Supardi and Minister for Immigration and Multicultural and Indige Nous Affairs
[2003] AATA 794
•13 August 2003
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2003] AATA 794
ADMINISTRATIVE APPEALS TRIBUNAL )
) No. N2002/485
GENERAL ADMINISTRATIVE DIVISION )
Re SUPARDI Applicant
And
MINISTER FOR IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS
Respondent
DECISION
Tribunal Senior Member M D Allen Date13 August 2003
PlaceSydney
Decision The decision under review is affirmed.
(Sgd) M. D. Allen
..............................................
Senior Member
CATCHWORDS
IMMIGRATION - cancellation of Business Skills Visa - did Applicant have an eligible business in Australia and was he exercising his skills in actively participating at a senior level in the day to day management of that business in Australia – Applicant active in business in Indonesia - formation of an Australian Proprietary Company not sufficient without more to create an eligible business.
Migration Act 1958 – s.134(1), s.134(2), s.134(3), s.134(4), s.134(5), s.134(10)
Migration Series Instruction 133
Re: Wong and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 54
Re: Chen and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 477
Re: Ong and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 178
Re: Huang and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 656
Re: Tio v. Minister for Immigration and Multicultural and Indigenous Affairs (2003) 197 ALR 117
Skoljarev v. Australia Fisheries Management Authority (1995) 133 ALR 690
Hope v. Bathurst City Council (1980) 144 CLR 1
REASONS FOR DECISION
13 August 2003 Senior Member M D Allen 1. By application made on 12 April 2002, the Applicant sought review of a decision by the Respondent dated 13 March 2002 to cancel his Business Skills Visa. The said application for review came on for hearing before me at Sydney on 15 July 2003. At that hearing, the following documents were taken in as exhibits and marked as follows, namely:
T1 – T24 The documents prepared for the Tribunal pursuant to Section 37 of the Administrative Appeals Tribunal Act 1975 A1 Applicants’ Statement of Facts and Contentions A2 Statement by Applicant dated 12/2/03 together with attachments R1 Respondent’s Statement of Facts and Contentions
2. At the outset, Mr Poynder, the Applicant’s counsel, submitted that the decision of the delegate of the Respondent to cancel the Applicant’s Business Skills Visa was out of time. Given the decision of the Full court of the Federal Court in Re: Tio v. Minister for Immigration and Multicultural and Indigenous Affairs (2003) 197 ALR 117 that submission was rejected, the period of ninety days mandated by paragraph 135(4)(b) of the Migration Act 1958 expiring at midnight on 13 March 2002.
3. A Business Skills Visa was granted to the Applicant on 23 November 1998. On 27 November 1998, the Applicant entered Australia pursuant to that grant. The Applicant’s initial period in Australia was brief, namely from 27 November 1998 to 29 November 1998. He then returned to Australia on 12 March 1999 together with his family. He remained in Australia until 20 March 1999.
4. During the period 27 November 1998 to date, the Applicant has spent a total of 166 days in Australia. At the time of cancellation of his visa, he had spent some 150 days in Australia only.
5. The grounds upon which a Business Skills Visa may be cancelled are set out in section 134 of the Migration Act 1958, namely:
“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).
…
(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.
…
(10)In this section:
…
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.”
6. Guidelines on the cancellation of a Business Skills Visa are provided in the Migration Series Instruction 133 (“MSI 133”), titled “Visa Cancellation under Subdivision C - Cancellation of Business Visas” dated 30 May 1996. This document is however mere policy and not binding upon the Tribunal, see the discussion by Davies J in Skoljarev v. Australian Fisheries Management Authority (1995) 133 ALR 690.
7. The policy states, inter alia, that the following evidence be obtained in relation to the criteria in subsection 134(3), namely at paragraph 4.5.1 of MSI 133. The notes are as follows:
“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, businesstrade 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, ie mandatory monitoring of Australian address and return of survey forms.”
8. Other matters to which this Tribunal will have regard to are:
(i)Business Activity Statements (lodged with the Australian Tax Office) for the relevant business covering the period from commencement of the business until the present.
(ii)The Income Tax Returns of the business for the years of income before and after the reviewable decision.
(iii)The Balance Sheet and Profit and Loss Account of the business for the years before and after the reviewable decision (where available).
(iv)The Applicant’s own Income Tax Returns for the years of income before and after the reviewable decision.
9. It is now well settled that the correct approach in respect of the cancellation of a Business Skills Visa is to determine the correct or preferable decision at the time that the decision to cancel was made. See Re: Wong and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 54 and Re: Chen and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 477.
10. I also adhere to the position I took in Re: Ong and Minister for Immigration and Multicultural and Indigenous Affairs [2003] AATA 178 where I followed Deputy President Muller in Re: Huang and Minister for Immigration and Multicultural and Indigenous Affairs [2002] AATA 656 and held that it is the business activities of the visa holder in Australia that must be examined and not his business activities whilst he is residing overseas.
11. In this matter, the Applicant, in or about August 1999, purchased for $12,500.00 a 30% share in a company titled “Majalah Indonesia Ausindo Pty Ltd” (“MIA Pty Ltd”). The business of the company was the production of a magazine for circulation amongst the expatriate Indonesian population in Sydney and surrounds. Apparently the publication was given away free to places such as restaurants and churches and revenue was obtained by selling advertising space in the said publication.
