WU (Migration) - [2018] AATA 1092

WU (Migration) [2018] AATA 1092 (9 March 2018)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANTS:  Ms Liuweina Wu
Ms Meiyi Wang
CASE NUMBER:  1506408
DIBP REFERENCE(S):  BCC2014/2616042
MEMBER:Katie Malyon
DATE:9 March 2018
PLACE OF DECISION:  Sydney
DECISION:The Tribunal remits the application for a Business Skills (Provisional) visa for reconsideration, with the direction that the first named applicant has established that the assets nominated for making the complying investment are unencumbered and lawfully acquired.
Statement made on 09 March 2018 at 1:08 pm

CATCHWORDS
Migration – Business Skills (Provisional) (Class EB) – Subclass 188 (Business Innovation and Investment) – Whether nominated assets are unencumbered and lawfully acquired – Lack of evidence provided to delegate – Evidence subsequently provided to Tribunal
LEGISLATION
Migration Act 1958, s 65
Migration Regulations 1994, r 5.19B(3), Schedule 2, cl 185.252(1)
CASES
Drake v MIEA (No 2) (1979) 2 ALD 634
Qiao v MIAC [2008] FMCA 380
Hneidi v MIAC [2010] FCAFC 20
STATEMENT OF DECISION AND REASONS

APPLICATION FOR REVIEW

This is an application for review of a decision made by a delegate of the Minister for Immigration on 24 April 2015 to refuse to grant the applicants a Business Skills (Provisional) Subclass 188 visas (Subclass 188 visa) under s.65 of the Migration Act 1958 (the Act).
The applicants applied for the visa on 7 October 2014. Their applications were made in the Significant Investor stream of the Subclass 188 visa after having been invited by the Minister to apply for the visas.
The delegate refused to grant the first named applicant, Ms Liuweina Wu, the visa on the basis she had not established that the assets she nominated for making the ‘complying investment’ were unencumbered and lawfully acquired, essentially because of the absence of any corroborating evidence. As a result, the delegate found that Ms Wu did not satisfy cl.188.252(1) of Schedule 2 of the Migration Regulations 1994 (the Regulations). The delegate also refused the applications of the second named applicant Ms Meiyi Wang (Ms Wu’s 12 year old daughter) and Mr Shiliang Wang (Ms Wu’s husband) as they did not meet the secondary criteria to be members of the family unit of a person who held a Subclass 188 visa and, further, there was no evidence to indicate that they met the primary visa criteria in their own right. A copy of the delegate’s decision was provided to the Tribunal.
On 21 October 2016, the Tribunal wrote to Ms Wu advising that it had considered all the material before it relating to the application but it was unable to make a favourable decision on that information alone. The Tribunal invited Ms Wu to give oral evidence and present arguments at a hearing on 24 November 2016.It specifically requested that she provide any further documents or information on which she intended to rely by 17 November 2016. On 28 October 2016, Ms Wu’s representative wrote to the Tribunal seeking an adjournment on the…

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

AGLC: WU (Migration) [2018] AATA 1092
Case: [2018] AATA 1092
Decision Date: 9 March 2018

CaseChat Overview and Summary

This matter concerned an appeal by Ms Wu against a decision by a delegate of the Minister for Immigration, who was not satisfied that the assets nominated for her Business Skills (Provisional) visa application were unencumbered and lawfully acquired. Ms Wu had declared total assets of AUD 5,007,422.45, comprising cash deposits, properties, and funds in a bank account. Despite requests for further documentation, the delegate remained unconvinced about the source and unencumbered nature of these assets. The Administrative Appeals Tribunal (the Tribunal) considered significantly more documentation and oral evidence than was initially provided to the Department.

The primary legal issue before the Tribunal was to determine whether Ms Wu had established, through sufficient evidence, that the assets she nominated for her complying investment were both unencumbered and lawfully acquired, as required by the Migration Regulations 1994. This involved assessing the credibility and sufficiency of the evidence provided regarding the historical accumulation of wealth by Ms Wu and her husband, Mr Wang, through various business and investment activities. The Tribunal also had to consider whether any inconsistencies or perceived shortcomings in the evidence warranted a refusal of the visa application.

The Tribunal reasoned that while there were initial shortcomings in the documentation provided to the delegate, the extensive evidence presented to the Tribunal, including statutory declarations and oral testimony from Ms Wu and Mr Wang, allowed for a reasonable assessment of the source of funds. The Tribunal accepted explanations for apparent inconsistencies in dates and business names, attributing them to translation issues or the early stages of business development. While a residual concern remained regarding Mr Wang's explanation for the discrepancy in his reported investment in Harbin Longpeng Supplies Sales Agency, the Tribunal gave this no weight in light of current immigration policy, which generally accepts recent source of funds documentation unless there are reasonable suspicions of illegal ownership. Ultimately, the Tribunal was satisfied that the investment funds could be traced back to legitimate business and investment activities of both Ms Wu and Mr Wang.

