‘Global Britain’ restricts rules on representatives of overseas businesses

In the midst of a global pandemic, and whilst the immigration law community waits with baited breath for further guidance related to COVID-19, on Thursday 14th May a new statement of changes to the Immigration Rules was laid before Parliament. The statement contains significant changes to the sole representative of an overseas business (‘sole rep’) route that come into force on 4th June 2020. In particular, the changes involve:

• the introduction of a new requirement to ‘genuinely’ meet the requirements of the rules;
• wording to specify that the branch or subsidiary established by the representative must not be established ‘solely for the purpose of facilitating the entry and stay of the applicant’; and
• a new requirement that the applicant has the skills, experience and knowledge of the business necessary to undertake the role (though this was arguably always implied within the Rules) .

These three changes in particular appear to introduce an element of subjectivity and discretion to the requirements, and give the Home Office a much wider margin to refuse applications in what was previously a straightforward category. The genuineness requirement is wording that we’re familiar with as it’s been a feature in other immigration categories and was a notorious stumbling block under the old Tier 1 (Entrepreneur) rules. We need to await further guidance on this but one can expect factors such as the evidence submitted and the credibility of the business and applicant to be scrutinised.

Other important changes include:

• a tightening up of the wording around majority stakeholding: whilst the current rules state that a sole representative should not be a ‘majority shareholder’ in the overseas business, from 4 June they will state that a sole rep must not have ‘a majority stake in, or otherwise own or control, that overseas business, whether that ownership or control is by means of a shareholding, partnership agreement, sole proprietorship or any other arrangement’. This change in language clearly confirms the position regarding stakeholding in the business; and
• preventing the partner of someone with a majority stake entering as the sole rep, with the majority stakeholder entering as their dependent (previously this had provided a loop hole through which to  effectively circumvent the majority stakeholder restriction).

Other minor amendments have been made including clarification that the overseas business must maintain its place of business outside the UK and that applicants must not engage in their own business or represent any other whilst in the UK. Both these requirements were, respectively, already included in the guidance and elsewhere in the Rules so these are less significant.

With these changes due to come into force in a couple of weeks time, it will be interesting to see if there is a surge in Entry Clearance applications (under the current rules) despite the coronavirus lockdown so that individuals can benefit from the less prohibitive rules.

Overall, these changes represent a notable restricting of a category that had until now been a useful and straightforward one for those looking to come to the UK for business purposes. One can’t help but wonder whether changes such as these really fit with the government’s quest to attract the ‘brightest and best’ to the UK, and whether they signal a ‘Global Britain’ that is ‘open for business’.