12. It is difficult to gauge what degree of involvement the Applicant had in the day-to-day running of this business. At document T14 is a report following a visit by an officer of the Department of Immigration and Multicultural and Indigenous Affairs (“the Department”) to the offices of Ausindo Magazine (business name of MIA Pty Ltd). It is clear from that document that the business was not particularly active and that the Applicant’s knowledge of the affairs of the business was minimal.
13. When cross-examined regarding his involvement with this business I found the Applicant’s evidence to be confusing and contradictory. I am satisfied that he knowingly allowed his migration agent to put forward a figure of 40 hours per week involvement in the business in the Business Survey requested by the Department knowing that figure to be incorrect. Similarly, the figure of $6,777.50, being chemicals exported by MIA Pty Ltd is also incorrect as this sum represented the cost of chemicals imported into Indonesia by the Applicant’s Indonesian company (“Kreasi”) - see paragraph 22 of Exhibit A2.
14. In passing, it seems clear that the Applicant’s Migration Agent either gave him bad advice or was not concerned to check the accuracy of information provided to him. The inference I drew from the Applicant’s evidence was that the Migration Agent suggested figures and the Applicant agreed. Either way, the conduct of this agent should be referred to the Migration Agents Registration Authority.
15. I am satisfied that the Applicant’s involvement in the affairs of MIA Pty Ltd was minimal, especially after the first year when he realised that the company was just breaking even. The profit and loss account for the year ended 30 June 2000 shows that MIA Pty Ltd made a net profit of just $726.00. I also note that in the year 2000/2001 MIA Pty Ltd made a loss of $5,422.00.
16. This finding is confirmed by the Applicant’s own evidence in chief. In his statement (Exhibit A2), the Applicant said at paragraph 16,
“When I returned to Australia, from 10 July until 5 August 1999, I purchased a 30% in Majalah Indonesia for $12,500.00, and I became a Director of the Company”.
He then continued at paragraph 23,
“In the meantime, I had spent much of my time in Australia thinking about how to improve Majalah Indonesia Ausindo. It was becoming apparent that it was not going to be a very profitable investment. Attached and marked S3 is a copy of a Financial Report for Ausindo for the year ending 30 June 2000, which shows that the Company had an income of $78,846 and a profit of only $726. I was also having a great deal of difficulty in communicating with the company, and I did not find them to be very cooperative.. On 11 September 2000 the company changed its name to Ausindo Magazine Pty Ltd without even notifying me. After this happened, I began to lose interest in the company, although I still remained interested in making business in Australia.”
17. On 22 May 2001, the Applicant caused to be incorporated a proprietary company Citra Biak Trading Pty Ltd (“CBT Pty Ltd”) with himself as the sole Director.
18. Since that time, CBT Pty Ltd has entered into two commercial dealings which resulted in the export of goods from Australia.
19. The first commercial activity was the export of gold bullion worth A$34,858.00 to Singapore. That appears to have been a one-off transaction and no evidence was adduced before me of any continuing gold trading activities by CBT Pty Ltd.
20. The second commercial activity by CBT Pty Ltd was the export of some A$29,072.00 worth of cleaning products from Australia to Indonesia. Although the agreement for the export of the goods was entered into by the Applicant’s company in November 2001, the export did not take place until early in 2002 due to problems the Australian manufacturer had in sourcing required chemicals from the United States. No evidence was given of any further shipments of cleaning agents from Australia.
21. On perusing the documents relating to that shipment as contained in Attachment S19 in Exhibit A2, I am not convinced that the Applicant’s CBT Pty Ltd was the moving party in the purchase and export of the cleaning products. The correspondence from the Applicant to CBT Pty Ltd emanated from Indonesia and some correspondence is on the letterhead of the Indonesian company, Kreasi. The Australian company may have made the payment for the goods but in reality the transaction was by the Applicant as an importer into Indonesia. There is nothing in the evidence to suggest this transaction led to the creation of an eligible business in Australia.
22. As was pointed out by Mason J (as he then was) in Hope v. Bathurst City Council (1980) 144 CLR 1, the concept of a business requires that there be a commercial enterprise in the nature of a going concern.
23. Furthermore, the exercising of skills in actively participating in the day-to-day management of the business must take place in Australia. The Applicant so far has exercised his business skills in Indonesia.
24. I am satisfied that as at 13 March 2002, the Applicant had:
(a)had not obtained a substantial ownership in an eligible business in Australia and furthermore;
(b)was not utilising his skills in actively participating at a senior level in the day‑to-day management of that business.
25. The decision under review is therefore affirmed.
I certify that the 25 preceding paragraphs are a true copy of the reasons for the decision herein of:
Senior Member M D Allen
Signed: (Kwai-Ling Wong) .......................................................................................
Associate
Date of Hearing 15 July 2003
Date of Decision 13 August 2003
Counsel for the Applicant Mr N Poynder
Solicitor for the Applicant Direct access brief
Solicitor for the Respondent Ms E Warner, Australian Government Solicitor
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