ISLE OF MAN: RESIDENCE AND PROPERTY

In this Section:

- ISLE OF MAN BUSINESS ENVIRONMENT
- ISLE OF MAN TRUST MANAGEMENT
- ISLE OF MAN BANKING AND FINANCIAL SERVICES
- ISLE OF MAN TELECOMMUNICATIONS
- ISLE OF MAN INTERNET AND E-COMMERCE FACILITIES
- ISLE OF MAN PROFESSIONAL SERVICES
- ISLE OF MAN THE LABOUR MARKET

Immigration legislation on the Isle of Man is similar to that in the United Kingdom and applies to nearly everyone who is not a British Citizen or who does not have the right of abode in the United Kingdom, although Irish citizens and EEA citizens exercising Treaty rights are exempt from many provisions.

The Manx government permits non-residents to purchase and own real estate on the island. Indeed, without an influx of new residents there would be a decline in the overall population. The official policy is to target specific areas for growth and ensure their compatibility with the Manx community. The recent expansion of the finance sector has created many more jobs than could possibly be supplied by the existing market. The resulting need for professional and skilled people from outside the Island is therefore likely to continue for the foreseeable future.

Potential real estate buyers will find a comprehensive range of properties available on the Island ranging from apartments right up to large country and coastal properties. New executive developments on the periphery of Douglas have met much of the increased demand for new property. Housing stock exists in many other parts of the Island, where prices can often be lower. Property values have increased in recent years and are comparable with many areas of England and Wales and lower than the south-east of England.

In 2000 the Isle of Man's parliament, Tynwald, passed a Residence Bill which would give the island's administration the power to impose immigration controls on non-Manx individuals.

The Isle of Man is being pressured by shortage of housing for its local population - this is a normal symptom of increasing success for an offshore jurisdiction. The success of the island's offshore financial services sector, together with a flow of wealthy individuals seeking relief from high EU taxes, is quickly driving house prices higher.

Local 'Manx' inhabitants form a high (although declining) proportion of the total population of 72,000, and by no means do they all benefit from the increasing wealth of the 'offshore' economy. Faced with the prospect of its indigenous population becoming paupers in a land of wealth, the Manx government will eventually have to follow other such jurisdictions in controlling rents and sale prices, or in limiting access to housing for foreigners.

The Royal Assent was granted to the Residence Act on the 20th March, 2001. The Act is perceived by the government as a piece of contingency planning: legislation to be kept in reserve and activated only in circumstances of necessity in response to a seriously deteriorating economic or social situation requiring government intervention. It was, and remains, the government's hope that it will not prove necessary to activate the legislation and that any future growth in population can be absorbed and will not create the circumstances which would warrant activating the Residence Act.

After EU enlargement was agreed in early 2003, pressure increased on the island for residency controls to be boosted.

Speaking during a debate on the European Communities (Amendment ) Bill - which updates existing Manx laws to include the 2001 Nice Treaty - Labour member Peter Karran suggested that: "With this piece of legislation there will be even more need as far as residency control (in the Island) is concerned."

This viewpoint was supported by then Chief Minister, Richard Corkhill, who announced that: "We are part of the UK immigration law."

He went on to add: "The work permit control legislation is most likely to be our saviour. We must pay due regard to the legislation we already have."

In December 2008, the Department of Trade and Industry released a consultation document intended to precede new Regulations aimed at modernising aspects of existing work permit legislation.

The Department issues around 10,000 work permits each year, playing a vital role in ensuring employers are able to secure the suitably skilled workers they require. This in turn has assisted the economy to continue to grow at over 6% a year while the population has grown by less than 1%. The present review is intended to ensure that the legislation, the protection afforded to Isle of Man workers and the needs of the economy are in alignment to the greatest degree possible.

Key matters considered in the consultation include proposals to:

• Update the economic and social criteria which are used to determine whether or not a permit should be granted;
• Modernise exemption policy so that some key individuals, such as those being targeted by Government inward investment policy, and also some temporary and intermittent visitors would not require permits;
• Ensure that the Department is aware of any relevant criminal convictions of persons applying for work permits and any relevant offences committed by persons subsequent to their being granted work permits.

Minister for Trade and Industry Hon David Cretney MHK commented:

“The present consultation follows on from the Review of Work Permit Legislation and its Administration” which I asked Nick Black to undertake in 2007. That review confirmed my view that there was no need to remove the work permit system and that employers and the wider public were supportive of its broad aims. Nick Black did, however, consider there was a need to review the current operation of the system to ensure that the needs of the workforce were balanced with those of the economy. Whilst the Regulations have not been amended since 1995 the economy has moved on. The proposals in the consultative document are an attempt to create a work permit system which fits the economy of the Isle of Man in the 21st century and which carefully balances the interests of Man workers and employers on the Island. If that balance is too much in favour of employers then some of our local workers may be overlooked for no good reason and may justifiably feel aggrieved; equally if employers perceive the legislation to be a strait-jacket they may choose not to invest, recruit or expand or on the Island and the legislation may have the opposite effect to that which is intended.”

Legislation to make immigration controls more lenient was approved on December 16 under the Control of Employment (Exemptions) Order 2009, and came into effect in the Isle of Man on January 1, 2010.

The new legislation exempts certain employments, the great majority of a temporary or intermittent nature, from the requirement for a work permit. The Order is designed to make the island an easier place to do business by reducing the administrative burden upon employers while at the same time protecting the essential interests of Isle of Man workers.

One of the main changes increases the general exemption period where a permit is not required from three days to 10 working days a year. With a very small number of exceptions – construction, mobile caterers and temporary retailers – this general exemption will apply across the board.

There is a longer exemption period for certain higher level employees of international companies. This is in recognition of the fact that such companies need to be able to move staff between jurisdictions; the exemption period is a maximum of 48 days year in this case. The exemption does not cover all employments, and is subject to certain conditions.

A further exemption category covers persons relocating businesses to the island or establishing a branch or subsidiary of a non-IoM business.

In total, 13 types of temporary and intermittent employments are exempted, along with three categories of permanent employment.

Minister for Trade and Industry, David Cretney MHK explained that:

“The Department listened very carefully to consultees and worked hard to produce a balanced package of measures aimed at increasing the attractiveness of the Isle of Man for employers – and hence overall employment opportunities – without diminishing protection for Isle of Man workers.”