Shao v Minister for Immigration & Multicultural & Indigenous Affairs [2005] FCA 478 | Case summary

Federal Court of Australia|2005-03-23|Before: Emmett J

REASONS FOR JUDGMENT 1 These appeals concern an application for a Temporary Business Entry (Class UC) visa under the Migration Act 1958 (Cth) ('the Act') and an associated application for approval of an employer as a business sponsor of the applicant for a visa. There are two separate appeals arising out of separate decisions of the Migration Review Tribunal ('the Tribunal'). The two decisions of the Tribunal were made by the same member, on the same day. Because of the relationship between the two applications, it is convenient to deal with the appeals together. 2 On 21 October 2002, the first appellant in proceeding NSD1872 of 2004, Mrs Jia Shao ('the Visa Applicant'), applied for a Temporary Business Entry (Class UC) (Subclass 457 Business (Long Stay)) visa. Included in the application were the husband and son of the Visa Applicant. One of the criteria provided for in the Regulations made under the Act is that the applicant for a Business (Long Stay) Visa proposes to be employed in an activity by an employer who is, relevantly, a standard business sponsor. On 21 October 2002, the appellant in appeal NSD1873 of 2004, Sundaze International Pty Ltd ('Sundaze'), applied for approval as a standard business sponsor. 3 On 31 October 2002, a delegate of the respondent, the Minister for Immigration & Multicultural & Indigenous Affairs ('the Minister'), refused the application for a Business (Long Stay) Visa by the Visa Applicant, and also rejected the application by Sundaze for approval as a standard business sponsor. On 20 November 2002, applications to the Tribunal were lodged by both the Visa Applicant and Sundaze seeking review of the respective decisions of the Minister's delegate. On 10 March 2004, the Tribunal affirmed both decisions under review, finding that Sundaze did not meet the criteria for approval as a standard business sponsor and that the Visa Applicant was, therefore, not entitled to the grant of a Business (Long Stay) Visa. 4 On 6 April 2004, the Visa Applicant commenced a proceeding in the Federal Magistrates Court, seeking relief under s 39B of the Judiciary Act 1903 (Cth) in respect of the decision of the Tribunal relating to her application for a Business (Long Stay) visa. On 30 April 2004, Sundaze commenced another proceeding in the Federal Magistrates Court, also seeking relief under s 39B in respect of the Tribunal's decision to reject its application for approval of it as a standard business sponsor. On 25 November 2004, both proceedings were dismissed with costs by the Federal Magistrates Court. 5 On 15 December 2004, both the applicant and Sundaze filed notice of appeal to the Federal Court from the orders of the Federal Magistrates Court. The Chief Justice has directed that both appeals be heard by a single judge. 6 I heard both appeals on 22 March 2005. None of the appellants were legally represented. Sundaze appeared by its director, Mr Jian Kevin Ren, without any objection on the part of the Minister. Mr Jian addressed the Court at length. While Mr Jian comprehends and speaks English well, he was assisted by a Mandarin interpreter. The Visa Applicant appeared in person with the assistance of the Mandarin interpreter and made brief submissions on her own behalf and on that of her husband and son.

