11 September 2020
This paper focusses on the unlawful suspension of processes involving residence applicants and grantees under the Investor Categories 1 and 2.[1] In particular the paper examines the following:
The investor mid-investment checks at the two-year point for Investor 1 and Investor 2 residents (who have already been granted residence).
The subsequent post-investment checks application for a Second and Subsequent Resident Visa (“SSRV”).
The refusal to process all new applications involving Investor 1 and Investor 2 applicants where the principal applicant is offshore (almost always the case).
Immigration New Zealand’s approach to the Covid-19 pandemic has included a change in the priorities of processing. The order that cases are to be processed in the Operational Manual is set out at A16 of the Operational Manual. The current priority rule issued on 13 May 2020 places all residence applications where the applicant is offshore as a “second priority” leaving certain Skilled Migrant Category and Residence from Work Category applications at first priority. As will be seen below, second category cases, which include the business investor cases, are “suspended.”
Section 26 of the Immigration Act 2009 empowers the setting of priorities. The term in the empowering legislation is the power to determine the “order and manner of processing any application for a visa or entry permission…” Order and manner does not however include “suspension.” There is no power to suspend contained in the Immigration Act 2009. This fact has been discussed in a High Court ruling by Justice Ronald Young EDENZ Colleges Ltd v Chief Executive, Ministry of Business Innovation and Employment, CIV 2012-485-2532 (Wellington High Court, 14 December 2012).
Where there is no power to “suspend” a statutory process (a residence application is a statutory process) then the New Zealand Government in suspending applications is in breach of a fundamental aspect of our legal system, namely the right to have an application considered and determined and within an appropriate period of time. This is a Rule of Law issue. Although the case was found by the Court of Appeal to not involve a statutory application process Justice Millar in the Unitec case also found that long delays amount to a breach of section 27 of the New Zealand Bill of Rights Act. The right to have a statutory application considered stretches back to the Magna Carta, as is still in force in New Zealand, through the Bill of Rights 1688 (Imp). The balance between the King (now the Crown or the Government), Parliament and the People, is that where Parliament has passed any statute allowing an “application” to be considered then it must be considered. The King cannot suspend what Parliament has ordered. It is prima facie unlawful to have any statutory process suspended.
As a footnote to the above, it should be noted that without a statutory power to suspend, the recent regulation promulgating a suspension of applications involving temporary visas (which expires on 9 November 2020) and began on 10 August 2020, is also ultra vires and therefore unlawful. The regulation makes no reference to the statutory power under which it is being made, to “suspend” a class of applications, because it is clear, there is no such power. [2]
The Minister of Immigration certifies the rules that are made in relation to the processing of visa applications. His power to certify such rules is contained in section 22 of the Immigration Act 2009. The types of rules that the Minister may create are listed in section 22 subsection 5. Section 22(5)(e), for example, authorises rules for lapsing. There is no power of “suspension” as was acknowledged by Justice Ronald Young in Edenz. Neither is there a rule in the Operational Manual itself allowing the suspension of residence applications that have already been filed, or for that matter suspending post-residence s49(1) checks such as that required for Investor clients that could conceivably have been issued under one or other of the powers contained within section 22(5). There were specific rules relating to the suspension of student visa applications with educational bodies which were in fact discussed in Edenz. No such instructions apply here in the investor context.
Noting that there is no power of suspension, the question then becomes whether or not the current “suspension” is lawful and on what basis it has been made. On 9 July the writer of this paper received an email from a senior officer in the Investor team which used the words “on hold” referring to “all parts of the Investor process, where the applicant is offshore.” “On hold” means clearly “suspended.”
In addition to the Operational Manual, Immigration New Zealand issues informal rules and maintains copies of those rules on its website. One such type of rule is referred to as a “Visa Pak.” Some immigration officers refer to these as “oral” instructions. However, whole branches of Immigration New Zealand must follow the instruction of a “Visa Pak” which as will be seen in this case, might include an instruction that is not in fact authorised under section 22 of the Immigration Act or under any other statutory power. A declaration as to unlawfulness would then be available.
The Visa Pak “instruction” (not a statutory power) of concern was promulgated on 19 June 2020. A copy is attached to this paper. The instruction which can only be countermanded by a National Manager (presumably the National Manager with oversight over the particular processing branch), provides that no visa application where the principal applicant is overseas can be processed. The statutory rationale for this is alleged to be section 43(1)(b) of the Immigration Act. The allegation is that because the current Covid entry permission rules prohibit or prevent the entry into New Zealand of a person who has been granted a resident visa and is offshore (and is unable to meet the entry visa requirement after that grant) that as this then prohibits the grant of such a visa, as a consequence to this, the processing of such applications, is also prohibited. There is however no link between s 43 and processing.
