What is a ‘golden visa’?
A Golden Visa is a ‘citizenship by investment’ or ‘residency by investment’ program. It is directed to wealthy foreign nationals who want to acquire residency in a certain country by investing a substantial amount of money in active and trading UK registered companies. Previously those eligible for the visa had to have at least £2 million in investment funds and a UK bank account.
Why have ‘golden visas’ been axed?
The Home Office has closed the Investor visa route for all new applications with immediate effect from 4 pm on 17 February stating that some cases had “given rise to security concerns, including people acquiring their wealth illegitimately and being associated with wider corruption”.
What impact will scrapping the ‘golden visa’ scheme have on the UK economy?
Axing this scheme, especially at such short notice, will have a significant long-term impact on the UK economy at an already unsteady time.
With no alternative visa route at present, this not only impacts future investments, but those already in progress. Legitimate overseas investors will now be left high and dry, not to mention the many families that were planning to move to the UK this year having already invested in real estate and secured places in UK schools for their children.
While the UK’s innovator visa route could provide alternative access to the UK for high-net-worth Europeans who can no longer take advantage of Free Movement, this provides much less flexibility for wealthy foreign investors, requiring them to set up and run a business in the UK. While we are expecting Home Office reforms to the Innovator, it need to come with an investment route that successfully supports the UK economy. The ‘golden visa’ scheme was also the only one that had no English language requirement, allowing recipients the freedom to work, study and do business in the UK, and provide holders with a fast track route to UK residency. The loss of this is significant.
It’s unlikely that the scheme will be replaced with an alternative at present as the closure was triggered by concerns over it being open to abuse, despite the fact that the Home Office previously reformed the scheme with a view to prevent corruption and improve its value to the UK economy. More must be done to keep the UK an attractive place to live, work and invest.
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