My business is acquiring another business, do I need to tell the Home Office?

Having a sponsor licence allows your business to employ migrant workers in the UK. Such a licence comes with duties that sponsors needs to comply with at all times.

One of the duties that a business with a sponsor licence needs to comply with is the requirement to report changes to the business’ organisational structure to the Home Office via the online Sponsorship Management System. This includes changes by way of a merger, acquisition, hive off, organisational simplification, or a change of ownership. Therefore, if your business is acquiring another business, for example, it is likely that you will need to report this change. If the other entity involved in the transaction also holds a sponsor licence, they will also need to report the details of the deal to the Home Office.

The business is (or both businesses are) required to notify the Home Office of the change to their organisational structure within 20 working days of the change taking place. It is also important to keep in mind that any changes to the organisational structure will likely have an effect on any sponsored migrants, and reporting may need to be undertaken on each affected employee’s record as well. 

Fundamentally, a sponsor licence is not transferrable between organisations. So where two entities that both hold sponsor licences are involved in a deal, it is likely that one of the licences will have to be relinquished. It can then either be applied for again, or the entity can be added to the remaining sponsor licence.

Failure to comply with any of the sponsor duties may lead to downgrading of a licence, suspension or revocation, which would have significant negative consequences for the business and any migrants it sponsors.

How Gherson can assist

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The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please do not hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.

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