ZHU v Minister for Immigration
[2016] FCCA 1874
•22 July 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| ZHU & ORS v MINISTER FOR IMMIGRATION & ANOR | [2016] FCCA 1874 |
| Catchwords: MIGRATION – Judicial review of a decision of the Migration Review Tribunal – application for a Subclass 892 Business Skills (Residence) (Class DF) visa – no grounds of jurisdictional error – application dismissed. |
| Legislation: Migration Act 1958 (Cth), ss. 134(1) |
| Liang v Minister for Immigration and Citizenship (2009) 175 FCR 184 Xiang v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 81 ALD 301 Yang v Minister for Immigration and Border Protection (2014) 289 FLR 192 |
| First Applicant: | HAIXIANG ZHU |
| Second Applicant: | QUANLI MA |
| Third Applicant: | ENZE ZHU |
| First Respondent: | MINISTER FOR IMMIGRATION & BORDER PROTECTION |
| Second Respondent: | ADMINISTRATIVE APPEALS TRIBUNAL |
| File Number: | MLG 393 of 2014 |
| Judgment of: | Judge Hartnett |
| Hearing date: | 13 April 2016 |
| Delivered at: | Melbourne |
| Delivered on: | 22 July 2016 |
REPRESENTATION
| Counsel for the Applicant: | Ms Costello |
| Solicitors for the Applicant: | FCG Legal |
| Counsel for the First Respondent: | Mr Hosking |
| Solicitors for the First Respondent: | Australian Government Solicitor |
ORDERS
The application is dismissed.
The Applicants pay the costs of the First Respondent fixed in the sum of $6,825.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 393 of 2014
| HAIXIANG ZHU |
First Applicant
| QUANLI MA |
Second Applicant
| ENZE ZHU |
Third Applicant
And
| MINISTER FOR IMMIGRATION & BORDER PROTECTION |
First Respondent
| ADMINISTRATIVE APPEALS TRIBUNAL |
Second Respondent
REASONS FOR JUDGMENT
Before the Court is an application dated 6 March 2014 which seeks judicial review of a decision of the Migration Review Tribunal (as it then was) (‘the Tribunal’) dated 4 February 2014. The Tribunal affirmed a decision by the delegate of the First Respondent not to grant the First Applicant a Subclass 892 Business Skills (Residence) (Class DF) visa (‘the visa’). The Tribunal did not have jurisdiction in respect of the Second and Third Applicants, as they were not present in the migration zone at the date of the application to the Tribunal.
The grounds of the application, as set out in the Applicants’ application are as follows:-
“The Migration Review Tribunal (‘the Tribunal’) made the following jurisdictional errors, by reason of which the migration decision under review is not a ‘privative clause decision’ to which section 474 of the Migration Act 1958 applies.
1. The Tribunal erred in law by identifying a wrong issue, asking a wrong question, relying on irrelevant material and/or ignoring relevant material, in that it misconstrued clause 892.221 of Schedule 2 to the Migration Regulations 1994 and, in doing so, failed to have regard to a ‘main business’ nominated by the applicant.
Particulars
a. The Tribunal found (paragraph 34) that in his application for a subclass 892 visa the applicant nominated one ‘main business’ within the meaning of Regulation 1.11, being a meat processing and wholesale business. The Tribunal further found that the applicant had an ‘ownership interest’ in this main business within the meaning of Regulation 1.03.
b. The Tribunal found (paragraphs 40, 43) that, at the time of the decision, the applicant no longer had an ownership interest in the business.
c. The Tribunal found (paragraph 40) that, at the time of decision the applicant was operating a different business, namely a café. The Tribunal did not go on to consider whether the applicant had an ‘ownership interest (sic) in this business at the time of the decision.
d. The Tribunal found (paragraph 41) that, for the purposes of clause 892.221, the applicant ‘cannot rely on a main business not nominated at the time of application.”
The First Respondent seeks dismissal of the application and costs in the event of such dismissal. The First Respondent relies upon his response to application filed 17 March 2014.
Each of the parties filed submissions. The submissions of the Applicants were filed on 2 February 2016 and the submissions of the First Respondent were filed on 17 February 2016. The Court also had before it the evidence as contained in the Court Book filed by the First Respondent on 11 July 2014.
The Applicants submit that the Tribunal fell into error by misconstruing cl.892.221 of Schedule 2 to the Migration Regulations 1994 (Cth) (‘the Regulations’).
The First Respondent submits that the meaning of cl.892.221 is governed by the decision of the Federal Court of Australia in Liang v Minister for Immigration and Citizenship (2009) 175 FCR 184 (‘Liang’). The First Respondent further submits, that the Tribunal, in construing cl.892.221, correctly applied that decision and that the construction of that clause by the Tribunal was correct.
