Rich Hongkongers ‘snap up UK golden visas at unheard-of pace’

Rich Hongkongers are pouring cash into UK “golden visas” to ensure a bolt-hole for themselves and their families amid growing political unrest in Hong Kong, immigration lawyers and property investment companies said.

The Brexit-battered pound, which makes the “passport” fee of £2 million (US$2.4 million) less expensive when converted from some other currencies, was also driving a surge in applications from Hong Kong and mainland China.

Hongkongers accounted for 10 per cent of all applications for the UK’s “Tier One” investor visa in the second quarter of 2019, twice as many as the first quarter. That number could rise when the next set of figures are released late November.

Mainland Chinese were still the biggest applicant group at 45 per cent.

Under UK rules, a foreign investor can obtain this type of visa for themselves and their dependents by investing £2 million in British companies. The visa gives selected foreigners the right to stay in the UK for three years and four months, with the option to extend for another two years. After that, they can remain and apply for a UK passport as a citizen a year later.

“Hong Kong Chinese are snapping up golden visas at an unheard-of pace,” said Georg Chmiel, Executive Chairman of the Chinese property group Juawei.

“Something is driving Hongkongers to obtain their golden visas now.”

Hong Kong has been gripped by mass protests triggered by a now-shelved extradition bill since June. Demonstrations have run for 13 consecutive weekends, and 1,117 protesters have been arrested in the biggest crisis to hit the city since the 1997 handover from Britain.

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Chmiel said that the surge of interest from Hong Kong means the UK will beat Portugal to first place for golden visa uptake in the European Union by the end of the year, bringing in around £1 billion for the UK economy.

According to Rafael Steinmetz Leffa, a client relationship manager with Shard Capital, the decline of the pound due to the ongoing uncertainties around the UK’s departure from the European Union has increased the popularity of the scheme among wealthy foreigners.

“The instability in Hong Kong is certainly a factor in the decision-making process. However, I strongly believe that the currency depreciation has been more helpful because it enables a bigger number of individuals that previously had considered the UK an option to take up that opportunity,” Leffa said.

Controversy has surrounded the UK’s golden visa system amid allegations it has allowed corrupt individuals to buy residency with tainted money and to launder their ill-gotten gains.

The system has been criticised for allowing Russian oligarchs close to the regime of Vladimir Putin to buy citizenship, especially following the Salisbury poisoning attack by the country’s agents last year.

Last year the government announced it was to scrap the scheme because of concern it was a vehicle for money laundering, only to change its mind a few days later.

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Juawei said that so far this year, 255 main applicants and 381 of their family members had received golden visas in the UK. There were only 400 successful applications in the whole of 2018.

Thirteen visas were given to Hongkongers and their families compared to seven in the first quarter, a number that was expected to rise as investment advice firms say hundreds more Hongkongers were expected to apply.

“The visa statistics show that mainland and Hong Kong Chinese haven’t let Brexit negatively shade their image of the UK,” Chmiel said.

“The UK, with its excellent educational institutions, offers Chinese families the opportunity to feel they are giving their children the absolute best possible start in life.”

According to Juwai, Hongkongers and mainland Chinese invested more than US$300 million into Portugal through its golden visa programme in 2018.

“Nine out of 10 of those dollars went into real estate,” Chmiel said.

The UK is expected to surpass Portugal by the end of 2019, making it the most popular destination for golden visa hunters after the US.