Setting up a branch or subsidiary of a foreign company in the UK

There are no specific visa requirements for anyone wishing to register a business in the UK. However, this is not the same as working for or on behalf of the company.

Ownership of a UK-registered business does not give the owner residency rights and does not imply the right to work.

In order to be able to work for or on behalf of the business, the business owner may wish to consider all available opportunities before choosing the option that best suits their situation and goals.

For companies established and doing business abroad for at least three years, one of the possible entry routes, including an immigration option for up to five senior employees, is the expansion route of workers. This route replaced the Single Representative route in May 2022. The Expansion Worker route is open to both the business owner and senior company employees and allows up to five representatives in the UK at the same time . The route requirement is that the business must continue to carry on its main business outside the UK, so the route is not suitable for a full transfer of the business, only for expansion in the UK from a well established company and continuing to trade overseas.

The first step on the UK Expansion Worker path is for the business to obtain a sponsorship license. To qualify for the licence, the business must demonstrate that it has been established and operating outside the UK for at least three years and has a genuine intention and ability to grow. The business must also make a UK ‘footprint’ – this means registering a UK branch or subsidiary or securing business premises. Documents required in support of the Expansion Worker sponsor license application include a business plan and financial projection to demonstrate the viability of the project.

Expansion workers must be paid at least £42,400 a year or the ‘governing rate’ for the job as specified in the immigration rules, whichever is greater. The worker must have worked for the company outside the UK for at least 12 months before applying for entry clearance, unless their proposed salary in the UK exceeds £73,900. This requirement does not apply to Japanese companies.

There are no English language requirements for expansion workers. And that road does not lead to settlement in the UK. To qualify for a permanent right to stay in the UK, the worker will need to move into another immigration category, most often the skilled worker route.

The registered branch must remain inactive until all expansion workers have moved to the UK. Once the company has started trading in the UK, the worker expansion route is no longer a viable option. At this stage the company will need a Skilled Worker License or a Senior or Specialist Worker Sponsor License to post their staff to the UK.

Skilled Worker Sponsorship License is accessible to any business enterprise with a genuine vacancy. The company must appoint an authorizing officer as the person responsible for processing the sponsor license application. This authorizing officer must be either a British citizen or a person established in the United Kingdom. Therefore, there is an implicit requirement that the company must have at least one senior manager or office holder.

The skilled worker license is granted for four years and is renewed before expiration.

There is no maximum number of skilled workers that the company can sponsor. The process of sponsoring an overseas worker is slightly different from sponsoring a worker who is already in the UK and is either changing categories or changing jobs. To sponsor a foreign worker, the company must apply to the Ministry of the Interior for a “defined sponsorship certificate”. The application will include details of the job title, job description, working hours, salary, and SOC code for the position, but does not require information about the potential employee. This process can take up to 14 weeks, although in practice it is normally processed much faster.

Once the defined sponsorship certificate is obtained from the Home Office, it is valid for three months and the employee is free to award it to any applicant of their choice. The future employee must then apply for a visa. The visa application must be made within 3 months of the awarding of a sponsorship certificate. The visa application process normally takes up to 8 weeks but can be expedited for an additional fee.

A skilled worker can be sponsored for up to five years. After five years, the employee is eligible to apply for indefinite leave, subject to continuous residency requirements and fitness requirements related to a clean criminal record and immigration history.

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