The Law
Clause 892.221 of Schedule 2 to the Regulations relevantly provided that it was a primary criterion for the grant of a Subclass 892 visa that, at the time of the application for the visa:-
“(1) The applicant has had, and continues to have, an ownership interest in 1 or more actively operating main businesses in Australia for at least 2 years immediately before the application is made.
(2) For each business to which subclause (1) applies:
(a) an Australian Business Number has been obtained; and
(b) all Business Activity Statements required by the Australian Taxation Office (the ATO) for the period mentioned in subclause (1) have been submitted to the ATO and have been included in the application.”
The relevant two year period for the purposes of cl.892.211(1) was 16 May 2009 to 16 May 2011.
The term ‘main business’ was relevantly defined in reg.1.11 of the Regulations, which provided that:-
“Main business
(1) For the purposes of these Regulations and subject to subregulation (2), a business is a main business in relation to an applicant for a visa if:
(a) the applicant has, or has had, an ownership interest in the business; and
(b) the applicant maintains, or has maintained, direct and continuous involvement in management of the business from day to day and in making decisions affecting the overall direction and performance of the business; and
…
(d) the business is a qualifying business.
(2) If an applicant has, or has had, an ownership interest in more than 1 qualifying business that would, except for this subregulation, be a main business in relation to the applicant, the applicant must not nominate more than 2 of those qualifying businesses as main businesses.”
The terms ‘ownership interest’ and ‘qualifying business’ were relevantly defined in reg.1.03 of the Regulations.
a)The term ‘ownership interest’ was defined as having the meaning given in s.134(1) of the Migration Act 1958 (Cth) (‘the Act’), which relevantly provided:-
“‘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.”
b)The term ‘qualifying business’ was defined as:-
“‘qualifying business’ means an enterprise that:
(a) is operated for the purpose of making profit through the provision of goods, services or goods and services (other than the provision of rental property) to the public; and
(b) is not operated primarily or substantially for the purpose of speculative or passive investment.”
At the relevant time, cl.892.221 provided that it was a primary criterion for the grant of a Subclass 892 visa that, at the time of the decision in relation to the application, “[t]he applicant…continues to satisfy the criteria in clauses 892.211 and 892.214.”
Clause 892.211 of Schedule 2 to the Regulations is as set out in paragraph 7 herein.
Clause 892.214 of Schedule 2 to the Regulations provided:-
“Neither the applicant nor his or her spouse or de facto partner (if any) has a history of involvement in business activities that are of a nature that is not generally acceptable in Australia.”
History
The Applicants are citizens of China. On 16 May 2011, they applied for Subclass 892 visas. The First Applicant applied on the basis that he satisfied the primary criteria for the grant of the visa. The Second and Third Applicants applied on the basis that they were members of the family unit of the First Applicant, and therefore satisfied the secondary criteria for the grant of the visa.
In his application for the visa, the First Applicant was required to nominate up to two businesses as being main businesses in relation to him. He nominated one business, PCK Food Services Pty Ltd, which he identified as carrying out the activity of meat processing and wholesale.
PCK Food Services Pty Ltd was a company that was registered by the First Applicant on 21 November 2008. On 9 April 2009, PCK Food Services Pty Ltd purchased an existing meat processing and wholesale business from a third party. PCK Food Services Pty Ltd operated that business until 30 June 2011, when the operation of the business was taken over by VP Poultry & Meats Pty Ltd. PCK Food Services Pty Ltd was wound up in 2011, pursuant to an order made on 16 November 2011. At all relevant times, the First Applicant was a shareholder and director of PCK Food Services Pty Ltd.
VP Poultry & Meats Pty Ltd is a company that was registered by the First Applicant on 25 May 2011. From July 2011 until April 2012, VP Poultry & Meats Pty Ltd operated the meat processing and wholesale business previously operated by PCK Food Services Pty Ltd. In April 2012, VP Poultry & Meats Pty Ltd sold the meat processing and wholesale business to a third party. In July 2012, VP Poultry & Meats Pty Ltd purchased a cafe business. At all relevant times, the First Applicant was a shareholder and director of VP Poultry & Meats Pty Ltd.
On 12 December 2011, while VP Poultry & Meats Pty Ltd was operating the meat processing and wholesale business, a delegate of the Minister (‘the delegate’) decided not to grant the Applicants Subclass 892 visas. The delegate found that the First Applicant had not satisfied the criterion in cl.892.211(1) as he had not met the ‘direct and continuous involvement’ requirement of reg.1.11(1)(b) in relation to PCK Food Services Pty Ltd in the two years immediately before 16 May 2011. The delegate also found that the First Applicant had not satisfied the criterion in cl.892.221.
The Tribunal
On 22 December 2011, the Applicants applied to the Tribunal for review of the delegate’s decision. With the applications, the Applicants submitted a copy of the primary decision record. On that date, as referred to in paragraph one herein, the Second and Third Applicants were not present in the migration zone.
