate at a senior level in day-to-day management of a proposed new business – applicant intended to continue to make such genuine efforts – conflict of authority of earlier Tribunal decisions as to whether activities outside Australia can amount to requisite participation in management of eligible business – nature of proposed business – applicant does not intend to reside in Australia for three to five years – limited relevance of circumstances or events subsequent to date of cancellation of visa – use of policy instructions – meaning of “day-to-day management” – decision under review set aside.
Migration Act 1958, ss 134(1), 134(2) and 134(3)
Acts Interpretation Act (1901) (Cth,) ss 15AB(1)(b) and s 15AA
Luntz Assessment of Damages for Personal Injury and Death 3rd Ed. (1990) par 1.4.1
Braverus Maritime Inc v Port Kembla Coal Terminal Ltd [2005] FCAFC 256
R v L (1994) 122 ALR 464
Re Angkadjaja and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 699
Re Griffiths and Migration Agents’ Registration Authority [2001] AATA 240
Re Haman & Ors 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 Jo and Minister for Immigration and Multicultural and Indigenous Affairs (2004) 38 AAR 394
Re Legana and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 1166
Re Lim & Ors and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 28
Re Ng and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 299
Re Ong and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 178
Re Permana & Ors and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 802
Re Tany and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 58
Re Thomas and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 637
Re Tjhang and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 1203
Re Widjaja and Minister for Immigration and Multicultural Affairs [2003] AATA 380
Re Yam and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 283
REASONS FOR DECISION
24 March 2006 Deputy President D G Jarvis 1. On 9 May 2005, a delegate of the Minister for Immigration and Multicultural and Indigenous Affairs (“DIMIA”) cancelled a business skills visa which had been granted to the applicant, Lok Yung (Michael) Wong, on 23 August 2001. The delegate found that there were grounds for cancellation under subsection 134(1) of the Migration Act 1958 (the “Act”) on the basis that Mr Wong had not obtained a substantial ownership interest in an eligible business in Australia, or was not utilising his skills in actively participating at a senior level in the day-to-day management of such a business, or did not intend to continue to hold such an interest or to so utilise his skills in such a business.
2. Mr Wong has applied to this tribunal for review of the delegate’s decision.
Issues
3. The issues before me are as follows:
(a) whether I am satisfied that Mr Wong:
(i)had made a genuine effort to obtain a substantial ownership interest in an eligible business in Australia;
(ii)had made a genuine effort to utilise his skills in actively participating at a senior level in the day-to-day management of such a business; and
(iii) intended to continue to make such genuine efforts
(in which case, by virtue of subsection 134(2), I must not cancel Mr Wong’s visa);
(b)whether under par 134(1)(c) of the Act I should be satisfied that Mr Wong did not intend to continue to:
·hold a substantial ownership interest in an eligible business in Australia; and
·utilise his in actively participating at a senior level in the day-to-day management of such a business; and
(c)whether I should exercise the discretion conferred by subsection 134(1) to cancel Mr Wong’s visa.
4. It was common ground that at the time of his visa cancellation, Mr Wong did not satisfy par 134(1)(a) of the Act (i.e. he had not obtained a substantial ownership interest in an eligible business in Australia), and that he had not satisfied par 134(1)(b) (that is, he was not utilising his skills in actively participating at a senior level in the day-to-day management of any such business).
Background
5. The following background facts were not in contention, and are based on the evidence of Mr Wong and his joint venture partner, Mr Lumbers, as well as certain documentary material in evidence before me. Both Mr Wong and Mr Lumbers were impressive witnesses. I accept their evidence as reliable and truthful.
6. Mr Wong was born in Singapore on 18 May 1951. He has been involved in the building and construction industry for approximately 40 years. In 1980 he established a building company, and its main activity was in the residential and commercial sectors.
7. In the late 1980s Mr Wong sought to diversify his business interests following a down turn in the building industry. After failed negotiations with Singaporean companies for the manufacture and supply of roller doors in Singapore, Mr Wong contacted Mr Warrick Lumbers. He is the executive chairman of Gliderol International Pty Ltd, an Australian company which manufactures residential and industrial roller doors.
8. Mr Lumbers founded Gliderol International in 1974. His family company still retains a 51% interest in Gliderol International. The company has grown significantly, and its current world-wide turnover, including its subsidiaries and off-shore agencies, is equivalent to A$300 to A$400 million. The company is the direct employer of about 300 people, and allowing for off-shore operations, total employment is between 400 and 500 people. The company has manufacturing facilities and offices in each major Australian state.
9. As a result of Mr Wong’s approach to Mr Lumbers, Gliderol International licensed Gliderol (S) Pte Ltd (“Gliderol Singapore”) to manufacture and sell roller doors in Singapore, Malaysia and Brunei, and to provide technical assistance for that purpose.
