Tan and Minister for Immigration and Citizenship
[2008] AATA 720
•18 August 2008
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2008] AATA 720
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2007/4106
GENERAL ADMINISTRATIVE DIVISION ) Re YONG FU TAN Applicant
And
MINISTER FOR IMMIGRATION AND CITIZENSHIP
Respondent
DECISION
Tribunal Dr K S Levy, RFD Senior Member Date18 August 2008
PlaceBrisbane
Decision The decision under review is affirmed. .............[Sgd].................................
Senior Member
CATCHWORDS
IMMIGRATION AND CITIZENSHIP – Visas – business skills visa – cancellation of visa – applicant not actively participating at a senior level in management of business – spent 29 days in Australia – not directly involved in business – applicant did not demonstrate a genuine effort to utilise his skills – no business proposals – limited direction of company – value of assets – significant financial interest in business – non compliance with department – consideration of residual discretion – no basis for exercise of residual discretion – decision under review affirmed.
Migration Act 1958 ss134(1)(b), (2)(b), (10), (3)(c), (3)(d), (3)(f), (3)(g), (10); 137
Re Yam and Minister for Immigration and Multicultural and Indigenous Affairs [2007] AATA 283
Re Philp and Minister for Immigration and Multicultural and Indigenous Affairs [2007] AATA 2092
Re Leo and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 309
Re Gunawan and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 852
Re Abbu and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 898
Re Koosasi and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 179
Re Legana and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 1166
Kim v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 31
Re Pan and Minister of Immigration and Citizenship [2007] AATA 1724
Re Padilla and Minister for Immigration and Cultural Affairs [2006] AATA 922
Minister of State of Immigration and Ethical Affairs v Teoh (1994) 183 CLR 273
Re Minister for Immigration and Multicultural Affairs; ex parte Lam (2003) 195 ALR 502
Re Teo and Minister for Immigration and Citizenship [2007] AATA 1118
REASONS FOR DECISION
18 August 2008 Dr K S Levy, RFD Senior Member INTRODUCTION
1. The Department of Immigration issued a notice of intention to cancel Mr Tan’s business skills visa on 9 May 2007. The visa was issued under the Migration Act 1958 (Cth) (“the Act”). In respect of the notice of intention to cancel the visa, Mr Tan was represented by an agent who responded on his behalf on 25 May 2007. On 2 August 2007 a delegate of the Minister decided to cancel Mr Tan’s visa pursuant to s 134 of the Act. Mr Tan now appeals against that decision.
ISSUES
2. The Tribunal must determine the following questions:
i. Was Mr Tan utilising his skills in actively participating at a senior level in the day to day management of his business? (s 134(1)(b))
ii. Has Mr Tan demonstrated a genuine effort to utilise his skills in actively participating in the business? (s 134(2)(b)) and
iii. Even if questions (1) and (2) are answered in the negative, should the Tribunal exercise its residual discretion in favour of Mr Tan?
EVIDENCE
3. An amount of documentary material was presented to the Tribunal in respect of this matter by both the Applicant and the Respondent. The Applicant did not appear at the hearing and his solicitors indicated just over 24 hours prior to the date of the hearing that they also would not appear. The Respondent was represented by Mr Maycock of Clayton Utz.
4. In summary the evidence shows that Mr Tan migrated to Australia on 30 May 2004. At that time he had a subclass 127 visa. Some nine months later, Mr Tan established an Australian company Just Kits Pty Ltd. This company was registered on 9 February 2005. On 11 April 2006, the Department of Immigration and Citizenship wrote to Mr Tan requesting him to complete a form 1010 (Survey Business Skills Migrant – 24 months). No response was received to that request and the Department wrote again on 3 further occasions requesting completion of that survey. Those subsequent requests by the Department were made on 21 September 2006, 12 December 2006 and 9 January 2007. On 10 April 2007, Mr Tan appointed a migration agent, Mr Daniel Lai and he advised the Department of this appointment. The Department subsequently issued a notice of intention to cancel Mr Tan’s visa, which was in fact determined on 2 August 2007.
