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UK's "Golden Visas" - Reflections On Tribunal Ruling

Ben Keith

17 March 2020

The present UK government, flush from being elected to power in December 2019 (which seems a long time ago already, given recent events), has made reform of the UK immigration system an important policy commitment. Control of the country’s borders was one of the main, if not the largest, issues in the Brexit referendum. Separate but related to that is how successive Labour, coalition and Conservative governments have adjusted the UK’s Tier 1 investor visa regime, or “golden visa” programme. Scores of countries around the world have such programmes, and they can be controversial because of their allegedly allowing dirty money into a country, or because they are seen as a way for rich people to buy citizenship in ways unobtainable for ordinary citizens.

What to make of the existing immigration picture in the UK? To try and answer that question is Ben Keith, a barrister at 5 St Andrew’s Hill in London. 

The editors of this news service are delighted to share these views on such a major topic and invite readers to respond. The usual editorial disclaimers apply. Email and

The Government has recently set out proposals on the new immigration rules, showing that the UK is open for business and welcoming highly skilled migrants entering the UK to take up employment. However, little has been mentioned about Tier 1 (aka “Golden”) visas, in which holders can live and work in the UK after investing £2 million ($2.45 million) of more and subsequently can obtain British nationality. The Government should be placing its focus much more on these visas, as high net worth individuals entering the UK on these visas provide substantial and important foreign investment in the UK economy, which will be much needed post Brexit. 

In reality, the attitude of the authorities to Tier 1 investors is often unduly hostile and unwelcoming, the evidence of which was highlighted in a recent Upper Tribunal (UT) case. The UT recently assessed several Tier 1 applications in R(JW and ors) v SSHD , the somewhat surprising outcome of which was disappointing in that it risks discouraging high net worth investment in the UK. 

Many of the investment schemes in this case didn’t comply with the Immigration rules, the UT found, so the applications were not granted. Realistically, the UT should have interpreted the law on investment by going through the definitions given by financial instrument and banking law. Instead, the UT looked at the interpretation of the law on investment products using the ‘ordinary meaning’ of the terms of the immigration rules, which is far from ideal when it comes to examining complex financial products. The decision by the UT is awaiting permission from the Court of Appeal but there are a number of features that show how a strict interpretation by the Home Office of the terms of the Immigration Rules will needlessly discourage high net worth investment in the UK. 

One of the applications involved two women who both bought a product by Maxwell Holding Ltd (“Maxwell”). Ms Wu was loaned £5 million by Maxwell Asset Management Ltd and A1 took out a £1 million loan, following which both women invested the money in Eclectic Capital Limited (“Eclectic”). A1’s loan agreement involved lending £1 million to Eclectic over a period of five years. Ms Wu’s loan agreement was materially similar of £5 million in February 2014. 

Both applications were denied in 2017, with the Home Office judging that neither women had control over their money at the time of entering into the investment agreement and therefore did not have a free choice to invest in Eclectic, but rather that they were required to do so. The Home Office also decided there was doubt over whether the women were genuinely investing funds under their own control, due to the lack of returns on their investment. A judicial review took place before the UT which decided the Home Office had the right to conclude this, based on the links between Eclectic and Maxwell, and the terms of the loan between the two companies. The decision that both applicants’ investment in Eclectic would not qualify as an investment loan was largely because it had common features to the vehicles listed in the Immigration Rules in §65(b) of Appendix A.

The UT was concerned that the applicants did not have the money under their control and said:

“ UKSC 16 rather than look at the myriad of available material on commercial investments. As a result, the conclusion was that the investment scheme was a type of “pooled investment” which are prohibited by the rules.

However, the analysis is faulty in this respect; there is a specific regulatory definition of “pooled investment” that are regulated by the Financial Conduct Authority and none of the regulated schemes covered the investments in this case (which would have made them prohibited by the immigration rules). However, the UT found that there were “common features” that made the Eclectic scheme non-compliant with the rules, even though the scheme was legitimate and did not require regulation. If the Home Office had examined more carefully the regulatory framework around the investments it would have been forced to conclude that the scheme was within the rules and a legitimate investment vehicle. 

By interpreting such investments without reference to the regulatory context, the UK does not look open for business. This case highlights a concerning lack of willingness by the UK Government to support Tier 1 visas, which could be very detrimental to attracting high net worth individuals and foreign investment to the UK when it is needed the most, i.e. post-Brexit.