10. Initially the licensee was called Divine Builders Pte Ltd (which was owned by Mr Wong and a partner). In 2003 Mr Wong bought out his partner, and the licensee changed its name to its present name. The company has enjoyed considerable success in Singapore, and now operates from a 130,000 sq ft factory premises worth approximately A$10 million. Mr Wong also indicated that his company orders approximately A$1 million worth of products from Gliderol International each year.
11. The market in the licensed territories of Singapore, Malaysia and Brunei is significantly different from the market in Australia for Gliderol products. In Australia, the predominant market is for residential doors. However, in the licensed territories, the market is predominantly for commercial and industrial doors or shutters. These products are commonly used to meet regulatory requirements in those countries whereby areas of commercial or industrial premises must be isolated from each other to prevent the spread of fire. Mr Wong explained that with residential doors, Gliderol International deals directly with home owners, but with the industrial products which he has developed, he works with architects, engineers, building owners and developers, and is obliged to meet stringent specifications. This is especially so with products like fire shutters, which have to be properly tested to approved standards. Gliderol Singapore has obtained approval to its products from Standards Associations in Europe and the United States of America. It is accordingly clear that the products predominantly manufactured and marketed by Gliderol Singapore are significantly different from the products manufactured in Australia by Gliderol International.
12. On 14 May 2001 Mr Wong lodged with the then Department of Immigration and Multicultural Affairs (“DIMA”) an application for a business visa (subclass 127). He was granted such a visa on 23 August 2001. Secondary visas were granted to Mr Wong’s wife (Ms Yoke Kuen Chan) and son (Mr Jared Wong). In his application Mr Wong said that he intended to be involved in a business dealing with Gliderol Doors in Australia, and that he had already commenced negotiations regarding the possibility of a joint venture. He further indicated that it was his intention to invest A$300,000 in the business venture in Australia.
13. Following the grant of his business visa Mr Wong has spent only fifteen days in Australia. His arrival and departure dates were set out in exhibit R3, and are as follows:
· in 2001, he was in Australia for four days, from 18 December until 22 December 2001;
· in 2002, he was in Australia for five days, from 31 October until 5 November 2002;
· in 2005, he was in Australia for six days, from 31 August to 3 September and from 6 October to 9 October 2005.
14. In February 2004 Mr Wong completed a twenty-four month survey provided to him by DIMIA. In response Mr Wong said that he had been invited to invest in his company’s major product licensor, Gliderol International, and was very inclined to do so. He said that together with Gliderol International he had identified Thailand and China as countries of interest and had been in discussion for some time. He observed that the Thai market was very similar to his company’s market in Singapore, because it was a project and specifications based market, where the doors were all custom-designed, and this was quite different from the standard Gliderol products made for the Australian market. He said that with his existing manufacturing facilities located in Singapore, he was much nearer to the two countries in question, and therefore better placed to oversee and support their operations. He said that he would be employed by Gliderol International and based in Singapore. He added that he would therefore not be able to physically reside in Australia, and he asked whether the time spent in Singapore in service of the company could be “reckoned as if I (was) residing and working in Australia” (exhibit R1, T17, page 114).
15. Following that survey, on 17 December 2004, DIMIA issued a Notice of Intention to Cancel the visa. Mr Wong responded by an email dated 22 February 2005. He attached a copy of a letter signed by Mr Lumbers as executive chairman of Gliderol International and addressed to Gliderol Doors Singapore. This letter was headed “Proposed Joint Venture for Dubai and Thailand”. It referred to Messrs Lumbers’ and Wong’s “several discussions” on the subject, and confirmed that Gliderol International was agreeable in principle to proceed with the proposed joint venture. The letter then proceeded to list certain specific arrangements which would “form an integral part of” the agreement. These matters included the proposition that:
· the proposed joint venture would be a company incorporated in Australia, with Gliderol International as the major shareholder;
· the principal objective of the company would be to promote Gliderol International’s Australian-made products in the two countries;
· Mr Wong would contribute not less than A$300,000; and
· Mr Wong would be responsible for the management of the operations in both countries on a full-time basis, but would be stationed in Singapore to be nearer to the two markets.
The letter concluded by saying that Gliderol International would proceed to prepare the necessary legal documents and form the company as soon as possible.
16. Notwithstanding that the respondent had cancelled Mr Wong’s business visa on 9 May 2005, the discussions between Mr Wong and Mr Lumbers continued. The proposed new company was registered in Australia on 8 September 2005, and was called Gliderol International Industrial Doors Pty Ltd (“GIID”). Gliderol International holds 51% of the shares in GIID, and Mr Wong holds the remaining 49%.
17. It is proposed that the products to be manufactured and distributed by GIID will conform to the approvals which Gliderol Singapore has obtained from standards associations in Europe and the United States of America, and that those approvals will be made available for GIID’s products. Mr Lumbers explained that it is a slow and difficult process to obtain relevant approvals to commercial and industrial products in Australia, because of the limited testing facilities available, and because testing does not usually relate to overseas standards.
