Key takeaways
Sponsor licences are not transferable
Ownership changes trigger mandatory Home Office reporting.
New ownership must meet sponsor obligations
Timely updates and accurate records help maintain immigration compliance.
Early planning helps avoid risk and delays
Legal advice and clear communication are essential.
Navigating sponsor licence changes after a business acquisition: How we can help
When a business undergoes a change in ownership, whether through a share sale, merger, or acquisition, immigration compliance is often overlooked.
UK businesses holding a sponsor licence should be aware that the licence is non-transferable. They are granted on the basis that the organisation is able and will meet its sponsor duties under the terms of the licence.
If your organisation undergoes any of the following changes, the Home Office treats them as “significant changes” that triggers mandatory reporting obligations:
A change in direct ownership
A sale of all or part of your controlling shares
A partial or full takeover by another organisation
A demerger or split forming new legal entities
Failure to act can result in serious consequences including:
Downgrading, suspension or revocation of your sponsor licence
Jeopardising your ability to sponsor overseas talent
Disruption to business continuity
Damage your organisation’s reputation
Cancellation of your sponsored workers’ permission to work in the UK
Recent changes
As of 22 July 2025, the UK’s Immigration Rules have undergone substantial reform under the new HC 997 framework. These changes are part of the government’s broader strategy to reduce net migration and focus on high-skilled roles. Key updates include:
Stricter eligibility for Skilled Worker visas, now limited to roles at RQF Level 6 (bachelor’s degree level) and above.
Increased salary thresholds and updated SOC codes, requiring sponsors to reassess role suitability.
Greater scrutiny of HR systems and compliance history, especially during sponsor licence applications and renewals.
These changes make it even more critical to get the sponsor licence transition process right during a change of ownership process.
The process
Depending on the organisation structure pre and post the transaction, certain processes must be followed.
For example, when a licensed Skilled Worker sponsor (Company A) is taken over by a company that does not hold a sponsor licence (Company B), and all sponsored workers transfer under TUPE or similar protection, the process becomes more complex and time-sensitive.
This scenario assumes an asset purchase, where Company B acquires the business and employees of Company A, but not the legal entity itself. As a result, Company B must apply for a new sponsor licence to continue sponsoring the transferred workers.
Here’s what needs to happen and when:
Notify the Home Office
Company A reports the change of ownership and confirms worker details.
Company B applies for a new sponsor licence within 20 working days.
Confirm sponsorship responsibility
After the licence is granted, Company B’s Authorising Officer to confirm sponsorship responsibility in writing. Supporting evidence is required.
This must be done promptly.
Licence transition & compliance risk
Company A must promptly notify the Home Office to make their licence dormant
Company B will be granted limited access to Company A’s licence records to enable accurate reporting for the transferred migrants
If Company B fails to secure a licence, the sponsored workers’ permission will be cancelled, with serious legal and operational consequences
Best practices
To manage this transition smoothly and mitigate risk, the following best practices should be considered:
Plan early and seek immigration advice
Engage legal and immigration advisors as soon. At Hill Dickinson, we can advise and support as early planning helps avoid delays and ensures compliance with tight reporting deadlines.Conduct a sponsor licence readiness assessment
If the acquiring company does not already hold a sponsor licence, assess their eligibility and readiness to apply. This includes reviewing HR systems, compliance procedures and record-keeping capabilities.Prepare the sponsor licence application in advance
Where possible, prepare the application before date of completion so it can be submitted immediately. This reduces the risk of missing the 20-working day deadline.Maintain clear communication between both entities
Ensure close coordination among all relevant parties regarding reporting obligations, worker details, and logistics for the licence transition.Keep sponsored workers informed
Transparent communication with affected employees is essential. Reassure them about the process and timelines and provide additional immigration support where needed.Document everything
Maintain a clear audit trail of all communications, submissions and decisions related to the takeover and sponsorship transition. This is vital in the event of a Home Office audit.
How we can help
Whether you’re planning a business acquisition or responding to one already in motion, we help ensure you remain compliant and your ability to sponsor overseas talent is protected.
Immigration compliance is just one of many moving parts during a corporate transaction, but it’s one that can have lasting consequences if overlooked. Our team partners with clients to navigate sponsor licence transitions with clarity, speed and strategically.
Our support includes:
Strategic advice on meeting Home Office requirements.
Preparation and submission of the sponsor licence applications.
Drafting supporting documentation and SMS notifications.
Coordination of sponsored worker’s transfer.
Tailored training for HR teams to ensure ongoing compliance.
Whether you’re planning a transaction or responding to one already underway, we’re here to help you stay compliant and avoid costly missteps.
