Wealth Global Pty Ltd (Migration)

[2021] AATA 1430

Wealth Global Pty Ltd (Migration) [2021] AATA 1430 (10 May 2021)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  Wealth Global Pty Ltd

CASE NUMBER:  1822736

HOME AFFAIRS REFERENCE(S):          BCC2016/4150972

MEMBER:Karen McNamara

DATE:10 May 2021

PLACE OF DECISION:  Sydney

DECISION:The Tribunal affirms the decision under review to refuse the nomination.

Statement made on 10 May 2021 at 11:08am

CATCHWORDS

MIGRATION – application for approval of nomination of position – direct entry nomination stream – adverse information from site inspection – no further action by department – capacity to employ nominee full-time for 2 years – business’s financial performance – trade restrictions imposed by Chinese government – no current financial information provided – decision under review affirmed

LEGISLATION

Migration Act 1958 (Cth), s 359(2), 359AA

Migration Regulations 1994 (Cth), rr 1.13A, 1.13B, 5.19(4)(d), (f)

STATEMENT OF DECISION AND REASONS

APPLICATION FOR REVIEW

1. This is an application for review of a decision made by a delegate of the Minister for Home Affairs on 17 July 2018 to reject the application by Wealth Global Pty Ltd (the applicant) for approval of the nomination of a position in Australia under r.5.19 of the Migration Regulations 1994 (the Regulations).

2. The applicant applied for approval on 8 December 2016. The requirements for the approval of the nomination of a position in Australia are found in r.5.19 of the Regulations which contains two alternative streams: a Temporary Residence Transition nomination stream (r.5.19(3)) and a Direct Entry nomination stream (r.5.19(4)). If the application is made in accordance with r.5.19(2) and meets the requirements of either stream, then the application must be approved. If any of the requirements are not met then the application must be refused: r.5.19(5).

3. In this case, the applicant has applied for approval of a nomination, seeking to satisfy the criteria in the Direct Entry nomination stream.

4. The delegate refused the application on the basis the applicant’s nomination did not satisfy 5.19(4)(h)(i)(A) of the Regulations because the application did not provide sufficient evidence to demonstrate that the tasks to be performed in the position will be performed in Australia.

5. The applicant applied to the Tribunal on 7 August 2018 for review of the delegate’s decision. The applicant submitted a copy of the primary decision record with the review application.

6. On the 5 February 2021, the Tribunal wrote to the applicant pursuant to section 359(2) of the Act (dispatched by email to the authorised recipient), requesting the applicant to provide updated and current information that would assist to determine whether the criteria in rr. 5.19(2) & (4) of the Regulations were met.

   Information provided to the Tribunal

7. On 19 February 2021, the applicant provided the following documents to the Tribunal;

   ·ASIC current & historical extract

   ·Company tax returns 2018/19 and 2019/20 financial years

   ·Financial Statements 2018/19 and 2019/20 financial years

   ·BAS returns July 2018 to June 2020

   ·Organisation chart

   ·Position Description

   ·Training expense summary

   ·Tax invoice/receipt The Vine Press dated 7 June 2016

8. On 20 April 2021, the applicant provided a copy of the nominee’s employment agreement signed and dated 14 April 2021.

9. On 21 April 2021, the applicant represented by Mr Ming Ming Gu (referred to below as the applicant) appeared before the Tribunal via telephone, to give evidence and present arguments. The Tribunal also received oral evidence via China from Ms Weiwei Li (the nominee) in the related matter for the subclass 186 visa (AAT Case file 1825550). The related matters were heard concurrently in a combined hearing. The Tribunal hearing was conducted with the assistance of an interpreter in the Mandarin and English languages.

10. The Tribunal exercised its discretion to hold the hearing by telephone. The hearing was held during the COVID-19 pandemic. The Tribunal determined it was reasonable to hold a hearing by telephone, having regard to the nature of this matter and the individual circumstances of the applicant and nominee. The Tribunal also had regard to the Tribunal’s objective of providing a mechanism of review that is fair, just, economical and quick, and the delay to the matter if the hearing was not to be conducted by telephone. The Tribunal is satisfied that the applicant and nominee were given a fair opportunity to give evidence and present arguments.