18. On 11 January 2006, Mr Wong arranged for the sum of A$300,000 to be transferred to the account of GIID. It is not clear whether this transfer was by way of loan. No evidence was produced that the funds were used to subscribe for shares in GIID. However, Mr Wong said that the funds were to be drawn down by GIID as and when they were required for the purposes of the proposed joint venture, and this evidence was not challenged.
19. Mr Wong also produced a memorandum of understanding, which he said he had prepared to record the terms of the proposed joint venture. A copy of this document was received as exhibit A8. It has not been executed by either party. It is therefore not enforceable. Because certain of the essential conditions of the joint venture are not provided for with sufficient certainty, the document probably would not be enforceable even if it had been fully executed. However, it contains a number of provisions which are consistent with the evidence of both Mr Wong and Mr Lumbers as to the essential proposals of the joint venture. To that extent, it is helpful.
20. Mr Wong gave evidence that as a result of his ongoing discussions with Mr Lumbers, his proposals for an Australian joint venture had evolved gradually, and differed somewhat from his intentions at the time when he lodged his application for the visa. He explained that Gliderol International had participated in trade shows. In particular, Gliderol International participated in Big Five trade shows in Dubai in November 2004 and November 2005. Mr Wong actively assisted with the company’s exhibitions, and the Gliderol products that were exhibited included not only the residential doors made by Gliderol International, but also the commercial and industrial doors and shutters manufactured by Gliderol Singapore. Mr Wong and Mr Lumbers realised from inquiries made at these trade shows that there was a strong market for the commercial and industrial products, having regard to market demands due to security concerns in the Middle East and also in Thailand. In addition, Mr Wong said that GIID is currently in the final stages of negotiating the sale of Gliderol products for use in the Terminal 3 extension of the Dubai Airport, and this would involve about 300 very large fire shutters. Mr Wong said that a major factor in the negotiations for the Terminal 3 project was the fact that the proposed Gliderol fire shutters had received the relevant US and European standards approval. In addition, GIID has been asked to put in a quotation to the developers of the Jumierah Palm Resort Project in Dubai, which would entail more than 1,600 residential doors.
21. Mr Wong referred to opportunities for GIID in the Middle East as very promising. It is proposed that GIID will establish a manufacturing facility in Dubai. He also produced a proposed memorandum of understanding between GIID and two other parties from the United Arab Emirates to incorporate a company in that country, which is to be licensed to manufacture, market, sell and promote the complete range of Gliderol products within twelve countries comprising the Middle-East region, subject to certain exclusions arising from licences previously entered into for certain products in seven of those countries. Once again, this memorandum of understanding is unexecuted and unenforceable, but it provides further evidence of GIID’s proposals and of the establishment of the proposed joint venture between Gliderol International and Mr Wong’s Singapore company.
Legislation
22. Section 134 of the Act provides relevantly as follows:
“(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).”
Consideration
23. The present matter differs from the review of a decision relating to whether an applicant is entitled to some benefit or licence, where facts or events occurring after the reviewable decision was made and prior to the Tribunal making its decision can properly be taken into account. The decision under review is a cancellation decision, and so my review of that decision involves considering whether that decision was the correct or preferable decision when it was made. Subject to the qualification referred to in the succeeding paragraph, I consider that I should confine my consideration to material that relates to relevant events or matters occurring up to, but not after, the date of cancellation of the visa. I may, of course, consider the evidence now before me, and I am not limited, in finding the relevant facts, to the evidence that was before the primary decision-maker when the decision under review was made, that is, on 19 August 2003. The foregoing principles emerge from the decisions of the Tribunal in Re Griffiths and Migration Agents’ Registration Authority [2001] AATA 240 at [39] and [41]; Re Haman & Ors and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 1113 at [52]; and Re Yam and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 283 at [8] to [14], and the authorities analysed in those decisions.
24. However, I consider that I may properly have regard to events which happened after the date of cancellation of the visa to the extent that the relevant criteria in s 134 of the Act require the decision-maker to consider prospective issues. The Tribunal reached this conclusion in Re Permana & Ors and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 802 at [15]. In that matter Member M J Allen pointed out that an eligible business is defined in subsection 134(10) of the Act in terms of whether a business “will” result in certain types of outcomes, and similarly, subsection 134(5) involves considering whether extreme hardship “would” result to another person who is a member of the family unit of the holder of the cancelled business visa. And if an applicant asserts (as Mr Wong does in the present matter) that as at the date of cancellation of the visa, he or she had the intention contemplated by subsections 134(1) and (2) as to obtaining an ownership interest in, or participating in the management of, or continuing to make genuine efforts in relation to those matters, then, in my view, subsequent events would be relevant to determine whether or not that intention existed as at the date of cancellation.
