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the Home Office suspend UK Tier 1 Investor Visa

7 December 2018

UPDATE: the Home Office has since made a U-turn and announced that the suspension is not in place but that they remain committed to reforming the route. A further announcement is expected in due course. Whilst the Home Office has not confirmed the reason for the U-turn it may be due to concerns raised about the lawfulness of revoking an entire category of leave by press release, with no forewarning or consultation. We will post an update when any further announcement is published.

The Home Office have temporarily suspended the Tier 1 Investor route with effect from today, due to ongoing concerns about organised crime and money laundering. We understand that the suspension is intended to be in place until new rules are introduced for investors in 2019.

Tier 1 Investor visas were introduced in 2008, in order to attract investment to UK businesses. Under this route, foreign nationals were permitted to invest a minimum of £2million in active trading UK registered companies, which in turn resulted in a fast tracked qualification for Indefinite Leave to Remain for the successful applicant. However, it is reported that most applicants were buying gilts in order to qualify (so effectively loaning money to the government rather than investing in business) and so the Migration Advisory Committee concluded that this visa category brought little economic benefit to British citizens.

In addition to the suspension, the Home Office have announced that an audit will be introduced whereby current and future financial and business interests will be assessed independently rather than by the Home Office, including checking that applicants have 'control' of the funds for at least two years prior to investment. At present, applicants only have to demonstrate that they have held funds for 90 days.

For future applications, we expect an investor route will be reintroduced in 2019 – changes are usually made in April or November. The source of funding will be scrutinised independently and is likely to require investment into active and trading government-backed businesses.

If you have already submitted an application and have any concerns about this, please feel free to contact us, otherwise we will update you as and when we receive news of the any new investor rules.

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