Trump’s Immigration Ban leads to Surge in Interest in UK Visas

By Duncan Hill, Marketing Director, Davies & Associates

Our clients have always been interested in the UK, but we have certainly seen a spike since President Trump suspended a whole lot of US visas in April (and then a whole lot more last week).

The first thing to say is that not all US visas have been suspended. We specialize in two key categories that are exempt. The EB-5 Immigrant Investor Visa Program and the E-2 Treaty Investor Visa were not included by President Trump, probably because they create jobs and promote investment in the United States.

Nevertheless, our teams around the world are noticing above-average-levels of interest in Britain, especially from clients and agents in Vietnam and India.

One of the ostensible aims of Brexit is to create a more “Global Britain“, attracting the best and brightest from around the world. As part of that, a new points-based immigration system will be introduced next year. Points will be awarded for things like English-language capability, salary bands, and education levels.

As the UK gears up to this, one change has already been made with the introduction of the Global Talent Visa in February. This change is rather more one of style than substance, since it is mostly a rebranding of the “Exceptional Talent Visa

The Global Talent Visa is one of a range of so-called “Tier One” visas offered by the British government. Tier One visas are for “high-value migrants”, such as people bringing investment or talent. By contrast, Tier Two visas are for skilled immigrants with a job offer in the UK.

Another Tier One visa is the Investor Visa, which requires a minimum £2 million investment in UK bonds or shares. Anyone with this visa can apply for Indefinite Leave to Remain (IDLR) in the UK after five years. That waiting time can be reduced to three years for a £5 million investment or two years for a £3 million investment. It is possible to apply for UK citizenship 12 months after obtaining IDLR, subject to certain other requirements.

Investment AmountApply for Indefinite Leave to Remain
> £2 million5 years
> 5 million3 years
> 10 million2 years
UK Investor Visa

The Innovator Visa and the Start-Up Visas, are also classified as Tier One. These visas are very similar in that they target people with a business idea that is deemed innovative, viable and scalable.

Where they differ is in the stage of development of the businesses they target. The Start-Up visa targets early stage companies and does not require any investment requirement, whereas the Innovator Visa targets slightly more mature firms by requiring minimum investment funds of £50,000.

Start-up visa holders are expected to transition to the Innovator visa when they can prove they have hit the funding threshold. After three years, anyone with an innovator visa can apply to settle in the UK, subject to certain other conditions.

All of these visas will be transitioned to the points based system in a favourable way. So, for example, a £2 million investment will give a person 75 points meaning they automatically exceed the 70-point-minimum threshold for entry.

While there is still considerable uncertainty surrounding immigration policy as the Brexit negotiations drag on, one thing is clear: The UK still wants to attract the “best and the brightest” to its shores.

Davies & Associates has offices in the United Kingdom and throughout the world. We are able to offer advice on the best ways for you to move your business and family overseas. As a law firm with both immigration lawyers and corporate lawyers, we are able to help our clients not just obtain visas, but to establish their firms overseas and stick by their side as they prosper.

Nothing in this blog constitutes legal advice. Please contact Davies & Associates to schedule a free consultation.


Live your Italian Dream through the Elective Residency Visa

By Matteo Tisato. Matteo is a Senior Immigration Analyst in our Italy Practice Group. Connect with Matteo on LinkedIn.

With offices across Italy, Davies & Associates is able to help foreign nationals obtain the right to live, work or claim citizenship, collect debts, and pay taxes in the country.

In the first of a series of blogs from the Italy Practice Group, Matteo Tisato examines the benefits, requirements, and timelines of the elective residency visa.

The Italian elective residency visa allows entry into Italy for an open, long-term visit to foreigners who intend to establish their residence in Italy and who are able to do so by showing financial incomes without the need of employment.

Individuals must submit suitable and documented proof of housing (to be purchased or rented) in Italy and an income of more than EUR 32,000 of regular and stable financial resources which are likely to remain steady in the future. Resources must derive from prolific revenues (annuities, rents, pensions, bonds), properties ownership, stable economic-financial activities or other sources other than subordinate employment. This type of visa allows these individuals to enter Italy for an indefinite period of time.

The visa application will involve completing the relevant application form and providing supporting documentation. The Consulate has the right to issue the visa within 90 days, but the processing time is usually between four to eight weeks, depending on the Consulate’s workload, time of year, and applicant’s nationality. The applicant will need to show assets from a portfolio. The Consulate may request original financial statements from banks, investments/brokerage firms, or social security, all indicating current balances.

As soon as the Elective Residence Visa is issued, the foreigner may enter Italy and apply for the Permit of Stay, also called “Permesso di Soggiorno”, within eight days of arrival. Once the Permit of Stay is issued, the immigration process is completed and the foreigner will have proper legal status in Italy.