Does subsection 134(2) apply?
25. In the present proceedings it is appropriate first to consider whether the proscriptive provisions of subsection 134(2) of the Act apply in the circumstances of the present matter. If I am satisfied of the matters referred to in that subsection, then I must not cancel Mr Wong’s business visa.
26. Subsection 134(2) involves a consideration of whether Mr Wong has made genuine efforts in relation to the matters referred to in the three subparagraphs of that subsection. Subsection 134(3) provides that any or all of a number of enumerated matters may be taken into account in considering whether the visa holder has made the genuine effort referred to in subsection 134(2). In Yam (supra) the Tribunal thought that the word “genuine” and the matters mentioned in subsection 134(3) showed that there must be a level of effort in relation to the relevant matters beyond that which is purely superficial or token, that the applicant himself or herself is the person who must have made the genuine efforts, and that relevant efforts which are genuine should not be rejected by virtue of subsection 134(3) simply because they fall short of the examples given in that section.
27. The Department of Immigration and Ethnic Affairs has issued an instruction to be used with reference to ss 134 – 137 of the Migration Act, namely Migration Series Instruction 133 (“MSI 133”). Clause 4.5 contains notes to guide decision-makers as to the interpretation of subsection 134(3) of the Act. Clause 4.5.1 sets out the provisions of subsection 134(3), and then includes a series of notes to be read with each paragraph of subsection 134(3), except for par 134(3)(i). I will refer below to these notes as appropriate. Clause 4.5.2 of MSI 133 is helpful in considering the application of subsection 134(3). It reads as follows:
“While 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.” (exhibit R1, T7, page 37)
I think that this paragraph correctly summarises the relevance of subsection 134(3) to the decision-making process.
28. In referring to MSI 133, however, I also bear in mind the authorities on the use which may be made of policy instructions, as helpfully summarised by the Tribunal in Yam (supra) at [48] to [51]. That is, although such instructions are not binding on the Tribunal, there is good reason why they should be applied in the interests of good and consistent administration, but no weight should be given to the instructions where they are clearly more restrictive than the terms of the Act itself; and when a statutory discretion is exercised by a decision-maker, that person must take into account all matters relevant to the exercise of the discretion.
29. As at the date of the cancellation of Mr Wong’s visa, no “eligible business” existed; Mr Wong had not acquired a substantial ownership interest in, or participated in the day-to-day management of, any such business. The parties were at that date still in the process of planning their proposed joint venture. Whilst by the date of cancellation they had contemplated that the joint venture would be carried on through a company, GIID was not registered until some four months after that date, and Mr Wong had not contributed any funds to the proposed joint venture.
30. However, subsection 134(2) does not require an eligible business in Australia to exist. I note that MSI 133 refers in paragraph 4.4 to the eventuality that the visa holder is not in business, that is that it recognises that the visa holder may not, at the time when the Department is considering the possible cancellation of the visa, have obtained a substantial ownership interest in an eligible business, and may not have engaged in the day-to-day management of any such business. MSI 133 states that in that event, the Department would seek substantiation of the visa holder’s genuine effort to engage in business since arriving in Australia.
31. The expression “eligible business” is defined in subsection 134(10) of the Act as follows:
(10)… 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.”
32. I am satisfied that the joint venture business which Messrs Wong and Lumbers were endeavouring to establish at the time of the cancellation of the visa would constitute an “eligible business” within the meaning of this definition. I find that the proposed business will result in:
· the development of business links with the international market (because of the proposals to sell the products in the Middle East, Thailand and China);
· the creation or maintenance of employment in Australia (because the mechanical componentry will be made in Australia and sold to GIID);
· the export of Australian goods; and
· the introduction of new or improved technology to Australia (because Mr Wong will make available to Gliderol International the technology and regulatory approvals held by Gliderol Singapore).
33. Counsel for the Minister, Mr d’Assumpcao, contended that Mr Wong had not made the genuine effort required by subsection 134(2). Counsel pointed out that Mr Wong’s first entry into Australia after being granted the business visa was on 18 December 2001, and that notwithstanding the considerable time that had elapsed, no business had been established by the time the visa was cancelled in May 2005. He pointed out further that no business was operating even as at the date of the hearing, which was more than four years after the relevant first entry into Australia. Counsel invited me to find that Mr Wong had engaged in a “flurry of activity” after he had received the notice from the Department requiring advice as to the steps he had taken, and to infer that he was more concerned to protect his visa than to proceed with the joint venture. He submitted that this was apparent from the attachment to the Form 1010 (Survey of Business Migrants) dated 27 February 2004 (exhibit R1, pages 113 – 114), where Mr Wong referred to the proposals for the joint venture, including the fact that he would be stationed in Singapore, and indicated that he was very concerned about how this would affect his visa, and asked to be advised as to this. Counsel further pointed out that another letter evidencing the terms of the proposed joint venture, namely the letter of 23 February 2005, had been prepared by Mr Wong for Mr Lumbers to sign, and that there was no other documentation to confirm the creation of the proposed joint venture, and no formal contracts existed.