Consequently, the Tribunal remitted Ms Wu's application for a Business Skills (Provisional) visa for reconsideration to the Department, with a direction that Ms Wu had established that the assets nominated for her complying investment were unencumbered and lawfully acquired.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

There is no suggestion in the delegate’s decision that the funds used by Ms Wu have been sourced illegally or that non-genuine documentation was provided to the Department. Rather, the delegate was not satisfied that, based on evidence provided, the source of funds for the nominated assets could be reasonably established. As noted above, the Tribunal has had the benefit of significantly more documentation than was originally provided to the Department as well as oral evidence from Ms Wu, Mr Wang and submissions from her current representative.CLAIMS AND EVIDENCEBackground As noted in the delegate’s decision, Ms Wu indicated in a Statement of Assets and Liabilities Position (SALP) dated 9 September 2014 accompanying her Subclass 188 visa application, that the total value of assets to be used for her complying investment wasAUD 5,007,422.45. This represented: AUD 439,081 in cash deposits in China with the Bank of China (in Mr Wang’s name); 3 properties in Harbin City valued at AUD 3,063,030; and, funds in Ms Wu’s Chatswood CBA bank account of AUD 1,505,311.45. Some documentation was provided in support of the application: however, the delegate made 3 requests for further documentation in support of the SALP. On 22 December 2014, Ms Wu’s former representative provided further documentation including a Statement on Source of Funds dated 1 December 2014 (SoF Statement). Additional documentation was also provided on 19 March 2015. Essentially, having regard to documentation provided, the delegate concluded that Ms Wu had not established through adequate evidence that the assets nominated for making the complying investment were unencumbered and lawfully acquired. In the SoF Statement, Ms Wu states she and her husband Mr Wang have been running a nightclub business and karaoke bar, Lao Wutong KTV (KTV), in Nangan District, Harbin since 2003 - it was a gift to her from her husband in anticipation of their wedding in 2004 - and that, after many years of business operations and investments, she and her husband have accumulated more than AUD 5 million net assets. She identifies essentially 5 key sources of income for the funds which she and her husband plan to use to make their complying investment. The accumulated assets of Ms Wu and Mr Wang, sources of income and their business KTV as set out in her SoF Statement as well as a supplementary Source of Funds Statement dated 18 March 2015 in Mandarin (Supplementary SoF Statement) are discussed below together with the delegate’s comments in relation to the evidence provided. Ms Wu’s former representative did not provide a translation of the Supplementary SoF Statement: however, he did provide a submission which summarised the statement. First, Mr Wang is a 60 year old businessman and has accumulated funds arising from his many business activities since the early 1980s. Initially, he ran a business selling children’s clothes from 1980 to 1983 and then, from 1984 to 1989, he expanded to running a business manufacturing woollen clothing. Having become a millionaire from his wool manufacturing business, he then invested in 1990 in the Meijianbao Lactose Factory and accumulated RMB 4.5 million.