An individual who obtains an elective residence visa shall not pay taxes in Italy if: (1) is not registered in the City Hall (Comune) of the place where living; (2) and lives in Italy less than 183 days during the fiscal year (January to December); (3) and does not have his habitual abode in the country (e.g. his family lives in Italy and he has in Italy his principal center of business and interests)

Holders of an elective Permit of Stay can apply for the EC Permit of Stay for long-term residents after 5 years of legal stay in Italy. In order to be eligible, they must have registered as residents of Italy and filed tax returns. After 10 years of legal residency in Italy, an individual should be eligible to apply for Italian citizenship.

TIMELINE

Elective Residence Visa Application2-6 Weeks
Residence Permit Application3-5 Months
Residency Registration1-3 Months

This blog is for informational purposes only. Nothing in this blog constitutes legal advice. Please contact us to discuss your specific circumstances.


EB-5 Project Due Diligence in Covid-19 era

By Mark Davies, Global Chairman, D&A

While the pandemic was not predictable economic shocks such as the mortgage crisis or just a plain economic downturn are.

Without making any comment at all on any specific EB-5 project, it is true that investors need to make sure that proper protections are in place when investing in any project. Many, not all, EB5 projects simply do not have the protections in them that a normal non-EB5 investor would demand.

There absolutely are real estate EB-5 projects in the market that are doing well, such as pre-leased warehouses or office buildings that are pre-leased to “AAA” clients.

There is far more to EB-5 project review than EB-5 compliance.

It is quite common to see EB-5 projects that have no language protecting clients from future subordination of the EB-5 position. In pre-leased commercial projects immigration lawyers often fail to take “due diligence” step 101 and read that lease on behalf of their client.

There are absolutely steps clients facing challenged projects must take now to protect themselves. Workouts 101.

Also, consider the position of a developer who is also a Regional Center in a workout or bankruptcy. Can they effectively represent the interests of EB5 investors?

***

The EB-5 Immigrant Investor Visa Program offers a direct route to a US Green Card. The minimum investment requirement is $900,000 and other conditions, such as job creation, apply. The EB-5 Visa is exempted from President Trump’s current “immigration ban”.

Contact me for more information.

Nothing in this blog constitutes legal advice, please contact Davies & Associates for a consultation with an attorney


July Visa Bulletin shows India EB-5 Visa Priority Date as “Current”

The State Department has published the July Visa Bulletin, which offers some insight into the waiting times for the EB-5 Immigrant Investor Visa Program. The most notable change in this month’s Visa Bulletin is that EB-5 Visa Priority Date for India has become “Current”.

What this means is that India is no longer in retrogression and EB-5 applicants born in India can progress to the next stage and schedule their visa appointment once they are approved.

At first glance this is exciting news and would appear to spell the end of the waiting list for Indians seeking an EB-5 Green Card. However, as we have cautioned before, this is likely to be artificial.

The probable explanation is that the rate of I-526 adjudications at the US Citizenship & Immigration Services (USCIS) has slowed significantly. Only after an I-526 has been approved can an applicant progress to obtaining a visa. So with fewer adjudications there is likely to be less demand at the National Visa Center, causing India to appear as “Current”.

With Covid-19 compounding the slowdown at USCIS, we will be keeping a close eye on the priority dates for you over the next few months.


Insolvency & Bankruptcy in India during Covid-19

Neha Mehta analyses what the Indian government is doing to mitigate the impact of Covid-19 on bankruptcy and insolvency.

COVID-19 & INITIAL MEASURES

Covid-19 has altered the fabric of the global economy. Worldwide lockdowns, travel restrictions, restraint on international trade and other stringent measures to curb the pandemic, has led to uncertainty around the future of many businesses.
With the objective of lending support to struggling businesses, most nations, including India, have introduced fiscal, monetary and protective measures to prevent multiple bankruptcies.
In its first measure to protect small and medium enterprises, already under severe financial stress, the Government of India, in March 2020, raised the threshold of the default amount for invoking the Insolvency and Bankruptcy Code, 2016 (IBC) to Rupees One Crore (earlier Rupees One Lakh).
The Government, to support and provide relief to businesses across all sectors subsequently indicated that it may suspend, for an initial period of six months, the (key) sections 8, 9 and 10 of IBC which trigger the insolvency process, and perhaps further extend such shield to a year, if the pandemic continues.