34. In many cases the failure of a business visa holder to obtain an ownership interest in an eligible business in Australia after such a long period, as well as the other matters to which counsel referred, would indicate that the person concerned had not made the genuine efforts required by subsection 134(2). However, it was apparent from the evidence of Messrs Wong and Lumbers that the business opportunity for the proposed joint venture, being the manufacture and marketing of industrial doors in the Middle East and Thailand, only became apparent to them some time after they had commenced discussions as to the proposed joint venture. They then had to determine the most appropriate business structure for the joint venture. It is also apparent that the venture has involved careful planning, as it will be a significant business entailing the manufacture and sale of reasonably sophisticated products to certain specialised overseas markets. Further, before the joint venture plans could be finalised and implemented, a number of existing licence agreements that Gliderol International had previously entered into had to be cancelled or renegotiated. In some cases it was necessary to give notices of varying durations to terminate existing licences. It took some time to investigate what steps were appropriate in each case, and then to implement them. Finally, negotiations have also ensued with other parties in the Middle East to establish the manufacturing and marketing arrangements which will apply in that region.
35. It is also relevant, in considering whether Mr Wong had made a genuine effort, to take into account the amount of time he spent in connection with the proposed joint venture compared with the time he has spent on his existing business, Gliderol Singapore. Mr Wong estimated as a ball-park figure that he had probably spent about 65% at least of his time on what he called the international work, being the proposed joint venture, and the rest of his time on his own local business. He explained that Gliderol Singapore had been “very established” some time ago and it had been running on “auto pilot” for some time, and that was why he had had the opportunity to work on international markets and proceed with the joint venture project.
36. For all of the above reasons, it is understandable that the proposals which have now led to the formation of GIID have taken a good deal of time to reach their present status, and why those proposals were not further advanced by the date of the cancellation of the visa. I do not accept that in all of the circumstances the delay referred to by counsel for the respondent leads to the conclusion that Mr Wong’s efforts have not been genuine.
37. The fact that Mr Wong has now acquired a substantial ownership interest in GIID, namely 49%, is consistent with his stated intention of acquiring such an interest. It is true that the payment of A$300,000, which was proposed in the application for the visa prepared more than four years ago, was not paid until a few weeks before the hearing of the application to this tribunal. However, as Mr Wong pointed out, the joint venture did not need these funds, and I accept that he did not wish to transfer the sum in question at an earlier date for this reason. By doing so before the hearing he has, however, acted in a way which is consistent with his stated intention as to his financial commitment to the joint venture.
38. Counsel for the respondent then referred to the specific provisions of subsection 134(3). This subsection provides in effect that without limiting the generality of the matters that the decision-maker may take into account in determining whether a person has made the genuine effort referred to in subsection 134(2), the decision-maker may take into account any or all of some nine matters which are then listed. I will consider these matters in turn, to the extent that they are relevant to the present proceedings.
(a) Business proposals that Mr Wong has developed : I have described the business proposals in some detail above. I am satisfied that as at the cancellation date, the proposals were substantial and genuine, and if successful will lead to the establishment of an eligible business in Australia.
(b) The existence of joint venturers for the business proposals : I find that this matter has been clearly established by the evidence to which I have referred above. Counsel for the respondent very properly pointed out that no formal contracts existed between the joint venturers, and this is one of the aspects which according to MSI 133 decision-makers should look for in this context. However, both Mr Wong and Mr Lumbers indicated during their evidence that they had conducted their various business enterprises with one another predominantly via the telephone, and to some extent more recently via email. They both indicated that the practice they had undertaken for the 20 years of their business relationship was to communicate predominantly by telephone, and that this practice had worked well for them over that time. It was also apparent that there is a relationship of mutual trust between Mr Lumbers and Mr Wong, and that they have developed a personal friendship. In view of the close relationship between the joint venturers, the absence of formal contracts was not in my view significant.
(c) Research that Mr Wong has undertaken into the conduct of an eligible business in Australia : I accept that appropriate investigations have been undertaken as a result of the participation of Gliderol International and Gliderol Singapore in the trade shows, by the endeavours made by the joint venturers to provide products to Terminal 3 in Dubai and the Jumierah Palm Resort project in Dubai, and by the ongoing discussions that Mr Wong has had with Mr Lumbers as to the potential to manufacture and sell Gliderol products in the Middle East, Thailand and potentially China. It is true that there is very little evidence of consultations with external business advisors, being one of the factors referred to in the notes to paragraph (c) of subsection 134(3). However, because of the nature of the proposed joint venture business and the location of its primary markets, to which I refer in more detail below, the absence of consultations with other business advisors or service providers was not significant in the present matter. Further, GIID was subsequently established by a South Australian law firm, and that is consistent with Mr Wong’s intentions at the date of cancellation.
