Knowledge

This briefing note provides a summary of the key provisions of the Control of Housing and Work (Jersey) Law 2012 (the "Law"). The Law has been devised to establish a registration process for Jersey residents and to provide for the control of both work and housing (i.e. it will govern who may live and who may work in Jersey). The Law replaces the Housing (Jersey) Law 1949 (the "Housing Law"), the Regulation of Undertakings & Development (Jersey) Law 1973 (the "Regulation of Undertakings Law") and the Hawkers and Non-Resident Traders (Jersey) Law 1965 (the " Hawkers and NRT Law").

Terminology
Classification of residents
15 categories of residential qualification under the Housing Law will be replaced by four new categories:

• Entitled (corresponding to the "(a) to (h)" categories under the Housing Regulations)
• Licensed (formerly referred to as "J Category")
• Entitled for Work Only
• Registered (formerly referred to as "unqualified")

Within each of these four categories there will be a range of people effectively falling within different sub-categories. For example, the Entitled category will cover as many as six sets of circumstances by which a person may be classed as "Entitled".

Under the Housing Law, the categories of residential status applicable to Jersey residents were set out in the Housing Regulations. The Control of Housing and Work (Residential and Employment Status (Jersey) Regulations 2013 (the "New Regulations"), replace the Housing Regulations.

Entitled
Information about how residents may qualify for Entitled status and permanently Entitled status under the New Regulations (along with information about how Entitled status may be lost) is set out in the table below: 

Anyone who ceases to be ordinarily resident in Jersey for aggregate periods not exceeding five years will not lose their Entitled status by virtue of those periods of absence. (This is a significant change from the current position.)

Licensed
This is similar to the "J Category" under Article 1(1)(j) of the Housing (General Provisions) (Jersey) Regulations 1970 (the "Housing Regulations"): i.e. the Housing Minister may approve a property purchase where the purchaser is "essentially employed" in Jersey and that consent can, in the best interests of the community, be justified. Unlike previously they will be allowed to buy property in their own names.

Licensed employees, like "J Category" residents under the former Housing Law (as they were commonly referred to), possess immediate housing rights via a licence approved by the Minister. The basis upon which a Licensed person may purchase Jersey property will be set out in the terms of that licence.

Entitled for Work Only
This category covers (i) a person who has been ordinarily resident in Jersey for a continuous period of five years or more; (ii) a person who does not have housing qualifications in his/her own right but is the spouse of a person who is Entitled, Licensed or Entitled for Work Only; (iii) persons divorced from those Entitled, Licensed or Entitled for Work Only less than five years ago where the other divorced spouse remains continuously ordinarily resident; and (iv) persons continuously working in an undertaking they joined before they reached age sixteen.

Registered
This covers everyone ordinarily resident in Jersey for three continuous months not falling within any of the other three categories.

Inheritance of Jersey property, of itself, does not give rights to any particular status under the Law.

Classification of property
Units of Jersey residential accommodation are classified as either Qualified or Registered property.

Qualified property
Qualified property is commonly described as property for sale or to let that was:

• subject to occupation control under the Housing Law; or
• created after the Law comes into force; or 
• acquired by dégrèvement or inheritance(1).

Registered property
All other property is Registered property (commonly referred to under the former system as "un-qualified"), which includes living accommodation within lodging houses.

The Housing Minister is able to re-categorise, impose, alter and/or remove conditions and allow concessions regarding the categorisation of any property, either on application by the owner or by the Housing Minster's own volition, but there is a right of appeal.  Those conditions and concessions applying to a property when the Law comes into force will remain.

Control of Housing
Occupation of Jersey property
Qualified property
This may only be occupied by an Entitled or Licensed person as his/her ordinary place of residence. Such person can purchase Qualified property or take on a lease or licence of the same. Ownership by a Licensed person will be on condition that if he/she ceases to be Licensed he/she will sell the property.

A person who is Entitled for Work only may occupy Qualified property if they have purchased with a spouse who is an Entitled or Licensed person.

If Qualified property is inherited, the heir, regardless of Jersey residential status, may occupy the dwelling, hence the previous situation remains unchanged.

There is a residual category of person who may occupy Qualified property, i.e. a person who used to be Entitled, Licensed, or Entitled for Work Only after a purchase with an Entitled or Licensed spouse, but who has lost that category, where the Minister gives specific consent for a specific period.

