Latest

 TV 
Date
03 April 2013

Mishcon Thinks: High Net Worth Immigration

In this film Kamal Rahman, Partner and Head of the Immigration Group, is in conversation with broadcaster Katie Derham on the issues affecting her high net worth clients and how an enhanced category of investor visa will help to attract inward investment into the UK.  

Transcript

Mischon Thinks:  High Net Worth Immigration

Katie Derham

Kamal Rahma, you’re a Partner at Mishcon de Reya and their Specialist in UK Immigration law.  Immigration is one of those topics that gets people very hot under the collar.  Which particular part of it are you dealing with?

Kamal Rahman
Partner, Immigration

At Mishcons we tend to advise high net worth individuals primarily from the emerging markets.  Those people that want to really come to the UK and invest and take residency by that route.

Katie Derham

And by what method are they doing that?

Kamal Rahman
Partner, Immigration

There are various categories in the immigration rules that say that you can come in for various purposes and the area that we specialise in is people coming in by investing under the Investor category simply by investing money and depending on the amount in certain approved investments that the government are trying to promote one can get residency here.

Katie Derham

So what are the numbers?  What are we talking about, what kind of money?

Kamal Rahman
Partner, Immigration

The numbers in terms of the investment that’s required is that either you invest 1 million, 5 million or 10 million pounds then depending on how much you invest the time to permanent residency, the equivalent to green card status is reduced.

Katie Derham

So if applicants for these Visas are so desirable why stop at 10 million?

Kamal Rahman
Partner, Immigration

That’s a very good point and what we at Mishcons would like to do is actually see the government go further and create an additional Investor category where actually a 20 million pound investment would result in expedited residency and potentially citizenship to the super wealthy that the UK really would like to attract.  I know that goes against the current immigration strategy in reducing numbers and our argument would be to actually limit the super wealthy investors, the 20 million pound investors to say 50 or 100 a year.  Just with those numbers alone you, you know you would have potentially 4 billion net new investment coming into the UK plc.

Katie Derham

Talking about UK plc and immigration strategy.  Do you think we are getting the balance right, are we getting the right kind of businesses, the right kind of people coming here?

Kamal Rahman
Partner, Immigration

I think the whole immigration debate gets skewed in favour of economic migrants who are deemed to be taking from the state and I don’t think there’s enough discussion about actually attracting business people, entrepreneurs and those who actually see London as part of their global economic strategy and their global business strategy and the UK is suffering because those people feel very unwelcome here.  And the messages that go out from an immigration dialogue from the UK is actually the UK borders are closed.

Katie Derham

So unless you have already made your money in which case you can buy one of these high net worth visas.

Kamal Rahman
Partner, Immigration

Yes.

Katie Derham

So you feel that they should be more open to the entrepreneurial business coming here to make their money?

Kamal Rahman
Partner, Immigration

Absolutely.  I think there’s a misconception that most entrepreneurs want to come here and stay here. Most entrepreneurs simply want to be able to come here, access the services that they require from the UK but return to their country of origin because actually that is where their network us, that’s where their spear of influence is and that’s where their connectivity is and they actually want to go back there and continue developing their wealth but be able to access the UK as and when required.

Katie Derham

So effectively this is a way to buy residency?

Kamal Rahman
Partner, Immigration

I wouldn’t say buy yourself residency has negative connotations; it’s actually a way in which the UK can attract high net worth individuals who are willing to put money in the UK government coffers.

Katie Derham

Well that might be wonderful news for property developers in Kensington and Chelsea, but of course one of the arguments that people get rather worried about is the fact that it’s hugely inflating the property market.

Kamal Rahman
Partner, Immigration

One could agree that and there is no getting away from the fact that actually certain pockets of Central London are being purchased specifically by overseas buyers, but I think that’s actually an attribute that London in particular has to sell for itself internationally.  People put money in London real estate because they see it as safe haven.  Safe haven not just from a political point of view, but from a value point of view so actually I think it’s a very good thing for the UK economy.

Katie Derham

What is it that makes people want to come to London?

Kamal Rahman
Partner, Immigration

A number of factors.  So it can vary from just the linguistic prevalence of English throughout the world, it’s definitely the educational system.  Most high net worth individuals, particularly for the emerging markets want their children educated in UK schools.  It is definitely the rule of law and the stability of the legal system here, you know we have seen many high profile litigation cases being held in London which perhaps don’t require, which aren’t being litigated by UK residents.  It’s definitely the fact that actually a stable government, a stable political system and that’s what people want, they want safety for their funds as well as their family and that’s what makes them come here.

Katie Derham

Could you describe a typical client of yours?

Kamal Rahman
Partner, Immigration

Yeah, a typical client would be somebody who has assets of over 50 million, between 50 million and up to a couple of billion, they tend to be self-made owner entrepreneurs, these aren’t people that have inherited money.  They are generally from the emerging markets so Russia, the Middle East and increasingly the Far East.  There is a huge strata of wealth in each of these countries and those people when they’ve have made their money in their country of origin, they want to have a base in a more stable environment and the UK is it.

Katie Derham

What do you say to people who say that it’s simply not fair that these people can buy residency in this highly desirable country?

Kamal Rahman
Partner, Immigration

The government has a mandate to reduce net immigration to the UK.  These people represent a tiny, tiny percentage of the immigration numbers that are publicised regularly. Probably last year I think the maximum number of investors that came into the UK was probably less than 500.  So we are looking at 500 people that are contributing significantly far in excess of the numbers to the UK economy.  So I think on a value basis this group represents very good value for the UK economy.

Katie Derham

So they are not the kind of people who are coming here to use the NHS for example which is often one of those headlines one sees.

Kamal Rahman
Partner, Immigration

Yeah.  I don’t think any of my clients would ever use NHS services; it’s just not part of their life cycle.  They are cash rich, time poor.  And anybody who might have gone into an NHS hospital recently whilst it provides fantastic services, it may not actually provide them at the fastest pace and these people are very, very time conscious.

Katie Derham

So in your view then these are the kind of immigrants about whom headlines are never written.

Kamal Rahman
Partner, Immigration

When the immigration debate continues, these people are not talked about.  It’s always high jacked to a certain extent to the economic migrants that one always hears about, people who are going to take from the UK economy.  These individuals come because actually this is a destination of choice for them and they come with their money to invest in the UK and they create a lot of value here.

Katie Derham

The people who are getting these visas are your classic non doms about whom there is sort of a knee jerk reaction in the press.  How do you feel about that debate?

Kamal Rahman
Partner, Immigration

The people that come here do see the UK as a very advantageous tax destination, but that is part of the UK’s attractiveness and I think if the legislation was changed, one would very rapidly see a huge exodus in the high net worth community leaving the UK and that would have a massive effect on London’s economy most definitely.  You can see that’s being replicated in France with the proposed increase in taxes there and that has already resulted in people to looking to have alternative residences, leaving Paris very, very quickly.

Mishcon de Reya