Introduction

As campaigning continues for the forthcoming referendum on whether the United Kingdom should leave the European Union, immigration (and its apparent links with national security) has become a central topic of the debate.

Aside from the headline-grabbing national security concerns, particular focus has been on UK immigration policy, the consequences of high net migration and the impact of the EU freedom of movement provisions. Prime Minister David Cameron has been accused of "corroding" public trust over immigration targets, and it could be argued that the political impetus to hold the referendum was driven by public concern over high net migration figures. Cameron's efforts to secure a freeze on in-work benefits for EU nationals was intended as a deterrent to EU migration and to help reduce net migration in the United Kingdom (currently running at over 300,000 per year, with around half from the European Union).

While it is impossible to predict future net migration figures, those campaigning to leave the European Union claim that net migration would be reduced if the United Kingdom were no longer a member state and subject to free movement rules. In reality, the United Kingdom would not simply refuse entry to all EU nationals and to imply this is misleading. It also ignores the benefits to the United Kingdom of migration from both EU and non-EU countries – for example, its role in increasing tax revenue and supporting economic growth.

Freedom of movement

The free movement of workers is a founding principle of the European Union, established in the Treaty of Rome and developed in subsequent treaties to include all EU citizens. EU Directive 2004/38/EC sought to amalgamate various laws on these rights, including case law from the European Court of Justice (ECJ), to clarify EU nationals' rights of free movement within the European Economic Area (which is comprised of EU member states and those countries within the European Free Trade Association).

The directive applies to all EU nationals, whether dual nationals or otherwise, together with their qualifying family members. It provides that EU citizens are entitled to travel and work freely within the European Union, and are protected from discriminatory treatment based on nationality (unless accession arrangements apply).

This affords EU nationals the same working rights and protections as domestic nationals (eg, minimum wage, which is decided by nation states rather than EU institutions).

The directive means that EU member states cannot impose visa or work permit requirements on nationals of other EU member states. These individuals enjoy unrestricted entry to all EU member states and can remain in those countries for up to 90 days. After 90 days they must be exercising what is commonly described as 'treaty rights of movement' – that is, they must be in that host state for the purposes of free movement, which is primarily for economic purposes and excludes tourism.

After the initial 90-day period, these individuals should be economically active, whether employed, self-employed, self-sufficient, a student or retired. This implies that a host state can require an individual who is not economically active to leave after 90 days. In practice, however, to do so the host state will need to know that the individual is in the country, the date on which he or she entered, where he or she is living and his or her activities. The equality provision of the directive does not permit such an assessment to be made of EU citizens if one is not required of domestic citizens. In practice, therefore, the restriction of 90 days is difficult to implement.

In order to apply for permanent residence (which all EU nationals who have exercised free movement rights for five years in a single host state are entitled to do, by virtue of the directive), evidence of economic activity must be provided covering the entire five-year qualifying period. The purpose of the free movement provisions is to support free trade among EU member states, giving businesses access to a wider pool of talent to support commercial growth. The ECJ has frequently commented in its adjudications on questions of interpretation of the directive, noting that restricting these rights could potentially deter an EU national from exercising free movement, in conflict with the founding principles of the European Union.

The most significant factor that has perpetuated concern about net migration was the enlargement of the European Union in 2004 - the largest single expansion to date, involving the accession of eight Eastern European countries (the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia). While many EU member states imposed accession restrictions on free movement on nationals from the new EU countries, the United Kingdom allowed full free movement rights. In excess of 650,000 Polish nationals registered as workers in the United Kingdom between May 2004 and June 2007.

As a result of this large migration into the United Kingdom, a negative perception formed that EU nationals were driving down wages in a 'race to the bottom' by accepting lower salaries than domestic nationals, and that employers were taking advantage of this. This reflects a very narrow view of the UK labour market and does not apply across all industries and sectors. Indeed, it merely reflects the free market principles of western commercial markets, albeit with the balance appearing in favour of commerce. The benefit to business goes beyond simply saving money with lower worker salaries. Businesses frequently need individuals with specialist knowledge or training, without which progress and growth could stall. Where a host nation lacks the required skill and knowledge, such individuals are frequently found from within the European Union. The benefits of business growth to the wider UK economy are clear and should be supported.

Immigration rules for non-EU citizens

For all non-EU nationals (or their family members) seeking to enter or remain in the United Kingdom for longer than six months, an application must be made under the UK Immigration Rules. These include:

  • family-based applications (applying to remain with a British spouse or child);
  • working categories (eg, those under the points-based system in Tier 1, Tier 2 or Tier 5);
  • students (primarily under Tier 4); and
  • ancestry or right of abode.

The criteria for each visa category must be met and the required documentary evidence provided (eg, financial requirements and evidence of employment and relationships). Entry clearance or leave to remain will be granted only if the applicant meets these strict criteria and produces the required evidence.

The approach of the Home Office to non-EU nationals heavily contrasts with the experience of the EU nationals relying on free movement. It is a more restrictive body of law, and is frequently made more restrictive as the government seeks to convince its critics that it has an answer to ever-increasing net migration.

Implications for EU migration

There is much speculation on how 'Brexit' might affect EU migration to the United Kingdom and what the social and economic consequences of such changes might be.

