Greater Scrutiny of UK Tier 1 Investor Visas

Foreign investors are facing greater Home Office scrutiny when applying for or renewing their UK Tier 1 Investor Visa, as Roman Abramovich’s delayed UK visa showed.

Following reports of a delay in his UK Tier 1 investor visa renewal application, Chelsea FC owner Roman Abramovich has now taken up Israeli citizenship.

Whether Abramovich was unwilling to explain to the Home Office the source of his wealth, or whether his application was in fact refused, he has taken the decision to exercise his right under Israel’s Law of Return and become a citizen of Israel.

 

Whereas Russian citizens must apply for a visa from the British Embassy in Moscow before they can travel to the UK, with an Israeli passport, Abramovich is now permitted to travel to the UK without a visa for short periods as a visitor, and can stay here for up to six months. He will still need to apply for a visa to live, work or study in the UK.

It’s an interesting turn of events in light of speculation that his ‘delayed’ visa application was due to the UK Government’s ‘clampdown’ on Russian visas. Both the Home Office and Abramovich declined to comment on the specifics of the case, but given the current political climate and the proximity in time to the Salisbury poisoning incident, it seems naïve to think there was no smoke without fire.

In some respects, Abramovich may not have been the most obvious target for the UK Government: he has been in the UK for so long, and by purchasing Chelsea FC, he has become part of the UK community insomuch that football is in our cultural DNA. Yet – he remains a high-profile figure, and the fact that an individual so closely integrated was not beyond the exercise of Home Office power sent (albeit unofficially) a powerful message. Added to this the timing of his application, it was perhaps too good a PR opportunity for the government to pass on?

Outside current issues between the UK and Russia however, there has been a lot going on with the Tier 1 visa system as a whole for a number of years. In 2014/15, the eligibility criteria for the Tier 1 investor route was tightened up, resulting in applications reducing by 84 per cent. What do foreign investors need to consider when approaching their Tier 1 investor application or renewal?

What is the Tier 1 visa?

The Tier 1 investor visa gives temporary leave to carry out permitted investment activity in the UK, provided a minimum investment of £2million (under current rules) is met. Not an issue of course for Abramovich.

Roman Abramovich was originally granted leave to remain in the UK as an investor back in the early 2000’s, if not earlier. I was helping Abramovich’s then colleague, the now-deceased Boris Berezovsky, with his application to remain in the UK.

At that time, many of the Russian investors were claiming political asylum to avoid future extradition from the UK. Abramovich however sought to preserve his links with the Kremlin and, unlike his colleagues, decided instead to apply to the Home Office under the old-style Tier 1 route.

Tier 1 investors are required to apply to renew their visa before their current leave expires. It’s at this point that the Home Office scrutinises the investor’s UK-based financial assets and activity, to ensure compliance with the visa conditions.

This, we understand, was the Home Office limbo where Abramovich found himself.

Stricter processing of Tier 1 applications?

The Home Office works to specific processing times for Tier 1 investor applications. With such a high profile individual as Abramovich, it’s highly unlikely the case was ever handled by a ‘regular’ caseworker.

The application would ordinarily be submitted via fast track at the Home Office and processed very quickly. But there are a number of possible grounds for delay (or refusal) which investors come up against when making their application.

If crucial documents are missing and/or the application was not within the published guidelines, there will be a delay. Extensive travelling can cause issues with eligibility, unless these qualify as exceptions for being mainly work-related.

Or, if the application was made from within the UK ie ‘in-country’, and the investor chooses to leave the UK before a decision was made, it’s unlikely the application would be processed.

If that was the case with Abramovich, the Home Office was clearly demonstrating an willingness to make exceptions or offer up special treatment – and rightly so.

One of the main reasons however for the notoriously high Tier 1 refusal rates is where investors fail to demonstrate through their application continued compliance with the financial requirements of the visa.

With his army of professional advisers, and presumably having gone though the process before, it’s hard to imagine this would be an issue for Abramovich. That is, unless (and until) the Home Office bar had been moved.

In response to the speculation about Abramovich’s delayed visa, Security Minister Ben Wallace confirmed a government mandate to scrutinise more closely Tier 1 investors, but stopped short of indicating any targeting of Russian investors: “As the Prime Minister and former Home Secretary made clear, we are taking another look at how the [Tier 1] route operates and are undertaking further checks on investors who came to the UK through this route before the [2014/15] reforms were introduced.”

Team Abramovich could very well have been labouring under this enhanced scrutiny in respect of the source of his investment funds, including those which had previously been cleared for Tier 1 purposes – something Tier 1 investor applicants and their professional advisers need to take specific consideration of when making their application.

Tier 1 investor visa & UK permanent residency

What was unclear about the information that came out was why Abramovich was still on the Tier 1 visa, and as such still subject to the intrusive Home Office renewal process.

Tier 1 investor visa holders become eligible to settle permanently in the UK after two years if they invest £10 million, after three years if they invest £5 million, or after five years if they invest £2 million.

So Abramovich would have qualified for UK permanent residency many years ago – his extensive UK absences permitting.

With permanent resident status, individuals have the right to live in the UK for the rest of their life, without restrictions attached to their leave in the Britain. There would be no more requirement for inspection of their financial affairs as under the Tier 1 route (on the part of the Home Office, at least), and they would also no longer be at the mercy of Home Office policy or discretion in respect of Tier 1 visa processing.

During his time in the UK, Abramovich had taken a consistent and highly-considered stance, balancing his interests as a close ally to Putin with a UK immigration strategy centred on maintaining his Tier 1 status. Given his continued connections to the Kremlin, it’s understandable why he hadn’t applied for a British passport, but UK permanent residence would have enabled him to travel in and out of the UK free from immigration control. I can only speak for the immigration aspects, but considerations of tax and domicile may well be the deciding factors, and the Tier 1 renewal process written-off as a relative and minor inconvenience in light of the wider benefits – that was, until the eligibility requirements changed.

What Tier 1 investor applicants should learn 

Whatever the truth of Abramovich’s Great Visa Delay, the Home Office is clearly enforcing the enhanced requirement to dig deeper than ever into applicants’ financial activities including source of funds predating the latest rule changes.

With so much at stake, applicants – Russian or otherwise – should take heed and air on the side of caution when making an initial Tier 1 application and also when renewing; ensuring with the support and guidance of professional advisers that all required documentation is up to date and conforms to Home Office standards, and by preparing well for interview. The likelihood is the UK Tier 1 route is only going to get tougher.

For guidance on a Tier 1 application or renewal, contact our immigration specialists.

By |2018-06-01T11:34:10+00:00May 29th, 2018|Comments Off on Greater Scrutiny of UK Tier 1 Investor Visas