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(b) the person does not satisfy the Minister that the person passes the character test." Section 501(6) relevantly provides that for the purposes of s 501: "a person does not pass "the character test" if: … (b) the person has or has had an association with someone else, or with a group or organisation, whom the Minister reasonably suspects has been or is involved in criminal conduct…." 3 The delegate's decision was based on the conclusion that Mrs Chan had had an "association" with her husband, who the delegate reasonably suspected had been or was involved in criminal conduct. The Tribunal, on the basis of the material before it, concluded that it would be satisfied as to the reasonableness of the suspicion that Mrs Chan's husband had been involved in criminal conduct. However, the Tribunal concluded that Mrs Chan did not have, and had not had, with her husband an association within the meaning of s 501(6)(b). 4 The Tribunal considered that the word "association", in the context in which it is used in s 501(6)(b), encompasses persons associated, connected or combined with a common purpose or having a community of ideas where one of the associates is reasonably suspected of having been, or being, involved in criminal conduct. The Tribunal in effect concluded that the reasonably suspected association, connection, combination community ideas of the one must have a nexus with the reasonably suspected involvement of the other in criminal conduct. The Tribunal accepted a submission that there must be a maintaining of the association by a visa applicant and the knowledge of the associate's criminal conduct, or knowingly taking a benefit from the proceeds of the associate's criminal activity which makes the association non-innocent before a person will be within the provision. 5 The Minister contended that, in adopting those views as to the proper construction of s 501(6)(b), the Tribunal erred in law. Accordingly, in this proceeding, the Minister seeks orders pursuant to s 44 of the Administrative Appeals Tribunal Act 1975 setting aside the Tribunal's decision and remitting the matter to the Tribunal to be dealt with according to law. The notice of appeal indicates that the question of law is whether the Tribunal erred in its construction of s 501(6)(b) of the Act. I am satisfied that the appeal does raise a question of law. 6 The Tribunal, in the course of its reasons, summarised the Minister's contentions as to the existence of an association between Mrs Chan and her husband in the following terms: · Mrs Chan's marriage continued from November 1991 until its dissolution in July 2000; · three children resulted from the relationship; · Mrs Chan and her former husband lived under the same roof as recently as late 1998 and early 1999, although since then there has not been a resumption of cohabitation; · a joint application by Mrs Chan and her husband was made for a sub-class 457 visa; · Mrs Chan and her husband jointly owned shares in Golden Wing International Pty Limited; · Mrs Chan and her former husband entered into a joint venture agreement and invested moneys derived from her former husband's business; · as part of a divorce settlement, Mrs Chan's former husband transferred his interest in Golden Wing International Pty Limited to her; · a continuing financial link existed between Mrs Chan and her former husband by reason of the divorce settlement; · there is contact between Mrs Chan and her former husband from time to time by telephone and in person in Hong Kong in circumstances where her former husband spends time with their children. The Tribunal concluded that an association by way of family ties such as I have just summarised is not of itself sufficient to ground the relevant association. 7 The Tribunal considered that it was necessary that there be some nexus between the visa holder and the criminal conduct of the person with whom the visa holder was associated. However, I do not consider that the language of s 501(6)(b) justifies such a limitation. There is nothing in the paragraph itself to limit the association in that way. Rather, the scheme of the provision is to confer upon the Minister a discretion under s 501(2) to cancel a visa if certain prerequisites are satisfied. The first prerequisite is that the Minister reasonably suspects that the person does not pass the character test and the second is that the person does not satisfy the Minister that the person passes the character test. 8 Even if those prerequisites are satisfied, the words "the Minister may cancel a visa" (emphasis added) indicate that there is still a discretion to be exercised by the Minister or his delegate as to whether or not to cancel a visa. There may be good reasons why, in a particular case, notwithstanding that the prerequisites are satisfied, the Minister may in the exercise of his discretion decide not to cancel a visa. For example, it may be that there is no nexus between the criminal conduct of the person with whom the visa holder had an association and the visa holder, as was found to be the case in relation to Mrs Chan. 9 It may be a relevant consideration that the visa holder had no knowledge of the criminal conduct of the other person. It may be a relevant consideration that the visa holder did not knowingly take a benefit from the proceeds of the associate's criminal conduct. Those matters, however, are matters for consideration upon the exercise of the discretion if the discretion arises. They are not matters to be taken into account in determining whether or not the discretion arises, namely, whether or not the person has had an association with someone else whom the Minister reasonably suspects has been involved in criminal conduct. 10 It may be significant that s 501 was relevantly amended with effect from June 1999. Prior to 1 June, 1999, the Minister had power to refuse to grant a visa or to cancel a visa, "if … the Minister … is satisfied that the person is not of good character because of the person's association with another person … who the Minister has reasonable grounds to believe has been or is involved in criminal conduct". In that form, the Minister was required to make a judgment as to whether or not the visa holder was not of good character because of the association with the person involved in criminal conduct. 11 The effect of the amendment was to remove any question of whether the Minister is satisfied as to the good character of a visa holder. The provisions in their present form merely require that the Minister be satisfied that the person does not pass the character test. The character test requires a more mechanical exercise, namely, whether or not for present purposes, the person has satisfies any of the four criteria set out in s 501(6)(a)-(d). 12 The change in the legislation confirms the construction that I consider is the proper construction of the words contained in the paragraph. It follows in my view that the Tribunal erred in law. Accordingly, the decision should be set aside and the matter should be remitted to the Tribunal for decision according to law. 13 The Minister asks for the costs of the appeal. When the matter was first before me for directions, Mrs Chan was represented by counsel and directions were given for settling an index for an appeal book. The matter was then stood over because it was necessary for a determination to be made by the Chief Justice as to whether the matter should be heard by a Full Court or by a single judge, since the decision was made by a presidential member of the Tribunal. On the second mention of the matter, counsel for Mrs Chan indicated that his instructions had been withdrawn and that Mrs Chan did not propose to contest the matter in the Court. Mrs Chan did not appear on the hearing of the matter before me today although she was informed, pursuant to a direction that I gave, that the matter would proceed to hearing today, notwithstanding her absence. 14 In the circumstances it appears to me to be appropriate to order the respondent to pay the Minister's costs of the appeal, limited to the first directions hearing, and that there be no order as to the costs thereafter. I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Emmett.