LORD JUSTICE KEENE: This appeal from the Asylum and Immigration Tribunal (“AIT”) comes before us for hearing in somewhat unusual circumstances. It is an appeal by an applicant for indefinite leave to remain as a retired person of independent means under the terms of Rule 269 of the Immigration Rules HC395. Such leave had been refused by the Secretary of State but the appellant had succeeded before an adjudicator. He, however, was reversed by the AIT. The appellant appealed to this court and in April 2006, a detailed skeleton argument signed by counsel was filed. Permission to appeal was in due course granted by Neuberger LJ.

On 1 September 2006, the Civil Appeals Office received a draft consent order signed by solicitors to both parties under which the appeal was to be allowed. The draft order was accompanied by a statement of reasons. Laws LJ however, directed that there should be a hearing so that oral argument could take place. In my view, it was understandable that he so directed. This appeal raises a point of law on the construction of the relevant parts of the Immigration Rules and it is a point which is of significance beyond the immediate case.

Rule 269 of the Immigration Rules reads as follows:

There was no dispute that the appellant met the terms of paragraph (i) of that rule. She had arrived in the United Kingdom in April 2000 from Myanmar, formerly known as Burma, of which she is a national. She had entry clearance as a retired person of independent means. She was then given leave to remain as such person until 21 April 2004 and she did so remain here on that basis during those four years.

Paragraph (ii) takes one to Rule 266, the requirements of which I need not set out in detail. There was again no dispute that she met them, save in respect of Rule 266(ii), which imposes a need to meet the requirements of Rule 263 (ii) to (iv). It is relevant to set out those paragraphs in full:

The facts about this appellant’s income are not in issue. She was found by the adjudicator to own considerable assets in Myanmar, both in property and especially also in transportation companies. From these assets she derives an annual income of, in terms of sterling, nearly £34,000. She had over £10,000 in a bank account in the United Kingdom when she first arrived here. Since then some US$ 6-7,000 annually has been brought into this country for her and these amounts have been sufficient to meet her needs because she lives with her daughter and son in law, who provide her with free board and lodging. When the Secretary of State refused indefinite leave to remain in May 2004 on the basis that he was not satisfied that £25,000 per annum had been transferred to the United Kingdom, the appellant within three weeks transferred £25,000 to her bank account in this country.

So far as the facts concerning ease of transfer of funds from Myanmar to this country are concerned, the adjudicator found that there were legal restrictions in Myanmar on the expatriation of the local currency, but that one could export foreign currency once obtained there from money changers. Other mechanisms also operated to enable such funds in practice to be made available in the United Kingdom if required here. The adjudicator rejected an argument by the Secretary of State that Rule 263(ii) required a person to have actually transferred £25,000 annually to the United Kingdom each year for the four years referred to in Rule 269. He observed that the rules required the money to be disposable in the United Kingdom but not that such a person actually transfer £25,000 each year to this country.

The adjudicator also referred to the Immigration Directorate instructions which only require that the funds be “freely transferable to the United Kingdom and convertible to sterling”, not that they actually be brought here. He found that there was no evidence of any legal restriction on the export of funds from Myanmar and he said this at paragraph 11 of his determination:

The AIT took a different view. In its decision promulgated on 19 January 2006, it held that £25,000 income had to be physically present in the United Kingdom each year in order to be disposable here. The source of the income could, it said, be overseas, but not the income itself. Otherwise, it said, the requirement under the rules could be defeated by practical difficulties in bringing funds into the United Kingdom, for example, as a result of exchange controls. The purpose of the rules to ensure that the applicant had adequate funds actually available in the United Kingdom would then not be met.

The Secretary of State does not seek now to uphold that approach of the AIT. It is accepted on his behalf that it is sufficient if the applicant is able to bring £25,000 into the United Kingdom each year if he or she wishes to. The rules do not impose any requirement as to the capital being in the United Kingdom. If the rules had intended that the income be actually brought into this country each year that they could easily have so provided; they do not. Mr Scannell, for the appellant, follows the same line of argument. He contends that one need merely show the potential to bring in the money each year rather than the actuality; whether that potential exists is essentially a question of fact.

For my part, I accept the parties’ submissions. I do so for a number of reasons. The first relates to the wording of Rule 263(ii). That provision does not require, in terms, £25,000 to be brought into the United Kingdom each year, far less for it to be spent here, or disposed of here. The word “disposable” in my judgment means capable of being disposed of; normally, no doubt, being spent in the United Kingdom. That requirement is met if the evidence shows that the applicant is able to bring £25,000 into this country each year if he or she needs to do so. It would not be met if exchange controls or other practical difficulties prevented that from happening, but that is an issue of fact to be determined upon the evidence in each particular case.

Secondly, on the AIT’s approach, the rules would be satisfied if the applicant brought £25,000 into the United Kingdom in a given year and then transferred it out again. What, one wonders, would be the useful purpose being served by that? It would merely be evidence of the ease of transfer of funds and such evidence can be provided in other ways. Indeed, once indefinite leave to remain has been granted, nothing prevents an applicant from transferring funds out of the United Kingdom so long as Rule 263(iii) is met.

Thirdly, the AIT’s reasoning seems to me to be illogical. There is, of course, always the possibility that at some future date the foreign state may introduce exchange controls or other restrictions preventing the transfer of income to this country. But a requirement that an applicant should have had £25,000 in the United Kingdom for each of the preceding four years before the grant of indefinite leave does nothing to remove that risk of future exchange controls. The only way that risk could be removed would be by requiring the source of the income to be located here, in effect by requiring income to be derived from investment in this country. But as the adjudicator pointed out, Rule 263 not only does not require that but it contrasts with Rule 201, dealing with business persons wishing to enter or remain here. That latter rule does by paragraph (ii) require it to be shown that a minimum sum would be invested in the United Kingdom. No such requirement appears in Rule 263.

Fourthly, the Immigration Directorate instructions do not support the AIT approach. Those instructions only require the funds to be freely transferable and convertible, no more. In addition, they specify that the £25,000 has to be net of any overseas tax. That implies that overseas tax may be payable on the gross sum, which in most instances is likely only to be the case if the £25,000 is derived from an overseas source.

Fifthly and finally, I have regard to what seems to be the purpose of this requirement in Rule 263(ii). It seems quite evidently to be intended to prevent someone who comes into this country from becoming a burden on the state. In that sense, its object is similar to that behind paragraph (iii), and so to some extent this may be a belt and braces operation. But the object to which I have just referred of preventing someone from becoming a burden on the state is one which can be attained by showing the ability to bring in such an amount if needed. It does not require the actual import of those funds each year, whether or not they may be required.

For all these reasons, I for my part have concluded that the adjudicator was right and that the AIT was wrong. In consequence, I would allow this appeal and make an order in the terms of a draft order placed before us by the parties.

LADY JUSTICE HALLETT: I agree.