5. In addition to this evidence, documentary evidence shows that the migration agent’s submission to the Department on behalf of Mr Tan submitted that Mr Tan was nominally the chairman of the company and went on to say “in the capacity as chairman, he directly manages the company director, Mr Matt Richards, and the general manager, Mr Stephen Horne”.
6. Other evidence indicates that the general manager of Just Kits Pty Ltd received strategic direction by the company directors (which includes Mr Tan) and that the general manager reports regularly on the operation performance of the company to Mr Tan.
7. There was other evidence submitted that the general manager reports to Mr Tan by email and that that reporting is sporadic and that the guidance received is somewhat minimal. In relation to the general manager receiving strategic direction from Mr Tan, the Respondent submitted that a statement from the accounting firm Accounting North Pty Ltd, of which one of its directors is also a director of Just Kits Pty Ltd, Mr Matthew Richards, has provided a statement which is to the following effect:
“… in the absence of the physical presence of the directors, I can confirm that Accounting North acts as an on the ground representative for the directors”.
A subsequent email update by Mr Richards to Mr Tan in September 2006 states:
“I think for a small business with only 10 or so employees that operates without any input from the owners it has done quite well. In many similar scenarios the business could quite easily go very bad very quickly, but the good team in place and the ongoing review by Accounting North have probably meant that this is very unlikely”.
8. The Respondent relies on much of this evidence as support for its contention that Mr Tan is essentially not involved in the day to day management of the business at a senior level and that Accounting North undertakes this role on his behalf.
9. Evidence was also received that Mr Tan had spent only 29 days in Australia between 30 May 2004 and the cancellation decision on 2 August 2007.
CONSIDERATION
10. In answering the questions in issue, I have taken account of all the factual and documentary evidence. I have also taken account of the legislative requirements, which relevantly provide:
“s134 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).
(3A) Subject to section 135, the Minister may cancel an investment‑linked visa (other than a family member's visa), by written notice to its holder, if the Minister is satisfied that the person, or any of the persons, who held the relevant designated investment when the visa was granted has or have ceased, for any reason, to hold that investment within 3 years of that investment being made.
… (10) In this section:
business visa means:
(a) a visa included in a class of visas, being a class that:
(i) has the words "Business Skills" in its title; and
(ii) is prescribed for the purposes of this paragraph; or
(b) a visa:
(i) to which a prescribed provision of the Migration Reform (Transitional Provisions) Regulations applies; and
(ii) that is of a kind prescribed for the purposes of this paragraph; or
(c) a return visa that is granted to a person who is or was the holder of a business permit or business visa;
that is or was granted on or after 17 February 1992.”
11. In relation to Issue (i) in paragraph 2, I make a finding of fact that Mr Tan had spent only 29 days in Australia in the period of over 3 years between 30 May 2004 and 2 August 2007. Although it is accepted that Mr Tan must have had some oversight of the affairs of the business over that period, other evidence provided shows that for the majority of the time, Mr Tan could not have been “directly” involved in managing either the company directors or the general manager of the business. On the basis of the facts presented therefore, I find he is not directly or actively participating in the day to day management of the business as required by s134(1)(b) of the Act.
12. In relation to Issue (ii) of paragraph 2, the question is whether Mr Tan has made a genuine effort to utilise his skills in actively participating at a senior level in the day to day management of his business. As the business appears to have had some degree of profitability and that Mr Tan has agents in Australia who undertake most of the management of the company, I accept that his business is an “eligible business” within the meaning of that term in s134(10). But the real issue in contention is whether Mr Tan has made a “genuine effort” to use his skills in participating in the management of that eligible business and at a senior level. Mr Maycock submitted that the effort by the Applicant must be more than a “superficial or token” level of effort[1]. He also submitted that on the authority of Re Philp and Minister for Immigration and Citizenship[2] that there must be a demonstration of some exertion or endeavour[3] and that effort must be “vigorous and determined”[4]. It has also been described as requiring a “strenuous attempt”[5] and that the effort must be of a “sustained and continuous quality”[6]. I accept those propositions as authoritatively based in respect of the requirements to answer this issue.
