For many wealthy people stuck with a passport that makes travel and the right to live elsewhere difficult, the search for an acceptable jurisdiction to base yourself has been a worthwhile pursuit. With the advent of Brexit this might well now include UK citizens who are keen to have a right to live and work in the EU.
Over the coming weeks we will be focusing on the various schemes that are available starting with Cyprus.
The Cypriot Citizenship by Investment Programme offers a route to obtaining a Cypriot passport (usually takes approximately 3 to 6 months). This is the fastest route to an EU passport that we are aware of, and just for that reason if of significant interest.
To be eligible, one of the eight criteria must be satisfied below:
- Investment in Government Bonds
The applicant must purchase state bonds of the Republic of Cyprus with a minimum value of €5 million.
- Real Estate
The applicant must make an investment with a minimum value of €5 million in real estate or other developments including residential, commercial or infrastructure projects.
- Investment in Financial Assets of Cypriot Companies or Organizations
The applicant must purchase financial assets of Cypriot companies or organizations (bonds, securities or debentures registered and issued in the Republic of Cyprus) with a minimum value of €5 million.
- Bank Deposits
The applicant, or a company or trust of which s/he is the main beneficiary, must hold a minimum fixed deposit of €5 million in a local bank account for at least the last three years. (This is probably a big ask given the haircut given to bank depositors in the last banking crisis in Cyprus)
- Purchase, Creation or Participation in Cypriot Businesses or Companies
The applicant must make an investment of a minimum of €2.5 million in the purchase, creation or participation in Cypriot businesses or companies that are based and operating in the Cyprus. It is a requirement that these businesses or companies have a tangible presence in Cyprus and employ at least five Cypriot citizens.
- Combination of the Above
The applicant may have a combination of the above options with the total investment amounting to at least €5 million.
- Impaired Deposits with the Popular Bank Public Company Ltd.
This is available to individuals whose deposits with the Popular Bank Public Company Ltd. were impaired by at least EUR 3 million due to the measures implemented after March 15 2013.
- Major Collective Investments
The Council of Ministers can reduce the above criteria (required by an individual) to €2.5 million for investors who participate in a Major Collective Investment (MIC), provided that the total value of the investment is a minimum of € 12.5 million. (We are advised by our Cypriot correspondents that they are able to source such investments and so it is likely that only €2.5m would be required.
Further, with regard to each criteria above, the applicant must purchase a private residence in Cyprus worth a minimum of €500,000. This condition does not apply if the investment under point 2 above (Real Estate) is exclusively in a single piece of real estate residential property.
The investor must retain the investment for at least 3 years following the acquisition of Cypriot citizenship, however it is a requirement that ownership of the residential property of €500,000 must be maintained throughout the applicant’s life (except where the investor substitutes with another property of an equal or higher purchase price).
Citizenship is granted to the spouse of the investor and minor children as well as to the financially dependent adult children up to the age of 28 (those who are full time students). There is no requirement to reside in Cyprus.
Given that Cyprus also offers many significant tax benefits to citizens and businesses, the acquisition of Cypriot citizenship is potentially an interesting option to pursue. Please note that Cyprus also has a resident non domiciled program along the lines of that offered by the UK.
Permanent Residence Program
It is also possible to obtain permanent residence in Cyprus by way of purchasing a residential property in Cyprus to a value of at least €300 000 and proof of payment of at least €200 000. The applicant also needs to provide evidence of a steady income of at least €30 000 from abroad and a further €5 000 per dependant. An amount of €30 000 also needs to be deposited into a Cypriot bank.
Once obtained the applicant and family may stay in Cyprus indefinitely and can apply for Cypriot citizenship after 7 years. This does not necessarily mean that the applicant is subject to Cypriot taxes.