No duty for Home Office to carry out impact assessment before revoking sponsor licence

The Court of Appeal confirmed in Prestwick Care Ltd & Ors, R (On the Application Of) v Secretary of State for the Home Department [2025] EWCA Civ 184 that the Home Office is not under a duty to carry out an assessment of the impact of sponsor licence revocation.

The Home Office has no obligation to exercise discretion in cases involving serious breaches and mandatory revocation is, indeed, mandatory.

Background

This Court of Appeal judgment has been anticipated following two initial contrasting High Court decisions on whether a wider impact assessment is required, which we looked at here and here. In Prestwick, the High Court said the Home Office was bound by such duty, but in Supporting Care, said it wasn’t.

There were two claimants in this joint appeal. The care home operator was challenging the High Court’s decision to uphold the revocation decision in Prestwick, and the Home Office was challenging the same court’s decision to quash the revocation decision in Supporting Care.

The question common to both appeals was, where a mandatory ground for revocation is established, whether the Home Office is required to assess the potential impact of the revocation on the sponsor’s business, its employees, and those who receive care services and the wider care industry. In other words, is mandatory revocation actually mandatory?

The appeal

The care home operator argued that when deciding whether to revoke a licence, the Home Office was required to balance the interests of immigration control with the impact of revocation on health and social care. The Home Office argued that such interpretation had no basis in law or guidance, and would seriously undermine the sponsor licence regime which is based on privilege, not a right.

The Court of Appeal sided with the Home Office, stating:

The issue for the [Home Office] in each of the cases under appeal was the impact on the integrity of immigration control of the company’s serious breach of the Guidance, not the consequences for the company and others of removing the sponsorship privilege that it had been afforded. 

In dismissing the care home operator’s appeal against the Prestwick judgment, the court affirmed that the Home Office was not obliged to consider the consequences of revocation on health and social care, and that its role is instead to maintain compliance with immigration control.

Although the Home Office succeeded on this principle in Supporting Care as well, the High Court’s decision to quash the revocation decision was upheld on the grounds of procedural unfairness. In Supporting Care, the Home Office concluded a worker’s role was deliberately exaggerated to facilitate her eligibility for sponsorship, which amounted to a finding of dishonesty. However, the Home Office did not put these findings to the worker or the care home operator in interview before revoking the sponsor licence.

The Court of Appeal found that this process did comply with the well-established principles of procedural fairness in cases of suspected dishonesty and upheld the High Court ruling to quash the revocation decision in Supporting Care.

Impact

Although there has been some consensus on the principle of Home Office discretion in the recent High Court decision in One Trees Estates, the Court of Appeal judgment brings certitude. The decision emphasises that sponsorship is a privilege, and serious abuse of that privilege will not be taken lightly. There is little room, if any, to make out an exceptional case or alternative to revocation in mandatory revocation cases.

That said, the judgment is a win for fairness. The Home Office can’t allege dishonesty based solely off a discrepancy on a certificate of sponsorship without following proper procedure, which was a stark determination that came out of the judgment in Supporting Care.

Sponsors must comply, but at the same time, the Home Office must act fairly when imposing serious penalties.