Entrepreneur’s Act Residence Permits May Need to be Resubmitted

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At a Glance

• Immigration authorities in Spain must adjudicate residence permit applications under the Entrepreneur’s Act category within 20 business days of submission of the application, and applications that are not adjudicated within this timeframe are deemed approved. Spanish authorities are now reviewing the initial permits approved under this policy when the related renewal application is submitted in order to ensure compliance with Entrepreneur’s Act requirements.
• When the renewal application is due, Fragomen will assess the best strategy for the company and employee, as they may need to file new applications which may require meeting different criteria and extra costs. This strategy would allow applicants to continue working under their granted permit while their applications are pending.

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The situation

In order to ensure compliance with Entrepreneur’s Act requirements, Spanish authorities are reviewing initial permits which were automatically granted to highly qualified employees under the Entrepreneurs’ Act when the related renewal application is filed.
A closer look

This review is based on the policy that when authorities fail to decide on a residence permit application under this category within 20 business days, the application is automatically deemed approved. 

Authorities have realized that due to this policy, many Entrepreneur’s Act residence permit applications were automatically granted even where they did not meet the requirements of the category.
Impact for foreign nationals

Foreign nationals who were granted a permit based on this policy will have their application reviewed when they renew their permit. Fragomen will alert foreign nationals who are affected upon initiation of their renewal case and provide case-by-case advice. For example, affected foreign nationals may need to consider filing other types of work and residence permit applications in case they do not qualify for the Entrepreneurs’ Act renewal.

The dual application process may require meeting different criteria and extra costs. However, it is not likely to require labor market testing as foreign nationals who have lived in Spain for one year with any valid work permit do not need to meet labor market test requirements. This strategy would allow applicants to continue working under their granted permit while their applications are pending.
Background

• Spanish trends.  Applications under the Entrepreneur’s Act are favorable for highly qualified foreign workers since this category offers a streamlined application process. However, this route has been subject to increasing scrutiny and refusals since July 2019. Spanish authorities have increased the required salary level, temporarily barred non-specialist roles and introduced wide ranging policy changes which increased transparency and dependent eligibility but restricted eligibility for foreign nationals with limited professional experience.
• Regional trends. Scrutiny of entrepreneur and investor visas, which tend to be more favorable and provide a streamlined route to settlement, is increasing across the region. The European Union as a whole has urged Member States to restrict such golden visa schemes. Specifically, the United Kingdom has closed the Entrepreneur route to new applicants due to ongoing concerns that the route provided low quality business which added little or no benefit to the UK economy, and opened new routes for startups and innovators instead.

Looking ahead

Fragomen expects Spanish authorities to continue scrutinizing applications for highly-skilled workers under the Entrepreneur’s Act in light of increasingly restrictive requirements. Spanish authorities are also likely to review and adjust immigration policy in general over the coming months in order to streamline the process for highly qualified foreign workers.

 

This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].