There has been a steady uptick in demand for the UK’s Tier 1 Investor visa among wealthy Chinese investors with total applications rising by more than 100 percent between 2015 and 2019.
Demand among investors from mainland China has surged by close to 170 percent, while total applications from Hong Kong, although much lower in absolute numbers as compared to the mainland, tripled between 2015-16 and 2018-19.
UK Tier 1 Investor Visa Applications
About the Tier 1 Investor Visa
The UK’s golden visa program offers investors the right to reside in the country for 40 months with the option of extending their stay by another two years along with the option of applying for settling permanently in the country.
The minimum investment under this program is £2 million, although investors can qualify for the right to apply for indefinite leave to remain in the UK faster by bringing in higher investments up to £6 million.
The surge in applications from China is surprising considering the uncertainty surrounding the program. In 2019, the government decided to temporarily shut down the program before rolling back its decision a few days later.
In April 2019, the government introduced tougher rules related to proof of ownership of funds. Investors are now required to submit proof of ownership of funds for at least two years prior to submission of the Tier 1 Investor visa application.
Reasons Behind Growing Tier 1 Visa Demand
The Tier 1 visa program was expected to witness a huge fall in demand due to the prolonged uncertainty surrounding Brexit and its implications for investment immigrants. Yet, investors chose to shrug off the issue and focused on the benefits and advantages of settling in the UK.
In fact, fears that the government would revoke the program or mandate higher investment requirements or tougher regulations prompted more wealthy investors to apply, which ultimately resulted in a surge in applications in 2018-19.
Other factors that prompted Chinese investors to prefer the UK over the US included the huge EB-5 backlog of applications from China, the simmering trade tensions between the US and China, and benefits like the education system in the UK.
Chinese investors face a 16-year waiting period for the EB-5 visa, which makes it virtually impossible for investment immigration to consider this option today.
EB-5 rules require the investment to remain at-risk until completion of the two-year conditional permanent residence. This means an investor from China may have to fulfill this requirement for as long two decades.
The UK is as developed as the US and, in fact, its education system has a much better reputation. This makes the UK an attractive destination for ambitious, wealthy Chinese investors seeking quality education and career prospects for their children.
The fall in the value of the British pound has made it easier and cheaper for foreign investors to buy assets in the UK, which is definitely a plus for any investment decision.
Finally, the end to prolonged political uncertainty in the UK, the election of a pro-business and pro-investment Prime Minister, and greater clarity on the post-Brexit picture, led to Chinese investors switching from the US to the UK in large numbers.
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