R (Ozmen) v Secretary of State for the Home Department  EWCA Civ 1366 (23 November 2023)
The Court of Appeal has held that by refusing Mr Ozmen—a Turkish national—leave to remain in the UK as a businessperson pursuant to the European Community Association Agreement (or "ECAA") between the UK and Turkey, the first instance decision-maker, the administrative reviewer and even the judge conducting a judicial review had all fallen into error in rejecting Mr Ozmen's proposal on the basis of a superficial search resulting in wrong factual information about the viability of one potential customer. That flaw had undermined the decision-making at all levels. It was also quite irrational to reject the entire application on the basis of an analysis of evidence about the viability of one customer where the overall scheme of the evidence about four potential customers showed that there was broad demand for Mr Ozmen's services. Mr Ozmen appealed against the dismissal of his claim for judicial review of the SSHD's refusal to grant him leave to remain in the UK as a businessperson under the ECAA. He had arrived in the UK having been granted leave to enter as a short-term student in December 2019 and in May 2020, he applied for leave to remain here as a business person. His plan was to work as a mobile barber in and around the town of Glossop (Derbyshire) and he had submitted a detailed proposal with his application. On 15 March 2021, his application was refused and his administrative review application was unsuccessful on 7 February 2022 and he was advised to leave the country.
Mr Ozmen challenged the decisions by judicial review contending that they were unfair, unlawful and irrational. Permission to apply for judicial review was initially refused on the papers, but granted after an oral hearing. Yet in November 2022, the Upper Tribunal dismissed his application and in April 2023, he was granted permission to appeal by Carr LJ on these grounds. He submitted that, as a matter of procedural fairness, he should have been invited to an interview to respond to concerns about the genuineness or credibility of his application; and that the SSHD had failed to refer to his qualifications and training and had wrongly concluded that the viability of his business plan was called into question by the travelling time to one potential customer. He provided a detailed proposal setting out such matters as market analysis, service and pricing summary, marketing strategy and a financial forecast with details of projected profit and loss, start-up funds and resources, cashflow and evidence of his qualifications and experience. He also provided evidence of four potential customers. His application was refused on the basis of insufficient evidence to demonstrate that the business proposal met the requirements set out in the guidance, entitled "ECAA business guidance". That guidance supplemented the Immigration Rules and instructed caseworkers to assess whether any failure to provide relevant documents undermined the "credibility" of the his business proposal.
The Court of Appeal
Sir Geoffrey Vos MR, Baker and Stuart-Smith LJJ allowed the appeal and addressed the approach to be applied to applications under the ECAA, the credibility of Mr Ozmen's application, qualifications and training and a factual error made by the decision-maker.
(i) Applications under the ECAA
First of all, in R (Karagul) v SSHD  EWHC 3208 (Admin), Saini J set out the legal background and explained that the purpose of the ECAA between the European Economic Community ("EEC") and Turkey, which was signed in 1963 and to which the UK became a signatory on joining the EEC in 1973.
As Saini J observed in Karagul the ECAA serves to promote the continuous and balanced strengthening of trade and economic relations between the contracting parties, including the progressive securing of free movement for workers and the abolition of restrictions on freedom of establishment and on freedom to provide services and to improve the standard of living of the Turkish people and facilitating the accession of Turkey to the Community at a later stage. Under an additional Protocol signed in 1970, the Contracting Parties also agreed to refrain from introducing between themselves any restrictions on the freedom of establishment and the freedom to provide services. The effect of this so called "Standstill Clause", as interpreted by CJEU case law, "was to require the United Kingdom to 'look back' in time to the domestic rules which applied to relevant Turkish nationals seeking to establish themselves in business as at 1 January 1973 (when the United Kingdom became a member of the EEC). The rules to be applied to current applications were 'frozen' in time as at that date." Bearing that in mind, Baker LJ held that:
6. For that reason, applications made by Turkish nationals throughout the period of the UK's membership of the EEC, subsequently the European Union, had to be considered under the Immigration Rules in force at the date of UK's accession. They were contained in HC510, "Statement of Immigration Rules for Control after Entry".
Notably, paragraph 21 of HC510 the provision in the rules was of particular relevance to this appeal. It provided that persons admitted to the UK as visitors could apply for the SSHD's consent to establish themselves in business, subject to certain requirements.
