The Decision
On 13th September, 2016, the Council of Ministers reached a Decision to amend several aspects of the Scheme for Naturalisation of Investors in Cyprus by Exception, on the basis of Section 111A(2) of the Civil Registry Laws of 2002 – 2015, in the hopes of increasing the degree of flexibility with which investors may exercise the option to invest in the Republic of Cyprus, and through it become eligible to apply for citizenship in the Republic the investment programme. The decision was passed in an effort to attract a greater foreign direct investment to the island, and has been fully applied and enforced since 1st of November, 2016.
Significant Amendments
Significant amendments have been made to the citizenship-by-investment program as follows:
- Perhaps one of the more notable amendments was made to the minimum investment amount required, enabling the investor to acquire citizenship by investing in one or more qualifying investments with a minimum total value of €2 million, rather than the previous minimum sum of €5 million (see below for description of qualifying assets).
- An applicant investor must be a holder of a Cyprus residence permit, though this amendment is likely to have minimal impact on the process, time consumption-wise, due to the fact that the applicant can also apply for a residence permit on the same day they apply for the citizenship program, for which the criteria are identical.
- The parents of the applicant are now also eligible for citizenship under the latest amendments, provided that they purchase a residence with a minimum value of €500,000 (plus VAT if applicable)
- Purchasing undeveloped land is now an eligible form of investment, provided it is annexed to a submission of a master plan for the development of it.
The Benefits
As previously mentioned, foreign direct investment is the much sough-after hopeful outcome of this decision as well as high net worth individuals, the new scheme promising significant benefits both to the successful applicant as well as their family members, such benefits including but not limited to:
- Cypriot Citizenship – Cyprus, being a member of the European Union, encompasses free movement of people, capital, goods, and services across its Member states, the four fundamental freedoms the Union was built upon.
- The scheme permits dual citizenship.
- The island proudly holds a strategic geographical location, located at the crossroads between Europe, Africa and Asia.
- Equal treatment to Cypriot nationals of the Investor in employment access, working conditions, and benefits including, in most cases, a 13th month salary.
- Taxation benefits including, but not limited to:
- Double Tax Treaties Network underpinning the Republic of Cyprus, which has 60 Tax Treaty Partners
- Corporate tax rate of 12.5%, amongst the very lowest in the EU
- Dividend participation exemption
- Exemption on disposal of securities such as shares, bonds and debentures
- No succession taxes
- No withholding taxes
- An attractive IP regime
- Visa-free travel to more than 150 countries worldwide.
- Cypriot citizenship for the spouse, children (including financially dependent adult children), and parents of the investor, upon meeting certain criteria.
- There is no pre-requisite of prior minimum physical residency to acquire said citizenship
- Citizenship is valid for life and transferrable to descendants.
- Issuance of Cyprus passport within approximately 90 days, the scheme is one of the fastest, most efficient and straightforward citizenship schemes in the world.
- The investor is not required to make any donation to the Government of the Republic of Cyprus as is the case with the citizenship programme of some other jurisdictions.
- The investor is not required to reside in Cyprus after a successful application.
- Acquisition of all legal rights of a Cypriot citizen
The list of benefits spans even longer, but the above mentioned are just to name a few.
Additional Information: Qualifying Investment Categories:
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- The applicant must make an investment of at least €2 million:
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- for the purchase or construction of buildings, or for the construction of other land development projects;
- for the purchase, creation or participation in businesses or companies that are based and operating in the Republic of Cyprus and employ at least five (5) Cypriot or other EU citizens; or
- in alternative investment funds or financial assets of Cypriot companies or organizations as licensed by the CySEC (Cyprus Securities Exchange Commission)
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- Alternatively, the applicant may invest through a combination of any of the above, amounting to at least €2 million, and the applicant may additionally purchase special government bonds of the Republic of Cyprus for which the investor may purchase special state bonds of the Republic of Cyprus up to a maximum amount of €0.5 million.
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Other Eligible Applicants
- Partner or spouse of the investor
- Children:
- Under 18 years of age may apply, after the initial investor has acquired their citizenship and the other parent’s consent for the grant of citizenship
- Adult children between the ages 18 – 28 years who are university students may apply
- Physically and/or mentally disables adult children may apply
- Parents of the investor may also apply after the initial investor has acquired their citizenship, provided that they are owners of a private residence valued at a minimum of €0.5 million + VAT. The investor, along with his or her parents, may collectively acquire a residential property amounting to at least €1 million + VAT.
How we can help
Obtaining Citizenship, even through these new, more accessible measures requires legal expertise and knowledge on both procedural and investment matters that underpin the entire process. Verita Legal has the knowledge, expertise and personnel trained to help in making the process easier for potential future citizens of the Republic. We offer a comprehensive package of services on anything from finding the best investment opportunities required for the successful application of the scheme, completing and submitting application, all the way to monitoring the application process to ensure its timely processing. Should you require any further information on our services, or even the scheme itself, please do not hesitate to contact us at [email protected]
