Citizenship by investment programs (CIPs) are used by wealthy individuals from outside the EU to fast-track their access to European countries and the rest of the world. With Brexit on the horizon, interest in the UK CIPs is expected to rise as this program provides benefits to economic development while benefiting investors.
By making sizeable investments and donations into growing economies, citizenship by investment (CBI) applicants can achieve permanent residence and citizenship for themselves and their families within a matter of months. Meanwhile, those investments can be used by participating jurisdictions to inject cash into their local development and infrastructure projects. For applicants, CIPs can open up more options for their investments. This diversification can provide more financial security and expanded opportunities to build wealth. In addition, many families want their children to have access to UK and EU universities and a broader range of travel and job opportunities.
Brexit is expected to result in changes to entry into the UK using CIPs from EU countries such as Cyprus’s CIP, which offers a passport in 6 months. However, even after Brexit has been fully implemented, EU citizens are expected to continue to hold a favourable position when accessing the UK. That means potential investors can explore several options for obtaining UK and EU access through a CIP.
CIPs represent a mutually beneficial system that helps individual families and economies alike. Countries offering CIP are responsible for validating the claims of applicants to ensure the CIP isn’t misused by tax evaders or money launderers. In fact, the UK’s own version of a residence by investment (RBI) program is currently under review for this very reason, partly motivated by the recent attack on the former spy, Sergei Skripal.
As the UK’s RBI regulatory procedures are being evaluated to ensure the proper safeguards are in place, it is important to keep in mind the economic benefits of the UK’s RBI program. Close to 4,000 investment-based residence visas have been awarded in the UK since 2008, with that investment made in the form of government bonds and capital towards UK companies.
Furthermore, under current RBI regulations applications can be refused if it appears that the applicant’s funds were accumulated by illegal means. Applicants also have to pass due diligence reviews by their UK banks.
There are over 100 countries with residence or citizenship by investment programs, and, while there is certainly room for improvement in how tax authorities collate and share information, there is no question that the CBI market is set for continued global growth.