Numerous submissions were made to the Tribunal by the Applicants migration agent prior to the Tribunal hearing. On 8 January 2014, the Applicants appeared before the Tribunal to give evidence and present arguments. The Tribunal hearing was conducted with the assistance of an interpreter in the Mandarin and English languages. The Applicants were represented by their migration agent. Following the hearing the Applicants migration agent provided further written submissions to the Tribunal, as invited by the Tribunal.
On 4 February 2014, the Tribunal affirmed the delegate's decision.
Findings
The Tribunal found that the business nominated by the First Applicant as a main business was the meat processing and wholesale business. The Tribunal noted that this business was operated from November 2008 to June 2011 by PCK Food Services Pty Ltd and from July 2011 to April 2012 by VP Poultry & Meats Pty Ltd.
The Tribunal accepted that the First Applicant had an ownership interest in the meat processing and wholesale business between November 2008 and April 2012. However, the Tribunal found that VP Processing & Meats Pty Ltd sold this business in April 2012 and purchased a cafe business in July 2012.
Based on those findings, the Tribunal found that the First Applicant did not satisfy the criterion in cl.892.221, as he did not continue to satisfy the criterion in cl.892.211(1) at the time of the Tribunal’s decision. The Tribunal said:-
“40. Based on the evidence, the Tribunal finds that, even if the first named applicant’s claims to have had an ownership interest in one or more actively operating main businesses in Australia for at least two years before the application was made are supported by the evidence, the Tribunal is satisfied that at the time of this decision, although he has an ownership interest in a registered company, VP Poultry & Meats Pty Ltd, the first named applicant no longer continues to have and ownership interest in one or more actively operating main businesses in Australia. This is because VP Poultry & Meats Pty Ltd is currently operating a different business (Café) from one that was nominated as a main business at the time of visa application for the purposes of satisfying cl.892.211 and is no longer continuing to operate the main business of meat processing and wholesale of meat.”
In reaching this conclusion, the Tribunal found that the First Applicant could not rely on an ownership interest in a business at the time of decision to satisfy the requirements of cl.892.221 unless he had nominated that business as a main business at the time of application. As authority for this proposition, the Tribunal relied on the decision of the Federal Court of Australia in Liang, which concerned the similarly-worded cl.845.221 of Schedule 2 to the Regulations. In describing the effect of the decision in Liang, the Tribunal said:-
“41. The Tribunal finds that the applicant cannot rely on a main business not nominated at the time of application to satisfy cl.892.221. While there has been no judicial consideration of the application of cl.892.221, the case of Liang v MIAC [2009] FCA 189 provides some guidance in the context of Subclass 845 visas drafted in similar terms. In that case, the applicant nominated one company at the time of application but ceased to have an interest in that company prior to the time of decision, and sought to rely on a new company at the time of decision, which commenced operating after the time of application but prior to the time of decision. The Federal Court held that, to continue to satisfy the time of application criterion in cl.845.213, the applicant must have an ownership interest in the main business nominated at the time of application that continues between the time of application and time of decision, and not an interest in a business created after the time of application.
42. In making its finding, the Tribunal notes the terms of cl.892.211(1) encompass two temporal requirements. First it requires that an applicant “has had… an ownership interest in one or more actively operating main businesses in Australia for at least two years before the application is made”; and secondly, that an applicant “… continues to have, an ownership interest in one or more actively operating main businesses in Australia” at the time of application. Clause 892.211 then qualifies the temporal elements in cl.892.211 by requiring an applicant to continue to satisfy the criteria in cl.892.211 up until the time of decision.
43. Based on the evidence before it, and in particular on Contract of Sale of VP Poultry & Meats Pty Ltd business, the Tribunal finds that, as of 23 April 2012, VP Poultry & Meats Pty Ltd is no longer operating the main business of meat processing and wholesale of meat. Accordingly, the Tribunal finds that the applicant no longer has an ownership interest in the main business nominated at the time of application.
44. For the reasons stated above, the Tribunal finds that applicant does not meet cl.892.221 of the Regulations.”
Contentions of Law
The question in this application was whether an Applicant for a Subclass 892 visa can rely on an ownership interest in a business at the time of decision to satisfy the requirements of cl.892.221 if he or she did not rely on an ownership interest in that business at the time of application to satisfy the requirements of cl.892.211.
The Minister submitted that the answer to this question is supplied by the decision of the Federal Court of Australia in Liang. By analogy with the clauses considered in that decision, an Applicant for a Subclass 892 visa may not rely on an ownership interest in a business at the time of decision to satisfy the requirements of cl.892.221 if he or she did not rely on an ownership interest in that business at the time of application to satisfy the requirements of cl.892.211.