STATUTORY FRAMEWORK 7 Section 29(1) of the Act provides that the Minister may grant a non-citizen permission, to be known as a visa, to travel to, enter into, and to remain in Australia. Under s 31(1) there are to be prescribed classes of visas. Under s 31(5), a visa is a visa of a particular class if the Act or Regulations specify that it is a visa of that class. Under Regulation 2.01, for the purposes of s 31 of the Act, the prescribed classes of visas are such classes as are set out in the respective items in Schedule 1 to the Regulations. Regulation 2.02 deals with the way in which parts of Schedule 2 are relevant to a particular class set out in Schedule 1 to the Regulations. 8 Section 31(3) of the Act provides that the Regulations may prescribe criteria for visas of a specified class. Regulation 2.03 provides that, for the purposes of s 31(3), the prescribed criteria for the grant to a person of a visa of a particular class are as set out in the relevant part of Schedule 2 to the Regulations. 9 Clause 1223A(4) of Part 2 of Schedule 1 to the Regulations provides for two subclasses of Temporary Business Entry (Class UC) visas, including Subclass 457 Business (Long Stay) visas. Clause 457.22 of Schedule 2 deals with the criteria to be satisfied at the time of making a decision in respect of an application for a Business (Long Stay) visa. Under clause 457.223, the applicant for such a visa must meet the requirements of one or other of the subclauses of that clause. For present purposes, subclause 457.223(4) is the relevant requirement. Under that subclause, the activity in which the visa applicant proposes to be employed in Australia by a person (the employer), must be the subject of an approved business nomination by the employer, and the employer must be either a pre-qualified business sponsor or a standard business sponsor. Those two expressions have the same meaning as in Division 1.4A of the Regulations. 10 Division 1.4A of the Regulations deals with sponsorship and nomination for the purposes of Temporary Business Entry visas. The object of Division 1.4A is stated in Regulation 1.20A to be to provide for:

applications for approval as a business sponsor;
nominations by business sponsors of activities to be undertaken in Australia by prospective holders of subclass 457 visas;
approval of such applications and nominations. Under regulation 1.20B, the terms 'pre-qualified business sponsor' and 'standard business sponsor' mean persons approved as such, in accordance with reg 1.20D. 11 At the relevant time, reg 1.20D(1) provided as follows: '(1) Subject to this regulation, the Minster may… approve or reject an application for approval as a pre-qualified business sponsor or as a standard business sponsor.' 12 At the relevant time, regulation 20D(2) provided that the Minister 'q approve an application for approval' as a pre-qualified business sponsor or as a standard business sponsor if the Minister is satisfied as to the matters that are then set out in regulation 1.20D(2). The relevant matters for present purposes are as follows: '(a) the Minister is satisfied that the applicant for approval is lawfully operating in Australia a business in which the employment of the holder of a Subclass 457 Business (Long Stay) Visa would contribute to: (i) the creation or maintenance of employment for Australian citizens or Australian permanent residents; or (ii) expansion of Australian trade in goods or services; or (iii) the improvement of Australian business links with international markets; or (iv) competitiveness with sectors of the Australian economy; and … (c) the Minister is satisfied that the applicant for approval: (i) will introduce two, or utilise or create in, Australia new or improved technology or business skills; or (ii) has a satisfactory record of, or a demonstrated commitment towards, training Australian citizens and Australian permanent residents in the business and operations of the applicant in Australia …' 13 A literal reading of regs 1.20D(1) and 1.20D(2) might suggest that, if the Minister is satisfied as to the matters referred to in reg 1.20D(2), the Minister must approve an application for approval but that, even if the Minister is not satisfied as to those matters, the Minister may nevertheless approve an application. That is to say, the language of reg 1.20D is open to the possible interpretation that, where certain criteria are satisfied, the Minister must approve an application but need not reject the application if the criteria are not satisfied. That would be a curious construction because it would confer on the Minister a discretion at large as to whether or not to approve an application, but would restrict the Minister's discretion to reject an application. 14 The Minister contends that reg 1.20D should be construed as though it provided that the Minister must approve an application if, and only if, satisfied as to the matters set out in reg 1.20D(2) and, accordingly, must reject the application if not satisfied as to all of those matters. In that regard, the language of reg 1.20D might be contrasted with, for example, the language of s 46(1) of the Act which provides expressly that an application for a visa is valid 'if, and only if' the matters set out in that provision are satisfied. 15 Neither the Visa Applicant nor Sundaze made a submission to the Court that reg 1.20D conferred a discretion on the Minister to approve an application, even if not satisfied as to the matters referred to in reg 1.20D(2). However, that construction appeared to me to be at least arguable and, for that reason, I invited submissions from the Minister on the question. It was accepted by the Minister that, if there was a residual discretion to approve an application, even if the Tribunal, standing in the shoes of the Minister, were not satisfied as to those matters, the Tribunal has committed a jurisdictional error such that the decision concerning the approval of Sundaze as a standard business sponsor should be set aside. 16 The Minister was unable to refer to any decision of the Court in which the argument has previously been considered. However, on several occasions, the Court has dealt with submissions concerning reg 1.20D on the assumption that reg 1.20D should be construed on the basis that, unless the decision maker, be it the Minister or the Tribunal, is satisfied as to the matters referred to in reg 1.20D(2), an application for approval should be rejected. For example, in M M International (Australia) Pty Ltd v Minister for Immigration & Multicultural & Indigenous Affairs [2003] FCA 880, Dowsett J referred to Division 1.4A as setting out 'the criteria which must be satisfied if the Minister is to approve an enterprise as a business sponsor' (at [16]). His Honour said that an applicant 'must satisfy' various paragraphs of reg 1.20D(2) (at [17]). The Full Court dismissed an appeal from the orders of Dowsett J - M M International (Australia) Pty Ltd v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCAFC 323. In Nice Shoes Aust Pty Ltd v Minister for Immigration & Multicultural Affairs [2004] FCA 252, Branson J considered the construction of reg 1.20D(2)(c)(ii). Her Honour observed that, 'for an approval to be granted, the Minister must be satisfied' as to various matters (at [14]). 17 In the circumstances, I consider, on balance, that the assumption made by the Court in those earlier cases should be regarded as correct. It would be curious if, notwithstanding the detailed formulation of the matters as to which the Minister may be satisfied with the consequence that an application must be approved, the Minister, by reference to no particular criteria at all, could nevertheless approve an application. It is tolerably clear that the preamble to reg 1.20D(1), namely 'subject to this regulation', should be construed as an indication that, unless the Minister is satisfied as to the matters referred to in reg 1.20D(2) the application must be rejected. That is the approach taken by the Tribunal.

