Sefat (Migration) - [2021] AATA 2984

Sefat (Migration) [2021] AATA 2984 (19 July 2021)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANTS:
Mr Mohammad Ali Sefat

Mr Alireza Sefat

Mr Amir Mohammad Sefat

Miss Najmeh Sefat

Mrs Nasrin Mozaffari
CASE NUMBER:  2006918
HOME AFFAIRS REFERENCE(S):          CLF2013/178024 CLF2014/58910
MEMBER:R. Skaros
DATE:19 July 2021
PLACE OF DECISION:  Sydney
DECISION:The Tribunal remits the applications for Business Skills (Residence) (Class DF) visas for reconsideration, with the direction that the first named applicant meets the following criteria for a Subclass 892 (State/Territory Sponsored Business Owner) visa:
·cl 892.211 of Schedule 2 to the Regulations;
·cl 892.212 of Schedule 2 to the Regulations;
·cl 892.213 of Schedule 2 to the Regulations;
·cl 892.214 of Schedule 2 to the Regulations;
·cl 892.221 of Schedule 2 to the Regulations.

Statement made on 19 July 2021 at 12:36pm

This is an application for review of a decision made by a delegate of the Minister for Immigration and Border Protection on 29 September 2014 to refuse to grant the visa applicants Business Skills (Residence) (Class DF) visas under s 65 of the Migration Act 1958 (Cth) (the Act).
The applicants applied for the visas on 19 July 2013. At the time of application, Class DF contained four subclasses: Subclass 890 (Business Owner), Subclass 891 (Investor), Subclass 892 (State/Territory Sponsored Business Owner) and Subclass 893 (State/Territory Sponsored Investor).
The applicants in this case are seeking to satisfy the criteria for the grant of Subclass 892 (State/Territory Sponsored Business Owner) visas, as set out in Part 892 of Schedule 2 to the Migration Regulations 1994 (Cth) (the Regulations). At least one member of the family unit must satisfy the primary criteria set out in Subdivision 892.2. The others need only to satisfy the secondary criteria set out in Subdivision 892.3.
The delegate in this case refused to grant the visas on the basis that the first named visa applicant (the applicant) did not satisfy the requirements of cl 892.211(1) of Schedule 2 to the Regulations because the delegate was not satisfied that the applicant had provided sufficient evidence to demonstrate his ownership interest in the nominated businesses.
The applicant provided a copy of the delegate’s decision record to the Tribunal.
On 23 July 2015 the Tribunal, differently constituted, affirmed the Department’s decision not to grant the visas. The applicant applied for judicial review of that decision. On 29 September 2016, by judgement,[1] the Federal Circuit Court of Australia (FCCA) quashed the Tribunal’s decision and the matter was remitted for redetermination according to law.
[1] Sefat v MIBP [2016] FCCA 2501 (Sefat 1)
On 22 May 2017 the Tribunal, differently constituted, again affirmed the decision not to grant the visas. The applicants applied for judicial review of the second Tribunal’s decision. On 3 March 2020, by judgment,[2] the second Tribunal’s decision was again quashed and remitted to the Tribunal for redetermination according to law.
[2] Sefat v MIBP (No.2) [2020] FCCA 456 (Sefat 2)
The applicants appeared before the present Tribunal on…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2021] AATA 2984
Decision Date: 19 July 2021

CaseChat Overview and Summary

This matter concerned an application for a Subclass 892 (State/Territory Business Owner) visa. The applicant sought to demonstrate that they had an ownership interest in one or more actively operating main businesses in Australia for at least two years prior to their visa application, and continued to hold such an interest at the time of the application and decision. The businesses in question were the Sefat Family Trust, trading as Cozy Shoes, and Gaptel Australia. The applicant and their spouse were co-trustees of the Sefat Family Trust. The Federal Circuit Court remitted the matter for reconsideration by the Tribunal.

The primary legal issue before the Tribunal was whether the applicant possessed a sufficient "ownership interest" in the nominated businesses, as defined by migration regulations and legislation, to satisfy the criteria for the Subclass 892 visa. This involved examining the applicant's role as a co-trustee, appointor, and beneficiary of the Sefat Family Trust, and considering the nature of their involvement in the day-to-day management and operation of Cozy Shoes and Gaptel Australia. The Tribunal also had to determine if the businesses had actively operated for the requisite period and met the annual turnover requirements.

The Tribunal considered the definition of "ownership interest" which includes being a shareholder, partner, or sole proprietor, or holding such an interest indirectly through interposed entities. It was satisfied, based on documentary and oral evidence, that the businesses had been purchased and operated in Australia. The Tribunal found that the applicant and their spouse met the requirements concerning the value of their combined business and personal assets at the time of the decision, having a net value well exceeding the AUD250,000 threshold. Furthermore, the Tribunal was satisfied that the nominated businesses had achieved a total annual turnover of at least AUD309,000 (exclusive of GST) in the 12 months immediately preceding the visa application, thereby meeting the turnover requirement.