11. The applicant was represented in relation to the review by his registered migration agent.

12. For the following reasons, the Tribunal has decided to affirm the decision under review to refuse the nomination.

    CONSIDERATION OF CLAIMS AND EVIDENCE

13. The issue in this case is whether the applicant meets the requirements for approval of the nomination under the Direct Entry nomination stream set out in r.5.19(4), which is extracted in the attachment to this decision. For the nomination to be approved, all the requirements must be met.

    BACKGROUND

14. The applicant operates a wine exporting business, predominantly to China. The business is based in Sydney, NSW. Information before the Tribunal show the company was registered on 22 August 2012.

15. On 26 July 2017, the applicant lodged an application for an employer nomination approval for the position of Sales and Marketing Manager under the occupation of Marketing Specialist (ANZSCO 225113) under the Direct Entry nomination stream. The nominated base rate and guaranteed earnings are $185,000 per annum.

16. The Tribunal notes that numerous evidence and submissions were lodged by or on behalf of the applicant. While the Tribunal has considered all of same, only that which was considered material to its decision has been expressly referred to herein.

    ADVERSE INFORMATION – Invitation to comment

17. There is evidence before the Tribunal regarding the applicant that may be considered adverse. In accordance with s.359AA of the Act, the Tribunal put to the applicant information before the Tribunal that suggests there is adverse information known to the Department about the applicant. The Tribunal explained that under s.359AA of the Act, the Tribunal is required to invite the applicant to comment on or respond to certain information which the Tribunal considers would, subject to the applicant’s comment or response, be the reason, or part of the reason, for affirming that decision under review.

18. The Tribunal told the applicant particulars of the information. The information relates to information contained on the Department file which shows that Department officers conducted an unscheduled onsite inspection of the applicant’s business premises on 19 October 2017 in response to concerns raised by the case officer. The case officer noted concerns in regard to; whether the business is active and lawfully trading, concerns regarding allegations of payment for visa claims for a previous sponsored employee and whether the nominated position of Sales & Marketing Manager is genuine and justified for the business. The case officer noted that the proposed salary of $185,000 offers exemptions for the skills and English requirement for the nominated visa applicant.

19. The Tribunal confirmed with the applicant that the Tribunal must be satisfied under r.5.19(4)(f) either:

    (i)there is no adverse information known to Immigration about the nominator or a person associated with the nominator; or

    (ii)it is reasonable to disregard any adverse information known to Immigration about the nominator or a person associated with the nominator.

20. The Tribunal told the applicant that this information is relevant, because it suggests that there is adverse information known to Immigration about the applicant and that at the time of the hearing there was no information currently before the Tribunal to suggest it is reasonable to disregard this adverse information. If the Tribunal relies on this information, it may not be satisfied the applicant meets the requirements of r.5.19(4)(f) and as such the Tribunal may then find that the applicant does not meet the requirements for approval of the application and the decision under review may be affirmed.

21. The Tribunal invited the applicant to comment on this information. The applicant chose to respond orally and told the Tribunal that he was in China at the time the Department officers conducted an onsite inspection, hence why the office was unattended. The applicant stated that he had no knowledge of the allegations of payment for visa claims and that this has never been brought to his attention before.

22. The Tribunal has considered whether the adverse information put to the applicant at the hearing falls within the definition of ‘adverse information’ and places weighting on the Department’s records which show that no further action was taken by the Department. The Tribunal therefore considers that this information does not fall within the definition of ‘adverse information’ and ‘associated with’ as defined in rr.1.13A and 1.13B.      

    Term of employment of the visa holder: r.5.19(4)(d)

23. Regulation 5.19(4)(d) requires the nominee to be employed in the nominated position for at least 2 years full time, and the terms and conditions of that employment do not expressly exclude the possibility of an extension. 

24. At the hearing the Tribunal discussed with the applicant, the capacity of the business to employ the nominee on a full-time basis in the position for at least two years. The applicant confirmed to the Tribunal that the financial statements and information provided to the Tribunal were an accurate indication of the financial position of the company.

