Cyprus implementing Citizenship-by-Investment Programme changes
15 February 2019
On February 13th, 2019 the Cyprus Council of Ministers approved revisions to the Cyprus Citizenship-by-Investment Programme (CIP) with the aim to enhance the due diligence standards and credibility of programme and address concerns previously raised by the EU Commission. In addition, these changes will contribute to research and development within the country and help fund affordable housing initiatives.
Three of these changes start with immediate effect while the remaining will be implemented on 16 May 2019.
Changes with Immediate Effect
1. The period for which the Investor must hold his investment increases from three to five years (this excludes the primary residence of €500,000 which still must be held for life).
2. In order to file an application for citizenship via the CIP, the applicant must hold a valid Schengen Visa at the time the application is submitted to the government.
3. Any applicant who was previously rejected by another European Member Country will not be eligible to apply to the Cyprus CIP.
Changes Starting 16 May 2019
1. In addition to the qualifying investment criteria there will be two new donation components added to the revised CIP that total €150,000:
- A €75,000 contribution to the Research and Innovation Foundation
- A €75,000 contribution to the Land Development Agency to fund affordable housing initiatives.
2. A planning permit shall be mandatory for properties under construction
3. The qualifying investment options will be ratified:
- Investments in the Shipping Industry will now be permitted
- Government bonds will no longer qualify
4. During the five year investment period the Investor will be able to change his or her investment, provided he or she is granted consent by the Ministry of Finance.
5. A specialised foreign due diligence firm will be hired to carry out all background checks on applicants and implement stricter criteria for approvals.
6. For the purchase of new real estate the minimum investment remains at €2 million however, for the purchase of re-sales the minimum investment will increase to €2.5 million.
Ensuring the CIPs longevity
These programme enhancements will ensure a more robust CIP and help to appease some of the concerns that the EU Commission had previously raised in a January report on member states that offer citizenship and residence schemes.
During the cabinet meeting, the Finance Minister, Mr. Harris Georgiades, touched on the positive aspects the CIP has contributed to the recovery of the real estate sector and it was now the appropriate time for the CIP to add a social contribution. “We ensure that for every naturalisation of a foreign investor, funds will also go towards an affordable home for our fellow citizens who are in need” he said.
Latitude Consultancy welcomes these enhancements that will ensure the credibility of the programme is kept intact through stricter selection criteria and standards. In the end, this will ensure the longevity of the programme that has had and will continue to have a positive impact on the economy and social well-being of the country.