The British Overseas Territories Act 2002 made the previously known “dependent” territories as British Overseas Territories. A further change took place on 21 May 2002. If a person was a British overseas territories citizen (except by virtue of a connection only with the Sovereign Base Areas of Akrotiri and Dhekelia), immediately before 21 May 2002, they automatically became a British citizen on that date. A person born on or after 21 May 2002 in a British overseas territory will be British otherwise than by descent at birth if born to a British citizen parent or person settled in the territory. A person born or after 21 May 2002 outside of a British Overseas territory will be a British citizen by descent if born to a British citizen able to transmit their British citizenship.

However, it is possible for a person to be a British Overseas Territories citizen by naturalisation, or if a child by registration (sections 18 and 17 of the British Nationality Act 1981 respectively), and so for that individual not to be automatically British. Such an individual would only become British by virtue of registration under section 4(2) of the British Nationality Act 1981 if the relevant requirements are met. These include residence in the UK, good character and excess absences, amongst others.