25. The Tribunal discussed with the applicant that the applicant’s 2018/2019 financial statements recorded sales of $1,702,876, cash at bank of $125,888 and $6,199 profit. The applicant’s 2019/20 financial statements recorded sales of $573,182 representing a 66% decrease on the previous financial year. The 2019/20 financial statements recorded a Director’s loan of $1,003,538, negative net equity ($100,933) cash at bank $6,631 and reported loss of ($196,320). The Tribunal put to the applicant that based on the financial evidence currently before it, that the business is currently operating at a loss therefore how is the applicant underwriting the losses and how long can the business sustain operating at a loss.

26. The applicant told the Tribunal that trade restrictions imposed by the Chinese Government had attributed to the current financial position of the business but business in China was going well and that the company now has an order ready to go. The applicant stated that it will take them one year, two years at the most, to make the business as it was before (the trade dispute) and better than before. To cover the losses, the applicant has increased their prices in China.

27. The Tribunal discussed with the applicant that it must be satisfied that the business has the capacity to employ the employee full time in the position for at least 2 years and that the financial evidence currently before the Tribunal shows that the business is operating at a loss. The Tribunal noted that in the 2018/19 financial year, whilst the business recorded a profit of $6,199 and cash at bank of $125,888, however this was not enough to cover the payment of the nominated salary of $185,000 and invited the applicant to indicate how the business would source funds to cover the nominee’s salary. The applicant told the Tribunal that the nominee is working for the applicant’s Chinese based entity and is doing well but has not been 100% focussed.

28. The Tribunal invited the applicant to respond to the Tribunal’s concern that based on the financial evidence currently before it, that it may form the view that the applicant does not have the financial capacity to afford a salary of $185,000 per annum for two years. The applicant addressed this at the hearing and told the Tribunal that the business has suffered a hard time over the last two years and that they were still awaiting payment for wine sold in China.

29. The Tribunal asked Mr Gu if he was aware what the current financial position of the business is. The applicant told the Tribunal that he thinks it is OK and that the China based company has made orders and because of the China based company the Australian company has cash flow. Because of the trade restrictions the applicant was unable to shift wine but now thanks to the Chinese company they have an order. The applicant stated that if the Australian company (the nominator) was not working well the China company can put money into it.

30. The applicant noted that the nominated salary of $185,000 per annum did not have to paid at once and was confident that it would be easy to pay the nominee monthly. The business also has two Directors and that the Directors may possibly put money into the business. The Tribunal noted its concern that the 2019/20 financial year statements record that despite a Director’s loan of $1,003,538 made to the business, the business still sustained a loss of ($196,320). The applicant responded by telling the Tribunal that he believed sales generated by the China based entity will assist the financial position of the Australian entity and that the nominee will have to perform to make sales better.

31. The Tribunal is required to assess the requirements for approval of the nomination on the evidence before it at the time of decision. In assessing the applicant’s capacity to employ the nominee full time in the position for at least 2 years, the Tribunal has taken into consideration the most recent financial evidence provided by the applicant to the Tribunal including financial statements and tax returns (2018/19 and 2019/20 financial years), BAS returns as submitted via ATO portal and the nominated salary amount.

32. The applicant has not provided evidence to support the most recent financial position of the company that being from 1 July 2020 to time of this decision. In the circumstances, it is difficult to be satisfied that the applicant has the capacity to employ the nominee on a full time basis in the position for at least 2 years when there is no contemporary evidence before the Tribunal to support the current financial position of the business.

33. Having overall consideration of the evidence before it, the Tribunal is of the view that there is lack of evidence that the Tribunal considers concrete and persuasive, to demonstrate the financial capacity of the applicant to pay the full-time salary for the nominated position for at least two years. As stated previously the applicant has not provided contemporary financial information to support the business is viable and profitable and there is no compelling evidence before the Tribunal to support how the applicant will meet the nominated salary of $185,000 per annum for at least two years.