(d) The periods during which Mr Wong has been present in Australia : Counsel for the respondent pointed out that Mr Wong has only been present in Australia for some fifteen days since the grant of his visa in 2001, and this constitutes less than 1% of the period that has elapsed since then. Counsel further pointed out that MSI 133 suggests that paragraph (d) of subsection 134(3) would require physical presence in Australia for more than six months after the first arrival as a business skills class migrant. However, this period is not referred to in the Act, and I do not think that the suggested period of at least six months, or any other arbitrary minimum period, should be applied by decision-makers. It seems to me that it will be necessary to consider the particular circumstances of each case. The present matter is unusual in important respects. As mentioned above, the proposed business is one which will predominantly entail manufacturing and marketing specialised products of a reasonably sophisticated nature for markets outside Australia. The products will be required to meet technical specifications and standards applicable in those countries. The potential capacity of the joint venture to produce the products and meet the relevant standards and specifications can be demonstrated in Gliderol Singapore’s manufacturing facilities, but not in Australia. It has been, and will continue to be, easier for potential customers to travel to Singapore for discussions with Mr Wong, and he will there be able to demonstrate manufacturing facilities and the relevant commercial and industrial products. This could not occur in Australia, where the products manufactured by Gliderol International are for residential use. The investigations into the marketing of the product had of necessity taken place in the potential overseas markets. Significant discussions had taken place between Mr Wong and his Australian joint venturer, Mr Lumbers, in the potential overseas markets and also in Singapore, during the course of Mr Lumbers’ overseas trips to service his existing international business operations. In all of the circumstances, I find that the very limited time which Mr Wong had spent in Australia as at the date of cancellation of the visa does not indicate that he had not made a genuine effort to obtain a substantial interest in an eligible business in Australia, or to utilise his skills in actively participating at a senior level in the day-to-day management of such a business, or that he did not intend to continue to do so.
(e) Value of assets transferred to Australia by Mr Wong for use in obtaining an interest in an eligible business : The notes in MSI 133 require the transfer of at least 50% of the intended funds within two years. This did not occur, but as mentioned above, the funds were not needed for the joint venture. However, the full amount has now been transferred, and this is consistent with Mr Wong’s previously stated intention. The section does not require the assets to be transferred within any particular period, and in this respect, MSI 133 imposes a prescriptive obligation which is not contained in the Act.
(f) The value of ownership interest in eligible businesses in Australia that are, or have been, held by the person : The notes to this paragraph of subsection 134(3) in MSI 133 refer to a minimum of A$100,000 or 10% ownership previously held by the person. Once again, there is no reference in the Act to any such monetary amount. However, Mr Wong had not previously held any interest in an eligible business in Australia, and I note that he did not satisfy this criteria.
(g) Business activity that is, or has been, undertaken by the person : Mr Wong is an experienced and successful businessman. As mentioned above, Gliderol Singapore operates from its own 130,000 sq ft factory premises worth approximately A$10 million, and it purchases approximately A$1 million worth of products from Gliderol International each year. This portion of Mr Wong’s business substantially exceeds the suggested minimum figure of A$100,000 referred to in the notes to paragraph (g) in MSI 133 (although once again, the Act does not provide for any specific minimum figure).
39. The remaining two subparagraphs, (h) and (i), of subsection 134(3) are not applicable to the present application.
40. The present matter also raises a further issue. Mr Wong and Mr Lumbers both said that Mr Wong will be the managing director of GIID and heavily involved in its day-to-day management, but that these activities would take place overseas, primarily in Singapore. Mr Wong further said that in view of the steps that would be needed to establish GIID, he did not expect to be able to move to Australia to live for at least three years, and possibly for as long as five years, depending on how quickly he was able to establish the business of GIID and secure and train suitable employees.
41. There is a conflict of authority in this tribunal as to whether the requisite day-to-day management of the eligible business must take place in Australia, or whether it may take place overseas. Decisions which indicate that the relevant management need not take place in Australia include Re Widjaja and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 380, at [40]; Re Jo and Minister for Immigration and Multicultural and Indigenous Affairs (2004) 38 AAR 394, at [33] and [34]; Re Yam (supra), at [97] to ]103]; Re Angkadjaja and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 699, at [21]; Re Tany and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 58, at [41] to [43]; and Re Thomas and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 637. Tribunal decisions which indicate that the relevant management must take place in Australia include Re Huang and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AAT 656, at [12]; Re Ong and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 178, at [28] to [32]; Re Ng and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 299, at [12]; and Re Tjhang and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 1203, at [34] to [36]. In two further decisions, namely Re Legana and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 1166, at [30] and Re Lim & Ors and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 28, at [42] and [43], the Tribunal referred to the relevance of the place where the management activities were to occur when considering the exercise of the tribunal’s discretion to cancel the visa. However, on a strict analysis, the tribunal did not decide in those matters that it was a requirement of subsections 134(1) or (2) that management activities must take place in Australia.
