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UK Investor Visas Explained

What do the programs' rules look like after some recent amendments?

By Roger Gherson

In December 2018 the Investor Visa scheme was suspended for a short period of time. It was reintroduced a few days later and revised in March 2019. The revisions are largely cosmetic, however, and hardly affect the scheme at all.

The current program provides the following:

The investor must bring at least £2million, £5 million or £10 million to the U.K. and must invest the full amount in specified types of investments.

The investor visa (the Home Office’s “Tier 1 (Investor) Migrant” category) is a points-based category. In order to obtain entry clearance to the U.K. as an investor, an applicant must demonstrate that:

(a)     they do not fall to be refused because of adverse U.K. immigration history and/or other character issues which the Home Office considers sufficiently serious so as to refuse you entry to the U.K.; and

(b)     the applicant will need to demonstrate that he has money of his own (which includes gifts made for the purpose of the application); and

(c)     the applicant must have an opened U.K. investment bank account; and

(d)     the applicant must be able to control and freely invest the money; and

(e)     the funds used for the application must not have been obtained by unlawful means; and

(f)      where any of the funds have been made available to the applicant by a third party, the character, conduct or associations of that third party must not be such that the approval of the application would not be conducive to the public good;

(g)        the applicant must be aged 18 or over;

(h)        the investment must be made within three months of entry to the U.K. as a Tier 1 (Investor) Migrant;

(i)         Tier 1 (Investor) applicants applying for entry clearance to the U.K. will be required to produce a criminal record certificate;

(j)         Applications for an investor visa (known as “entry clearance”) must be submitted outside of the U.K.

Should the applicant wish to apply for indefinite leave to remain (“ILR”) i.e., permanent residence to remain after two, three or five years (depending on the level of investment) in the U.K., then the applicant and the dependent spouse/partner will need to limit their absences from the U.K. to an average maximum of 180 days in any 12-month period leading up to the application. Applications for British citizenship can be made one year after obtaining indefinite leave to remain, i.e., after five or six years in the U.K. (depending on the level of investment) provided the applicant’s absences from the U.K. do not exceed a maximum of 450 days for the five-year period prior the date of application.

At present, the Home Office offers an accelerated route to ILR for those who invest £5 million or £10 million in the U.K. for a specified period of time whilst resident as a Tier 1 (Investor) Migrant. Please see below a table summarizing the timeline for achieving ILR and British citizenship using the alternative routes.

Investment £                     £2 million       £5 million       £10 million

ILR - Main applicant              5 years           3 years              2 years

Citizenship - Main applicant   6 years          5 years               5 years

The accelerated route is currently only available to the main Tier 1 (Investor) Migrant, and is not available to their dependent spouse or children where both parents are present in the U.K. under the Investor route. Dependent spouses and children must wait five years before being eligible to apply for ILR.

The main changes to the rules highlight the source of funds requirements. The UK Border Agency (“UKBA”) have an overriding power under the Immigration Rules to effectively make any reasonable enquiry of any visa applicant particularly as to the probity of his source of funds. The change to the rules highlighting the necessity of not using tainted funds is an expression of what has always been the case.

In December, when the Government announced the changes in the rules, it did so due to perceived abuse. The sham nature of the announcement was highlighted, however, by experienced practitioners who have dealt with the UKBA and who know that if there had been any abuse of the investor rules, to the extent alleged by the UKBA, this would have been with the UKBA’s knowledge. The fact is that banks conduct vigorous enquiries on funds arriving into UK bank accounts and this is to be coupled with the detailed scrutiny of the applications received by the UKBA. The announcement was effectively the Government throwing the UKBA officials "under the bus" in order to obtain some respite from Brexit-dominated headlines, which were themselves caused by the absolute chaos resulting from the Government’s mismanagement of the Brexit process.

Once the promise was made by the Government to amend the rules, they had to be amended.

It is business as usual, but with two significant changes. Prior to 31 March 2019 investor applicants were permitted to invest in U.K. Government bonds and gilts. This is no longer permitted.

The second major change is that if you are demonstrating cash in your account you need to have held it for two years if you are not providing evidence as to its source. This is perplexing. If you wish to open a U.K. Bank account (a requirement before being able to apply) or if you have an existing account and deposit at least £2 million in it, you will have to demonstrate the source of funds. In the unlikely event that you do not have to demonstrate the source of funds, the choice of two years appears to be an arbitrary number. Do the powers that be believe tainted money becomes untainted after two years? Why not six months or six years?

Roger Gherson is a  founding partner at Gherson Solicitors.

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