It is illegal for the Labour Party to directly receive donations from foreign individuals or entities that are not "permissible donors" under UK law. However, foreign money has entered UK politics, including to the Labour Party, through legal loopholes such as donations from UK-registered companies with foreign ties.
Foreign-linked donations to Labour via loopholes
- Cayman Islands-based hedge fund: In 2024, Labour received a £4 million donation from Quadrature Capital, a hedge fund with its parent company registered in the Cayman Islands. The company stated that it pays corporation tax in the UK.
- Pro-Israel lobby groups: Reports from 2024 revealed that pro-Israel lobby groups have donated over £300,000 to more than half of Keir Starmer's shadow cabinet members. Some of these donations involved groups paying for Labour MPs to take trips to Israel, with some payments coming directly from the Israeli Ministry of Foreign Affairs.
- Foreign-domiciled individuals: As of 2015, the Labour Party had received at least £8.55 million from donors who were domiciled abroad for tax purposes.
Labour Party's response to foreign donations
- Pledged to strengthen rules: In its 2024 manifesto, the Labour Party committed to strengthening the rules on political donations to address "dodgy money" from overseas.
- Internal division over a ban: In February 2025, reports indicated that Labour had dropped a plan to ban foreign political donations after an intervention from a Labour peer.