The Immigration Minister, Damian Green, has introduced changes to the tier 1 rules for investors and entrepreneurs, and a new visa category for the 'exceptionally talented'. These changes will take effect on 6 April 2011.
For investors the changes will allow a faster route to Indefinite Leave to Remain (ILR) for those able to invest greater sums in the UK and the ability to spend more time outside of the UK.
For entrepreneurs the changes will also allow a faster route to ILR in certain circumstances and a reduced investment threshold for those with finding from a reputable approved organisation.
The principal changes are that there will be accelerated ILR:
- after three years for those who have brought £5 million into the UK; and
- after only two years for those bringing £10 million.
Permitted absences of up to 180 days per year
In addition, investors are now officially allowed to be absent from the UK for up to 180 days a year without it affecting their eligibility for ILR.
Existing criteria that apply to £1 million investors will also apply to the new 'super-investors' – they will only have to invest not less than 75% of the funds in qualifying investments and can invest the balance in assets or keep it in cash at the bank.
The ability to use borrowed funds has also been replicated on a pro rata basis eg if an applicant wants to use £5 million or £10 million of borrowed funds they must have personal net assets of at least twice as much.
It looks from a first reading of the rules that the new relaxation on permitted absences will apply retrospectively to those already here under the existing rules.
Also, if any existing investors have already brought enough money into the UK and invested enough in qualifying investments they will be able to benefit retrospectively from the new accelerated settlement provisions.
There will therefore be opportunities, and an incentive, for some existing investors to take advantage of the accelerated settlement provisions by increasing the amount of funds brought into the UK and the amount invested in qualifying investments.
On the negative note there are two new requirements for eligibility for ILR:
- applicants must be free of any 'unspent' convictions, for any offence, so a minor traffic conviction could prevent an investor being granted ILR. It is unclear whether someone in this position will be able to extend their temporary leave indefinitely until the conviction becomes 'spent' or will have to leave the UK; and
- although investors do not have to be able to speak or understand English language for the grant of their initial visa and extensions, when they apply for settlement they will now have to pass the 'Life in the UK' test, which requires an ability to speak in English.
There are also a number of relaxations for entrepreneurs.
A new entrepreneur visitor category is being introduced, to enable prospective entrepreneurs to come to the UK to secure their funding and make arrangements for starting their business before they transfer onto a full entrepreneur visa in country.
Reduced investment threshold
While the standard investment threshold for an entrepreneur to qualify for a visa will remain at £200,000, the Government will also make provision for high potential businesses to come to the UK with £50,000 in funding from a reputable approved organisation - for example venture capitalists, including angel investors, a Government department (such as UK Trade & Investment) or through seed competitions.
Entrepreneurs will also be able to settle in the UK more quickly if they create ten jobs or turn over £5m in a three year period.
Two business partners can qualify together using the same investment provided that they have equal control over the funds and/or the business.
This new route, the replacement for tier 1 (general) for exceptionally talented migrants, will be limited to 1,000 visas per year. It is for those who have already been recognised or have the potential to be recognised as leaders in the fields of science, arts and humanities.
Migrants will not need to be sponsored by an employer but will need to be endorsed by an accredited competent body. These competent bodies will be announced in the near future. It will be for each competent body to select those who will qualify for endorsement.
Migrants will initially be granted permission to stay in the UK for three years and four months. They will then be able to extend their stay for a further two years, and to settle here after five years' residence in the UK.