THE UNCERTAINTY
The effective date of such amendments would be the date of promulgation of an ordinance. However, as one was not issued, till now, speculation was rife over what the Government will do, especially with respect to the cut-off date to invoke insolvency under sections 8, 9 or 10.
In the midst of this, there has been an overwhelming section of the public that has been disenchanted over the attempt to shield defaulters and provide them benefits that they may not deserve. There has also been concern over whether the protections would extend to prior defaults, existing pre Covid-19. This includes borrowers, banks, financial institutions, legal professionals and parties affected by breached contracts.

Ultimately, on 17th May 2020 the Union Finance Minister, in line with earlier announcements, announced that the Government will promulgate an ordinance suspending initiation of fresh insolvency cases for a year, and that the amended definition of ‘default’ under the IBC would exclude Covid-19 related debt.
Despite the announcement, it was unclear whether fresh insolvency filings would include a debt or default occuring prior to the onset of Covid-19.

CLARITY
The air was cleared with the promulgation of an Ordinance on 5th June 2020 (Ordinance), suspending the Corporate Insolvency Resolution Process (CIRP) for all defaults arising on or after 25th March 2020 for a period of six months, with a possible extension upto one year that may be notified subsequently (Suspension Period)
In essence, by virtue of the Ordinance no CIRP proceedings, may be invoked at any time in future, for defaults that have arisen during the Suspension Period. However, defaults occurring before or after the Suspension Period are not protected.
In addition, the Suspension Period is excluded from the six-month default period for declaration of a debt as a non-performing asset (NPA).


LENDERS – A HAPLESS BUNCH?
To say that these are challenging times for lenders would be an understatement. The IBC has not only provided efficacious and speedy remedy for recovery, it has also proved a strong deterrent against borrowers defaulting.

In the absence of this formidable weapon and shield, lenders may turn to The Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (SARFAESI) for enforcement of security interests, including enforcing mortgages of real property, and assuming management and control of a debtor.

While the Government has not suspended SARFAESI (at least not as yet), the deferment of NPA classification for the six-month Suspension Period may render SARFAESI a toothless tiger. This may leave lenders with the sole option of invoking dispute resolution provisions, as a method of recovery, in respect of a default. 

As far as affected parties to a contract, as IBC is off the table for the time being, their only option would be to resort to dispute resolution, which, of course, is neither as economical or as speedy as the CIRP process. 

CONCLUSION 

With a flood of defaults looming, questions will arise over whether these protective measures shield those who don’t really deserve protection, with a view to save the few who are genuine and well-intentioned. The argument in favour will, of course, be that the Government, by taking the broader long-term view, and allowing distressed businesses to heal and recover, will help the economy recover and, in the long run, even recoveries. Certainly, that would be the ideal outcome, but until we see that happen, lenders and parties to contracts that are owned monies will have to hold their breath and hope for the best. 

Disclaimer: This article is provided for informational purposes only and is not legal advice. For more advice on the topic, please contact the author. 


India Tax Changes on Remittances Delayed to October

Sukanya Raman, Associate in our Mumbai office, analyses changes to India’s taxation of remittances.

In February, 2020 the Union Budget had proposed the levy of Tax Collected at Source (TCS) on remittances made under the Liberalised Remittance Scheme (LRS) of the Reserve Bank of India. Although, the Scheme was introduced in the year 2004 with a limit of USD 25,000. This is the first time TCS shall be levied at 5% on remittances over and above certain limit.

TCS was to be applicable for remittances on or after April 1, 2020, as per the budget 2020. However, the provision shall now be effective from October 1, 2020.

In a Financial Year (FY) April- March under the Liberalised Remittance Scheme a resident individual can remit USD 250,000, equivalent to INR 1,90,00,000 with an exchange rate of INR 76.00.

LRS is applicable to resident individuals which also allows minors to remit money to any permissible current or capital account transaction or a combination of both. If remitter is a minor, then their natural guardian must undertake a declaration form. The LRS cannot be availed by corporates, partnership firms, HUF, Trusts etc.

TCS shall be collected at the rate of 5% on remittances aggregating to INR 7,00,000 or more in a financial year. 

Per the RBI guidelines, LRS is permitted for private visits to any country (except Nepal and Bhutan), gift or donation, traveling abroad for employment, emigration, investment abroad, maintenance of close relative abroad, medical treatment abroad, overseas education and Any other current account transaction which is not covered under the definition of the current account in FEMA 1999.

Under the LRS, remittances can be consolidated in respect of close family members. However, it shall be subject to the individual family members complying with the terms and conditions of the LRS.

The remitter is eligible to claim credit for the tax collected (TCS) by the bank while filing their Income Tax returns, if it is remitted to the sender’s own account abroad.  

Based on the data released by RBI, remittance rose by 36% in  FY20 to USD 18.75 billion over the previous high of USD 13.78 billion in FY19.

This blog is for informational purposes only and is not meant as legal advice. For advice on this matter, please contact our team.