For more than a decade, EU membership has granted significant work and residence rights to EU citizens. EU citizens have been able to live and work legally in the United Kingdom without having to meet any of the criteria that non-EU nationals must currently satisfy, such as having a skilled job or qualifying family relationship. Examples of other benefits that EU citizens enjoy include visa-free travel to the United Kingdom and cooperation on asylum. The levels of EU migrant integration have come so far that Brexit would have profound legal, economic, social and political implications irrespective of what type of agreement is eventually reached. The degree to which the United Kingdom will maintain any of these policies post-Brexit depends on what kind of EU-UK relationship replaces EU membership; so far, there is little indication of what this may look like.

One possibility would be for the United Kingdom to negotiate an association agreement with the European Union. This would allow the United Kingdom to retain full access to the single market. It would consist of an arrangement similar to those applicable to Iceland, Liechtenstein and Norway. These non-EU countries, as a consequence of their membership of the European Free Trade Association, have implemented free movement provisions with the European Union. If the United Kingdom negotiates this type of agreement, work and residence rights for EU citizens would remain in place in the United Kingdom and there would be no new restrictions on EU migration. Alternatively, if an agreement is reached between the European Union and the United Kingdom which does not involve the free movement of people, the United Kingdom will become free to impose its own selection criteria on EU citizens. In this case, the criteria would likely be the same as the current points-based system rules for non-EU citizens – which require migrants to demonstrate that they have a skilled job, a spouse or partner in the United Kingdom or a place to study with a registered university or college. Many EU citizens are currently working in jobs that do not meet the skills criteria and therefore would not meet these requirements.

There has been an increase in EU nationals who – having exercised treaty rights by working, studying or being self-sufficient in the United Kingdom for at least five years – have applied for permanent residence in the United Kingdom. Should the United Kingdom vote to leave the European Union in the forthcoming referendum, the number of EU applicants for permanent residence is likely to increase. It is unclear at this stage what the position will be for those EU nationals who have not exercised treaty rights for the full five years required at the time of either the referendum or the potential exit.

As it is uncertain what the immigration policy will be should the United Kingdom leave the European Union, the effects also cannot be predicted. Regardless of the policy framework in place, migration levels are difficult to forecast. Evidence suggests that the economic impact of migration overall tends to be low, but the impact of a reduction in EU migration would be unevenly distributed and there is insufficient data to draw strong conclusions.

Implications for British citizens abroad

According to the United Nations, over 1 million British nationals live in Europe – mainly in Spain, France and Ireland. British citizens residing in the European Union currently enjoy access to the right to reside in their country of choice, to the open job market and to healthcare and educational systems. They can also live in EU member states with their families, buy properties, run businesses or simply enjoy their retirement.

Should the United Kingdom vote to leave the European Union, it is uncertain how other EU member states will change their policies towards British citizens residing abroad, who will be affected by an end to free movement in the absence of EU-wide agreements and whether they will treat British citizens as other migrants from outside the European Union.

If British citizens had to meet normal immigration criteria, the rules and policies would vary from country to country. Bilateral immigration agreements with specific EU countries might be possible, but these would take many years to negotiate and finalise. There are fears that British immigrants may be asked to pay additional fees or face stricter immigration rules.

There are particular worries for British citizens who have retired abroad and the fact that they may not retain the right to remain in their country of choice after Brexit. Consideration should also be given to those who reside in other EU countries as self-sufficient persons or entrepreneurs, as some countries require a migrant to have a job in the country in order to stay (as applies in the United Kingdom).

Another possible outcome of Brexit would be the ability for EU countries to deport British citizens living or visiting abroad. This outcome could apply to serious offences as well as trivial misdemeanours, such as drunk and disorderly behaviour. Deportation from one country could affect any immigration application in the future – be it in the European Union or elsewhere.

Visitors

The United Kingdom is not a signatory to the Schengen Agreement (which provides for freedom of movement without border controls across continental Europe). Despite the media rhetoric, the United Kingdom does control its borders. In the event of Brexit, it is possible that, unless visa waiver programmes can be negotiated and implemented, EU nationals will be required to apply for visas in order to travel to the United Kingdom (and vice versa) for short-term business or tourism purposes.

As visitors (whether through a formal visa application or visitor status granted upon entry), these individuals will have to comply with the restrictions imposed by the visitor visa route (eg, time limits and the inability to carry out any productive work). This may prove to be a considerable disruption to businesses that rely on the transfer of staff between EU countries and will also have a detrimental effect on the UK tourism industry.

Comment

Speculation as to the impact of the United Kingdom leaving the European Union is just that – speculation. While there has been much campaigning from both sides of the Brexit argument, together with the usual political mud-slinging, there seems to be a general lack of facts. One thing is clear: the process of leaving the European Union will be hugely complicated, with new trade agreements to be negotiated and legal frameworks manoeuvred. Brexit is likely to take many years to finalise, involving complex changes to the UK legal system as well as social and political reform.

Even if the United Kingdom does leave the European Union and net migration is significantly reduced – as has been the focus of UK immigration policy for the last few years – the negative economic impact may finally change the government's focus on reducing migration. Further, it may convince the public that immigration is, in fact, a good thing.

For further information on this topic please contact Chris Magrath, Ben Sheldrick or Frederique Montalti at Magrath LLP by telephone (+44 20 7495 3003) or email (chris.magrath@magrath.co.uk, ben.sheldrick@magrath.co.uk or frederique.montalti@magrath.co.uk). The Magrath LLP website can be accessed at www.magrath.co.uk.

This article was first published by the International Law Office, a premium online legal update service for major companies and law firms worldwide. Register for a free subscription.