The UK has seen a significant increase in Chinese investment over the past few years. In 2012 the UK overtook France as the prime destination in Europe for investment from China. Investment has increased almost exponentially with China having invested over twice as much in the UK since 2012 as it had over the previous 7 years.

Today inward investment from China is said to contribute over £8 billion to the UK economy each year and has created over 6,000 jobs in the UK between 2013/2014. When this is combined with UK exports to China averaging over £1 billion each month it is apparent that the UK’s economic relationship with China is significant.

A potential driver for increased investment from China into the UK is the Tier 1 Investor Visa category which can fast track the applicant to permanent residence depending on their level of investment. For example an investment of £10 million allows the investor to apply for permanent residence in just 2 years as opposed to 5 years as prescribed by most other visa categories with routes to settlement.

Since this route opened in 2008, Chinese nationals have been granted around a quarter of the 2,000 visas awarded. Chinese nationals are by far the biggest recipient group far out reaching the US and Russia in the same category.

In order to apply for a Tier 1 Investor visa one must:

Have investment funds of at least £2 million which is:

  • Held in one for more regulated financial institutions; and is
  • Freely disposable in the UK.

The investment funds can be invested in UK government bonds, share capital or loan capital in active and trading UK registered companies. However an investment can not be made into a company mainly engaged in property investment, property management or property development.

Despite the Home Office doubling the investment fund threshold from £1 million to £2 million, the UK is still trying other methods of incentivising investors from the region to come to the UK and spend their cash. An illustration of this is the historic British – Irish Visa Scheme being rolled out exclusively for Chinese and Indian nationals.

Under this scheme Chinese and Indian nationals will now be able to visit both the UK and the Republic of Ireland using a single visa, rather than having to apply for two separate visas. It is hoped that this will help stimulate significant revenue for both the UK and the Republic of Ireland both through direct investment from Chinese and Indian nationals/businesses and easier tourism throughout the common travel area.