Prior to the closure of the Tier 1 (Entrepreneur) route, the main requirement was evidence that an applicant had access to funds for investment in their proposed venture.

The Immigration Rules permitted applicants to rely on their own funds, or alternatively on funds that have recently been transferred to them by third parties. In certain circumstances, the rules also permitted reliance on funds that were still held by a third party at the time of the application.

In this scenario, the applicant (and the Home Office) was relying on the third party’s promise that, if and when the visa is granted, the funds would be made available to the Tier 1 (Entrepreneur) for their venture.

It is still a mystery to me why the drafters of the Immigration Rules permitted this funding structure at all. If the third party was serious about investing, why not require the funds to be transferred to the prospective Tier 1 (Entrepreneur) prior to the submission of the application?

The rules on third party funding

Instead, the Home Office created a rule where, if an applicant wished to rely on funds held by a third party, they would need a letter from the wealthy benefactor’s bank confirming that it was

not aware of the third party having promised to make that money available to any other person.

This requirement was listed at paragraph 41-SD(c)(i)(10) of Appendix A (as it was, prior to amendment in 2018). It was aimed at preventing a situation where one person acts as a third party funder for several different applications.

I have never heard of a bank issuing such a letter: it is hard enough getting them to verify statements with a stamp.

To comply, an applicant would have to obtain a declaration, usually from a branch manager, on behalf of the entire bank, regarding their institutional awareness of the third party’s intentions.

Which is why, if a client ever wished to proceed with this funding structure, I would pop a flare, drop to my knees, and frantically wave my hands above my head like Nicolas Cage in the final scene of The Rock in my efforts to dissuade them. 

The case of Junied

This is not what happened in R (Junied) v Secretary of State for Home Department [2019] EWCA Civ 2293.

The third party holding the funds in this case tried to obtain a letter confirming his intentions from the Halifax Bank, where the investment monies were held.

The Halifax issued a letter explaining that it could not provide such a declaration. The relevant branch manager was recorded in evidence as stating

he was not aware of any precedent and/or an example where the bank had issued the letter in the requested format.

The applicant relied on this letter to suggest that the requirement was incapable of fulfilment and that discretion should therefore be exercised.

He also submitted similar letters from NatWest, Lloyds and Barclays which (he suggested) indicated that those banks would also be unable to make such a declaration.

For its part, the Home Office produced in evidence a letter from HSBC in an unrelated case from 2016 to show that such a declaration had been made in the past.

Nothing is impossible

Lord Justice Davis, giving judgment in the Court of Appeal, doesn’t really address the bonkers nature of the requirement itself. Instead he sticks to the “rules is rules” theme of applications made under the Points Based System:

The underpinning rationale for the current requirements of the PBS under the Rules is, as I have said, clear. These requirements have been, in a context such as the present, expressly approved as workable and fair in cases such as Durrani and Iqbal (cited above). There is no reason not to apply the reasoning in those cases to paragraph 41-SD(c)(i) of Appendix A and to this particular case, and every reason for doing so. The rules here are specific in their requirements; and the applicant in this case failed to meet those requirements. As paragraph 245DD of the Immigration Rules stipulates, in such circumstances the application will be refused. That, put shortly, is the end of the matter, as I see it.

In an approach no doubt inspired by Westlife’s underrated 2008 track Nothing is Impossible, Davis LJ did not accept that such a declaration could not be obtained:

I should in any event make clear that I was wholly unpersuaded on the evidence that there was an impossibility of compliance here. It may be that the evidence (including the two witness statements) indicates that the Halifax Bank itself does not, as a matter of its practice, currently choose to provide letters in the required format. But that does not mean at all that it is impossible for the Halifax Bank to do so. Nor does it preclude an applicant or sponsor from going to some other regulated financial institution which does not have such a practice.

It is difficult to imagine what evidence could have been placed before the court to prove this negative, and show that it was impossible to obtain the required letter from the Halifax.

It remains to be seen whether and how the promised Australian-style upgrade of the Points Based System will carry forward these evidential knots. Time will tell.