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Changes in Immigration Rules - Important Tier 1 and Tier 2 Changes

22/10/2014
Last week the Minister of State for Immigration and Security, James Brokenshire, laid before Parliament the Statement of Changes in Immigration Rules. Most of the changes will come into force on 6 Last week the Minister of State for Immigration and Security, James Brokenshire, laid before Parliament the Statement of Changes in Immigration Rules. Most of the changes will come into force on 6 November 2014. The reforms contain important measures to make it easier to deport foreign criminals; to make it quicker and easier for the Home Office to correct case work errors on student applications; to clarify the Immigration Rules relating to family and private life; and to extend the time required to give notice of marriage or civil partnerships to combat sham marriages and civil partnerships.

However, the most interesting change is the much talked about change to the investment threshold for Tier 1 (Investor) applications. We also detail below some of the other changes that may impact your immigration circumstances:

Tier 1 (Investor)

The Tier 1 (Investor) category caters for high net worth individuals making a substantial financial investment to the UK. The Tier 1 (Investor) route is being reformed in a variety of ways following recommendations from a report delivered by the Migration Advisory Committee:

  • The minimum investment threshold will be raised from £1 million to £2 million - this will only affect applicants who submit their application on or after 6 November 2014. The government will also consult further on what sort of investment the route should encourage in order to deliver real economic benefits, and other improvements to the route. A consultation document will be published in due course.

  • Under current Rules, a Tier 1 (Investor) is required to invest 75% of the funds in prescribed forms of investments (share or loan capital in active and trading UK companies, or UK Government bonds) and the remainder can be held in a wider range of holdings. This requirement will be removed so that from 6 November 2014 the full investment sum of £2 million must be invested in the prescribed investments.

  • The current requirement that the migrant’s investment must be “topped up” if its market value falls will be removed from 6 November 2014 in the hope that this will provide investors with greater flexibility. Tier 1 (Investor) migrants will only need to purchase new qualifying investments if they sell part of their portfolios and need to replace them in order to maintain the investment threshold.

  • The existing provision under which the required investment sum can be sourced as a loan is being removed.


Furthermore, Entry Clearance Officers and UK Visas & Immigration caseworkers are being empowered to refuse a Tier 1 (Investor) application where all the criteria has been met if they have reasonable grounds to believe that: (i) the applicant is not in control of the investment funds; (ii) the funds were obtained unlawfully (or by means which would be unlawful if they happened in the UK); or (iii) the character, conduct or associations of a party providing the funds mean that approving the application is not conducive to the public good.

Due to transitional arrangements, Tier 1 (Investor) migrants who have already entered the route before these changes are introduced will not be subject to these changes and can rely on the £1 million investment level when they apply for extensions or for Indefinite Leave to Remain.

Tier 1 (Exceptional Talent)

Good news was delivered for the exceptionally talented. The Tier 1 (Exceptional Talent) category was introduced for those who lead the world or show exceptional promise in the fields of science, humanities, engineering  and the arts, who have been endorsed by a Designated Competent Body and wish to work in the UK.

Under current Rules, a successful applicant is granted leave for three years. This has now been changed so that applicants will now be granted five years' leave – this reflects a similar change that was made to the Tier 2 category in April 2014. In addition, the English language requirement is being removed for extension applications. The Statement also contains minor clarifications to the criteria applied by The Royal Society, The Royal Academy of Engineering and The British Academy.

Tier 1 (Entrepreneur)

The Tier 1 (Entrepreneur) category caters for applicants coming to the UK to set up, take over, or otherwise be involved in the running of a business in the UK. As a result of abuse in this category in recent years, the following changes will take place:

  • For applications made in the UK from 6 November 2014, the funds to be invested in the business must also be in the UK. This change is designed to assist in verifying that the funds are genuine.

  • Those applying under the accelerated provisions for Indefinite Leave to Remain must show that they have invested their funds from 6 November 2014 onwards.

  • A number of technical clarifications are being made to evidential requirements relating to funding held in joint accounts, multiple bank accounts, or another business; where an applicant has already established a business; to the job creation requirements for Indefinite Leave to Remain, and to the definitions of “Venture Capital firms”, “new businesses” and “property development or property management”.


Tier 2

Tier 2 of the Points-Based System caters for migrant workers with an offer of a skilled job from an employer that holds a Sponsor Licence.

The Statement of Change brings a new power to the Home Office to assess whether a genuine vacancy exists in relation to a Tier 2 (Intra-Company Transfer) and Tier 2 (General) application. This change will empower Entry Clearance Officers and caseworkers to refuse applications where there are reasonable grounds to believe that the job described by the sponsor does not genuinely exist; has been exaggerated to meet the Tier 2 skills threshold; or in respect of Tier 2 (General) has been tailored to exclude resident workers from being recruited; or where there are reasonable grounds to believe that the applicant is not qualified to do the job.

Further, it is now being confirmed in the Immigration Rules that migrants cannot be sponsored to fill a position for a third party who is not the sponsor. And some leeway is being given to Tier 2 (General) migrants: applicants whose leave expired no more than 28 days before they make their extension application will be exempt from the Resident Labour Market Test if they are continuing to work in the same role with the same employer. Currently the exemption only applies if the applicant still has current leave as a Tier 2 (General) Migrant when they make their extension application.

Business Visitors

The Business Visitor route enables individuals to carry out a wide range of permitted activities in the UK provided they remain paid and employed overseas.

Changes will be made to provide flexibility within the Business Visitor route to: (i) allow scientists and researchers to collaborate on an international project that is being led from the UK; (ii) to allow overseas lawyers, who are employees of international law firms which have offices in the UK, to advise UK clients on litigation or international transactions; and (iii) to allow graduates of an overseas nursing school to take an Objective Structured Clinical Examination in the UK which is required before any overseas nurse can work in the UK under the Tier 2 route.

Overseas Domestic Worker in a Private Household route

The Overseas Domestic Worker route exists to allow employers resident overseas to be accompanied by their household staff on visits to the UK. A maximum stay of six months is permitted. Changes to the Rules on Overseas Domestic Workers in a Private Household will prevent abuse by those who are living in the UK through frequent, successive visits, and provide added protection to workers against exploitation.

For more information on any of the above topics, please contact Lynn McCloghry.

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