THE TRIBUNAL'S DECISIONS 18 When lodging its application to the Tribunal for review of the delegate's decision, Sundaze referred to attachments. However, there were no attachments to the application. Accordingly, on 7 May 2003, the Tribunal wrote to Sundaze requesting, inter alia, evidence that shows Sundaze will introduce to, or utilise or create in Australia, new or improved technology or business skills, or that Sundaze has a satisfactory record of training, or has demonstrated commitment to training Australian permanent residents and citizens. That request was clearly made in contemplation of reg 1.20D(2)(c). 19 On 13 June 2003, the agent for Sundaze made a written submission to the Tribunal, which attached copies of promotional material relating to a range of products sold by Sundaze, together with copies of three training agreements between Sundaze and individuals who are Australian residents and evidence of enrolment of individual Australian residents in courses of study at the University of Sydney. 20 While the Tribunal did not refer to that material in great detail in its reasons, it referred in its reasons to the request of 7 May 2003 and the response and said that full details of the submission could be found on the Tribunal's file. The Tribunal also said that, at the hearing, much of the evidence contained in the files was reiterated by Mr Jian. Thus, it is clear enough that the Tribunal had regard to the material. 21 In its reasons, the Tribunal referred to the claims by Sundaze that its business promoted new products in the Australian domestic market and also to the international market. The Tribunal referred specifically to the promotional material attached to the submission of 13 June 2003 and summarised the so-called new products as follows: 'These 'new products' are Macadamia Nut Chocolates & Bars, Macadamia and assorted oils, spreads and jams, Macadamia Canvas Tote Bags, carry bags and wraps, Aboriginal painted T-shirts, Boomerangs, pottery and Emu Eggs and Callers, Souvenir caps, Grape Seeds, Adori leather goods, jewellery, watches, Propolis and other natural solutions (Lowe Products NZ), skin care products, perfume, make up Canterbury Leather International jackets, slippers and shoes.' 22 The Tribunal observed that all of those products, except for the Lowe products and Canterbury Leather International products, appeared to be created in Australia. The Tribunal understood that those products may have been newly taken in by Sundaze to sell through its retail shops. However, the Tribunal considered that the products have already been available on the Australian market through other brands and retail shops. The Tribunal concluded that the selling of those products did not constitute introducing, utilising or creating new or improved technology or business skills. 23 The Tribunal observed that the expression 'new or improved business skills' generally meant 'leading or cutting edge technology or skills'. The Tribunal considered, however, that the specific business interest of Sundaze was the retailing of a variety of goods, including importing and exporting stock. Sundaze also claimed that the Visa Applicant has an understanding of the cultural differences between Australia and China and is familiar with Chinese customs. However, the Tribunal was not satisfied that that equated to 'new or improved business skills'. Nor did the Tribunal consider that that was a specialist skill for the purposes of the Act. After referring to Procedures Advice Manual 3, the Tribunal found, on balance, that Sundaze does not satisfy regulation 1.20D(2)(c)(i), either in terms of new technology or of new business skill. 24 In relation to regulation 1.20D(2)(c)(ii), Sundaze drew attention to a document included in the agent's submission entitled 'Staff's Training' and to the training agreements and evidence of attendance of its staff at courses conducted by the University of Sydney. The Tribunal referred to claims by Sundaze that it conducts weekly training for all staff and formal training for three non-Australians as on-the-job trainees. At the hearing, Sundaze also asserted that special training for staff was to be conducted by the Visa Applicant. However, the Tribunal wondered how the Visa Applicant, who required an interpreter during her hearing, would be able to conduct training and impart knowledge to Australian citizens and permanent residents and raised that matter with Mr Jian. Mr Jian responded that most of his staff speak Chinese and that the Visa Applicant had taught in the English language. 25 The Tribunal considered that there was no evidence before it that Sundaze has a satisfactory record of training Australian residents or citizens. The Tribunal referred to the material provided by Sundaze. However, the Tribunal gave little weight to the material, as the courses of study in question appeared to have been undertaken by employees in their own time, while working part time for Sundaze. The Tribunal concluded that, in the absence of any detailed training plans, either current or for the future, it was not satisfied that the commitment of Sundaze to training satisfies the requirements set out in reg 1.20D(2)(c)(ii). 26 Accordingly, the Tribunal found, on balance, that Sundaze does not satisfy the requirements of reg 1.20D. The Tribunal also found, as a consequence, that the Visa Applicant does not satisfy the requirements for the grant of a Business (Long Stay) visa.