Decision

Reasons for decision

The Tribunal has carefully considered the evidence provided to assess whether the ownership and source of funds proposed to be used for Ms Wu’s complying investment have been lawfully acquired and are unencumbered. The Tribunal acknowledges the shortcomings in documentation provided to the Department at the time of the delegate’s decision. The Tribunal also accepts that, consistent with immigration policy, it is appropriate to seek information on which to reasonably make a decision as to the source of ownership of the couple’s assets and that documentation covering the most recent source of funds would generally be enough unless there are reasonable suspicions that the assets are not legally owned.[3] [3] >Ms Wu has provided the Tribunal with a detailed statement in her Statutory Declaration of 23 November 2016 as to how the assets in her SALP have been acquired. This has been updated by her new representative as at July 2017. Based on documentation provided, the Tribunal is satisfied that the investment funds of Ms Wu and Mr Wang can be traced back to legitimate business and investment activities of the couple since at least 2003. Mr Wang has also provided a detailed Statutory Declaration dated 10 July 2017 in which he addresses the concerns raised by the Tribunal in its letter of 8 June 2017. In this regard, the Tribunal notes Mr Wang declares that, in his first statement to the Department dated1 December 2014 about how he earned his wealth through concentrating on his business career, he omitted to refer to his positions as an employee. He declares that, from 1977 to 1987, he worked in the Harbin Enamel General Factory, a government enterprise: however, in the late 1970s when restrictions on doing business were gradually loosened in China, he started his own small business in 1981 (selling clothes, shoes and accessories) taking leave of absence to do so, just in case the business failed. Then, for 5 years from 1984 to 1989, he operated a wool wholesale business while still being ‘on the books‘ at Harbin Enamel General Factory. The Tribunal observed during the hearing that Mr Wang clearly has an entrepreneurial drive and accepts his explanation of the inconsistency in evidence to the Department and the Tribunal. In relation to the apparent confusion regarding his statement dated 1 December 2014 that from 1990 – 1993 he invested in the Meijianbao Lactose Factory whereas documentation provided by Ms Wu’s new representative to the Tribunal refers to Jianbaole Beverage and Food Factory, the Tribunal accepts Mr Wang’s explanation that this is a translation issue. He explains the timing issue as the initial start-up phase, especially having regard to the fact the factory was built on government land. The Tribunal accepts Mr Wang’s explanation. Mr Wang has also explained, to the Tribunal’s satisfaction the timing difference in relation to his involvement with Harbin Longpeng Coal Distribution Company (also known as Harbin Longpeng Supplies Sales Agency) due to grant of a temporary licence in the company’s first 3 years of operation, in what is a highly regulated industry. However, the Tribunal had some concern in relation to evidence that Mr Wang’s investment in this company was reported to be RMB 700,000 and yet he claimed he held RMB 3 million. Mr Wang acknowledges the documentation provided to the Tribunal shows capital investment totalled RMB 2.2 million (RMB 700,000 registered capital, RMB 1 million fixed capital and RMB 500,000 working capital) and admits that he mistakenly rounded his total investment up. Whilst the Tribunal accepts documentation provided confirms total capital investment of RMB 2.2 million, Mr Wang’s explanation for ‘rounding up’ his investment in Harbin Longpeng Supplies Sales Agency remains the Tribunal’s residual concern in relation to his inconsistent evidence to the Tribunal. However, having regard to current immigration policy referred to above that documentation covering the most recent source of funds would generally be enough unless there are reasonable suspicions that the assets are not legally owned, the Tribunal gives no weight to this inconsistency. Furthermore, the Tribunal observes that Mr Wang’s confusion about his interest in Harbin Longpeng Supplies Sales Agency dates back almost 2 decades. Moreover, the Tribunal is satisfied that Ms Wu has demonstrated the source of funds she has nominated for making the complying investment have been lawfully acquired through her interest in KTV. Having carefully reviewed all documentation provided by the applicants’ new representative and, with the benefit of oral evidence provided at the hearing from both Ms Wu and Mr Wang as well as the new representative’s submissions, the Tribunal is satisfied that the investment funds can be traced back to legitimate business and investment activities of both Ms Wu and Mr Wang. Accordingly, the Tribunal finds that Ms Wu has established that the assets she has nominated for making the ‘complying investment’ are unencumbered and lawfully acquired. As the second named applicant applied on the basis of a being member of the family unit of the first named applicant, her application will be determined by reference to the outcome of the first named applicant’s application on remittal to the Department for reconsideration. DECISION.The Tribunal remits the application for a Business Skills (Provisional) visa for reconsideration, with the direction that the first named applicant has established that the assets nominated for making the complying investment are unencumbered and lawfully acquired. Katie MalyonMemberAnnexureExtracts from the Migration Act 1956s.134 Cancellation of business visas….s.134(10) In this section: …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.Extracts from the Migration Regulations 1994 r.5.19B Complying investment(1) An investment by a person (the investor) is a complying investment if all of the requirements in this regulation are met.(2) Description The investment must consist of one or more of the following:(a) an investment in a government bond (however described) of the Commonwealth, a State or Territory; or(b) a direct investment in an Australian proprietary company that meets the following requirements:(i) the company is not listed on an Australian stock exchange;(ii) the company has not been established wholly or substantially for the purpose of creating compliance with this paragraph;(iii) the investment is an ownership interest in the company; or(c) an investment in a managed fund (directly or through an investor directed portfolio service) for a purpose specified by the Minister in an instrument in writing for this paragraph.(3) The funds used to make the investment are:(a) unencumbered; and(b) lawfully acquired.(4) InvestorThe investor must be an individual.(5) The investor must make the investment:(a) personally; or(b) with the investor’s spouse or de facto partner; or(c) by means of a company that has issued shares and in which:(i) the investor holds all of the issued shares; or(ii) the investor and the investor’s spouse or de facto partner hold all of the issued shares; or(d) by means of a trust:(i) that is lawfully established; and(ii) of which:(A) the investor is the sole trustee; or(B) the investor and the investor’s spouse or de facto partner are the sole trustees; and(iii) of which:(A) the investor is the sole beneficiary; or(B) the investor and the investor’s spouse or de facto partner are the sole beneficiaries.(6) If:(a) an investor withdraws money from a complying investment, or cancels the investment; and(b) the investor makes an investment of at least the value of the withdrawn money or cancelled investment in one or more other investments mentioned in subregulation (2); and(c) no more than 30 days passes between the events mentioned in paragraphs (a) and (b).the investment is taken not to have ceased to be a complying investment during the period between the events mentioned in paragraphs (a) and (b).…Extracts from Part 188 of Schedule 2 of the Migration Regulations 1994SUBCLASS 188 – BUSINESS INNOVATION AND INVESTMENT (PROVISIONAL)…188.252 (1) The applicant has made a complying investment of at least AUD 5,000,000.Note: A complying investment may be based on one or more investments.(2) The applicant has a genuine intention to hold the complying investment for at least 4 years.oOOo

Ratio Decidendi

Legal Principle Established

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