Given that the Tribunal was satisfied that the applicant met the requirements of clauses 892.212(b) and (c), and consequently clause 892.212 as a whole, and also met the ongoing asset value requirement under clause 892.221(b), the matter was remitted for reconsideration with a view to granting the visa.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

For the following reasons, the Tribunal has decided that the matter should be remitted for reconsideration.CONSIDERATION OF CLAIMS AND EVIDENCE The issue in this case is whether the applicant had an ownership interest, as defined in s 134(10) of the Act, in one or more actively operating main businesses in Australia for at least two years immediately before the visa application was made and continued to have that interest at the time the visa application was made: cl 892.211(1). The applicant must continue to satisfy the requirement in cl 892.211(1) at the time of this decision: cl 892.221(a). No more than two businesses can be nominated for this purpose (reg 1.11(2)) and only one or both of the businesses relied on to meet the time of application criterion can be relied on to meet the time of decision criterion: Yang v Minister for Immigration and Border Protection [2014] FCCA 1576. The businesses relied on by the applicant to satisfy the requirements of the visa are the Sefat Family Trust trading as Cozy Shoes and Gaptel Australia. Cozy Shoes is a retail business located in Adelaide that is involved in selling footwear. Gaptel Australia is involved in providing voice over internet protocol (VOIP) services. The applicant and his spouse are co‑trustees of the Sefat Family Trust. In submissions to the Department, the applicant stated that he purchased the footwear business, which was then named Best Shoes, for $10,000, and the VOIP business from Gaptel Inc., which is based in Canada, for $80,000. The applicant provided to the Department certificates evidencing the registration of business names which note the applicant and his spouse as proprietors. The certificates, which were issued by the Government of South Australia, indicate that Cozy Shoes was registered on 11 March 2010 and Gaptel Australia was registered on 18 November 2008. The delegate was not satisfied that the applicant had provided sufficient evidence to demonstrate that he, or he and his spouse, had acquired an ownership interest in the nominated businesses. The delegate was concerned that there was no evidence of a purchase contract or payments for the businesses. This concern was not shared by the previously constituted Tribunals or the present Tribunal. The Tribunal is satisfied on the documentary and oral evidence before it that the businesses were purchased and operated in Australia.Does the applicant have an ownership interest in the businesses? An ‘ownership interest’, in relation to a business, means an interest in the business as:·a shareholder in a company that carries on the business; or·a partner in a partnership that carries on the business; or·the sole proprietor of the business;including such an interest held indirectly through one or more interposed companies, partnerships or trusts (reg 1.03 of the Regulations and s 134(10) of the Act). Ownership for this purpose includes beneficial ownership if it is evidenced in accordance with the terms of reg 1.11A of the Regulations, set out in the attachment to this decision: reg 1.11A(1).

Decision

Reasons for decision

As the requirements in cl 892.212(b) and (c) have been satisfied, it follows that the applicant meets the whole of cl 892.212.Value of business and personal assets at time of decision If an applicant satisfies the requirements in cl 892.212(b), relating to their business and personal assets, as in this case, then cl 892.221(b) must also be satisfied at the time of decision. Clause 892.221(b) requires that the applicant continues to satisfy cl 892.212(b) at the time of decision. The applicant has provided to the Tribunal current information regarding the value of their business and personal assets. The evidence provided in relation to his and his spouse’s personal assets include bank statements as at 15 June 2021, evidence of continued ownership and current valuation of the Hillcrest property and outstanding loans against the Hillcrest property. The applicants also provided evidence of the value of personal items such as jewellery, home contents, rugs and a motor vehicle. In relation to the value of the business assets, the Tribunal received financial statements for the Sefat Family Trust for the year ended 30 June 2020. Following a request for updated information, the Tribunal received an interim balance sheet as at 15 June 2021, which was accompanied by a letter from the accountant pertaining to the items in the balance sheet. On the evidence before it, the Tribunal has calculated the current value of the applicant and his spouse’s net personal and business assets as follows: The Tribunal notes that it had some concern about including the current amount claimed for intangible assets, being the total funds paid to Gaptel Inc. for Gaptel Australia, given the limited activity of the VOIP business at this time. The Tribunal considers that the value of the intangible asset is likely to have been impaired since the purchase from Gaptel Inc. In any case, given the net value of the applicant and his spouse’s net business and personal assets have well exceeded the required amount of $250,000, it is not necessary to make an assessment of the current value of the intangible asset as the applicant does not need to rely on it. Nor is it necessary for the applicant to rely on the amounts claimed regarding the value of his and his spouse’s home contents, cars, jewellery and rugs. Give the above, the Tribunal is satisfied that, at the time of this decision, the combined business and personal assets in Australia of the applicant and his spouse have a net value of at least AUD250,000. The requirement in cl 892.221(b) is therefore met.Turnover Clause 892.213 requires that unless the appropriate regional authority has determined that there are exceptional circumstances, the main businesses in Australia, together, in the 12 months immediately before the application is made, had an annual turnover of at least AUD200,000. The Tribunal is satisfied on the basis of the evidence before it, including the activity statements for businesses for the period from 1 July 2012 to 30 June 2013, the comparative financial report for the year ended 30 June 2013 and the amended trust tax returns, that the businesses nominated by the applicant achieved total sales of AUD309,000 exclusive of GST.

Ratio Decidendi

Legal Principle Established

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