The UK has shut down its Tier-1 Investor visa program in a decision that has taken the global investment immigration industry by surprise.
The abrupt decision is designed to punish wealthy Russians given the ongoing invasion of Ukraine.
Setup in 2008, the program ceased to exist with effect from February 17, 2022.
National Security Concerns Prompted the Move
The government justified the decision on grounds of dirty money and corrupt elites threatening national security. Critics have long targeted golden visa programs and citizenship by investment programs, especially those in the EU, for national security concerns.
However, the dirty money argument doesn’t really hold for the UK program because authorities had imposed new financial controls with retrospective effect on all Tier-1 Investor visa applicants in 2020.
The new rules were imposed after a bizarre turnaround that saw the program terminated before the decision was overturned in a day. However, this time, the shutdown of the Investor visa seems final.
About the Tier-1 Investor Program
Typically, a foreign national must reside in the UK for at least three to five years before becoming eligible to apply for permanent residence (or Indefinite Leave to Remain).
The Tier-1 Investor visa allowed wealthy foreign nationals to jump the line and qualify for ILR in just two years. The price tag? A cool £10 million investment in the UK. Those investing £5 million would have to wait for three years while the minimum residence period was five years for those investing £2 million.
In contrast, a foreigner working in the UK can apply after five years while an applicant under the Innovator visa must wait for three years before they are eligible to seek ILR.
Fast-track ILR apart, the Tier-1 Investor visa had no specific requirements related to the applicant’s educational qualifications, language skills, or even the need to work to settle in the country.
The program was popular among the wealthy citizens of Russia and China. Between 2010 and 2021, the program brought in foreign investment worth at least £17 billion.
Short-Sighted Decision to End the Program
Considering that the UK retrospectively introduced new financial controls in 2020 to curb the entry of dirty money into the country, the abrupt termination of the program on grounds of national security concerns does not seem convincing.
Out of the 12,000+ Tier-1 Investor visas issued since 2008, just 2,500 visas have been issued to Russians, which means this short-sighted decision will harm the UK economy and its ability to attract foreign investments with no tangible benefit.
With the US sorting out all the issues with its EB-5 visa, including reauthorization of the Regional Center program, this decision is likely to prompt investors to simply switch over to across the Atlantic instead.