34. On the information before it and the reasons noted above, the Tribunal finds, it is not satisfied that applicant has demonstrated the financial capacity to pay the full-time salary for the nominated position for at least two years. Accordingly, the Tribunal has formed the view that the applicant has not demonstrated that the nominee will be employed as required for the minimum period of two years on a full-time basis as specified in the Regulation. The Tribunal therefore finds the applicant does not satisfy the requirement in r.5.19(4)(d)(i).

35. Accordingly, the requirements in r.5.19(4)(d) are not met.

36. As the Tribunal has found the applicant does not meet r.5.19(4)(d) it is not required to consider the rest of the requirements as set out in r.5.19(4).

37. For the above reasons the Tribunal is not satisfied that the applicant meets the requirements of r.5.19(4). The applicant has not sought to satisfy the criteria in Temporary Residence Transition Nomination stream, and as such has not met the requirements in r.5.19(3). Accordingly, the nomination of the position cannot be approved. Therefore, the Tribunal must affirm the decision under review.

    DECISION

38. The Tribunal affirms the decision under review to refuse the nomination.

    Karen McNamara
    Member

    
    

    ATTACHMENT  -  EXTRACTS FROM THE MIGRATION REGULATIONS 1994

    5.19Approval of nominated positions (employer nomination)

    …

    (2)The application must:

    (a)be made in accordance with approved form 1395…; and

    (aa) include a written certification by the nominator stating whether or not the nominator has engaged in conduct, in relation to the nomination, that constitutes a contravention of subsection 245AR(1) of the Act; and

    (b)be accompanied by the fee mentioned in regulation 5.37.

    …

    Direct Entry nomination

    (4)The Minister must, in writing, approve a nomination if:

    (a)the application for approval:

    (i)       is made in accordance with subregulation (2); and

    (ii)      identifies a need for the nominator to employ a paid employee to work in the position under the nominator’s direct control; and

    (b)the nominator:

    (i)       is actively and lawfully operating a business in Australia; and

    (ii)      directly operates the business; and

    (c)for a nominator whose business activities include activities relating to the hiring of labour to other unrelated businesses — the position is within the business activities of the nominator and not for hire to other unrelated businesses; and

    (d)both of the following apply:

    (i)       the employee will be employed on a full-time basis in the position for at least 2 years;

    (ii)      the terms and conditions of the employee’s employment will not include an express exclusion of the possibility of extending the period of employment; and

    (e)the terms and conditions of employment applicable to the position will be no less favourable than the terms and conditions that:

    (i)       are provided; or

    (ii)      would be provided;

    to an Australian citizen or an Australian permanent resident for performing equivalent work in the same workplace at the same location; and

    (f)either:

    (i)       there is no adverse information known to Immigration about the nominator or a person associated with the nominator; or

    (ii)      it is reasonable to disregard any adverse information known to Immigration about the nominator or a person associated with the nominator; and

    (g)the nominator has a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations; and

    (h)either:

    (i)       both of the following apply:

    (A)the tasks to be performed in the position will be performed in Australia and correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;

    (AAA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;

    (B)either:

    (I)the nominator’s business has operated for at least 12 months, and the nominator meets the requirements for the training of Australian citizens and Australian permanent residents that are specified by the Minister in an instrument in writing for this sub-sub-subparagraph; or

    (II)the nominator’s business has operated for less than 12 months, and the nominator has an auditable plan for meeting the requirements specified in the instrument mentioned in sub-sub-subparagraph (I); or

    (ii)      all of the following apply:

    (A)the position is located in regional Australia;

    (B)there is a genuine need for the nominator to employ a paid employee to work in the position under the nominator’s direct control;

    (C)the position cannot be filled by an Australian citizen or an Australian permanent resident who is living in the same local area as that place;

    (D)the tasks to be performed in the position correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;

    (DA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;

    (E)the business operated by the nominator is located at that place;

    (F)a body that is:

    (I)specified by the Minister in an instrument in writing for this sub-subparagraph; and

    (II)located in the same State or Territory as the location of the position;

    has advised the Minister about the matters mentioned in paragraph (e) and sub-subparagraphs (B) and (C).