Qualified property: occupation of part
As mentioned above, only Entitled or Licensed persons (or Entitled for Work Only persons married to Entitled and Licensed persons joining in the transaction) are permitted to occupy Qualified property. However, Registered persons may occupy part of a Qualified property if a substantial part of the unit is occupied by a person who is Entitled or Licensed resident as their principal place of residence in Jersey. This exception does not apply to Qualified property substantially occupied by a person only by virtue of inheritance.

Otherwise, a Registered person or an Entitled for Work Only person (other than one with an Entitled or Licensed spouse who is joining in the transaction) may not buy, rent or take a licence of Qualified property.

Registered property
A person categorised as Entitled for Work Only (other than when purchasing with an Entitled or Licensed Spouse) or Registered is only able to occupy a Registered property.  He/she may rent it for up to nine years, or occupy it under a licence, but may not purchase it or take it on a longer lease.

Registered Property may also be purchased, leased or licensed and occupied by Entitled or Licensed persons.

Property transactions and moving in: new requirements
Under the Law, anyone acquiring ownership of or leasing Jersey property has to produce to the vendor/lessor of the property his/her registration card (the "Card"). The Card will show the person's residential status and any conditions attached to his/her ability to occupy Jersey property.

Also, anyone moving to a new address in Jersey for more than three months has to notify the Population Minister of his/her full name, date of birth, address and date of moving. Similar details must be supplied for those persons moving to the new address with that person.

Any party to any such transaction failing to notify the Minister would be guilty of an offence and could be subject to a fine.

Housing consents
Individuals
Consent from the Population Minister is no longer needed where a person buys or takes on a lease (whether paper or contract) of Jersey residential or commercial property.

Companies or other legal entities
Consent is required for a company or other body where:

• it buys Jersey property; or
• it takes on a paper or contract lease of Jersey residential property.

Consent is not required if the company takes any lease of wholly commercial property.

Control of Work
Advantages of the changes introduced under the Law
The Law introduces a range of improvements to the law in Jersey in relation to work and the regulation of undertakings. These include:

• no application necessary to engage Entitled workers;
• streamlined rules on changes in beneficial ownership permissions for undertakings;
• reduced administration for businesses when recruiting Licensed employees;
• establishment of a register of undertakings open to public inspection;
• wider criteria to be applied when considering business (previously termed "commencement") licence applications;
• exemptions from the licensing requirements to be provided via orders (reducing bureaucracy and providing clarity); and
• potential to levy fees (e.g. on non-resident contractors, non-resident traders and Licensed employees).

Summary of work options available to workers
Entitled workers and Entitled for Work Only workers can work for any business or start their own. Licensed workers are to be engaged by a specific business and must undertake a role with that business which complies with the description of the permitted role given in the business' licence. Registered workers can only be engaged on the basis of a licence obtained by the employer.

Definition of "undertaking"
Previously, "undertaking" in the Regulation of Undertakings Law was defined as "any trade, business or profession whether or not carried on for profit".

Under the Law, a more detailed definition of "undertaking" is given:
"any trade, business or activity involving work or services performed for, or offered to members of the public, including a section of the public carried on in Jersey by any person whether or not carried on for profit".

The words "carried on in Jersey" include a requirement for a "physical presence" in the Island. A "physical presence" may be limited to the presence in Jersey of "any item in the custody or ownership of the undertaking". Accordingly, businesses such as online retailers (i.e. without local staff or premises but with goods flowing through the Island), may well be captured as undertakings and may therefore require a licence.

The Law also states that a trade, business or activity that does not pay any persons who work for it (e.g. certain voluntary organisations and charities) is not an undertaking. However, if such an organisation pays any one of its staff it is an undertaking and therefore requires a business licence.

A public register must be kept of each undertaking granted a licence under the Law, providing public confirmation that a licence has been issued.

Change of beneficial ownership of undertaking
Under the Regulation of Undertakings Law, there was often a requirement included as a condition to the license to notify the Regulation of Undertakings and Development department in the event of a change in beneficial ownership of an undertaking.

Under the Law, an undertaking's licence is invalid if there is a significant change in ownership and more than sixty days have lapsed since that change without the undertaking having complied with the applicable notification process.