[1] Re Yam and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 283.
[2] [2007] AATA 2092.
[3] Re Leo and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 309.
[4] Re Gunawan and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 852 at [46] & [48].
[5] Re Abbu and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 898.
[6] Re Koosasi and Minister for Immigration and Multicultural and Indigenous Affairs [2006] AATA 179.
13. However this determination must also take account of the factors listed in s 134(3). A consideration of these factors includes the following:
i. The subsection requires for example, that there should be business proposals developed. The Respondent has submitted that Mr Tan has not provided evidence of such proposals. However, whether they are formalised or not, it would appear that the degree of operational activity is such that some business proposals must have been developed and there appears to have been, some implementation of these proposals, given the degree of operational success to date. Even if there were no such business proposals in any formal sense, whatever business proposals or strategies have been adopted, even by Mr Richards, his agent at Accounting North Pty Ltd, then there would appear to be no reason why Mr Tan could not be regarded as approving any such strategies on behalf of the board of the company, or at least on his own behalf as a director.
ii. Section 134(3)(c) requires consideration of any evidence of research in the conduct of the eligible business in Australia. While that was not formally presented to the Tribunal, it would appear that some research has been undertaken, at least to the extent of operationalising broad strategic plans or direction for the company and in terms of having researched market opportunities.
iii. Section 134(3)(d) refers to the periods during which the person has been present in Australia. As stated earlier, this is a relevant factor in assessing the degree of genuine effort undertaken by Mr Tan[7]. For reasons outlined earlier, I find that Mr Tan has not satisfactorily complied with that factor.
iv. Relevant to the Tribunal’s consideration, is the value of assets transferred to Australia. It appears that Mr Tan has made a deposit of some $130,000.00 for his share of the ownership of the business. While there was some doubt raised by the Respondent whether this value was provided by Mr Tan, there was no countervailing evidence. I therefore find that that factor is not one of great weight in favour of the Applicant or the Respondent.
v. Also relevant is the value of the ownership of the business in Australia (s 134(3)(f)). It is apparent Mr Tan owns a fifty percent shareholding in the business. This indicates a significant interest. The business activity that has been undertaken by the person is also of relevance. There is evidence of the business being involved in the construction of Kit homes sold by Just Kits Pty Ltd and despite the level of activity, it appears that it has performed profitably and therefore satisfies s134(3)(g).
vi. Finally, another factor which should be taken into account is whether Mr Tan has complied with a notice issued under s137. It is noted that the evidence shows that the Applicant was requested on four separate occasions to complete the 24 month survey. However, it is apparent that while the request was ultimately complied with, it was not completed speedily. The Department’s role is to determine the efficacy of visas issued in assessing whether an eligible business complies with the definition in s 134(10).
[7] Re Legana and Minister for Immigration and Multicultural and Indigenous Affairs [2005] AATA 1166.
14. In light of considering all the above factors, the evidence available, the case authorities and the degree of involvement by Mr Tan in the business (as compared to the direct oversight by the director associated with the firm Accounting North Pty Ltd), I find that the weight of evidence is that Mr Tan does not satisfy the requirement of making a genuine effort to use his skills in the day to day management of the business, despite the company operating successfully.
15. In relation to Issue (iii) of paragraph 2, the Tribunal does have a residual discretion to determine whether Mr Tan’s visa should be cancelled, notwithstanding the findings above in relation to ss134(1) and 134(2)[8]. The residual discretion requires that the Tribunal have regard to facts and circumstances within the period up to the cancellation date although the discretion also exists to enable a decision maker to have sufficient “… flexibility to deal with unanticipated circumstances”[9].
[8] Kim v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 31.
[9] Re Pan and Minister of Immigration and Citizenship [2007] AATA 1724.
