The British government and the EU have agreed that one of their priorities in Brexit negotiations is to reach a deal on arrangements for EU nationals living in the UK and British expats living elsewhere in the EU. However despite two rounds of talks having taken place, a deal has not yet been achieved.

The British government unveiled its ‘offer’ to EU nationals back on 26 June 2017. The EU immediately expressed disappointment, saying the offer does not go far enough. 

We note that it only covers EU nationals and does not mention other nationalities who currently enjoy the same rights (Norway, Iceland, Lichtenstein and Switzerland). It also does not affect Irish nationals, who enjoy a special status in the UK which pre-dates EU free movement rules.

Under the government’s proposal (which may or may not actually come into force):

  • Free movement will end when we leave the EU. All EU nationals will need to apply to the Home Office for permission to stay in the UK. However there will be a grace period of two years in which to apply. The proposal does not address what will happen to those who wish to travel abroad during the grace period, or how employers will carry out right to work checks during that time, when some people will have documentation and others will not.
  • Permanent residence will not be valid after we leave the EU. Qualifying EU citizens will have to apply for a new  ‘settled status’. This is not described as  ‘indefinite leave to remain’ but seems likely to be the same thing. It is disappointing that the government is not proposing to automatically deem all those with permanent residence cards to be settled. It is likely this is because they want the ability to exclude those with criminal convictions. Under the proposal, applications by those with permanent residence cards will be fast-tracked.
  • There are three different groups of people to consider:
  • EU nationals who arrived in the UK before a specified date and who have completed a period of five years’ continuous residence in the UK before we leave will be able to apply for settled status. The proposal does not explain what  ‘residence’ means and it is unclear whether these individuals will need to show they have been exercising EU Treaty rights during this time, or just that they have been living in the UK. It is suggested that the requirement for comprehensive sickness insurance for those not economically active may be waived. This would particularly help students.
  • EU nationals who arrived before the specified date but who have not accrued five years’ continuous residence at the time of the UK’s exit will need to apply for temporary status in order to remain resident in the UK until they have accumulated five years, after which they will be eligible to apply for settled status.
  • EU nationals who arrived after the specified date will apply to stay on a temporary basis. Their rights will depend on the deal that is struck and on the rules that will apply to EU nationals generally after we leave, so it is uncertain whether or not they will be able to apply for settled status.
  • Family dependants who join a qualifying EU national in the UK before the UK’s exit would be able to apply for settled status after five years irrespective of the specified date. EU nationals who wish to bring family to the UK are advised to do so before we leave as they currently enjoy much more generous rules than British nationals and others with settled status.
  • The crucial 'specified date' will be no earlier than 29 March 2017 (the date Article 50 was triggered) and no later than the date of the UK’s withdrawal from the EU. This uncertainty means it is still difficult for those who arrived between those dates to plan for the future. However we cannot see the EU agreeing to anything other than the specified date being the date we leave the EU.
  • EU citizens with settled status would continue to have access to UK benefits on the same basis as a comparable UK national under domestic law.
  • New rights in UK law for qualifying EU citizens resident in the UK before Brexit would be enforceable in the UK legal system. The Court of Justice of the European Union would not have jurisdiction in the UK. We understand this is one of the key sticking points in the current negotiations with the EU.

We remain of the view that those qualify for and who can afford to apply for a permanent residence card should do so now, notwithstanding the government's efforts to dissuade them from doing so. A permanent residence card is required if you wish to apply for naturalisation as a British citizen before we leave the EU. It will also mean any later application for settled status will be fast tracked. This could be invaluable in future as the government will need to process over 3,000,000 applications for settled status and we are concerned about how long this is likely to take.