UK Sole Representative Visa Rule Changes 2020SoleRepVisaAdmin2020-08-26T07:54:16+00:00
UK Sole Representative Visa Rule Changes 2020
Discover how you can meet the new program requirements with ease.
Helping you understand the June 4th changes to the Representative of an Overseas Business Visa Program and how it affects your business in 2020 and beyond.
Investment migration in the UK in general – and the Tier 1 Investor Visa Program, in particular – has increasingly been drawing scrutiny and criticism from the left of the political spectrum in recent years. While the Tier 1 Program has been criticized for providing potential scope for exploitation by bad international actors, the so-called Sole Rep Visa Program has also come under increased scrutiny.
Argentineans use an expression that roughly translates to “create the rule, and you create the workaround”, and especially since the Tier 1 Visa Program and UK Startup Visa’s criteria became a lot more stringent, those seeking a faster, cheaper workaround to gain UK residency and eventual citizenship have started applying for the Sole Rep Visa Program, leading to it being used in manners other than that intended by the UK Home Office.
As such, the changes to the program qualifying criteria, enacted on 4 June 2020, seeks to tighten the screws, as it were, reducing the likelihood of abuse – and increasing the need for applicants to provide sufficient proof of legitimacy, both in terms of their parent company’s establishedness, and their connection with the organization as a senior employee or minority shareholder. While none of this is completely new, the update regulations seek to consolidate and clarify these requirements under a single set of rules.
This increased requirement is broadly being referred to as the new “genuineness test”, and has a number of significant implications for both overseas businesses and their prospective deployed visa applicants.
Find out more about the recent changes to the program below, or contact us now for more information and to see whether you could potentially qualify for a Representative of an Overseas Business Visa in 2020.
The so-called Sole Rep Visa is a popular alternative to the UK Tier 1 Investor Visa, and is frequently the immigration visa of choice for business owners seeking to establish a commercial presence in the UK. The changes to the program were announced by the UK government on 14 May 2020, and enacted on 4 June 2020 as per the Immigration Rules CP 232 under rule 144. The changes were implemented to make the visa more difficult to obtain, given the spike in demand for the program during the last 12 months.
The key change to the program came in the form of the introduction of a subjective genuineness test, implying increased scrutiny of both the overseas business seeking to establish a presence in the UK and the primary applicant wishing to serve as the new UK branch or subsidiary’s sole business representative.
The new criteria for the overseas business are summarised below.
OVERSEAS BUSINESS REQUIREMENTS
Must be an established overseas business, seeking to establish a new presence in the UK, but intending to keep its overseas headquarters and for that entity to continue trading even after the new UK branch or subsidiary has been established. This is known as the Centre of Operations test, and it is a key program criterion.
If an Entrance Clearance Officer suspects that the intention, instead, is to move the company’s head office operations to the UK and abandon the current headquarters, the application will be refused.
The company must have a genuine intention to establish a trading UK presence. If an Entry Clearance Officer suspects that the branch is being set up solely to achieve settlement rights for the applicant, the application will be refused. The application’s focus should therefore be on convincingly illustrating how the branch or subsidiary will help the overseas business grow.
The company must have been trading for at least 12 months, and must be able to prove generating a monthly revenue in excess of £5,000 (£60,000 per year).
VISA APPLICANT REQUIREMENTS
The applicant must be a senior employee or minority shareholder of the overseas business.
If an outside party with no current employment contract or affiliation is being recruited to head up the UK branch or subsidiary, they have to be recruited outside the UK, and extensive proof will be required in terms of their successful track record in setting up new business branches or subsidiaries on behalf of other companies.
Majority shareholders are not eligible to apply for the UK Sole Rep Visa. The rationale for this is that it is most likely that the majority shareholder of the overseas business will need to remain involved in the running of company’s headquarters in order for the business to keep on trading sustainably, thus meeting the program requirements in this regard.
Following on the above point, the spouse of a majority shareholder is no longer allowed to apply as the primary applicant, with the majority shareholder applying as a dependent. As such, a primary applicant and their dependent, collectively, are not allowed to own more than a 50% stake in the overseas business.
The Sole Representative of the new branch or subsidiary must be present in the UK. The new rules make it harder obtain this settlement visa inasmuch as the applicant now has to prove that they have the skills and experience required to manage the new business entity.
The visa applicant must be fully authorized and empowered to make executive and operational business decisions on behalf of the new entity. Previously, less emphasis was placed on the employment letter supplied by the overseas business. Going forward, it is expected that this letter will supply extensive details proving that the applicant is duly qualified, authorized and positioned within the overseas business in order to serve as the company’s sole business representative in the UK.
Under the old program rules, the representative was not allowed to be a majority shareholder, and they had to be a senior employee of the overseas business. This requirement has now been clarified. As of 4 June 2020, the applicant may not have a majority stake or be otherwise in majority control of the overseas business, be it by partnership, shareholding, sole proprietorship or any other such arrangement.
The applicant must be employed full time in the new UK business, and they are not allowed to engage in any business activities of their own, nor to represent any other third-party business interests.
DISCLAIMER: The above information is intended as general information on the topic only, and does not purport to be comprehensive or to provide legal advice. Whilst every effort has been made to ensure the information is accurate and current as of the date of publication, it should be stressed that this does not necessarily reflect the present legal position.
The authors of this site accept no responsibility for any losses which may arise from reliance on the information contained in this UK immigration site. For formal advice on the current law please don’t hesitate to contact us now. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of our licensed UK immigration partners.
Contact us now for the latest program guidance and information
While the above rule changes do make it more difficult to obtain approval under the UK Sole Rep Visa Program, our application analysts are well versed in both the old and new requirements and can help you navigate the application process with ease. Our proven pre-approval assessment can help you significantly reduce the likelihood of application rejection, and our team can help you achieve your company’s UK expansion goals with ease.
Contact us now for a free consultation and start your application today – obtain your UK settlement visa within the next 95 days.