The Visa Pak Issue 438 in its third paragraph states as follows:
“Therefore, while the border closure is in effect, an offshore visa application cannot be approved, unless the application is approved under the Restricted Temporary Entry Instructions at H5.”
Approval however is not the same as processing. There is nothing to prevent an approval-in-principle with a delayed grant of the visa. New Zealand’s immigration processes already allow that.
As Visa Pak Issue 438 itself indicates however, the fact that a visa cannot be issued until entry permission rules are changed, even if that is the case, this does not mean that processing should be suspended. The instruction in fact indicates quite clearly that processing can continue and provides for the possibility that visa officers can specify to client applicants that a final decision may not be available until the border restrictions are lifted. This does not therefore mandate a total “suspension.”
By early July 2020 however, it became apparent that the processing of certain classes of cases had in fact been totally suspended. Email communications indicated that no further Investor 1 section 49(1) checks were being processed. Several emails from branch managers etc also indicate that the post-investment check “Second and Subsequent Resident Visa” applications have also been suspended. In correspondence, the Manager of the SSRV processing team at Henderson has confirmed this, avoiding the term “suspension” but referring to the applications as being “on hold.”
However, the language that is also used is that offshore applicants are down-prioritised in the Operational Manual at paragraph A16. However, the reality is not that there is a lowering of priority, but the true fact is that processing is suspended. No applications are being processed.
Mid-investment checks
Where an investor has already been in the country as a resident, the investment check is only part of the post-residence grant conditions, under s 49(1). Such persons are not barred from entry but must be granted entry at the border in accordance with the operational rule at Y3.10. That provision ensures that all those that hold a Permanent Resident Visa or hold a Resident Visa but have already been in New Zealand once, or who, after first arrival, now hold a SSRV, these three categories are not therefore subject to the possibility of not obtaining entry. The suggestion that their investment checks and SSRVs are suspended because of the “impossibility of their entry,” is therefore not correct at all. The question then arises why have investor mid-investment checks been suspended and why have the processing of their post-investment check SSRV/VOCs been “suspended” or put on hold (indefinitely) with no end date in sight?
In particular, the SSRV process probably involves less than one hour of work. It is therefore not credible that the refusal to process such post-investment check SSRVs is being delayed because of other priorities.
The conclusion there is that a suspension of applications is now in force and that that is unlawful.
Legal solutions
New Zealand recognises the right to obtain declaratory relief in our court of inherent jurisdiction, the High Court. In this case, an application for a declaration made under the Declaratory Judgments Act 1908 could be filed. The Government will undoubtedly argue “order and manner” and that it is entitled to “put on hold” the processing of the Investor mid-investment checks and SSRVs. The writer has gathered enough evidence to confirm that this is not a deprioritising but a suspension.
Recently it also became known that all new Investor 1 and Investor 2 applications that are currently being filed are not being processed at the Business Migration Branch. This too is believed to be as a result of Visa Pak Issue 438 and a view that suspension is permitted, under A16.1, General Instructions as to the order of processing visa applications. It is contended that the suggestion that the “suspension” arises out of “priority” is in fact a camouflage. The reality is, that processing has been suspended in each of the above three cases (and throughout our immigration system).
As the suspension is now in its third month, and as there is a general return to work within Immigration New Zealand, then it is believed that the argument that “the order of processing” entitles all such applications to be put “on hold” indefinitely, is a weak argument. If all applications are on hold, then this amounts to a suspension. In New Zealand a single aggrieved applicant can request a Court declaration, or a group of applicants could also gather together to file a case in the High Court. A class-wide action could also be proposed by a representative body. It is known that the New Zealand Association of Migration and Investment current does not wish to take such action (as was explored by the writer in late July). Individual immigration specialists are however deeply concerned, after 3 months. One could say that 3 months of inaction amounts to a suspension. However it is clear that individual immigration officers will confirm they are not permitted to process these matters, even if they have the time to work on them.
Undoubtedly the above measures have been promulgated in order to control the number of those arriving at the border, and as part of the New Zealand Government’s response to COVID-19. However, whatever the cause, that does not authorise a fundamental breach of New Zealand’s legal responsibilities that Immigration New Zealand and all Government Departments must follow. Statutory processes cannot be suspended and of course as indicated above, such a suspension is a fundamental breach of the rule of law in that it countermands what the statute has permitted and authorised.
It is clear that now, almost three months since the suspension of these processes at the Business Migration Branch involving Investor 1 and 2 clients, and at the branch processing the SSRVs, that this clearly involves an unlawful suspension of these processes and that this must be corrected promptly.
David Ryken
Ryken and Associates
[1] An earlier version of this paper was posted on the website of Ryken and Associates on 16 July 2020. The situation remains unchanged.
[2] Immigration (Visa, Entry Permission, and Relates Matters) Amendment (COVID-19 Applications and Fees) Regulations 2020, 27 July 2020.