The application fee of £65, or £32.50 for those under 16, will be abolished by the time the scheme is fully operational on 30 March 2019. Fees will continue to apply during the current test phase, but anybody who pays a fee or already did so under a previous pilot will have their fee refunded, according to the Home Office.
Corporate immigration law expert Euan Smith of Pinsent Masons, the law firm behind Out-Law.com, said that the removal of the fee "will be welcomed by both EEA nationals and their employers".
"However, as 29 March 2019 gets closer, employers are more concerned with avoiding the risk of a no-deal 'hard Brexit'. They want to avoid the loss of the transition period, until 31 December 2020, which would enable new EU arrivals to come to work in the UK until then without needing a work visa. The transition period would apply if there is an agreed deal based on the Withdrawal Agreement," he said.
The prime minister announced on Monday that the fee would be abolished in response to "powerful representations" from MPs and campaigners. The government also intends to "step up" its efforts to ensure that EU member states guarantee the rights of resident UK citizens in the event of a 'no deal' Brexit, she said.
The prime minister made the announcement as part of an update to the House of Commons on Brexit, following last week's vote by MPs to reject the terms of the EU withdrawal agreement negotiated by the government. She has also committed to further engagement with parliament, business and the devolved administrations on the terms of the UK's future relationship with the EU, and to guarantee no reductions in protections for workers' rights or the environment once the UK is no longer bound by EU rules.
The full public test phase of the settlement scheme began on Monday, and is open to UK resident EU citizens with a valid EU passport as well as their non-EU citizen family members who hold a biometric residence card. Nationals of the EFTA states of Iceland, Liechtenstein and Norway, and nationals of Switzerland, will also be eligible for the settlement scheme, but will not be able to apply until the scheme is fully operational in March.
Individuals applying for 'settled status' will be asked to prove their identity and that they have been living in the UK for the past five years, and to declare that they have no serious criminal convictions. Those who have not yet met the five-year residence requirement may apply for 'pre-settled status', which they will be able to convert to settled status once they reach the five-year residence requirement.
The scheme will be open to individuals who arrive in the UK before 31 December 2020 should the UK leave the EU with a formal withdrawal agreement in place, or before 29 March 2019 in the event of a no deal Brexit. Individuals will be able to apply until 30 June 2021 under the withdrawal agreement, or until 31 December 2020 if there is no deal.
Settled status will enable EU nationals to remain in the UK with the same access to work, education, benefits and public services that they have now. They will also be entitled to bring "close family members", defined as spouses, civil partners and durable partners, dependent children and grandchildren and dependent parents and grandparents, to the UK in future, provided that the relationship existed on 31 December 2020 under the withdrawal agreement, or 29 March 2019 if there is no deal.