The Home Office has rowed back last week’s announcement that the Tier 1 (Investor) route was suspended with near-immediate effect. It was widely reported last Thursday that the route would be closed to new applications from midnight the next day due to concerns over money laundering, but the department provided no official confirmation beyond the press release evidently sent to news organisations, and the online application system remains live.
Today the Migration Policy team at the Home Office has confirmed in an email that:
The Tier 1 (Investor) visa is not currently suspended. However, the Government remains committed to reforming the route. A further announcement will be made in due course. Any suspension would be implemented through changes to the Immigration Rules.
As the Immigration Law Practitioners’ Association rightly says, the situation “makes a mockery of the principles of certainty and stability inherent in the rule of law”. Nichola Carter of Carter Thomas told us:
The only thing out there that suggested the unexpected suspension of the investor route last week were identical quotes from the Immigration Minister published by some of the press. If the Minister did provide the information quoted in the media but a decision was then made that the suspension would not go ahead, whilst good news for applicants, this is reckless to say the least. It is extremely important to the integrity of the UK’s immigration system that any changes made to key immigration routes are made formally and with sufficient notice.
On Thursday 6 December, the BBC, Times and Guardian all reported that the Tier 1 (Investor) route was to be closed to new applicants more or less immediately and quoted the immigration minister as follows:
The UK will always be open to legitimate and genuine investors who are committed to helping our economy and businesses grow. However, I have been clear that we will not tolerate people who do not play by the rules and seek to abuse the system.
That is why I am bringing forward these new measures which will make sure that only genuine investors, who intend to support UK businesses, can benefit from our immigration system.
Neither the press release nor any official confirmation of the move was published, leaving immigration lawyers (and this blog) unable to confirm the status of the investor route. The Times and ILPA reported the suspension as applying from midnight on the 6th, while the Guardian and BBC said midnight on the 7th. Amid the confusion, the immigration minister issued a written statement on various forthcoming changes to the Immigration Rules which says:
Alongside this, we will reform our Tier 1 (Investor) route.
These reforms will be introduced in the spring and will ensure the UK remains a world-leading destination for investment and innovation. We will shortly be publishing a Statement of Intent setting out the details of how the reformed routes will work and I will place a copy in the House Library.
The Home Office repeatedly ignored requests for clarification until sending ILPA the short statement above on 11 December, confirming that investor visas were not suspended after all. It is still not clear whether they will be put on hold at some stage while the rules are tightened up. The Times reports that the suspension was delayed “after objections from other Whitehall departments” but sources have told the paper that “it remains an objective of the department to suspend the so-called gold-plated visas pending reforms next year”.
Home Office forced to delay suspension of Tier 1 investor visas after opposition from other Government departments , Times discloses.
— richard ford (@RFord4) December 11, 2018
The press reports say that the reforms include removing government bonds from the list of acceptable investments. Instead, applicants “must invest in active and trading UK companies” and be able to provide comprehensive audit trails showing where the money came from.
A 2014 report by the Migration Advisory Committee said that, while the investment route was highly prized by overseas investors as a route to British citizenship, “less clear is the extent to which UK residents benefit from the existence of the route, and even if they benefit at all. The evidence suggests Tier 1 investors invest mainly in gilts, partly as a result of the design of the route and the investment behaviour this incentivises… this is of little benefit to the UK economy”.
However, last week’s press announcement referred to financial crime and money laundering rather than the general principles of the visa. There may also be a geopolitical element: it had been reported that the Home Office was reviewing Tier 1 (Investor) in the aftermath of the Salisbury poisonings in order to stop wealthy Russians with links to the Putin government from availing of the route. A Home Office source told the Guardian in September that:
We are reviewing all tier 1 [investor] visas granted before 5 April 2015, some of which are issued to wealthy Russians. We have not ruled out making further changes to the tier 1 investor route in order to ensure that it continues to work in the national interest.
The increased scrutiny on investor visas reportedly affected Chelsea owner Roman Abramovich, who became an Israeli citizen.
Transparency International has argued that “between 2008 and 2015, the UK Tier 1 Investment Visa suffered from a ‘blind faith’ period during which 3,000 high net worth people entered the UK, bringing with them at least £3.15 billion (€3.6 billion) of questionable legitimacy”.
Previous changes aimed at tightening up the Tier 1 (Investor) route were introduced in November 2014 and April 2015. Under those reforms, applications can be refused if there are reasonable doubts about the source of the investment funds or that they have been acquired through unlawful conduct. The applicant’s criminal and immigration history will be scrutinised as part of the application and the Home Office can also look closely at any third party providing the funds to check that they are above board.
The number of Tier 1 (Investor) visas issued plummeted in the immediate aftermath of the 2014/15 changes, but had more recently been staging a modest recovery. Just 192 were granted in 2015, compared with 1,172 the year before and 361 over 12 months to September 2018.
This article was originally published on 7 December and has been updated several times.