Two members of the House of Lords have tabled an amendment to the 2015 Immigration Bill in which they propose that the Tier 1 Investor Visa programme be abolished.
Under their proposed amendment, Baroness Hamwee and Lord Wallace of Saltaire call for the closure of the route to visas for both new applicants as well as those switching to the Tier 1 type from other visas, “no later than 1 January 2017”.
The bill is likely to be debated imminently, according to Nicolas Rollason, partner and immigration practice leader at Kingsley Napley, the London law firm.
According to Rollason, it’s unclear what has prompted Baroness Hamwee and Lord Wallace to move to do away with the Tier 1 visa scheme. “It may be that there are continuing doubts around the economic benefit of the route to the UK, and speculative concerns around whether the investor visa is being used by criminals,” Rollason wrote in a recent blog on his firm’s website, which includes a link to a Transparency International UK report on the investment visas. This report argues that the Tier 1 scheme “can be vulnerable as a tool to launder the proceeds of corruption from around the world”.
According to Rollason, 2015 saw a relatively small number of investors applying to come to the UK – 200 – “down from around 1,172 in 2014”.
In addition, “historical concerns about how the route could be used by those whose wealth was dubious have largely been addressed by a 2015 immigration rule change, which now requires extensive due diligence to be undertaken on the source and origin of funds by UK banks (as having a UK investment account is a precondition),” Rollason noted.
“This source of funds and wealth information is now often being requested as part of the visa application, both in relation to the investor themselves and any third parties who have made the funds available.”
He surmises that the popularity if the Tier 1 Visa route has been knocked by the increase in the minimum investment required, to £2m from £1m, in November 2014, and by recent geopolitical and economic factors in the two main source countries for Tier 1 Investor Visa applicants, China and Russia.
Tier 1 Visas were introduced in 2008, to enable foreigners to remain in the UK on a long-term basis in exchange for investing at least £1m. Since the scheme was launched, a number of other countries have introduced their own schemes, with the price and ease of acceptance typically related to the desirability of becoming a citizen of the country in question. A number of countries in the Caribbean, for example, have begun to aggressively market their residency and citizenship offerings, while Malta ruffled some feathers in the European Union a few years back when it unveiled a scheme some critics thought overly generous.
At the same time, some other countries have begun to tighten up their so-called “passports for cash” programmes. Canada, long a favoured destination of mainland Chinese seeking to emigrate, all but shut the door a few years ago, and upped the amount of money would-be Canadian immigrants are required to possess, to C$10m (US$7.2m), and to pay – now you must make a non-guaranteed investment of at least C$2 m into a venture capital fund that supports Canadian start-ups. Australia has also tightened up its rules, which has had the effect of slowing demand for its investor visa programme since July of last year, according to press reports.