THE APPEALS 27 The Federal Magistrates Court summarised the grounds upon which Sundaze sought relief under s 39B of the Judiciary Act as follows: 'a) The Tribunal did not comply with its obligations under s.359 of the Act, and did not have regard to certain information submitted by the applicant, and ignored certain other information provided by the applicant. b) The Tribunal did not comply with its obligations under s.359A of the Act. The Tribunal's decision was: "…mainly based on its [sic] 'curious to know how the proposed nominee, who required an interpreter duringthe [sic] hearing would be able to conduct training …'. In other words, English ability is a key issue for affirming the decision that is under review". 28 The grounds of appeal in Sundaze's notice of appeal to the Federal Court are as follows: '- The judgment of Federal Magistrates Court ("Magistrates Court")… is absolutely incorrect. - The Magistrates Court's judgment, mostly, relied on the ground that the [Tribuna] "…made its adverse decision on the content of the training program and not on the English proficiency of the proposed nominee…", and therefore "…Any failure by the Tribunal to observe s.359A in relation to the proposed nominee's English proficiency is irrelevant…" - However, the Magistrates Court failed to regard the matter as a whole, and failed to consider the relevant claims, evidences and information in relation to the application. - If the Magistrates Court were to do so, it should have found that the Tribunal's decision was mainly based on the reason that [Sundaze] could not realize its training program properly because of the visa applicant's poor English. In other words, the application was refused, in fact, owing to the visa applicant's English level.' 29 The grounds of review in the Visa Applicant's proceeding before the Federal Magistrates Court were as follows: '(1) There was an error or [sic] law in the Tribunal's decision constituting a jurisdictional error. (2) There was procedural error in the Tribunal's decision constituting an absence of natural justice. (3) The Tribunal failed to consider certain facts.' The Federal Magistrates Court summarised the application as alleging the following errors:

the Tribunal failed to explain clause 457.223 to the Visa Applicant;
the Tribunal failed to ensure that the Visa Applicant fully and completely understood the information the Tribunal would use in its decision;
the Tribunal failed to provide information pursuant to s 441A of the Act;
the Tribunal did not fairly and correctly consider the review application of Sundaze. 30 In the Visa Applicant's notice of appeal to the Federal Court the grounds were stated as follows: '- The judgment of Federal Magistrates Court ("Magistrates Court") in relation to above-mentioned matter is absolutely incorrect. - The Magistrates Court failed to consider the fact that the Migration Review Tribunal has made incorrect decision on the review application of [Sundaze] which is the sponsoring company for the visa applicant. - The Magistrates Court failed to consider that the Magistrates Court itself has also made incorrect decision on the judicial review of [Sundaze]. - The Magistrates Court failed to consider the Tribunal's decision carefully, fairly and thoroughly.' 31 Despite the fact that directions were given for the appellants to file written submissions prior to the hearing of the appeals, no written submissions were filed. However, as I have said, Mr Jian addressed the Court orally at some length. 32 Sundaze complained that the Tribunal did not have the expertise to address the questions before it. Mr Jian contended that the questions were of a technical nature and the Tribunal did not have the expertise to make any finding on such technical matters. He argued that only an expert could assess such matters. 33 In particular, Mr Jian complained that, unless the Tribunal had analysed the material provided to it carefully, it would not know whether the products being sold by Sundaze were similar to products already on the market. While Mr Jian complained that the Tribunal did not take into account all of the evidence, that was really no more than a complaint that the Tribunal did not accept all of his contentions and submissions. 34 Mr Jian asserted that certain new products that Sundaze had introduced into the market involved new technology. He complained that the Tribunal was not an expert in assessing or appraising the technology involved in the products being sold by Sundaze. Mr Jian drew attention specifically to parts of the promotional material dealing with 'joint and mobility products' and a range of aloe vera skin care products. He asserted that those products involved extraction of substances from plants and that the technology was new. He also drew attention to parts of the promotional material dealing with new fabrics. 35 It is clear that the Tribunal had regard to the material submitted on behalf of Sundaze. It concluded that the selling of those products in Australia did not constitute introducing, utilising or creating new or improved technology or business skills. That was a finding of fact that was open to the Tribunal on the material before it. There was no jurisdictional error on the part of the Tribunal in that regard. 36 Mr Jian also pointed to the 'Staff's Training' document, which might be summarised as follows: 'A. Regular training It is the policy of [Sundaze] that Mr.Kevin Ren, the Managing Director, conducted a regular training for staffs at the Shop of Surry Hill from 8:30 to 9:30 on every Monday morning. … B. Formal training The Company has sent two staffs to accept formal training: 1. …is currently studying at the University of Sydney for Bachelor degree of Commerce. She is a full-time student, and a part-time trainee of [Sundaze]… 2. …is currently studying at TAFE for a Certificate of Financial Service. She is a part-time student, and a part-time trainee of [Sundaze]… C. Special training [Sundaze] has provided short term training for staffs according to business requirements. During the last financial year (2001/2002), [Sundaze] has organised two short-term training classes as follows: 1. During the period from 5 to 9 November 2001, … provided training for staffs regarding to Special English Terms widely used in commercial documents; 2. During the period from 8 to 21 March 2001, Mr Kevin Ren provided training for staffs regarding to changes of Chinese economic environment… D. Training proposal [Sundaze] is planning to arrange [the Visa Applicant]… to provide following training for our staffs: 1. 3-4 days short-term training… regarding to special business skills for developing international trading with Chinese businessmen or companies; 2. At least one week training… regarding to business skills for export & import activities between Australia and China; 3. At least one week training… regarding to marketing research including the skills for domestic and international market; 4. 1 or 2 days training… regarding to sales promotion activities; 5. 