42. Counsel for the respondent submitted that the relevant management should take place in Australia. He drew my attention to the second reading speech of the Minister when the Bill to amend the Act was read for a second time (Hansard, House of Representatives, 7 May 1992, at page 2678 ff). The Minister said in part that the Bill contained new powers “to facilitate the successful operation of the Government’s initiative to attract successful business migrants to Australia”. Further, the second reading speech contemplates that business migrants and their families will reside in Australia.
43. Neither counsel addressed any argument as to whether it was appropriate for me to refer to extrinsic material in interpreting subsections 134(1) and (2) of the Act. Subsection 15AB(1) of the Acts Interpretation Act 1901 (Cth) provides for the circumstances in which consideration may be given to appropriate extrinsic material to determine the meaning of the provision of an Act. Paragraph (a) of that subsection enables consideration to be given to extrinsic material to confirm the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act. Paragraph (b) enables consideration to be given to extrinsic material when:
“(i) the provision is ambiguous or obscure; or
(ii)the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act leads to a result that is manifestly absurd or is unreasonable.”
44. I do not think that the relevant subsections of the Migration Act are ambiguous or obscure. Subsections 134(1) and (2) do not in terms require the relevant management of an eligible business to take place in Australia. Further, I consider that an interpretation to the effect that there is no such requirement does not necessarily lead to a result that is manifestly absurd or unreasonable. Whilst a business visa confers an entitlement to reside in Australia, the Act does not require the holders of such visas to take up that entitlement. Additionally, if the decision-maker is not satisfied of the matters referred to in subsection 134(2) (for example, because no genuine effort has been made to obtain a substantial ownership interest in an eligible business), but is satisfied of the matters referred to in subsection 134(1), the discretion to cancel the visa will be enlivened. It seems to me that it would be relevant in the exercise of that discretion to determine such matters as whether the visa holder intends to reside in Australia, and if so, when he or she intends to come to Australia to reside, and the amount of time which he or she is likely to spend in Australia in managing the proposed business, as well as other matters relevant to the circumstances of the applicant (such as the matters referred to by Deputy President Hotop in Re Haman (supra). The decision-maker should also keep in mind the potential benefits to Australia of attracting people with appropriate business skills to acquire an ownership interest in an Australian business, as this will assist the growth of business activity in Australia.
45. Quite apart from the matters referred to in the preceding paragraph, subsection 15AB(1) of the Acts Interpretation Act does not permit an interpretation which would amount to a departure from the ordinary meaning of the provision in question, nor would it permit, by an extrapolation from the words used by the Minister in his second reading speech, an interpretation that imposes a requirement not provided for in the relevant subsections of the Migration Act (see generally Pearce and Geddes, Statutory, Interpretation in Australia, 5th Edition, [3.11] to [3.13]).
46. I have also considered the possible relevance of s 15AA of the Acts Interpretation Act 1901 (Cth), which provides:
“In the interpretation of a provision of an Act, a construction that would promote the purpose or object underlying the Act (whether that purpose or object is expressly stated in the Act or not) shall be preferred to a construction that would not promote that purpose or object.”
The object of the Migration Act is set out in subsection 4(1), and is “to regulate, in the national interest, the coming into, and presence in, Australia of non-citizens.” However, taking account of this object would not permit giving subsections 134(1)(b) or 134(2)(b) a construction that was not otherwise open, or adopting a construction that would amount to redrafting the relevant subsections: R v L (1994) 122 ALR 464, at 468-9.
47. For the sake of completeness, I have also considered the common law principles of statutory interpretation, which require an interpretation to be consistent with the purpose of the provision in question (see Braverus Maritime Inc v Port Kembla Coal Terminal Ltd [2005] FCAFC 256 at [36]). Whilst this principle is not confined to circumstances where the provision being interpreted is ambiguous, I consider that it would not be permissible to imply into subsections 134(1) or (2) a requirement for the relevant management of an eligible business to take place in Australia. Once again, this would be tantamount to rewriting the provisions in question. Whilst a consideration of the place where management activities will take place might be relevant to the exercise of discretion in appropriate cases, it is not a requirement of the relevant subsections. Further, I think that an additional purpose of the business migration provisions is to attract non-citizens with business expertise to invest in eligible businesses in Australia, and thereby promote economic growth. This purpose can be achieved without implying the further requirement that the relevant day-to-day management activities must take place in Australia.
