The Investor route – or so-called golden visa – has been a popular immigration route into the UK for many years for high net worth individuals. Numerous changes have been made to this category over the years but, up until the sudden closure of the route in February 2022, this was by far the most flexible immigration route for those able to invest at least £2 million in share capital or loan capital in active and trading UK registered companies – usually listed companies. It was also relatively common for wealthy parents to gift their children the required funds to enable them to come to the UK.  By Kerry Garcia, Partner at Stevens & Bolton LLP

The route was particularly popular because it allowed successful applicants to work in the UK, either on an employed or self-employed basis, to study or indeed to do nothing. Investors were also able to bring their partners and children under 18 to the UK. Another attraction of the route was that, provided Investors continued to invest the required funds; spent no more than 180 days outside of the UK in any 12-month period; met the English language requirements; and passed a test about life in the UK, they were likely to be eligible for settlement in the UK after spending 5 years here as an Investor.   Indeed, if they were willing to invest £5 million, they may even have been able to obtain settlement after a mere two years in the UK. Applicants were also often able to go on to naturalise as British citizens.

As a result, hundreds of applicants applied each year, although numbers had been dropping since the all-time high of nearly 2,000 applicants in 2014 and following the change in rules, which required applicants to invest at least £2 million, rather than £1 million. Indeed, in 2021 only 335 people applied under this route. In terms of the nationalities of those applying, between 2008 to 2021, 33% of Investor applicants were Chinese and 18% were Russian.

This all ended when the route was abruptly closed in February 2022, following a Twitter announcement by the Home Secretary who cited security concerns, stating that some applicants had acquired their wealth illegitimately and were associated with wider corruption.

Even assuming the relatively low number of applicants applying in 2021 would have continued, on the basis each investor invested only the minimum £2 million, accumulative new investments into UK companies would total £670 million. This does not include the inevitable additional expenditure on UK properties, luxury goods and independent schooling, as well as UK taxes paid by Investors.    

Since then, the Government has announced a number of new immigration routes but none come close to offering the flexibility of the Investor route. The Home Office promised reforms to the Innovator route “to provide an ambitious investment route which works more effectively in support of the UK’s economy”. The reforms are disappointing and, in practice, this route is unlikely to be an option in most cases. Those investing £50,000 in a UK business can apply for an Innovator visa if they want to set up and run an innovative business in the UK, but it must be something that is different from anything else on the market; and the business or business idea must have been endorsed by an approved body, known as an endorsing body. This does not suit many would-be-passive investors and few business ideas meet the stringent requirements so this remains a poor cousin to the Investor route.  

Other routes are for very particular purposes, such as the student route to study and the Skilled Worker route for those with a job offer from an employer willing to sponsor them. A new global talent route is available from 30 May 2022 but only those who have been awarded an overseas degree from a university on the Global Universities List during the five years before their immigration application are eligible. 

The Global Universities List is compiled on an annual basis and consists of all non-UK institutions that are ranked in the top 50 of at least two of the following ranking systems: Times Higher Education World University Rankings, Quacquarelli Symonds World University Rankings, and The Academic Ranking of World Universities

Unlike the Investor route, applicants must meet English language requirements and will only be granted two or three years’ leave. Importantly the route does not lead to settlement.  

Only time will tell, but many other countries are still keen to entice wealthy investors and it looks likely that many high net worth individuals will instead look to invest their cash elsewhere, focusing on countries such as Portugal, Greece, Malta and Spain who continue to offer attractive golden visas.