Moreover, the assessment of an application pursuant to paragraph 21 was a merits-based evaluative assessment for the decision-maker and it involved a predictive analysis of the future viability of the proposed business. The SSHD had a wide margin of appreciation as to the merits and feasibility of proposed businesses and whether they met the paragraph 21 requirements. This was in keeping with Saini J's observations in Karagul which Baker LJ applied in the present judgment. Next, the court turned its attention to credibility.
(ii) Credibility of application
Mr Ozmen submitted that the emphasis of the SSHD's reasons for refusing his application was on its "credibility", which was used in the guidance to mean "genuineness', and that the judge had erred in concluding that it referred to the viability of the business. As to the judge's decision, he further submitted that it amounted to a conclusion that the application was not genuine or being made in good faith, and that he should have had the opportunity to respond to those concerns.
Upper Tribunal Norton-Taylor was of the view that "credible" and "credibility" have two meanings. "Credible" means "believable" in the sense of "genuine" or "honest". On other occasions, it is used to mean "plausible" in the sense of "viable" or "feasible". The Home Office ECAA Business Guidance, uses the word "credibility" in both senses and when it appears in the phrase "credibility of evidence", it is being used in the first sense. When it appears in the phrase "credibility of the business proposal", it is being used in the second sense. Baker LJ held that:
28. Plainly there is a risk that these dual meanings could lead decision-makers astray. But I am not persuaded that this has happened in this case. I do not accept the premise of the appellant's argument under this ground that the substantive reason for the refusal of his application was that the respondent did not accept that it was genuine. There is no reference to "credibility" in the original decision letter, nor any finding that the appellant did not genuinely intend to establish the proposed business if given leave to remain. The caseworker's overall conclusion was that "I am not satisfied that the documents provided reflect a business proposal with a realistic prospect of success". The administrative review was therefore right to conclude that the application had been "essentially refused for viability reasons, not on the basis of genuine intentions which was not mentioned in the refusal letter".
It was true that the administrative review proceeded to refer to "credibility" at two further points. But in Baker LJ's view, Judge Norton-Taylor was right to conclude that on both occasions it was again referring to the viability of Mr Ozmen's business plan, not to the genuineness of his intentions.
(iii) Qualifications and training
As to the qualifications and training issue, although the SSHD had made no reference to the evidence adduced by Mr Ozmen as to his qualifications and experience, nor did the decision refer to many other aspects of the evidence. Moreover, the fact that there was no mention of qualifications and training did not mean that they were not taken into account.
(iv) Factual error
Mr Ozmen argued that the original decision contained a factual error regarding the time it would take to travel to one of the potential customers by bus. The decision-maker stated that their searches had indicated a journey time of 75 minutes, this was due to temporary changes to the timetable due to the COVID-19 pandemic. In normal times, the journey would only take 30 minutes. The administrative reviewer refused to take his assertions into account on the ground that he was unable to accept "new information or evidence not available to the original decision-maker". The original decision- maker, the administrative reviewer and the judge had all fallen into error. Overall, Baker LJ concluded that:
35. Given the view that the viability of the applicant's plans to travel by public transport was a substantial and not a trivial issue, these flaws undermined the decision-making at all levels. The original decision-maker failed to consider the applicant's evidence at all, and this omission was not picked up either in the administrative review or by the judge. It only came to light in the course of exchanges with counsel during the appeal hearing before this Court. Had the judge been aware of this unconsidered evidence in Mr Ozmen's application, I cannot conceive that he would have concluded that the decision-maker had been "rationally entitled" to "interrogate" the viability of the potential customer in Marple by "conducting a simple search on Google maps".
36. Furthermore it was irrational to reject the whole application on the basis of an analysis of evidence about the viability of one customer where the overall scheme of the evidence about the four potential customers was to show that there was broad demand. That proposition was not in any event undermined by what was wrongly perceived to be a flaw in one of the four items of evidence.
37. The original decision identified just two reasons for refusing the application, one of which was plainly both wrong and unfair. In my view the original decision was a superficial and flawed analysis of Mr Ozmen's application which should have been recognised as such by the administrative review and the UTJ. For those reasons, I would allow the appeal and remit the application for a fresh decision.
Sir Geoffrey Vos MR and Stuart-Smith LJ agreed with Baker LJ.
This case yet again demonstrates that Home Office decision-making is not fit for purpose and applicants for leave to remain suffer adverse consequences on the basis of superficial and arbitrary refusals which are inherently contradictory, unfair, unlawful and irrational.