48. It seems to me that the correct approach is to examine the facts of each case to determine the role (or, if the business is not established, the intended role) of the person concerned in the eligible business, and also the nature of the business and what is (or will be) required for the day-to-day management of that business at a senior level. In many cases, no doubt the business will be such that the relevant management activities will need to occur in Australia. However, as has been pointed out in earlier tribunal decisions, with modern technology the day-to-day management of a business in Australia can often take place from overseas. Indeed, the nature of some businesses is such that it might be necessary for the day-to-day management of the business to take place in overseas countries, if that is where the business’s primary market is located. In my view, on a proper construction of subsections 134(1) and (2), the person concerned will satisfy the requirements of those subsections if he or she participates (or intends to participate) in the requisite management activities of that business, irrespective of whether his or her management activities occur within or outside Australia. However, where the discretion to cancel a business visa arises, the fact that the relevant management activities will not take place in Australia will be a relevant, but not decisive, consideration.
49. The considerations referred to in MSI 133 and the information provided to visa holders as to circumstances relevant to the exercise of the Minister’s discretion to cancel the visa do not suggest that the day-to-day management activities at a senior level must occur in Australia. Whilst these matters cannot of course affect the construction of subsections 134(1) and (2) of the Act, I note that they are consistent with the conclusion I have reached as to the interpretation of those subsections.
50. In the case of the joint venture proposed by Mr Wong, I am satisfied that it will be necessary for the business of GIID to be developed from Singapore and in the overseas markets where the relevant commercial Gliderol products will be marketed, and that Mr Wong’s role in the management of GIID will satisfy the requirements of paragraph (b) of subsections 134(1) and (2). I find that his effort to utilise his skills in the relevant management activities as at the date of cancellation of his visa were sufficient to satisfy par 134(2)(b).
51. I am further satisfied that Mr Wong intended to continue to make the requisite genuine effects, as required by par 134(2)(c). The evidence produced by the applicant before me has provided considerably more information than was available to the delegate who made the reviewable decision as to the status of the proposed joint venture and its prospects as at the date of cancellation of the visa, and as to subsequent actions which are consistent with Mr Wong’s stated intentions and efforts in relation to the proposed business. I have taken that information into account in the manner referred to in paragraphs 23 and 24 above. Mr Wong is clearly impressed with the prospects of the joint venture, and proposes to delay coming to Australia to live until he is satisfied that the business of GIID has been sufficiently established. Mr Lumbers’ evidence also supports my conclusion that par 134(2)(c) was met.
52. For the above reasons I am satisfied that Mr Wong had complied with the matters referred to in subsection 134(2), and I am accordingly precluded by that subsection from cancelling his business visa.
Exercise of discretion under subsection 134(1)
53. In case my interpretation of subsection 134(2) is not correct, and I am not precluded by that subsection from cancelling the visa, then I find that as at the date of cancellation of his visa Mr Wong had not obtained a substantial ownership interest in an eligible business in Australia, and was not utilising his skills in the requisite management of any such business. Accordingly, the discretion under subsection 134(1) to cancel the visa had been enlivened. However, I further find that in the circumstances of this matter, that discretion should not have been exercised, and I would decline to cancel the visa. I make it clear that ordinarily, the very limited period of time during which Mr Wong has been in Australia, and his admitted intention to conduct the relevant day-to-day management activities outside Australia for a significant period would be important considerations weighing in favour of cancelling the visa. However, there are a number of features of the present matter which have led me to the opposite view. I refer in particular (without attempting to arrange the following matters in order of importance) to the particular and proven expertise of Mr Wong, the fact that the proposal entails a joint venture in association with a well established and successful Australian business (rather than a start-up business which would ordinarily require more preparatory work to be done in Australia), the fact that the proposed business is in effect an extension of a successful business which Mr Wong has operated for some time in Singapore, the significance of the proposed joint venture business, the vital role which Mr Wong will play in the day-to-day management of GIID at a senior level, Mr Wong’s intention to invest further substantial amounts in GIID, the likelihood that in view of his experience and expertise, Mr Wong will succeed in developing and establishing GIID, the strong existing business relationship between Mr Lumbers and Mr Wong, and their favourable assessment of the prospects of GIID. It is also important in considering the exercise of discretion that Mr Wong genuinely desires to live in Australia with his family as soon as he has been able to establish the business of GIID to a point where this can occur.
Decision
54. The tribunal sets aside the decision under review and directs that the business skills visa of the applicant not be cancelled.
I certify that the 54 preceding paragraphs are a
true copy of the reasons for the decision herein
of Deputy President D G JarvisSigned: ....................................................................................
B. Bills AssistantDate/s of Hearing 9 and 10 February 2006
Date of Decision 24 March 2006
Counsel for the Applicant Ms J McGrath
Solicitor for the Applicant McDonald Steed McGrath
Solicitor for the Respondent Australian Government Solicitor
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