Further, the First Respondent submitted that this interpretation of cl.892.221 is correct as a matter of construction. The Minister submits that, on a proper construction of the Regulations, in order to ‘continu[e] to satisfy’ (cl.892.221) the requirement that the applicant ‘continues to have’ (cl.892.211(1)) an ownership interest in a main business, the Applicant must have had an ownership interest in the same main business from the time of application to the time of decision.
For these reasons, the Minister submitted that the Applicants' application to the Court should be dismissed with costs.
In reaching the decision in Liang, Logan J of the Federal Court of Australia had regard to the observation by the Full Court of the Federal Court of Australia in Xiang v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 81 ALD 301 that the meaning of the word ‘continues’ must be gathered from its context.[1] In particular, in considering the meaning of the words ‘continues to satisfy’ in cl.845.221, the Federal Court of Australia emphasised the presence of the words ‘continues to have’ in cl 845.213(b). The Court said:-
“The evident concern of the further temporal limitation in cl 845.213(b) [that is, the use of the words [continue to have] is that the “ownership interest” in one or more “main business” over the period of 18 months immediately preceding the application must be maintained, “continued”, throughout whatever period elapses thereafter until the application is made. In other words, the intention, reflected in the language of cl 845.213(b), is that there should be no gap in the holding of an ownership interest.”[2]
[1] Xiang v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 81 ALD 301 at 304 [9].
[2] Liang v Minister for Immigration and Citizenship (2009) 175 FCR 184 at 198 [54].
Logan J held that the ownership interest that the Applicant must ‘continu[e] to have’ for the purpose of cl.845.213(p) was the ownership interest that the applicant had for the purpose of cl.845.213(a) - that is, an ownership interest in the same main business.[3] It followed from this that, in order to satisfy cl.845.221, it was necessary for the Applicant to continue to have an ownership interest in the same main business at the time of decision. In other words, it was not possible for the Applicant to rely on an ownership interest in a business that did not exist at the time of application to satisfy the requirements of cl.845.221.
[3] Ibid at 198-199 [55]-[56].
Logan J drew further support for its conclusion from the fact that, under reg.1.11(1)(b), a business will only be a ‘main business’ in relation to an applicant if the applicant “maintains, or has maintained, direct and continuous involvement” in the day to day management of the business. The Court regarded this as a further textual indication that, in order to satisfy cl.845.221, it was necessary for the Applicant to continue to have an ownership interest in the same main business at the time of decision.[4] To allow the Applicant to rely on a different ownership interest to satisfy cl.845.221 would subvert the continuity of involvement required by reg.1.11(1)(b).[5]
[4] Ibid at 199 [57]-[59].
[5] Ibid at 199 [56].
The Minister submitted, correctly, that the decision in Liang is directly applicable to cls.892.211(1) and 892.221.
Applicants’ Submissions
The Applicants acknowledge that judicial authority “is against them”. Counsel for the Applicants’ submitted the following:-
a)In Liang, Logan J held (in relation to a similar provision to cl.890.211) that the Applicant must continue to have an ownership interest in the same business as nominated at the time of application that continues between the time of application and the time of decision, and not an ownership interest that is created after the time of application.
b)In Yang v Minister for Immigrationand Border Protection (2014) 289 FLR 192 (‘Yang’), the Federal Circuit Court applied Liang to cl.890.221.
c)Both Liang and Yang were wrongly decided in that cl.890.221 does not require the only businesses that can meet the criterion in cl.890.211 are those that were nominated in the application. Instead, the Tribunal can consider whether the Applicant has had and continues to have an ownership interest in a business that falls within the requirements of the provisions.
d)Clause 890.221 should be interpreted to require the main applicant who continues to hold a relevant ownership interest at the time of the decision – without that interest having been nominated in the application.
e)Regulation 1.11(2), which defines ‘main business’, does not limit the business to one that was nominated in an application. Instead, the effect of reg.1.11(2) is to limit the number of businesses that can be used to satisfy cl.890.221 and 890.211 to two.
f)The Tribunal’s interpretation of the provisions as requiring the relevant business to have been nominated in the visa application reads words into cl.890.221 which do not appear in the provision. Clause 890.221 does not state that the applicant’s ownership interest must be on that was nominated in his visa application. Even the definition of ‘main business’ does not speak about ‘nomination’ as being ‘nomination in the visa application’.
The Applicants’ submissions cannot be accepted in light of current judicial authority against the Applicants’ arguments. That much was conceded by their Counsel. Further, the Court accepts the correctness of the approach taken by the Tribunal as a matter of construction of the relevant legislation as submitted by Counsel for the First Respondent.
The application will be dismissed with costs.
I certify that the preceding thirty-five (35) paragraphs are a true copy of the reasons for judgment of Judge Hartnett
Date: 22 July 2016
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