Changes to the Tier 1 (Entrepreneur) category from 31 January 2013

In its most recent Statement of Changes to the Immigration Rules, the UK government has announced important changes to the Tier 1 (Entrepreneur) category of the points-based system. The changes were laid before Parliament on 30 January 2013 and come into force with immediate effect today, 31 January 2013.

The changes being made to the Tier 1 (Entrepreneur) category are designed to improve the effectiveness of the current Immigration Rules. The following changes apply to both Tier 1 (Entrepreneur) entry clearance applications and Tier 1 (Entrepreneur) leave to remain applications.

Genuine entrepreneur test

From 31 January 2013, a "genuine entrepreneur" test is being introduced to give the UK Border Agency the ability to test the credibility of suspicious applicants and to use their discretion, while leaving the basic requirements unchanged.

In order to qualify for entry clearance or leave to remain as a Tier 1 (Entrepreneur) Migrant, applicants are now required to demonstrate that they genuinely (a) intend and are able to establish, take over or become a director of one or more businesses in the UK within the next six months; or (b) have established, taken over or become a director of one or more businesses in the UK and continue to operate that business or businesses (only applicable for leave to remain applications). Applicants are also required to show that they genuinely intend to invest their funds in the above business or businesses.

The UKBA may take into account the following factors in assessing whether or not an applicant is a genuine entrepreneur:

(a) the evidence the applicant has submitted;

(b) the viability and credibility of the source of the applicant's money;

(c) the viability and credibility of the applicant's business plans and market research into their chosen business sector;

(d) the applicant's previous educational and business experience (or lack thereof);

(e) the applicant's immigration history and previous activity in the UK;

(f) where an applicant has already registered in the UK as self-employed or as the director of a business, and the nature of the business requires mandatory accreditation, registration and/or insurance, whether that accreditation, registration and/or insurance has been obtained (only applicable for leave to remain applications); and

(g) any other relevant information.

Although there are no mandatory requirements in terms of specified documentary evidence, the UKBA reserves the right to request additional information and evidence to support the above assessment. If the UKBA is not satisfied with the genuineness of the application, then the application is likely to be refused.

Minimum funds to be held

From 31 January 2013, further changes are being made to require the necessary minimum investment funds to be held, or invested in the business, on an ongoing basis rather than solely at the date of application.

In order to qualify for entry clearance or leave to remain as a Tier 1 (Entrepreneur) migrant, an applicant is now required to demonstrate that they have access to £200,000 (or £50,000) and that the money is genuinely available to them, and will remain available to them until such time as it is spent by their business or businesses. There are no changes to the level or accepted sources of the funds themselves. Applicants can rely on money in their own possession, in the financial accounts of a UK incorporated business of which they are the director, or available to them from any third party or parties named in the application.

The UKBA has also introduced a power to curtail leave if the funds cease to be available. An applicant's leave to remain as a Tier 1 (Entrepreneur) may be curtailed if the investment funds cease to be available after leave to enter or remain in the UK has been granted, unless the funds have been invested in the establishment or running of a business or businesses in the UK.

As with all aspects of the Immigration Rules, compliance with the above new requirements will need to be checked carefully in all cases. If you would like further advice or assistance with preparing an application for entry clearance or leave to remain as a Tier 1 (Entrepreneur) migrant, then please contact our immigration barristers in Covent Garden, London on 0203 617 9173 or by email info@richmondchambers.com