"Significant" change means transactions concerning the acquisition of share capital in an undertaking where the resulting ownership of shares by (1) Entitled, (2) Licensed or (3) Entitled for Work Only persons, when aggregated, is less than 60%.

The requirement to notify the Minister applies to the first occasion of a significant change in beneficial ownership (the "First Transaction"). Provided that, after the First Transaction, share ownership in the undertaking by persons listed in (1), (2) or (3) above has not increased subsequently to 60% or more, additional transactions concerning the change in beneficial ownership can be entered into without prior notification to the Minister.

The change in beneficial ownership provisions in the Law relates to transactions involving undertakings which are share-owned (companies). The Law states that the Minister may, by Order, specify guidance on the requirements for notification in respect of the change of ownership of other structures (e.g. partnerships).

Licensed employees (formerly "essentially employed" persons with permission to occupy J Category properties)
It is hoped that the Law will enable employers to manage their staff numbers more efficiently and so reduce bureaucracy.

In future, business licences issued by the Minister will state (as a condition):

• the maximum number of Licensed or Registered people that the undertaking may employ; and
• the nature of the work that any Licensed employees can do.

Other conditions may be attached to the business licence affecting the undertaking's Licensed or Registered employees. These could include:

• restrictions on the type of accommodation that may be occupied;
• restrictions on the number of Licensed persons within the undertaking's quota who may purchase Jersey property;
• restrictions on the period of time that such persons may be employed; and
• a date or dates on which the undertaking's licence may be reviewed by the Minister.

No permission is required for Entitled or Entitled for Work Only individuals.

Importantly, if a Licensed employee within the undertaking's permitted quota leaves, the employer may fill the post without prior application to the Minister, as long as the nature of work to be done by the replacement employee fits with the licence. Employers should note that if a Licensed employee no longer does work of the description set out in the relevant licence he/she will lose their "Licensed" status at that moment.

As with the previous Regulation of Undertakings Law, it is important that a business is aware of the conditions that may apply to its licence. Failure to adhere to the conditions specified by the Minister will invalidate an undertaking's licence, which is an offence under the Law.

Registration Cards
The first time a person changes job after the Law has come into force will require that person to obtain a registration card in order to start work. The registration card will state his/her name, social security number, residential status, the card issue date and an expiry date (if needed).

Newcomers to the Island who intend to reside in Jersey for at least three months (e.g. to secure employment etc.) need to obtain a card within three months of arriving in Jersey.

Licensed, Registered and "high net worth" individuals (granted Entitled status under Regulation 2(1)(e) of the New Regulations) will be charged a fee for obtaining their first Card. The fee will be prescribed by an Order of the Minister.

Licensed and Registered employees: fee payable to the Minister
Under the Law, a business will be charged annually for each of the Licensed and/or Registered employees that it is permitted to employ under its business licence. The fee will be prescribed by an Order of the Minister.

Hawkers and Non-resident Traders
The Control of Housing and Work Law replaces the Hawkers and NRT Law, which required traders without a fixed place of business in Jersey (a "Hawker" if resident or a "Non-resident Trader" if a visitor) to obtain a licence if they intended to sell goods in Jersey.

An important change under the Control of Housing and Work Law is the requirement for a Non-Resident Trader to have a licence if he/she intends to sell services or buy goods. Previously, under the Hawkers and NRT Law, a Non-Resident Trader was only required to apply for a licence if he/she intended to sell goods.

Under the Law, a Hawker must produce his/her licence for inspection by a person who approaches the Hawker for the purposes of the Hawker's business. A Non-Resident Trader must display his/her licence in a prominent position in the place where the trading activity is carried out or, if it is not possible to do so due to the nature of the trading activity, must produce the licence for inspection if requested.

Aspects of the application process are slightly different under the new regime. For example, applications should be submitted to the Chief Minister's Department (previously the Minister for Economic Development) and the Chief Minister has a broad discretion in relation to the type of information and documentation that may be required to be submitted for the purposes of determining whether a licence should be granted. Traders should seek advice beforehand if they are unsure about how to apply.

[1] If the property was acquired by dégrèvement or inheritance which occurred before 1993 it will only become "Qualified" once it is transferred in perpetuity or for a term ending on a specific event. Property acquired after 1993, although Qualified property, may be occupied by the person who inherits it.