16. There is no legislative guidance about the exercise of the residual discretion. The Respondent referred me to Philp and the Minister of Immigration and Citizenship[10]. There, Mr A Sweidan, the presiding Senior Member, outlined comprehensively the sorts of factors which might be taken into account by the Tribunal. In particular, he determined that a Tribunal could take account of circumstances where the Applicant had a satisfactory explanation for inactivity up to the date of cancellation. He also suggested that humanitarian grounds could be a legitimate consideration and whether or not a little more time might assist an Applicant to fulfil his other visa obligations. However, it was also submitted that the discretion should not be used where the Applicant had spent only a minimal time in Australia, or had not acquired permanent residential property in Australia; where the Applicant had not developed a significant connection within Australia; or where the Applicant had not demonstrated a sustained commitment to trying to fulfil his visa obligations, unless there is also a genuine and realistic indication that the Applicant was playing a substantial role in the eligible business. Taking account of the factors mentioned above, there is no evidence available to substantiate the exercise of that residual discretion on the basis of Mr Tan’s having a substantial role in the business.
[10] [2007] AATA 2092.
17. There was also reference in Philp, that hardship is a factor which may have relevance. Hardship is a broad issue depending on the circumstances and it is not sufficient that other secondary visa holders such as family members, would have their visa cancelled to justisfy overriding a cancellation decision pertaining to an applicant[11]. There was no submission by the Applicant or his solicitors in respect of any of the above considerations. Indeed no evidence of any actual hardship was proffered.
[11] Re Padilla and Minister for Immigration and Cultural Affairs [2006] AATA 922.
18. There was mention from the bar table that some information had been provided in a lawyer to lawyer telephone conversation that the applicant had a son studying in Australia and he was expected to graduate later this year. It is relevant to note that the High Court of Australia has previously outlined the need to take account of legitimate expectations of an Applicant, particularly where children are concerned[12]. But the High Court refined that decision in Re Minister for Immigration and Multicultural Affairs; Ex Parte Lam[13] where the court said the doctrine of legitimate expectation cannot affect substantive rights but only procedural rights. Indeed, that decision determined that even if children of the Applicant are Australian born, then that alone is not sufficient to set aside a cancellation decision. Also, a residual discretion should not be exercised where it would be likely to adversely impact on the objectives of Australia’s migration policy[14].
[12] Minister of State of Immigration and Ethical Affairs v Teoh (1994) 183 CLR 273.
[13] (2003) 195 ALR 502.
[14] Re Teo and Minister Immigration for Citizenship [2007] AATA 1118.
19. I take into account that Mr Tan has been involved in a business in Australia for the past 3 years or so. On the evidence presented, it is not a significant business in size or scope, but equally, it has not been a failure. The Applicant seems to have adopted advice and actions of his employees to a large degree, although that of itself is not a disqualifying factor. In terms of s 134(3), there are some factors which he expressly or impliedly satisfies particularly through some high level decision making for the business. There are others which he clearly has not satisfied, and these relate to his personal commitment and level of input by day to day management, as well as time spent in Australia in management of the business. I find that the factors not satisfied outweigh the factors which are satisfied, in the context of the meaning of “genuine effort”. I have also looked at whether there is any subsequent evidence since the date of the decision in terms of Shi v Migration Agents Registration Authority[15]. As neither the Applicant nor his solicitor appeared, I can find no further evidence on which I can assess this matter further or which is favourable to the Applicant.
[15] [2008] HCA 31.
20. Taking account of all the evidence and the relevant authorities, I can find no adequate basis for the exercise of the residual discretion.
DECISION
21. The decision under review is affirmed.
I certify that the 21 preceding paragraphs are a true copy of the reasons for the decision herein of Dr K S Levy, RFD Senior Member
Signed: ............................[Sgd].................................................
Elizabeth Young, Research AssociateDate of Hearing 11 July 2008
Date of Decision 18 August 2008
The applicant did not appear
Solicitor for the Applicant Non appearance
Solicitor for the Respondent Mr Steven Maycock, Clayton Utz
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