1 or 2 days training… regarding to how to determine price system according to market changes. [Sundaze] is also planning to arrange for sending [one member of staff] for a short-term training in a Chinese company in order to have more understanding of business skills with Chinese businessmen.' 37 Mr Jian also drew attention to the three training agreements. The content of the training be provided under those agreements was as follows: '4. Content of training : 1. Determining local and overseas business opportunities; 2. Researching regulatory and statutory requirements affecting the import and export of goals to and from Australia 3. Liaising with customs officers and other government representatives to ensure that goods being imported are legal, and meet Australian standards 4. Developing a business plan and implementing marketing, pricing and credit policy and procedures 5. Arranging the shipping of goods to and from Australia 6. Monitoring the performance of the business and preparing reports of import-export operations' 38 Finally, in relation to the question of training, Mr Jian referred to the evidence that part-time employees were studying at the University of Sydney, enrolled in degrees such as Bachelor of Commerce. Clearly, the Tribunal had regard to all of the evidence relied on by Sundaze and reached a conclusion, and made a finding, of fact that was open to it on the material before it. In essence, Mr Jian was endeavouring to persuade the Court to reach a different conclusion on the evidence before the Tribunal. That course was not open to him, having regard to the nature of the proceeding. 39 Mr Jian also complained about the observations made by the Tribunal concerning the expertise of the Visa Applicant in the English language. He contended that the Tribunal failed to comply with s 359A of the Act in relation to that question. Section 359A(1)(a) relevantly provides that the Tribunal must give, to an applicant, particulars of any information that the Tribunal considers would be the reason, or part of the reason, for affirming the decision that is under review. Mr Jian asserts that part of the Tribunal's reason for affirming the decision of the delegate is that the Visa Applicant does not have a good command of English and that, before making its decision, the Tribunal should have given the Visa Applicant and Sundaze the opportunity of demonstrating that the Visa Applicant has an adequate command of English. 40 However, on a fair reading of the Tribunal's reasons, the Tribunal did not reject the application by Sundaze because the Visa Applicant had poor English. The Tribunal's conclusion was that there was no evidence that Sundaze had a satisfactory past record of training Australian residents or citizens. It was not suggested by Mr Jian that the Visa Applicant had in the past provided training. Rather, the 'Staffs Training' document indicated that Sundaze was planning to arrange for the Visa Applicant to provide training. The Tribunal's finding about the commitment of Sundaze to future training being insufficient, was based, for the most part, on the absence of detailed training plans. The Tribunal's reasons do not suggest that it regarded a lack of English proficiency on the part of the Visa Applicant as in any way significant. 41 Sundaze has not established that there was any jurisdictional error on the part of the Tribunal in making its decision to reject its application for approval as a standard business sponsor. It follows that the appeal by Sundaze must be dismissed with costs. 42 A necessary criterion for the grant of a Business (Long Stay) Visa to the Visa Applicant was not satisfied, since Sundaze has not been approved as a standard business sponsor. The Minister filed notice of contention in the appeal by the Visa Applicant, indicating that she intended to rely on the proposition that, even if the appeal by Sundaze were upheld that would not affect the decision of the Tribunal in relation to the Visa Applicant. In the light of the conclusion that I have reached concerning the appeal by Sundaze, it is not necessary to deal with that question. 43 It follows that the appeal by the Visa Applicant and her family should also be dismissed with costs. The third appellant in the appeal is an infant, who appeared by his tutor ad litem, namely, the Visa Applicant, his mother. Only the Visa Applicant and her husband should be ordered to pay the Minister's costs.

I certify that the preceding forty-three (43) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Emmett.

Associate: Dated: 6 May 2005 In NSD1872/2004 The appellants appeared in person.

Date of Hearing: 22 and 23 March 2005

In NSD1873/2004 Appearance for the Appellant: Mr Jian Ren

Date of Hearing: 22 and 23 March 2005

Shao v Minister for Immigration & Multicultural & Indigenous Affairs

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