Significant changes to the Immigration Rules: part 2 of 3 – Tier 1 (Investor) Visa

Changes to the Tier 1 (Investor) Visa category are the most radical we have seen since the Tier 1 Investor rules came into being in 2008, replacing the old Investor route.

In the latest publication of the Immigration Rules as set out by Parliament, the rules relating to the Tier 1 (Investor) category have been amended. These changes have been enacted in an effort to combat the issue of money laundering into the UK. There is to be additional scrutiny as to the character and conduct of Tier 1 (Investor) Migrants and the specific source of funds being relied upon. The rules have also been changed with a view to ensuring that the investments being made by migrants result in a greater economic benefit for the UK.

Under the rules in place now, applicants must provide evidence that the funds being relied upon for investment in the UK have been held by them for a minimum of 90 days. If this is not the case, evidence of the source of funds must be provided. From 29th March, applicants will have to show that they have held the funds for a consecutive 2-year period, ending no earlier than one month before the date of application. Again, where the funds have not been held for this 2 year period, applicants will have to provide the evidence set out in the rules relating to the source of funds.

Further, applicants are currently required to open a UK bank account for the purpose of making their investment before making a Tier 1 (Investor) application. The new rules will require banks to evidence that they have carried out all required due diligence checks and know your customer enquiries, and provide confirmation that these have been done.

Investors can now only invest in active and trading companies and the definition of this has been tightened. Investments in bonds will no longer be allowed. Applicants will now be required to show stronger evidence to prove the company/companies they are trading in, namely that they are:

1. Registered with Companies House in the UK
2. Registered with HMRC for corporation tax and PAYE
3. Accounts and UK business bank account showing regular trading
4. Have at least 2 employees.

Pooled/collective investments are only allowed in very limited situation.

Visas for extension applications filed overseas will now only be granted for 2 years, in line with extension applications submitted in the UK.

Initial Tier 1 (Investor) applications will no longer be granted if the decision maker has reasonable grounds to believe that

• the applicant is not in control of the investment funds
• the funds were obtained unlawfully (or by means which would be considered to be unlawful in the UK)
• the character, conduct or associations of a party providing the funds mean that approving the application is not conducive to the public good.

The above tests are being extended to cover instances where there are reasonable grounds to believe that the funds have been, or will be, transferred unlawfully internationally in any of the countries involved. The above criteria are to apply to extension and settlement applications which means that migrants already in the UK may be refused if evidence showing the above has come to light since the initial application was granted. This supplements the existing provisions that require such applicants to remain in control of their funds, and not fail under the general grounds for refusal.

Finally, where people are in the UK under the £1m route (rules in place before November 2014), they should note that they will not be able to extend their visas under the same category after 5 April 2020 and they will not be able to apply for settlement under the same category after 6 April 2022. Anyone needing to apply for an extension or Indefinite Leave to Remain will have to so under the rules in place as of the 29 March 2019 and will have to maintain an investment of £2m in investments as prescribed by these rules.

For further information, please contact any member of the Immigration team.

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