Immigration lawyer Joanna Hunt, Fieldfisher, says it is vital that businesses understand the actions they need to take in respect of their licence when a controlling interest is transferred.
Many businesses are unaware that a change in their ownership structure can have significant implications under immigration law, particularly if they hold a sponsor licence under the Skilled Worker visa category or other sponsorship route.
The Home Office expects a business, once it secures a sponsor licence, to shoulder some of the responsibility of policing the immigration system and monitoring of their sponsored workers by adhering to a series of duties and expected behaviours while they hold a licence.
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The duties require sponsors to report certain events and changes in circumstances to the Home Office that relate not only to the sponsored worker but also to the sponsor themselves. As a sponsor licence is not “transferable”, a change in the ownership structure of a business may therefore necessitate reports to be made to the Home Office, and in some cases a new licence will need to be obtained.
Steps businesses should take
The steps that a business will need to take will depend on the change in ownership structure and whether a controlling interest has been transferred. If, for instance, a business has a new direct owner then the following steps may need to be taken.
If the new owner does not have a sponsor licence, the Home Office expects a new sponsor licence application to be made within 20 working days of the transfer in ownership. This will require the company to go through the same application process they did when they obtained their licence, complete with the supporting documentation and payment of a fee.
Secondly, a series of reports need to be made to the Home Office via their online portal, the Sponsor Management System, all within 20 working days. This includes notifying the Home Office of the change in ownership on the old licence, which is then usually made dormant. Once the new licence is in place, reports are made to confirm that the business is still continuing to employ the sponsored workers and that they have transferred to the new licence.
Severe consequences
The consequences for failing to carry out these actions are severe. The Home Office can cancel the worker’s sponsorship and curtail their visas. The workers would then either have to leave the UK or find new employers and the business can be prevented from applying for another licence for 12 months.
Any sponsor licence holder that is going through a change in ownership should therefore seek advice on what actions they need to take in respect of their licence to ensure they do not fall foul of their sponsor licence duties.
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