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Commercial Angles' Newsletter - May 2001

Business Immigration into UK

This article discusses the requirements for individuals wishing to work in UK. The various forms in which businesses may conduct their affairs will be dealt with in a subsequent newsletter.

Immigration by Individuals

Frequently employees are relocated to offices and factories in different countries. The type of work permit and procedures to apply depend on the citizenship of the person to be relocated (and his or her spouse if both are to be relocated together). A citizen of any country in the European Economic Area, (EEA), does not need to obtain permission to live in UK. An accompanying spouse from a non-EEA country will still need to apply for permission but this is normally easy to obtain.

The countries in EEA are: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Holland, Iceland, Ireland, Italy, Liechtenstein, Luxembourg, Norway, Portugal, Spain, Sweden and UK.

The citizenship of the person to be relocated should be checked because many people of British ancestry have retained their British citizenship without knowing it. If this is the case a British passport should be obtained without too much difficulty. There are also favourable rules for citizens of the fifty-four Commonwealth countries.

If all citizenship connections with EEA or the Commonwealth have been ruled out then there are several immigration categories in which the person may be placed. Each category has different rules.

Work Permits

If the business already has an established base in UK and if the person is not a significant shareholder, (less than 10% is frequently the test), a work permit may be applied for from the Department for Education and Employment office in Sheffield, South Yorkshire, (DfEE). The applicant must possess skill and experience and the position in which the applicant will be working must require this level of skill or experience. Also, if the position is not to be filled by an inter-company transfer, the company must prove that it has advertised the position and found no suitable applicants from within EEA. However, positions for which skills are in short supply need not be advertised. Details of areas of skills shortages are available at http://www.dfee.gov.uk/ols.

If the position is to be filled by an inter-company transfer then the company does not have to advertise the position, but to class as an intercompany transfer the applicant must have worked for at least six months in the related company overseas. Also, one of the related companies must own all, or a majority, of the shares in the other or both must have a common parent company. A board-level appointment does not require advertising but DfEE may need convincing that the position has real board-level responsibilities and the company will still have to show that no EEA national was suitable.

Typically, the applicant will have a first degree or specialist qualification of a similar level, or will have had three years' experience of performing specialist skills. A non-specialist qualification and one year's relevant experience may also qualify the applicant for a work permit.

The work permit is specific to a named employer. If the applicant wishes to change jobs, a new work permit must be obtained.

Sole Representative

If the business has no UK base and the employee owns less than a majority of the shares in the overseas business, the employee may apply for entry as a sole representative. Such applications should be made outside UK at a British consulate. To qualify as a sole representative, the applicant must be employed in the overseas business and must be a senior employee with full authority to take operational decisions on its behalf in UK. There are few specific requirements as to qualifications or experience for the sole representative.

Once in UK, the employee must establish a branch or a subsidiary which is wholly owned by the overseas company. To do this the foreign entity must be capable of having an overseas branch or subsidiary in UK. Also the sole representative can not subsequently own any shares in the UK subsidiary, for example as a bonus, because it must remain wholly owned by the overseas company. If the sole representative has any shares in the overseas business, there will be a delay in approving the application for entry as a sole representative whilst the details are checked.

The overseas company must continue to operate as the main operation and headquarters once the UK branch or subsidiary has been established. If more employees are to be transferred to the UK operation they must apply for work permits and the rules for advertising the vacancies and employment of EEA citizens will apply..

Entrepreneurs

There are three categories of entrepreneur: innovators, investors and business person / self-employed. Applications to enter UK under these categories must be made at a British consulate who will refer the application to the Immigration and Nationality Department of the Home Office.

An innovator is one who is planning to develop a business but who has raised the funds for at least the first six months of operations from others. The minimum criteria are that:
1. the business must plan to employ at least two people full-time, or their equivalent part-time,
2. the innovator must own at least 5% of the equity of the new business, and
3. the innovator must have sufficient funds to maintain himself and his family without taking employment or relying on public funds.
An investor must control at least £1 million for use within UK. Provided he invests the money in UK and makes his main home in UK, he will be allowed to set up his own business. However he will not be allowed to take up employment except in his own business.
A business person with £200,000 may enter UK to set up a business, provided that:
1. he works in it full-time,
2. he has a major or controlling interest in the business,
3. his capital is invested in the business, and
4. the business creates at least two full-time jobs for EEA residents in UK.

Spouses and Dependents

Spouses of British citizens or those entitled to permanent residence in UK may apply for residence. A non-EEA spouse may apply to live and work in UK if his or her spouse is British or a permanent resident in UK. Cohabitees of a British citizen or someone with permanent residence status may also be able to join their partners in UK. A person with an EEA spouse may accompany their spouse to UK and work in UK provided no funds are drawn from the public purse. Dependants under 18 years of age may accompany the work-permit holder, sole representative or entrepreneur to UK and may work in UK. Dependants over 18 years of age must apply for permission at a British consulate.

Procedures and Problem Areas

Visiting UK to look for accommodation is permitted but as a general rule the applicant should be outside UK and not give up his home base whilst the application is being processed. Applications for work permits and sole representatives are normally processed within a week or two but approval may be delayed if there is any doubt about the circumstances. Applications to enter as an entrepreneur will normally take a month or two and corporate immigration applications sometimes take more than six months to approve. Renewal of work-permits is processed in UK - normally by DfEE. Other renewals are processed by the Immigration and Nationality Department of the Home Office. It is important to comply with the conditions of entry otherwise a renewal may be refused. Some countries require their nationals to obtain a visa before travelling to UK and this affects the procedure the applicants for UK entry must go through. It is a criminal offence for a UK employer to employ someone who does not have permission to work for the company.

Articles from previous newsletters