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INVESTORS AND ENTREPRENEURS: AN UPDATE ON THE TIER 1 VISA ROUTE

The Home Office published a detailed statement of changes to the Immigration Rules on 7th March, in which they confirmed that the Tier 1 (Graduate Entrepreneur) and the Tier 1 (Entrepreneur) route are to be replaced by “Start-up” and “Innovator” visas.

These changes also clarify details of their significant reforms to the Tier 1 (Investor) requirements.

Click here to read the Home Office’s detailed statement of changes

Start-up and Innovator Visas

On 29 March 2019, the Tier 1 (Entrepreneur) route will close and the Tier 1 (Innovator) route will open in its place. The required investment for this route has decreased from £200,000 to £50,000.

On 6 July 2019 the Tier 1 (Graduate Entrepreneur) route will close and the Tier 1 (Start-up) route will open in its place. This visa is for those starting a new business for the first time in the UK. Applicants will no longer need to be graduates and will not need to have secured any initial funding.

For both these routes, however, applicants will now need to be endorsed by trusted organisations in the UK, such as “business accelerators, seed competitions and government agencies, as well as higher education providers”. The endorsing body will be obligated to judge the applicant’s business plan, to assess if their business is “innovative, viable and scalable”. Successful applicants will need to stay in contact with those endorsing bodies regularly and will require further endorsement when applying for extensions to their visas. These will require them to prove they have made significant achievements in line with their business plan. A higher level of English will also be required.

Applications for Indefinite Leave to Remain will also require a further endorsement letter.  In order to receive this endorsement, the applicant will have to satisfy several requirements, including evidence to showing that they have successful businesses employing numerous people or generating significant revenues.

Tier 1 (Investor)

There will be significant changes to the Tier 1 (Investor) route from 29 March 2019. These primarily affect the types of permitted investment and the source of an investor’s funds.

Permitted Investments

Applicants will no longer be able to invest their money in UK government bonds. Instead, they will have to invest in active and trading UK companies. The rules on routing investment funds via “intermediary vehicles” will also become stricter, and will include a requirement that such vehicles be regulated by the Financial Conduct Authority. The definition of “active and trading” companies is also being tightened.

Source of Funds

The period for which funds must be held prior to applying for an investor visa will be increased from 90 days to two years. However, this requirement can be circumvented (as is possible under the current rules), if you can provide mandatory evidence of the source of your funds. Furthermore, the requirement to open a UK bank account before applying for an investor visa will also be tightened, to make explicit that the bank must carry out all required due diligence checks and confirm that these have been done.

Please note that there are transitional arrangements in place for those on existing Entrepreneur and Investor visas.

About the Author

Alice Boyle is a solicitor with extensive experience in all areas of immigration law. She can assist both corporate and individual clients with any immigration, nationality or asylum matter and possesses a sound understanding of Tier 1 Investors, Tier 1 Entrepreneurs and Tier 2 matters. Alice has substantial experience of challenging UK Home Office decisions, regularly representing clients in appeals at both the First-Tier and Upper Tribunal and also by way of Judicial Review applications in both the Upper Tribunal and UK High Court.

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental  sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way. The above is only a very brief summary of some of the principal changes the Home Office has announced. Please contact us for further detail, or if we can assist you in connection with any of the applications mentioned in this article.

For more information or assistance with a particular query, please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

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