Nadine Goldfoot, Partner, Fragomen Worldwide, UK
In March, the European Commission published the agreement reached by the EU’s chief negotiator and the UK’s Brexit Secretary that free movement rights will continue during the Brexit transition period, i.e. 29 March 2019 to 31 December 2020. This concession is in line with a recent UK Home Office proposal and gives affected foreign nationals confirmation of their rights and more time to plan for a post-Brexit strategy.
The UK and the EU have not yet reached agreement on the Northern Ireland border. Negotiators from both parties agree that Northern Ireland should remain in the customs union as an emergency fallback solution if no alternative solution can be found. This confirms the commitment of the UK to avoiding a hard border, including any physical infrastructure or related checks and controls.
UK Government to Review Tier 1 Investor
On 27 March 2018, the Prime Minister gave oral evidence before the Commons Liaison Committee following the Salisbury incident during which she was questioned on the grant of Tier 1 Investor visas to about 700 Russian nationals between 2008 and 2015. Yvette Cooper MP asked if the Home Office intended to do a retrospective source of money check on these granted applications. The Prime Minister did not promise such an investigation into these specific cases but advised that a more general review of the Tier 1 Investor scheme was underway by former Home Secretary Amber Rudd MP. The review goes beyond the specific Russia issue, and the Prime Minister stated: “It is right that we look generally to see whether this is a part of our visa regime that is being used properly or whether there are loopholes in it for people to be able to use it as access to the UK when otherwise we would not be granting them access.” a
The scope of the review is not fully known but the investor scheme has already seen significant tightening of regulatory regimes around it. As is commonly known, applicants must of course now open UK bank accounts prior to applying. New civil powers also came into force on 31 January enabling the High Court to grant an Unexplained Wealth Order (UWO) on satisfaction of a number of tests. It is effectively an investigative tool.
A UWO requires a person who is reasonably suspected of involvement in, or of being connected to a person involved in, serious crime to explain the nature and extent of their interest in particular property, and to explain how the property was obtained, where there are reasonable grounds to suspect that the respondent’s known and lawfully obtained income would be insufficient to allow the respondent to obtain the property. The test for involvement with serious crime is by reference to Part 1 of the Serious Crime Act 2007. A UWO can also be applied to politicians or officials from outside the European Economic Area (EEA) or those associated with them i.e. politically exposed persons (PEPs). A UWO made in relation to a non-EEA PEP would not require suspicion of serious criminality.
Global Investor Migration Elsewhere in the News
Even leaving aside reports of Russian-Israeli billionaire businessman, investor, and politician Roman Abramovich’s ongoing visa troubles, investor migration remains headline news. On Monday 5 March, the Organized Crime and Corruption Reporting Project and Transparency International launched a report on global investor migration programs. The report alleges that citizenship- and residence-by-investment schemes are vulnerable to abuse, discusses programs in a number of jurisdictions, and calls on the European Commission to act. The Commission is already active in this area and is examining investor migration programs across Europe (due to report late this year). Nonetheless, the report serves as an important learning tool which the young and evolving industry takes very seriously. It is also a warning of the absolute importance of enhanced due diligence throughout the application process for those offering such programs or looking to move into this space. The report demonstrates that work is still to be done within the industry in order to achieve best practices, rigorous standards, and reputational integrity — improvements can of course always be made and constructive dialogue will remain key.
a parliament.uk/documents/commons-committees/liaison/LC-27-03-18.pdf at Q6